Event: Dongfeng Co., Ltd. released its 2021 annual report and 2022 quarterly report. In 2021, the company achieved an operating income of 3.805 billion yuan, an increase of 23.97% over the same period last year, a net profit of 785 million yuan, an increase of 43.39%, and a net profit of 777 million yuan, an increase of 45.00% over the same period last year. Of this total, 21Q4 achieved an operating income of 1.092 billion yuan, an increase of 18.21% over the same period last year, a net profit of 197 million yuan, an increase of 4.76% over the same period last year, and a net profit of 202 million yuan, an increase of 9.23%.
In addition, 2022Q1 achieved operating income of 1.047 billion yuan in the quarter, up 7.80% from the same period last year; net profit from home was 121 million yuan, down 50.71% from the same period last year; and net profit from non-return was 7 million yuan, down 51.88% from the same period last year.
Speed up the transformation of the drug package, and the steady development of the cigarette label
In terms of the large packaging industry, the company continues to promote "increasing cigarette labels, expanding medicine packages, adding competition channels, and raising valuation".
The strategic transformation, increase the investment of medicine package. 1) in terms of tobacco label printing, the company actively invested in research and development and continued to launch new products, the ability of bidding to obtain orders was further enhanced, and the proportion of medium-and high-grade tobacco label structure was further improved. There were 27 winning projects, with revenue of 2.711 billion yuan, an increase of 20.60% over the same period last year. Among them, the growth of tobacco innovative packaging is brilliant. The company continues to promote the technical transformation and relocation of Hunan Fu Rui high-end packaging and printing intelligent factory, which will further expand the production scale and improve production efficiency. 2) in terms of medicine bags, in the past 21 years, the company has actively distributed the fields of class I medicine packages, medicinal accessories, medical consumables and medical devices, acquired Fuxin Huakang, increased capital to subsidiaries, and initially formed the layout of holding four medicine bags subsidiaries. and rely on the coordination of the whole industry chain, large-scale procurement and group credit and other ways to speed up the scale. The company's drug bag products have covered PVC hard tablets, PVDC hard tablets and other bag materials, customers include Beijing Kexing Zhongwei, AstraZeneca PLC and many other domestic and foreign well-known pharmaceutical companies. In 2001, the revenue of drug bags reached 538 million yuan, an increase of 91.85% over the same period last year. The company will accelerate the transformation, continue to promote mergers and acquisitions and collaborative integration, through the subsidiary Dongfeng medicine bag to co-ordinate the development of medicine, to create a "Dongfeng medicine bag" medicine big healthy brand. 3) in terms of new materials, the company increased investment in research and development, accelerated the upgrading of product structure, achieved revenue of 297 million yuan, an increase of 36.96% over the same period last year, and will focus on the areas of high growth, high barrier and new energy materials.
In terms of large consumer business, the company continues to promote new types of tobacco, mainly HNB and covering atomization at the same time, with the layout of the whole industry chain from base materials, flavoring, equipment independent research and development to brands, cigarette production and sales. HNB policy is expected to further develop after the gradual landing of the policy.
Good cost control, decline in investment income led to 22Q1 net interest rate short-term pressure by rising international commodity prices, COVID-19 epidemic, rising procurement costs of raw and auxiliary materials, the company's gross profit margin is under pressure. The 21-year gross profit margin of the company was 31.69%, while the gross profit margin of 22Q1 was 32.17% compared with the same period last year, which decreased 1.69pct from the same period last year and increased 0.73pct from the previous year.
The company's expenses are well controlled. The expense rate during the 21-year period of the company was 17.62%, a decrease of 2.29pct compared with the same period last year, and the sales / management / R & D / financial expense rate ratio was 5.02%, 8.47%, 4.12%, 0.02%, respectively, compared with the same period last year. The company's net interest rate in 21 years was 20.63%, an increase of 2.79pct over the same period last year. The net interest rate of 22Q1 was 11.58%, down 13.75pct from the same period last year, mainly due to the investment income of the company's two consumer investment funds, Tiantu Dongfeng, which fell 157.31% to-60 million yuan compared with the same period last year.
Investment suggestion: the steady development of the company's cigarette label, accelerate the transformation of the package, and the long-term development is expected. We expect Dongfeng's operating income from 2022 to 2024 to be 44.67,52.27 and 6.054 billion yuan, an increase of 17.40%, 17.01% and 15.82% over the same period last year, and the net profit of its parent is 8.20,9.69 and 1.089 billion yuan, up 4.43%, 18.18% and 12.36% over the same period last year, corresponding to PE of 12.8x, 10.8x and 9.7x.
Risk hints: the risk of large fluctuations in raw material prices; the risk of less-than-expected growth of new business, the risk of HNB policy supervision exceeding expectations, the risk of repeated epidemic, and so on.
Lower 5.45pct