Hengshun Vinegar Industry (600305) 2018 Annual Report Comments: The main vinegar industry’s volume and price rose, and the profit and loss impact was controllable

Investment highlights: Event: The company released its 2018 annual report and achieved operating income in 201816.

94 ppm, a ten-year increase of 9.

87%, net profit attributable to mothers3.

50,000 yuan, an increase of 8 in ten years.

44%, net of non-attributed net profit2.

19 ppm, an increase of 21 in ten years.


Of which 18Q4 achieved operating income4.

580,000 yuan, an increase of 7 in ten years.

34%, achieving net profit attributable to mother 0.

86 ‰, a decrease of 36 per year.

56%, deducting non-mother net profit 0.

60,000 yuan, an increase of 16 in ten years.


The company intends to distribute a cash dividend of 1 per 10 shares to all shareholders.

2 yuan (including tax), the distribution found that the bonus is 0.

9.4 billion.

The main business of condiments increased steadily, the volume and price of vinegar rose and the volume of cooking wine accelerated.

The condiment business achieved revenue of 15 in 18 years.

28 ppm, an increase of 10 in ten years.

41%, accounting for 80%, 3 pct per year, the main focus of condiments continues to focus.

Among them, the vinegar business achieved revenue11.

62 ppm, an increase of 12 in ten years.

49%, black vinegar increased by 9 in three years.

59%, white vinegar increased by 13 in ten years.

27%, high-end vinegar increased by 15.

At 07%, the proportion of high-end vinegar continued to increase. In terms of volume and price, vinegar sales were higher.

28 initially, up 8 each year.

83%, the price increased by 3% year-on-year, the main increase in volume, product structure continued to optimize, prices rose steadily.

The release of cooking wine production speeded up and realized revenue1.

0.94 million yuan, an increase of 33 in ten years.

19%, mainly due to the increase in sales. At present, the income from cooking wine business has accounted for 11 of the company’s total revenue.

43%, it is expected to continue to contribute in the future and continue to contribute to revenue.

Since January this year, the company started to raise prices using Class A core vinegar products. The current sales situation is good, and the condiment has reached a new level in 19 years.

Product structure upgrades The gross profit margin continued to rise, and the adjustment and optimization of fee structure deducted non-net profit and increased steadily.

Condiment business gross margin reached 43.

34%, up 1 every year.

82 points.The gross profit margin of vinegar products reached 44.

03%, up 2 every year.

02pct, mainly due to the increase in the proportion of high-end products.

The vinegar ton price in 18 years reached 7,608 yuan / ton, an increase of 3 in advance.


Company net margin 17.

94%, a decrease of 0 every year.

23pct, mainly due to the decline in the company’s asset disposal gains in 18 years. After replacing non-recurring gains and losses, the company’s non-net interest rate in 2017/18 was 11 respectively.

74% / 12.

93%, 18-year deduction net interest rate increased by 1.

19 points.

The company’s expense structure is gradually optimizing, with management expenses accounting for 6%.

59%, down 2.

13pct, mainly due to the supplement of office expenses and personnel costs, increased research and development expenses, accounting for 2%.

82%, up 1.

95pct, selling expenses accounted for 14.

9%, a slight decrease of 0 every year.

26pct, mainly due to the company’s change in sales strategy, ground layout speed and promotion efforts increased, channel promotion methods are more benign.

The East China Channel has initially subsided, and the non-East China commercial super end has made initial efforts, and Hengshun’s nationalization strategy has shown initial results.

In terms of regional income, Hengshun’s revenue in East China / Central China / South China / Western China / North China accounted for 54% / 16% / 14% / 10% / 6%, respectively.

East China has achieved initial income 8.

2.5 billion, up 20 every year.

32%, mainly due to the sinking of distribution channels, driven by the development of catering channels and product structure upgrades, Hengshun has a significant home advantage.

Since 18 years, the company has placed advertisements on high-speed railway lines in East China, Central China, and South China. The response in South China has been good and it has achieved revenue2.

18 ppm, an increase of 12 in ten years.

32%, gross profit margin rose 2 in ten years.

03pct, the gross profit increased the most.

Realization of income in the western region1.

48 ppm, an increase of 17 in ten years.

68%, revenue growth rate is second only to East China home.

In the future, East China is still the main force, and the non-East China market is advancing steadily.

“Spring ploughing and afforestation” sinks towns and villages to zero-touch with consumers, embraces new retail, and explores new marketing models in the Internet age.

In terms of traditional channels, the company added 99 national large-scale supermarket stores, 583 township supermarkets, and 18,000 farmer’s outlets in 18 years. The nationalization of the brand and the sinking of channels have been synchronized.

In terms of modern channels, the company actively cooperates with new channels such as Alibaba, JD.com, Meilai.com and other channels to B. To the C terminal, it cooperates with Hema Xiansheng and Tmall Supermarket to adjust its own sales plan using the advantages 上海夜网论坛 of big data.Stores expanded to 70,000 people.

From the perspective of sales methods, the gross profit margin of the direct sales model is higher than that of the distribution model by nearly 5.

5%, which translates into the development of online direct-operated stores and new online to B channels, and the company’s overall profitability continues to increase.

Continue to slim down and streamline SKUs, focus on the Hengshun + Beigushan brand, create large items and increase visibility.

In the past, the company’s SKU has been higher than the industry average. The highest number of SKUs for vinegar products reached 101. After 15 years of the company’s orientation to streamline SKUs to create large single products, the SKUs of category A products have been reduced to 15 types. The company will continue to eliminate 南京夜网 them this year.The integration of 22 products will focus on the dual brand operation of Hengshun + Beigushan in the future, and strive to build core A and high-end products, and continue to streamline SKUs to 60-70 levels.

Profit forecast and investment rating: The company is expected to achieve operating income of 19 in 2019-2021.

07 billion, 21.7.2 billion, 25.

0.7 million yuan, an increase of 12 in ten years.

61%, 13.

89%, 15.

42%; net profit attributable to mothers is 3.

500 million, 4.

1.4 billion and 5.

00 ppm, an increase of 15 in ten years.

31%, 18.

40%, 20.

56%; maintain “strongly recommended” rating.

Risk warnings: 1. The prices of upstream raw materials fluctuate greatly; 2. The downstream demand is less than expected.