Yunnan Baiyao (000538) 2019 Third Quarterly Report Review: Pharmaceuticals, Daily Chemicals Segment Maintains Steady Growth, Company Opens Outward Development Model

Yunnan Baiyao (000538) 2019 Third Quarterly Report Review: Pharmaceuticals, Daily Chemicals Segment Maintains Steady Growth, Company Opens Outward Development Model

Matters: The company released the third quarter report for 2019 on October 28, reporting that the two companies achieved operating income of 216.

4.6 billion (+8.

36%), realizing net profit attributable to mother 35.

4.2 billion (+7.

46%) and realized deduction of non-net profit23.

3.6 billion (-7.

30%), 228 cash received from sales of goods and services.

85 (-1.

95%) million yuan, net cash inflow from operating activities1.

54 (-88.

06%) million.

  The company’s Q3 single quarter achieved operating income of 77.

4.9 billion (+13.

42%), achieving net profit attributable to mother 12.

9.5 billion (+5.

55%), to achieve a deduction of non-net profit of 12.

10,000 yuan (+17.

78%), cash received from sales of goods and services 81.

86 (+26.

79%) million yuan, net cash inflow from operating activities 6.

05 (+124.

05%) ten thousand yuan.

  Comment: Pharmaceuticals and Daily Chemicals maintained steady growth.

The company’s pharmaceutical sector (parent company performance) reported operating income of 39.

9.1 billion (7.

33 +%), net profit attributable to mother 2.

9.9 billion 深圳桑拿网 (55.

83%); operating income in the third quarter of a single quarter14.

5.8 billion (27.

08%), net profit attributable to mother 3.

8.2 billion (11.


The growth rate of the company’s pharmaceutical sector changed from negative to positive for the first time earlier this year. Initially, the H1 pharmaceutical sector was mainly destocked in 2019, and the normal shipment level was restored in Q3.

The company’s health products report gradually predicts that the operating income will exceed the growth rate by about 10%, which is higher than the average growth rate of the toothpaste market by 2-3 increments.

Initially, the channel of the daily chemical sector sinks further. At present, Yunnan Baiyao toothpaste accounts for 20% of the reorganization.

1%, the first in the country.

  The company started an extension development model.
On October 15, 2019, the company announced the signing of the “Convertible Bond Subscription Agreement” with Bandung Holdings to 7.
The consideration of 300 million Hong Kong dollars is for the subscription of convertible bonds with an annual interest rate of 3%.

As far as possible to obtain fixed income, it can increase and deepen the continued cooperation between the two parties in the personal care product trade, as well as plant extraction and supporting monitoring, logistics, import and export and related services.

On October 25, the company announced plans to use its own funds of $ 50 million (about 3).

500 million yuan), as a cornerstone investor in the subscription of China Antibody Pharmaceutical Co., Ltd. (Chinese name) on the Hong Kong Stock Exchange’s initial public offering of shares.

The source of funds for the above investment becomes the listed company’s own funds, which will not have a significant impact on the company’s financial status and daily production and operation in the short term; in the long run, it will help the company’s layout in the biomedical field and improve the company’s capital utilization efficiencyPromoting the company’s internationalization process has a positive impact on the company’s development.

  Earnings forecasts, estimates and investment ratings.

We expect the company’s revenue to reach 293 in 19-21.

32 billion (+9.

8%), 321.

9.2 billion (+9.

7%), 352.

7.8 billion (+9.

6%); net profit attributable to mothers is 36.

3.8 billion (+10.

0%), 39.

5.7 billion (+8.

8%), 44.

40 billion (+12.

2%) (original predictor 37).

7.1 billion, 42.

1.2 billion, 49.

2 billion, mainly due to the company’s performance in the first half of 19 due to the destocking of the pharmaceutical sector, the company’s performance slowed).

Focusing on the company’s future free cash flow to be temporarily stable, the DCF estimation method is used to adjust the target price to 94.

93 yuan (original predictor variable 99.

36 yuan, the reason for the downward adjustment is to lower the expected growth rate of profits).

The company’s performance is stable, maintaining the “recommended” rating.

  risk warning.

The pharmaceutical sector, the daily chemical sector, and new investment projects grew faster than expected.