Haixiang Pharmaceutical (002099) first quarter report and first half performance forecast comments: pharmaceutical, dye two-wheel 夜来香体验网 drive performance in line with expectations
Event: On April 23, Haixiang Pharmaceutical issued the first quarter report and the first half of 2019 performance forecast: the company achieved operating income in the first quarter of 20198.
32 ppm, an increase of 36 in ten years.
21%; net profit attributable to shareholders of listed companies2.
20,000 yuan, an increase of 352 in ten years.
The company expects to realize net profit attributable to shareholders of listed companies in the first half of 2019.
50,000-50,000 yuan, an increase of 63 in ten years.
26%, of which the second quarter profit 2.
98 ppm, a ten-year increase of 7.
9%, in line with performance expectations.
The growth of the company’s performance was mainly due to the increase in sales of clindamycin hydrochloride series products in the international market, and the scale of new dye product business continued to expand, so profits increased significantly.
Key points of investment: The development of the two main industries of medicine and dyestuffs has strong profitability.
The company’s main business is divided into two major sectors of medicine and dyes.
Production and sales of major military characteristic intermediates, APIs and related preparations in the pharmaceutical sector, as well as providing international pharmaceutical CDMO / CMO professional services.
The products cover many fields such as anti-infection, cardiovascular, psychiatric diseases, metabolism and immunity.
The dyes sector mainly produces and sells military environmentally-friendly reactive dyes, dye intermediates and pigment intermediates. The products are mainly reactive blue KN-R dyes.
The company achieved operating income of 27 in 2018.
190,000 yuan (+17.
74%), achieving net profit attributable to the parent company6.
50,000 yuan (+76 compared to the same period last year).
Among them, the pharmaceutical sector achieved operating income14.
6.9 billion (+13 year-on-year.
24%), to achieve a net profit of 1.
RMB 990,000 (+55 compared with the same period last year).
13%); the dye segment achieved sales revenue of 12.
500,000 yuan (+23.
51%), achieving a net profit of 4.
0.6 million yuan (+89 compared with the same period last year).
Optimize the structure of pharmaceutical products and expand international custom cooperation business.
Haixiang Pharmaceutical’s pharmaceutical business is mainly the production and sales of military-specific APIs and preparations, as well as the provision of customized production and supporting R & D services for international pharmaceutical companies.
The company maintains a good cooperative relationship with internationally renowned pharmaceutical companies. With more than ten years of cooperation with Pfizer, the company is the only strategic partner of German BII in China.
The company’s Penan series, clindamycin series and flufenicol series have absolute advantages in scale, quality and technology in the market and are in the leading position in the industry.
In 2017, through strengthening internal management, reducing costs and increasing efficiency, the company continued to consolidate its market share of products such as clindamycin series and Penan series, and the profitability of the pharmaceutical sector was stable. The type and output of dye products increased and expanded, and there is great room for growth in the future.
Haixiang Pharmaceutical’s Reactive Brilliant Blue KN-R is at the forefront of high-end reactive dyes, giving its price an absolute say and stable downstream customers.
At present, Taizhou’s first and second phases of Reactive Brilliant Blue KR-N have both been put into production and the total production capacity has reached 1.
In 2018, environmental protection became stricter, and the company’s price increase performance of dye products expanded.
In the future, the company will respond to the general trend of upgrading the dye industry, from a single anthraquinone series of reactive blue dye products to more than 10 reactive blue dyes such as formazan reactive blue and fluorine-containing reactive blue, as well as other color-based reactive dyes and acid dyes.Product extension, enhance the ability to respond to market risks, and help expand the company’s competitive advantage in the high-end dye segment, and increase market share.
Earnings forecast and investment rating: “Buy” rating.
The company achieved steady growth in performance through new product expansion and capacity expansion, and sought product funding against a backdrop of severe environmental protection.
We believe that the price increase of dyes in the market will be conducted in the future. Therefore, we have raised the company’s profit forecast. It is expected that EPS for 2019-2020 will be zero.
05 and 1.
18 yuan, corresponding to PE10.
99 and 8.
Risk warnings for maintaining the “Buy” rating: increased competition in the pharmaceutical intermediate industry; the expected speed of environmental protection in the dye industry; the downward risk of the price of dye products; the risk of safety and environmental protection; the impact of changes in the RMB exchange rate on the company’s performance.