The company released a performance forecast. The company's net profit for the first three quarters of 2020 is expected to be 85 million yuan to 95 million yuan, an increase of 78.94%-99.99% over the previous year. The company's net profit for 3Q20 is expected to be 21 million yuan to 31 million yuan, an increase of 153.77% to 274.61% over the previous year.
Online channels are gaining strength to build a more three-dimensional, diversified, and full-coverage sales network. As of June 30, 2020, the company's online sales were 92,726,600 yuan, an increase of 112.78% over the same period last year.
In addition to Tmall, JD, and Taobao, the company also has platforms and channels such as fresh e-commerce, social e-commerce, live e-commerce, content e-commerce, etc., and has established a three-dimensional, diversified, and full-coverage online sales network.
Consolidate the cost advantage and have sufficient raw materials. As of August 10, 2020, the company had 17,300 tons of pork ingredients in stock, 3,950 tons in transit, totaling 2,1250 tons. Most of them were purchased this year. The shelf life of frozen pork is generally 2 years. The company currently has sufficient raw materials to meet the company's normal production and operation needs.
The revenue from specialty meat products increased 123.9% year-on-year in the first half of 2020, growing rapidly. Specialty meat products refer to products such as sausage, sausage, bacon, soy sauce, light salted meat, etc. They are meat products handed down in China's history. They have 3 major characteristics: 1. Pure meat is made with diverse flavors and rich nutrients; 2. The production cycle is short and capital turnover is fast; 3. The consumer base is large and the frequency of repeated consumption is high.
Profit forecasts and investment suggestions: The company has fully returned to its main business, focusing on the development of meat products. The variety of meat products has been gradually enriched, and the product structure has been gradually improved. We expect to enter a period of rapid performance development in recent years. The company's revenue for 20-22 is estimated to be 7.7, 12.8, and 1.82 billion yuan respectively, net profit of 180, 320, and 46 billion yuan, EPS is 0.18, 0.33, and 0.47 yuan respectively, and the corresponding PE is 35, 20, and 13X respectively, giving a “recommended” rating.
Risk warning: trade frictions, large fluctuations in pork purchase prices, new product sales falling short of expectations, slowing channel development and quantity of development falling short of expectations, asset impairment losses, uncertain effects of the epidemic, food safety issues, etc.