Tsingtao Brewery (600,600): Structural upgrades, tonnage price increase, expected growth rate lowered, thickened profit, mid-term report performance was better than expected
The expected growth rate of the event was reduced to increase profits, and the interim report performance exceeded expectations.The company announced its 2019 Interim Report, which achieved revenue of 165 in 19H1.5 trillion, the same increase of 9.2%.Realize net profit deducted from non-returned mothers14.500 million, an increase of 30.6%, corresponding to EPS1.21 yuan / share.2Q19 achieved revenue of 86.0 million yuan, an increase of 7.3%; Realize net profit after deduction.300 million, an increase of 34.7%.We believe that the company’s revenue growth rate in the second quarter was due to factors such as cleaning up inventory, night channel adjustments, and cooler weather; the gradual increase in the downward adjustment led to a quarter-on-quarter increase in profit growth, and the company is still expected to enjoy dividends. Core point of view The product structure continued to upgrade, and the average price per ton increased significantly.In terms of component prices, in the first half of the year, the company’s product sales increased by 3 per ton.6%, 5.The 4% increase in ton price was mainly due to product price increases, structural upgrades, and lower tax rates.In terms of products, the sales of the Qingdao brand in 19H1 and other brands were 2.36 million kiloliters (+6.3%), 2.37 million kiloliters (+1.0%), pure health, 1903 and other high-end products sales growth rate of about 10%, the product structure is further upgraded to high-end.We believe that although the company’s ton price is at a relatively high level in the industry, the proportion of sales of ordinary low-end products is still high, and the structure improvement logic is expected to be established for a long time. The profitability has been steadily improved, and the cost of investment has been held up.In the first half of the year, the cost of barley and barley increased.74 cases reached 40.11%, of which Q2 rose by 1.82pct; sales expense ratio increased by 0.27 Crata 18.06%, of which Q2 rose by 1.0pct, mainly due to freight, advertising costs, and staff budget increase; management expense rate (including research and development expenses) decreased by 0 every year.24pct to 3.62%, of which Q2 decreased by 0.19pct; drop in blood glucose rate decreased by 0.66 points to 25.69%.The increase in gross profit margin + the decrease in tax rate led to an increase in net profit1.10 points and 22 points.43%. The regional strategic planning is clear, and the long-term logic of price increase is firmly grasped.In terms of different regions, Tsingtao Brewery gradually improved: 淡水桑拿网 North China focused on product upgrades to build a core market; South China converted competitive products to suppress attenuation and transformation trend; Northeast China grew rapidly and continued to seize the share of competitive products.We expect the company to further strengthen the basic market and seize the strategic high point along the Yellow River.Affected by channel preparations and assessment factors in the short term, the company’s sales may be disturbed, but we believe that the core factor affecting revenue and profits lies in price rather than sales.Looking ahead to the second half of the year, we judge that the price dividend will continue, and the improvement in the price of ton price will reach the growth rate of full coverage costs. The gross profit margin and net profit margin are expected to improve, and we expect the expense rate to decline after the 成都桑拿网 release of the layout. Financial Forecast and Investment Recommendations We maintain the previous profit forecast, and forecast the company’s profit and earnings for the year 19-21 to be 1.29, 1.56、1.88 yuan.Maintain the company’s 43-year PE for 19 years, corresponding to a target price of 55.47 yuan to maintain the overweight level. Risk reminder: the ton price has risen less than expected, the price of raw materials has continued to increase, and industry competition has intensified.