Event: black Sesame released its three-quarter report in 2016, and the company's 3Q16 achieved revenue of 440 million, an increase of 38.8% year-on-year, a net profit of 39.146 million yuan, a year-on-year increase of 29%, and earnings per share of 0.06 yuan. In the first three quarters, revenue and net profit were 1.18 billion and 60 million respectively, revenue increased 13.96% year-on-year, net profit decreased 14.3% year-on-year, earnings per share 0.10 yuan, in line with our expectations.
Comment
The performance rebounded significantly in the third quarter, and the industrial development strategy of "black nutrition, selenium food" has achieved initial results. 1) the performance of 1Q and 2Q is weak, and the performance of 3Q rebounds obviously. The company's revenue 1Q/2Q/3Q was 438Universe 294xpx 444 million yuan, 3Q revenue + 38.8% year-on-year, month-on-month + 51%, a large rebound. The 1Q/2Q/3Q of the company's net profit is 0.22 trillion, respectively. Compared with the decline of 1Q and 2Q, the net profit of 3Q has greatly increased. The net profit rate of sales 1Q/2Q/3Q is 5.47% Universe 0.01% Candle 9.2% Magi 3Q, respectively. 2) there is no worry about the company's profits, and although there is pressure on the revenue target, it is more likely to achieve it. 1-3Q16 income from the food industry is estimated to be + 10 per cent. 4Q is the peak sales season for the old product black sesame paste, which is expected to increase by 10% for the whole year and achieve an income of 11-1.2 billion. It is estimated that the income of black sesame milk in 16 years is more than 200 million. It is estimated that the income of the new product Black Milk 1-3Q16 is 4000-50 million, and the volume and price of 4Q16 is expected to rise, and the revenue is expected to be more than 60 million. The rice industry has large reserves, 1-3Q16 revenue is expected to be more than 200 million, 4Q sales season, the annual income is expected to achieve 400 million. Black sesame equity incentive requires that the average annual income (food industry) growth rate from 2016 to 2017 is not less than 30%, and the net profit is not less than 200 million yuan and 250 million yuan. After the termination of the M & A sesame oil project, we believe that although there is some pressure to achieve the incentive, the possibility of completion is still high.
Cost control is efficient, management expense rate and sales expense rate are reduced. The company's 1H16 mainly promotes the new product black milk expenditure, 3Q16 control expenses, sales expense rate is expected to decline compared with the same period last year-0.3pctGrain4Q; management expense rate year-on-year-0.9pct, current loan interest increases, financial expense rate + 1.8pct, business tax rate + 0.4pct.
The shareholding ratio of major shareholders is 41.38%. 7.2 yuan per share after 14 years of reinstatement of the company's additional offering price, which is close to the current price, taking into account the cost of capital and the stock price upside down. Epitaxial mergers and acquisitions to expand and strengthen the health food industry. Jinghe rice was acquired in 2016 to build a selenium-rich food industry chain. Jinghe rice is expected to have revenue of about 400 million yuan in 16 years, and revenue is expected to achieve 20% growth in 17 years. After the acquisition of 60% stake in Saibao in southern Inner Mongolia in 2015, there is huge room for development after the completion of the integration. The company has plenty of cash on hand, 500 million M & A fund, actively looking for foreign projects, and strong expectations of extension mergers and acquisitions.
Profit forecast and investment advice: the overall performance is expected to grow by 30% 40% in 16 years:
Through the expansion of new channels and price increases, the old products are expected to grow by 10%, with a net profit of 130 million yuan; the overall target of new products is 200-300 million yuan, corresponding to an increase of 30-40% over the same period last year; the growth rate of the logistics park is stable and the net profit is expected to be 3000-40 million yuan; and the rice industry is estimated to have a net profit of 12 million yuan. We believe that the rice industry has greater growth potential in the future. At the same time, the company has sufficient additional funds and strong expectations of epitaxial mergers and acquisitions. The equity incentive target of 200 million is likely to be completed, and it is currently valued at 24XPE. The net profit for 16-17 years is expected to be 2.0,280 million, an increase of 35% and 40% over the same period last year. It will be given a 16-year 30XPE with a target price of 9.6 yuan and 25% room to maintain the buy rating.
Risk factors: new product promotion is not as expected, food safety issues.
