Core ideas:
Event: the company released its half-yearly report for 2022. During the reporting period, the company achieved revenue of 552 million yuan, up 2.46% over the same period last year; net profit of 70 million yuan, up 31.18% over the same period last year; and basic earnings per share of 0.32 yuan per share. Of this total, the company's revenue in the second quarter was 328 million yuan, up 2.91% from the same period last year, and the net profit returned to its mother was 49 million yuan, up 37.23% from the same period last year.
The fluctuation of raw material prices caused the company's gross profit margin to decline compared with the same period last year. During the reporting period, the company's comprehensive gross profit margin was 29.64%, down 1.82 pct from the same period last year. Among them, 22Q2's single-quarter gross profit margin was 30.42%, an improvement of 1.64 pct over the same period last year and 1.92 pct month-on-month improvement. In the first half of the year, the company's gross profit margin decreased compared with the same period last year, mainly due to higher production costs driven by rising prices of raw materials such as plates, lines, veneer and paints.
During the period, the overall improvement in rates led to an increase in the net interest rate compared with the same period last year. In terms of expense rate, during the reporting period, the expense rate during the company period was 16.36%, a decrease of 3.16 pct over the same period last year. Among them, the sales / management / R & D / financial expense rates were 7.87% / 5.01% / 4.42% /-0.94% respectively, which decreased by 0.44 pct / 1.34 pct / 0.71 pct / 0.67 pct respectively compared with the same period last year. In terms of net interest rate, in the first half of the year, the company's net interest rate was 12.77%, 2.81 pct;22Q2 year-on-year improvement of 15.04%, 3.78 pct year-on-year improvement, and 5.62 pct month-on-month improvement.
Steady progress in channel construction and the construction of a trinity marketing system. In terms of retail channels, the company continued to promote the upgrading of terminal stores and integrated live broadcast online and offline. By the end of the reporting period, the company had developed 964 dealers in 31 provinces, autonomous regions and municipalities directly under the Central Government, and the marketing outlets sank to third -, fourth-and fifth-tier towns. In terms of home improvement channels, the company fully explored the markets of Hangzhou and Chengdu, refined the effective business model of home decoration channels, and reached strategic cooperation with a number of head equipment enterprises in the first half of the year. It is expected that more than 80% of the head equipment enterprises will sign contracts and open stores in a large area of the country by the second half of the year. In terms of bulk channels, the company focuses on resources to serve large state-owned enterprises, central enterprises and sound real estate head customers, relying on channel exclusive products and high-quality project team to build core competitiveness.
The capacity layout continues to fall to the ground, supporting the integrated upgrading of doors, walls and cabinets. The company adheres to the development strategy of "from wooden door to woodwork" and continues to promote the upgrading from single wooden door category to integrated wooden work category of door and wall cabinet. During the reporting period, the company orderly promoted the construction of the "annual production line of 370000 sets of flat doors and 90,000 sets of personalized customized cabinets", planned and mass-produced a production line of 200000 sets of lacquer-free wooden doors and door sets.
Investment suggestion: the company is a leader in the wooden door industry, with outstanding brand advantages, comprehensively promoting channel construction to strengthen flow competitiveness, relying on advantage categories to enrich the product matrix, and remarkable future growth. The company is expected to achieve basic earnings per share in 2022 / 23 / 24, corresponding to PE of 14X / 12X / 10X, covering it for the first time and giving it a "recommended" rating.
Risk hint: the risk of lower-than-expected economic growth; the risk of intensified market competition
