Events:
On April 3, the company released its 2017 annual report. In 2017, the company achieved a total operating income of 555.1303 million yuan, an increase of 48.80% over the same period last year, and the net profit attributed to shareholders of listed companies was 89.6014 million yuan, an increase of 66.74% over the same period last year.
Announcement comments:
The strategic layout of "one body, two wings, two-wheel drive" has been initially completed. The company adopted the development strategy of "one body, two wings and two-wheel drive", successfully acquired long Zhijie and Bo Rihong in 2017, and initially completed the industrial layout in the field of automatic control of biological and pharmaceutical industry and rehabilitation medical devices. In 2017, the operating income of the pharmaceutical and biological automation business reached 444.7561 million yuan, an increase of 19.22 percent over the same period last year, and the net profit reached 60.1756 million yuan, up 11.98 percent from the same period last year. In the field of rehabilitation medical devices, the operating income reached 11,037,000 yuan, which is the main driving factor of the company's performance growth.
The comprehensive gross profit margin increased in an all-round way, and the rate of sales expenses increased significantly. In 2017, the company's comprehensive gross profit margin was 40.18%, an increase of 3.65 percentage points over the previous year, mainly because the gross profit margin of the company's rehabilitation medical devices sector was as high as 65.48%, driving up the overall gross profit margin, and the gross profit margin of pharmaceutical and biological automation business was 33.90%. A decrease of 2.63 percentage points over the previous year. Affected by the combined table of long Zhijie and Bo Rihong, the company's sales expense rate increased by 4.67% over the previous year, affecting operating profit of 25.92 million yuan.
The rehabilitation market will grow rapidly, and long Zhijie's future performance is expected. In 2016, China's rehabilitation market was about 32.1 billion yuan. As China will continue to increase the reform of medical services in the future, at the same time, with the improvement of the three-level rehabilitation medical system and the further implementation of medical insurance policies related to rehabilitation health care, China's rehabilitation medical market is expected to grow rapidly. Long Zhijie is mainly engaged in the research, development, production and sales of rehabilitation medical equipment, and its products cover the fields of physiotherapy and clinical testing. It is a high-tech enterprise integrating R & D, manufacturing, sales and service. Its innovation in pain rehabilitation, cardiopulmonary rehabilitation, nerve rehabilitation, geriatric rehabilitation and mobile medicine Especially in electrotherapy, phototherapy, magnetic therapy, pressure therapy and other physical factor therapy products and sports therapy products are in a leading position in China. Long Zhijie's self-developed shock wave, interference electricity, magnetic vibration heat and other products and projects are technologically leading in the same industry in China, and the sales volume is also in the forefront of the same industry in China. In 2017, long Zhijie achieved an operating income of 127.1699 million yuan, and the net profit attributed to the owner of the parent company was 38.9653 million yuan. After deducting non-recurring profits and losses, the net profit attributed to the owner of the parent company was 36.1312 million yuan, which was 94.93% of the promised net profit. According to the profit Forecast compensation Agreement, there is no need to compensate the company for performance.
Investment advice:
Regardless of the performance contribution of the fixed increase project for the time being, we estimate that the net profit attributed to the owner of the parent company in 2018, 2019, and 2020 will be 1.27, 140, 0.54 million yuan, 0.70, 0.77, 0.85 and 33-30-27, respectively. Considering the steady development of the company's pharmaceutical and biological automation business, the future development of rehabilitation medical device business is expected, and the comprehensive gross profit margin will increase significantly. We maintain its "overweight" investment rating.
Risk Tips:
The development of rehabilitation medical equipment is not as expected, and the risk of impairment of goodwill.