Events:

In the first three quarters of 22, the revenue was 3.986 billion yuan, an increase of 18.04% over the same period last year, and the net profit was 86.9626 million yuan, an increase of 182.05% over the same period last year. Of this total, Q3 revenue was 1.6 billion yuan, an increase of 39.14% over the same period last year; the net loss of homing was 67.9956 million yuan, down 323.52% from the same period last year.

Comments:

The salmon harvest increased significantly, and the fish price correction affected the performance.

The operating income of Q3 company was 1.6 billion yuan, an increase of 39.14% over the same period last year, while the net loss of homing was 67.9956 million yuan, down 323.52% from the same period last year. Subsidiary Australis achieved operating income of 3.016 billion yuan in the first three quarters, up 30% from the same period last year; net profit was 320 million yuan, up 348% from the same period last year; and operating profit was 183 million yuan, up 42% from the same period last year. However, due to the loss of 176 million yuan in fair value changes in the current quarter, Australis's net profit in the third quarter was 3.1645 million yuan, down 97% from the same period last year. In the third quarter, the main salmon markets in Europe and the United States are in the off-season of consumption and the supply in the main producing areas resumes. The company's Q3 Atlantic salmon is priced at US $7.03 / kg, which is expected to decline by about 13% from the previous month. In terms of harvest, the company's Q3 harvest was about 32800 tons, an increase of 119% over the same period last year and nearly 79% month-on-month growth. It is estimated that the total volume of goods in 2022 is 99500 tons, an increase of 18% over the same period last year.

Q3 salmon price correction, the long-term industry still maintains a tight balance between supply and demand.

As of Oct. 10, the price of Urner Barry salmon was $6.145 per pound, falling to its level at the end of 2021. Q3 is the off-season of traditional consumption of salmon, and the price of salmon may be weaker. Due to the decline of seedlings from 2020 to 2021, poor seawater growth conditions and early fishing, the growth rate of salmon supply is expected to slow down in 2022. According to the Kontali forecast, the supply growth of salmon may be less than 1% in 2022. The compound growth rate of supply side in 2021-2026 is 4%, which is much lower than the balanced growth rate of 8.8%. The tight balance between supply and demand in the industry continues.

Earnings forecasts, valuations and ratings.

Affected by the downward price of salmon, we downgrade the company's profit forecast. It is estimated that the company's revenue from 2022 to 2024 is 58.16pm 70.45 / 8.559 billion yuan (the previous value is 60.39pm 73.42 / 8.948 billion yuan), which is 26.51%, 21.13% and 21.49% respectively compared with the same period last year. The net profit of homing is RMB 2.09 / 756 million (the previous value is RMB 3.09 / 808 million), and the year-on-year net profit is 172.40%, 134.29% and 54.48%, respectively, compared with the same period last year. With reference to the 23-year average valuation of the comparable company, the target price is maintained at 34.9 yuan and the "buy" rating is maintained.

Risk hint: fish price fluctuation risk, agricultural product price fluctuation