Zhongshun Jierou (002511): First-quarter results exceeded expectations, focusing on personal care business performance

1Q19 results exceeded expectations. ZhongShun JieRou announced 1Q19 results: Revenue 15.

4 trillion, an increase of 25 in ten years.

8%; Net profit 1.

2.3 billion, an increase of 25 previously.

2%, blacks earn 0.

09 yuan.

The revenue growth in the first quarter of 19 was higher than expected. Thanks to the close to 50% growth in e-commerce and North China and the good performance of high-end categories, the revenue growth rate in the first quarter of 19 exceeded 40%.

The sales management expense rate is downgraded by 4 per year.

6ppt, which basically offset the decline in gross profit margin4.

The decline of 8ppt, the net profit margin was more than flat, and the profit growth exceeded market expectations driven by revenue.

Development Trends E-commerce channels and high-end categories are expected to drive 19 years of steady revenue growth.

In the first quarter of 19th, the revenue growth rate of high-end products exceeded 40%. Among them, the growth rate of lotion and face increased by 100% and 45% every other year. The total share of high-end products was 65%. It is expected that the expansion ratio will further increase to 70.%the above.

The growth of e-commerce in the first quarter of 2019 exceeded 50%. The growth of e-commerce channels and high-end categories is expected to drive 19 years of revenue to continue to grow steadily, but the growth rate may be all higher than the previous quarter, mainly considering that the 19th quarter is still at a high cost, so expensesThe average delivery is more cautious (this can also be reduced by 3 from the company’s 1Q19 expense ratio.

7%), market competition is expected to intensify from 2Q19, or it will disturb the company’s continued high-speed growth 北京夜网 of 1Q19.

In the first quarter of 19, gross profit margin picked up from the previous month, and further improvement of space may be subject to industry competition.

In the first quarter of 19, gross profit margin rose 3ppt month-on-month. It is expected that as low-priced pulp is further reflected in costs, gross profit margin is expected to show a seasonal improvement trend.

Of course, the space for improvement may be subject to the industry’s competition. Because the company’s price increase last year was ahead of the industry, if the price competition trend resumes due to the decline in the overall cost of the industry since 2Q19 this year, the company may face increasing pressure on price promotions, and some costs will be favorable.

A care category is expected to be officially launched by the end of 天津夜网 April.

The company’s category expansion will begin with the sanitary napkin category. New products are planned to be launched at the end of April or early May this year, mainly targeting high-end products.

We affirm the company’s efforts for category development, but because sanitary napkins are more concentrated than paper products and consumption penetration is saturated, and industry leaders Hengan and Unicam are competing with each other, we judge that brand building and consumer education still need timePersonal care products have limited contribution to revenue this year.

Earnings Forecast As revenue is higher than expected, we fine-tune our 2019/20 revenue forecast1.

4% / 1.

4% to 68.


30,000 yuan, corresponding to an increase in profit for 2019/20 by 1.

9% / 1.

8% to 4.


100 million yuan.

Estimates and recommendations Companies currently sustainably correspond to 19/20 years27.


0x P / E, and we raise our target price from 9 due to the upward revision of earnings forecasts.

2 yuan up 5.

1% to 9.

67 yuan, corresponding to 19/20 26.


6 times P / E, compared to current expectations of 6.
7% decrease.
Consider that the current estimated level is higher than the international average, and remain neutral.

Risk pulp prices rose sharply, demand was weak, and the performance of new products fell short of expectations, dragging down earnings.