Event
The company issued a forecast of first-quarter results, with a profit of 37.5 million yuan, a year-on-year turnround, and basic earnings per share of 0.07 yuan.
Main viewpoints
1. Rising product prices and investment income are the main factors to reverse losses. During the reporting period, the price of the company's main raw materials rebounded, the sales price of the product rose slightly, and the gross profit margin of the product increased; the company sold its 3.095 million shares of "Bank of Communications" shares through the secondary market and obtained an investment income of 17.54 million yuan. The company received 10.42 million yuan in profit distribution from Guangdong General Digital Investment Consulting Co., Ltd. Exchange losses and financial expenses decreased compared with the same period last year.
two。 There are more points to be seen in the future. Acquire San Medino Medical to enter the blood glucose monitor market. Blood sugar monitor market space is huge, 2014 is the first year of wearable devices, 2015 ushered in a take-off year, so far the company's sensor orders have far exceeded the previously reported 1 million sets, the current order volume is far more than 1 million sets. There is a huge space for CGM in the domestic market. At present, there are 400 million patients with prediabetes, 200 million patients with cardiovascular and cerebrovascular diseases, and 300-400 million people need to be tested. It is estimated that 50 million people will use CGM regularly in the next 3-5 years. Assuming 20 weeks in 52 weeks of a year, it is the annual dosage of 1 billion sensors (7-10 days for one sensor). At present, the company's shareholding ratio is 9.75%. Considering that the company has signed strategic cooperation agreements with Vega and other channel vendors, the possibility of increasing San Medino's shareholding can not be ruled out in the future, and the company will strategically cooperate with Vega Group to obtain resources such as sales channels. In January, Meida announced that it had signed a strategic cooperation agreement with Weigao Group, which mainly included making use of the company's leading advantage in high-grade functional nylon fiber and carrying out extensive and in-depth cooperation with Weigao Group in the areas of huge and stable market demand such as medical protection and quartermaster supplies. Taking advantage of the opportunity to enter the field of dynamic blood glucose monitoring from a high starting point by taking a stake in San Medino, we cooperate with Weigao Group in the fields of wearable medical devices, medical big data cloud platform and medical and health management. We believe that the cooperation between Meida and Weigao Group mainly focuses on the sales channels of its 1500 third-class hospitals, which will contribute to CGM sales in the future. In addition, the two sides also complement each other in other aspects, such as nylon will be used in military protective clothing, and CGM equipment can be used in conjunction with the insulin pump of Shandong Weigao.
3. Profit forecast and investment rating. Increase EPS to 0.10 yuan and 0.19 yuan respectively from 2015 to 2016, taking into account that if the company's transformation is successful in the future, there will be more room for improvement in market capitalization, so we can maintain strong recommendations.
Risk tips: nylon industry continues to be in the doldrums, blood glucose meter promotion of low expectations.