Liuyao shares (603368) semi-annual report comment: performance slightly exceeded expectations regional leader steady growth
The semi-annual performance in 2019 increased rapidly, and the scale of operations continued to expand. The company released the semi-annual report for 2019, and the company’s semi-annual revenue for 2019 reached 71.
9.7 billion (+30.
47%); net profit attributable to mother 3.
5.6 billion (+39.
35%); net profit after deduction to the mother 3.
500 million (+37.
22%); estimated increase in average net asset income by 8.
97%, increase by 1 every year.
In the first half of 2019, the company’s sales scale continued to expand and its performance achieved rapid growth.
We judge the company’s initial results in the first half of the year to maintain high growth results: (1) the core wholesale business structure has been continuously optimized: high gross profit rate hospital pure sales business has steadily increased, and the pure sales ratio has continued to increase (the pure sales ratio in 2018 was 75.
79%), the proportion of commercial distribution declined, and the third-terminal primary medical service developed rapidly. (2) The retail business has steadily advanced, and the number and scale of Guizhong Pharmacy have continued to increase. In the first half of 2019, the retail business accounted for 12 of the company’s main business.
09%; (3) The industrial end brings new points of profit growth through the continuous release of production capacity.
The industrial chain extension effect is obvious. The three major businesses go hand in hand to become the leading pharmaceutical business in Guangxi Province. The company takes the hospital sales business as the core driving force for the company’s development and brings the advantages of commercial channels. The company actively carries out upstream and downstream business extensions to achieve diversified business development, And achieved more obvious results: (1) the company in the business side to strengthen upstream cooperation with industrial enterprises to obtain more high-quality varieties, improve the variety satisfaction rate; strengthen the network layout of downstream medical institutions, and extend service projects through the supply chainStrengthen the service to medical institutions. In 2019, H1 Company and 68 medical institutions in Guangxi Province clinical hospital supply chain extension service project agreement and gradually implemented.
The company’s hospital sales business reported revenue of 53.
80,000 yuan, an increase of 27 in ten years.
At the same time, the company strengthened the business development of medical devices and consumables, and reported that the sales of two medical devices were realized.
900 million (+33.
60%); the inspection reagent business is advancing steadily.
(2) The retail chain has steadily improved and its performance is remarkable.
The company Guizhong Pharmacy achieved revenue in the reporting ten years.
6.8 billion (+52.
In 2019H1, the company continued to accelerate the establishment of stores in core cities through self-construction or acquisition, with a total of 547 drug stores, including 341 medical insurance drug stores.
The company actively plans to undertake prescription outflows, improve channel construction, improve the advantages of commercial channels, and increase the advantages of special diseases such as chronic diseases and tumors, and gradually form a city-specific pharmacy as the center, with DTP pharmacies and hospital-side pharmacies as the support and coverage.Store system in core urban areas and communities.
(3) The production and processing capacity 北京夜网 of Chinese herbal medicines for industrial use has continued to increase.
At present, there are nearly 700 varieties of Chinese medicinal materials; Medical University Xiansheng has passed GMP certification to achieve production; the target Wantong Pharmaceutical acquired has operated well and its profitability has steadily improved.
In 2019H1, the company’s industrial segment achieved revenue1.
800 million (+270.
48%), net income of Xianzhu Traditional Chinese Medicine and Wantong Pharmaceutical was 0.
11 ppm, 0.
3.3 billion US dollars, gradually forming a new profit support point.
Profitability has improved, and cash flow has been gradually optimized. The optimization of business structure has also further improved the company’s profitability.
The company’s reported gross sales margin and net sales margin were 12 respectively.
47%, increasing by 1 each year.
89 pp, 0.
The report summarizes the company’s supplementary loan, and the financial expenses have improved; the report merges the company’s sales expense ratio, management expense ratio, and financial expense ratio to 2, respectively.
90%; increase by 0 respectively.
3 pp, 0.
29 pp, 0.
Report the turnover days of accounts receivable of first-tier companies, and inventory turnover days are 141 respectively.
64 days, increased by 3 respectively.
The net cash flow from H1’s operating activities in 2019 was -3.
640,000 yuan, the net cash flow from operating activities in the same period of 2018 was -5.
01 million US dollars, through the initial optimization of the company’s business structure, the cash flow situation has been gradually optimized.
It is estimated that the rapid growth of the retail and industrial sectors of the company is expected to promote the steady growth of the company’s performance. It is expected that the company’s net profit for 2019-2021 will be 6 respectively.
0 million yuan, corresponding to PE is 12.
6X / 7.
Three times, maintaining the “buy rating” risk warning: industry policy risk, drug price risk, receivable bad debt risk, intensified market competition, less progress in the industry sector, and less than expected development of pharmaceutical chain operations.