Liuyao (603368): 19H1 results meet expectations and rapid growth in high gross profit business

Liuyao (603368): 19H1 results meet expectations and rapid growth in high gross profit business

Event: The company released its 2019 Interim Report and achieved revenue of 72 in 19H1.

0 million yuan (+30.

5%), deducting non-net profit amounted to 3.

5 billion (+37.

2%), the operating net cash flow is -3.

6.4 billion.

Interim results are in line with our expectations and the market (already reported).

Opinion: Revenue is accelerating, driven by hospital + retail + industry.

19H1 revenue +30.

5%, a significant increase, mainly due to the acceleration of logistics extension services.

By the end of the period, the company’s cooperative hospitals reached 68 (+9). At the same time, the scope of cooperation between the original agreement hospitals was expanded, including SPD for equipment consumables, intelligent Chinese medicine, and cooperation in outsourcing prescriptions.

19H1 hospital sales revenue +28.

0% is the core driving force for growth.

19H1 retail revenue +52.

6%, 82 DTP pharmacies (+33), and the rapid deployment of DTP is the main reason.

19H1 industrial revenue +270.

5%, mainly due to rapid sales of Metrohm Consolidation and Xianzhu sales.

The gross profit margin continued to increase in 19Q2, and the expense ratio was well controlled.

The company’s gross profit margin was 19 in Q2.

2%, +1.

4pp, a significant improvement, mainly due to: 1) rapid growth in innovative business such as medical devices in hospital sales; 2) rapid growth in retail and industrial businesses with high gross profit margins contributed to the increase in the proportion

The company’s 19Q2 sales / management / financial expense ratio increased by +0 respectively.

16pp / + 0.

00pp / + 0.

45pp, except for the increase in financial expenses, the overall expense ratio is well controlled, and the overall net profit margin for sales in 19Q2 reached 5.

81%, ten years +0.

41pp, profitability further improved.

19Q2 operating cash was able to improve and operating capacity remained good.

The company’s 19Q2 operating cash alternative is zero.

59 trillion, rating 19Q1 of 3.

50,000 yuan has been greatly improved.

From the operating indicators, the company’s 19Q2 inventory turnover days for several years -2.

0 days, accounts receivable turnover days year +3.

6 days, basically kept stable, while the accounts payable turnover days are several years -20.

0 days, but 四川耍耍网 at the same time the bills payable increased, the overall cash flow still showed some improvement.

19H1 performance is in line with expectations, high gross profit business grows rapidly, maintain “Buy” rating and maintain company 19?
The 21-year earnings per share forecast is 2.

72 yuan, the current price corresponds to 19?
The 21-year PE is 13x / 11x / 9x.

The company’s interim report performance was in line with expectations, and high gross profit business continued to grow rapidly. It is estimated to readjust and maintain a “Buy” rating.

Risk reminders: 1) The risk of price reduction with volume purchases; 2) The integration of Wantong Pharmaceutical, Youhe Ancient City does not meet the expected risk.