What happened: the company released its third quarter report for 2022. During the reporting period, the company achieved revenue of 3.942 billion yuan, an increase of 8% over the same period last year; net profit of 585 million yuan, down 28.32% from the same period last year; and basic earnings per share of 0.4 yuan per share. Among them, the company's revenue in the third quarter reached 1.298 billion yuan, an increase of 7.94 percent over the same period last year, and the net profit returned to its mother was 86 million yuan, down 72.34 percent from the same period last year.
The expense rate has increased compared with the same period last year, and profitability has declined significantly. In terms of gross profit margin, during the reporting period, the company's comprehensive gross profit margin was 28.59%, down 4.99 pct from the same period last year. Among them, 22Q3's single-quarter gross profit margin was 21.73%, down 10.72 pct from the same period last year and 7.92 pct from the previous month. In terms of expense rate, during the reporting period, the company's expense rate was 13.37%, an increase of 1.97 pct over the same period last year.
Among them, the sales / management / R & D / financial expense rates were 1.54% / 7.6% / 4.24% / 0%, respectively, with year-on-year changes of + 0.21 pct / + 1.77 pct /-0.17 pct / + 0.16 pct. The increase in the rate of management expenses compared with the same period last year is mainly due to the amortization of equity incentive fees during the reporting period.
In terms of net interest rate, in the first three quarters of 2022, the company's net interest rate was 15.82%, down 7.22 pct from a year earlier. Among them, 22Q3's single-quarter net interest rate was 7.34%, down 19.36pct from the same period last year and 9.55 pct from the previous year.
Cigarette label main business under a small pressure, color boxes, packaging new materials business is steadily improving. Affected by the intensification of market competition and the fluctuation of raw material costs and prices, the company's cigarette label business is temporarily under pressure, but the company is ahead of the industry in terms of process level, and is expected to fully benefit from the demand for cigarette label upgrading brought about by the high-end development of cigarettes in the future. At the same time, the company to tobacco and alcohol, 3C packaging expansion, broad space for development, the share continues to increase, color boxes, packaging new materials to achieve steady expansion.
The layout of the new tobacco industry chain is perfect, and the revenue growth rate is outstanding. The company seizes the policy opportunity to lay out the new tobacco industry chain and has the ability to provide integrated solutions such as raw materials, manufacturing, brand operation and supply chain services. In the first half of the year, the company's new tobacco business achieved revenue of 169 million yuan, an increase of 297.53% over the same period last year, accounting for 6.4% of revenue, an increase of 4.66 pct over the same period last year. In terms of raw materials, the company distributes atomized e-cigarettes and HNB raw materials respectively through Yunshuo Technology and Changyi Technology; in manufacturing, the company provides OEM business for new tobacco products around Jinjia Technology, while through Jiayu Technology, it provides HNB smoking set R & D and production business, and Jiaju Electronics operates the business of heating herbal particles smoke bomb. In terms of sales, the company launched its own brand Foogo to sell e-cigarette products.
During the reporting period, the company's subsidiaries Yunshuo Technology and Yunpu Xinghe have obtained relevant production licenses.
Investment suggestion: the company is a leading enterprise of tobacco label, with steady growth of basic plate business such as tobacco label and color box, smooth development of new tobacco business, and is expected to achieve rapid development under the background of regulatory policy. the company is expected to achieve basic earnings per share of 0.65 / 0.71 / 0.74 yuan per share in 2022 / 23 / 24, corresponding to PE of 15X / 14X / 13x, maintaining the "recommended" rating.
Risk hint: the risk that economic growth is less than expected; the risk of intensified market competition.