Zhongshun Jierou (002511): Continued improvement in earnings meets expectations

Zhongshun Jierou (002511): Continued improvement in earnings meets expectations

The net profit attributable to mothers increased by 25 per year in Q1 2019.

2% Zhongshun Jierou achieved revenue of 15 in the first quarter of 2019.

410,000 yuan, an increase of 25 in ten years.

8%; net profit attributable to mother 1.

23 ppm, an increase of 25 in ten years.

2%, net profit after deducting non-return to mother 1.

22 ppm, an increase of 33 in ten years.

1%, in line with our Air Force expectations.

The company’s downstream demand is stable, and it has experienced the digestion of high-priced pulp stocks in the early stage. The company’s earnings elasticity is expected to start to appear in the second quarter of 2019.

We expect the company’s EPS for 2019-2021 to be 0.

40, 0.

49, 0.

63 yuan, maintaining the “overweight” level.

The pulp price center is down, and the company’s profit continues to improve. In the first quarter of 2019, the company achieved revenue of 15%.

410,000 yuan, an increase of 25 in ten years.

8%, the growth comes from the rapid growth of the company’s e-commerce and commercial sales channels, and benefit from the increase in the average price of the product brought by the upgrade of the product structure.

In terms of profit, the gross profit margin in 2019Q1 was 34.

0%, ranking 18Q4 increased by 3pct; net margin was 8.


0%, an increase of 2 from the fourth quarter of the previous quarter.

1pct, earnings improved quarter-on-quarter.

The price of the company’s main raw material, wood pulp, has continued to fall since November 2018. According to wind data, the average price of coniferous pulp and broadleaf pulp in 19Q1 decreased by 11% and 2% from 18Q4.It is expected to start to appear further in 2019Q2.

The period expense ratio decreased, operating cash flow increased significantly, and the company period expense ratio dropped to 7.

7pct to 21.

3%, sales / management + R & D / financial expense ratio multiples -3.

7 / -3.

1 / -0.

8 points to 17.

twenty three.

7% / 0.

4%, during which the rate of expenses fell significantly.

In the first quarter, the company reduced its purchase of materials and its inventory decreased for ten years.

3% to 8.

0 ppm; net operating cash flow increased by 7 over the same period last year.

20,000 yuan, an increase of 341 in ten years.

93%, because the company used its own funds to repay corporate bonds in 18Q1 and base number conversion for the same period last year, which was mainly due to the increase in the payment received during the reporting period and the decrease in payment for materials.

The 杭州桑拿网 four major channels are in full swing, increasing production capacity and increasing regional supply capacity. The company continues to refine and refine the channel construction. It has established separate mother-to-child and new retail channels. While continuously improving and optimizing the existing channels, it also explores and refines new sales.Model, comprehensively carry out marketing layout, and expand sales network.

The company has made full efforts in the four major channels of KA / GT / AFH / EC. At present, the product has covered more than 1,790 counties and cities offline. In 2019, the company will further accelerate the layout of outlets in blank counties and cities, and improve the dealer network; add onlineExpenditures on e-commerce platforms such as Tmall, Taobao, and JD.com have seen high growth in e-commerce 杭州桑拿网 platform revenue.
In 2019, the company increased the investment in the first phase of the project invested by Hubei Zhongshun 20, expanding its production capacity in a rhythmic manner according to the market environment and sales, and then moved to Hubei. Tangshan increased its capacity and released continuously, promoting the company’s regional supply capacity.
Development has entered the fast track, maintaining the “overweight” rating company’s channel layout is constantly improving, increasing production capacity to provide continuous growth momentum.

Maintain the Air Force’s profit forecast.It is expected that the company’s net profit attributable to its mother in 2019-2021 will be 5.

2, 6.

4, 8.

2 trillion, the corresponding EPS is 0.

40, 0.

49, 0.

63 yuan.

The average PE of comparable companies in 2019 is 21 times. Considering the scarcity of A-share tissue paper and the company’s performance growth rate is higher than that of comparable companies.
30 times PE estimate, target price range is 11.

40 yuan, maintaining the “overweight” level.

Risk warning: market competition is intensifying, and raw material prices have risen sharply.