订单粮食业务快速增长，海外市场拓展成效显著。分产品看，1）2024H1水稻种子营业收入3.8 亿元（同比+14.1%），毛利率为31.2%，同比下降8.8pcts，主要是由于上半年出口业务的毛利率较低且占比较高；2）订单粮食业务实现销售收入4.8 亿元（同比+112.0%），毛利率为1.5%，同比下降3.8pcts，主要是由于今年粮食价格波动下行，盈利水平有所下降；3）皮棉业务营收2.0 亿元（同比-9.5%），毛利率为7.4%，同比上升1.4pcts。分地区上看，1）华东为主要区域，实现收入5.3 亿元，同比+21.7%；2）华北、西北地区齐发力，分别实现收入1.5/3.1 亿元，同比+112.0%/34.5%；3）国外实现收入2.2 亿元，同比增长147.4%，公司拓展海外市场成效显著。Event: The company's 2024H1 revenue +30.6%, net profit to mother -156.4%; 2024Q2 revenue 59.5%, net profit to mother -593.4%. In 2024 H1, the company achieved operating income of 1.41 billion yuan (+30.6% year over year) and net profit to mother - 22.24 million yuan (year-on-year change from profit to loss). 2024Q2 achieved operating income of 0.74 billion yuan and net profit of 39.98 million yuan; 24Q1/24Q2 revenue in a single quarter was +9.0%/+59.5% year-on-year, and net profit to mother changed from profit to loss year-on-year.
The gross margin of 2024H1 sales declined, and net profit margins were under pressure. 2024 H1 gross margin was 17.6% (-7.2pcts year over year). The cost rate for the period was 19.7%, of which the sales expense ratio was 8.7% (-0.9 pcts year over year); the management expenses (including R&D expenses) ratio was 9.3% (-0.6 pcts year over year); and the financial expenses ratio was 1.7% (+0.9 pcts year over year), mainly due to increased interest costs on loans. Net sales margin was -1.9% (-7.8pcts year over year). 2024Q2 gross margin was 15.6% (YoY -11.7pcts); sales expenses ratio 9.0% (YoY -3.5pcts); management expenses (including R&D expenses) ratio 9.7% (YoY -2.6pcts); financial expenses ratio 1.4% (YoY +1.4pcts).
Net sales margin was -5.9% (-11.6pcts year over year). The company's net profit declined year-on-year, mainly due to increased investment in scientific research, a year-on-year increase in operating and management expenses, and a decrease in gross margin.
The food order business is growing rapidly, and overseas market expansion has achieved remarkable results. By product, 1) 2024H1 rice seed revenue was 0.38 billion yuan (+14.1% year over year), gross margin was 31.2%, down 8.8 pcts year on year, mainly due to the low and relatively high gross margin of export business in the first half of the year; 2) the food order business achieved sales revenue of 0.48 billion yuan (+112.0% year over year), gross margin was 1.5%, down 3.8 pcts year on year, mainly due to declining grain price fluctuations this year; 3) Linton business revenue 0.2 billion yuan (-9.5% YoY), gross margin was 7.4%, up 1.4 pcts year over year. By region, 1) East China is the main region, achieving revenue of 0.53 billion yuan, +21.7%; 2) North China and Northwest China made concerted efforts to achieve revenue of 0.15/0.31 billion yuan, +112.0%/34.5% year over year; 3) Foreign revenue of 0.22 billion yuan, an increase of 147.4% year on year. The company achieved remarkable results in expanding overseas markets.
Investment advice: The company is a leader in “breeding and promoting integration” in the seed industry. It consolidates the foundation of development by strengthening R&D investment and science-enterprise cooperation, and opens up future growth space through diversified business layout through epitaxial mergers and acquisitions. We expect the company to achieve total operating income of 5.132/6.243/7.518 billion yuan and net profit to mother of 0.312/0.362/0.425 billion yuan in 2024-2026. The PE corresponding to the closing price on August 28 was 18/16/13 times, respectively, maintaining the “gain” rating.
Risk warning: risk of agricultural product price fluctuations due to natural disasters, risk of diseases and pests exceeding expectations, risk of worsening international conditions affecting agricultural product circulation, risk of product promotion falling short of expectations, risk of agricultural policy disturbances