Company releases 2024 semi-annual report
24Q2's revenue was 3.65 billion, down 3.1%; deducted to mother 0.27 billion, up 6.5%; net revenue of 24H1 was 7.21 billion, up 1.1%; net profit of 24H1 was 0.55 billion, up 18.4%; net profit from net income of 0.55 billion yuan, same increase of 18.4%; net profit not deducted from mother was 0.53 billion, same increase of 21.7%.
By product, 24H1's revenue from metal packaging products and services was 6.36 billion yuan (accounting for 88.3% of the total), an increase of 2.7%; the gross profit margin was 19.6%, an increase of 2.0pct. By region, 24H1 domestic revenue was 6.61 billion yuan (accounting for 91.8% of total revenue), an increase of 2.1%; gross profit margin was 19.2%, an increase of 2.2 pcts.
The company's 24Q2 gross profit margin was 17.4%, up 0.5 pct; net profit margin was 7.3%, up 0.8 pct; 24H1 gross profit margin was 17.8%, up 1.9 pct; net profit margin was 7.5%, up 1.2 pct.
In-depth cooperation with quality customers, sustainable growth in performance
The company pioneered the adoption of a “follow-up” production layout model in the domestic metal packaging industry. Through a “symbiotic production layout” and a “close production layout”, we are closely spatially dependent on core customers and equipped with internationally leading production equipment in line with the product characteristics and quality requirements of core customers to form an interdependent development model, and can also minimize product and packaging transportation costs.
After more than 20 years of development, the company has accumulated a large number of high-quality customer resources in the food and beverage industry, and signed strategic cooperation agreements with major core customers to establish long-term and stable strategic partnerships to ensure the sustainable growth of the company's performance.
Optimize supply chain management to achieve high-quality development
The company continuously optimizes supply chain management, promotes lean production management results to all production bases, and a stable supply chain system supports the company's market competitiveness. The company has a raw material supply chain, mainly tinplate, aluminum and lids, and has formed long-term and stable cooperative relationships with major domestic tinplate, aluminum and metal lid suppliers, so that the company has a firm guarantee in terms of procurement volume, quality and cost.
In the first half of '24, the company relied on artificial intelligence technology to continue to promote the high-quality development of metal packaging, innovate and implement the “interactive smart packaging” business, and actively explore the integration of AI technology with new retail to enhance the consumer experience.
Promote major asset purchase projects to help improve large-scale performance
Since disclosing the indicative announcement regarding plans to issue a voluntary conditional comprehensive offer to all shareholders of COFCO Packaging, a listed company on the Hong Kong Stock Exchange Limited, to acquire all issued shares of COFCO Packaging in cash, the company 24H1 has completed major asset purchase plans and other related disclosure work, and has submitted overseas investment filing applications related to this transaction to the competent commercial authorities, the National Development and Reform Commission, and a centralized operator report.
The company is actively cooperating with the requirements of the regulatory authorities to push for the filing and review matters to be completed as soon as possible. At the same time, other matters related to this transaction are being actively promoted. Currently, the company is steadily advancing tenders and acquisitions, and we expect that the implementation of leading integrations will lead to an improvement in the industry pattern and an increase in profitability.
Maintain profit forecasts and maintain “buy” ratings
We maintain our profit forecast. We expect revenue of 16.15/18.61/21.24 billion yuan for 24-26, net profit to mother of 0.93/1.07/1.23 billion yuan, and corresponding PE of 12/10/9X, respectively.
Risk warning: Industry competition increases risks; downstream demand recovery falls short of expectations, risk of raw material price fluctuations, risk of declining core customer share, etc.