Anjing Food (603345) 2019 Interim Report Review: Fearless of Stress, Real Growth Ability, Excellent and Sustainable

Anjing Food (603345) 2019 Interim Report Review: Fearless of Stress, Real Growth Ability, Excellent and Sustainable

Core point of view The 2019H1 industry has high cost pressures, and the company’s various categories of revenue have performed well, the cost control is outstanding, and the overall performance of the performance is in line with expectations.

In the long run, the company is expected to give full play to the advantages of production / channel / cold chain distribution, grab the development bonus of the catering industry chain, and open up the company’s development space.

Maintain “Buy” rating.

   2019H1 revenue / net profit increased by 19.

9% / 16.

0%.

2019H1 company realized revenue23.

3.6 billion, with an increase of 19.

9%, net profit attributable to mother 1.

6.5 billion, an increase of 16.

0%, deducting non-net profit 1.

4.9 billion, an increase of 20.

7%.

  Among them, the company in Q2 2019 achieved revenue of 12.

3.9 billion, an increase of 25.

1%, achieving a net profit of 1.

00 ppm, an increase of 13.

8%.

From the perspective of regional markets, the Northeast / North China market of the H1 company in 2019 will benefit from market expansion, the production capacity of the Liaoning plant will increase, and revenue will increase by 48.

9% / 40.

6%, excellent performance.

   Revenue analysis: It is predicted that the products and surimi will accelerate compared with the previous month, and meat products will resume growth.

In terms of categories, the company’s rice noodle products continued to grow at a higher rate in 2019H1, achieving revenue6.

3.9 billion, an increase of 25.

6%, of which Q2 increased by 18.

6%; expected to benefit from Mr. Frozen Products and explosive products such as egg dumplings / thousand pages of tofu, and revenue in 2019H1.

2.3 billion, an increase of 35.

5%, of which Q2 increased by 46.

2%; Quick-frozen surimi products increased speed from the previous month, and revenue in 2019H1 was 8.

7.4 billion, an increase of 23.

7%, of which Q2 increased by 31.

4%; Q1 of quick-frozen meat products subject to production line suspension income decreased by 4 as well.

3%, Q2 income increased by 15 after production resumed.

6%, 2019H1 revenue increased by 4.

9% to 5.

9.4 billion.

In terms of different channels, 2019H1 dealers’ revenues also increased by 22.

5%, dealers net increase of 44 to 662; 2019H1 Supermarket / Special Channel channel revenue increased by 2.2% / 16.

8%, of which Q2 dropped by 38.

7% / 1.

7%, mainly due to the expected adjustment, Q1 invoicing in advance to confirm some revenue.

   Earnings analysis: short-term pressure on gross profit margin, and continuous improvement in expense ratio.

In 2019H1, the company’s gross profit margin decreased by 1.

2PCT to 25.

5% (Q2 decreases by 1.

6PCTs), mainly because ① the price of pork continues to increase, the company completely uses imported pork, overlapping poultry and other prices rose, resulting in pressure on meat products.

② Discontinued production and added testing equipment for some Q1 production lines.

2019H1 sales expense ratio also decreased by 1.

1PCTs, mainly due to the effect of scale and the continuous release of new production capacity, the proportion of employee compensation / advertising costs / logistics costs fell by 0.

5/0.

4/0.

4PCT; Through the continuous growth of revenue, both the management expense ratio and the R & D expense ratio decreased slightly.

1PCT; financial expense ratio also increased by 0.

2PCT, mainly due to the increase in interest 南京夜网 on short-term borrowings and convertible bonds.

The overall profitability of the company’s 2019H1 company fell by 0.

2PCT, where Q2 decreases by 0.

8PCT.

   It is planned to issue convertible bonds to expand production, guarantee future growth, and be optimistic about the company’s production period growth space.

The company announced that it will raise US $ 90 billion of convertible debt to be issued for the construction of Hubei / Henan / Liaoning factories, corresponding to 150,000 / 100,000 / 4 substitutes, which will gradually expand and release instead of Sichuan15, which will be the basis for the company’s long-term performance growth.

In the short term, with the expansion of production capacity and market expansion in 2019, the H2 revenue side is expected to maintain the H1 growth trend. On the profit side, the company currently has a rich raw pork / surimi raw material reserve and basically locks costs.Properly control and adjust when the cost pressure rises, and under the effect of scale, the company’s mature market cost savings prospects ensure that the company’s profitability steadily improves.

In the long run, the company is expected to give full play to the advantages of production / channel / cold chain distribution in the catering industry chain, grab the development bonus of the catering industry chain, and open up the company’s development space.

   Risk factors: less than expected channel expansion; sharp rise in raw material prices; food safety issues.

   Investment suggestion: Maintain the net profit forecast, but take into account the equity changes brought about by the company’s convertible debt to equity, adjust the EPS forecast for 2019/20/21 to 1.

40/1.

74/2.

14 yuan (was 1).

70/2.

17/2.

28 yuan), maintain “Buy” rating.