Taoli Bread (603866): 2Q19 Performance Accelerated Growth Regional Expansion Orderly

Taoli Bread (603866): 2Q19 Performance Accelerated Growth Regional Expansion Orderly

The 2Q19 results were in line with the expected 1H19 results announced by the company: Revenue 25.

600 million, +18 a year.

1%; net profit attributable to mother is 300 million yuan, +15 for the whole year.

5%, corresponding to a relative profit of 0.

46 yuan.

Among them, 2Q19 single quarter income of ten years +20.

2%, net profit attributable to mother +10 for ten years.

9%, consistent with the performance report.

Development Trend 2Q19 revenues are accelerating month-on-month, and new and old markets are working together.

In the second quarter of 19th, the company’s revenue increased by 20%, a significant increase from the first quarter of 19. We believe that it mainly benefited from the rapid expansion of the channel network in new and old markets and the improvement of single store sales.

In 1H19, the revenue in the new markets of East China and South China increased by 23% / 39%, and in the mature markets of Northeast / North China increased by 15% / 19% (the growth rate does not consider distribution and revenue distribution in Central China).The rapid growth mainly benefited from the development of dealers and outlets (together with 50 dealers in 1H19 in East China and South China), and the steady growth in mature markets benefited from the sinking of the channel network and intensive cultivation.

1H19 company has about 230,000 sales terminals across the country, an increase of about 15%. We estimate that the average single store sales increase by about 3%. We believe that the company has an orderly expansion of its national sales network, making full use of high-quality products and distribution services, while achievingWith the rapid growth of revenue, we judge the probability gap between the expected revenue of the company and the budget indicator of 18% increase.

In the second quarter of 19, gross profit margin remained at a high level, and product structure upgrades and scale effects released contributions.

The company’s gross profit margin for the second quarter of 19 was 39.

9%, ten years +0.

2ppt, ring than +0.

6ppt, a relatively high level, we believe 杭州夜生活网 that it is mainly benefited from the company’s continuous introduction of new high-margin products, while the rapid growth in revenue brought about the scale effect also has a positive contribution to the gross profit margin.

1H19 South China gross margin was about 24%, +3 in ten years.

3ppt, we believe that it reflects the scale effect brought by the maximization of plant capacity in the new market.

We expect the company’s overall consolidated gross margin to remain at a relatively high level of 39-40%.

In the second quarter of 19, the expense ratio fell slightly from the previous quarter, mainly benefiting from the scale effect.

The company’s sales expense ratio for the second quarter of 19 was 21.

4%, ten years +0.

8ppt, ring than -1.

6ppt, we believe that the company’s sales expense ratio has fallen 杭州夜网 from the previous quarter mainly due to the scale effect brought by the rapid growth in revenue. Therefore, we judge that the gradual sales expense ratio will still maintain a high level to ensure the company’s market share to increase steadily, which is beneficial to market developmentLeverage revenue growth.

We judge that the company’s profit end 2H19 is expected to benefit from the lower base in the same period last year, product structure upgrades and scale effects to achieve faster growth than in the first half of the year. We judge that the company can achieve a net error of 15% with a probability increase in the budget indicator.

Earnings forecast and forecast Maintain earnings forecast and outperform industry rating, maintain target price of 55 yuan, corresponding to 49/42 times P / E in 19/20, current price corresponds to 42/36 times P / E in 19/20, current price is 17%space.

Risk area expansion risks, increased industry competition, raw material price fluctuations, and food safety risks.