Zhongshun Jierou (002511) Interim Report in 2019: Performance Exceeds Expectation “Product + Channel” Two-Wheel Drive Capacity Expansion and Employee Stock Ownership Plan Help Growth

Zhongshun Jierou (002511) Interim Report in 2019: Performance Exceeds Expectation “Product + Channel” Two-Wheel Drive Capacity Expansion and Employee Stock Ownership Plan Help Growth

Matters: Operating income 31 in the first half of 2019.

72 ppm, an increase of 22 in ten years.

67%; net profit attributable to mothers2.

75 ppm, an increase of 37 in ten years.

59%; net profit after deduction is returned 2.

70,000 yuan, an increase of 41 in ten years.


2019Q2 achieved operating income16.

32 ppm, an increase of 26 in ten years.

87%; net profit attributable to mothers1.

51 ppm, a 47-year increase of 47.

86%; net profit after deduction to non-returned mother1.

48 ppm, an increase of 54 in ten years.


Comment: The product structure is continuously optimized, high-end products are developing rapidly, and personal care products are increasing. The company continues to increase the proportion of high-end, high-margin products and non-rolled paper categories. The current proportion of key products such as emulsions, natural woods exceeds 65%, Revenue growth rate exceeds 30%.

In addition, the company launched personal care products in June 2019, using a new brand “dolemi” to broaden its product line.

Diversified sales channels and continued development of marketing network: The company’s four major channels, KA / GT / AFH / EC, are in full swing, and their revenue growth rates are all above 10%. Among them, the e-commerce and commercial sales channel revenues have grown rapidly, followed by KA.Channels and GT channels.

In terms of e-commerce, the company increased its investment in peer-to-peer e-commerce platforms, strengthened the supply chain system and formed a professional e-commerce operation team.

In terms of commercial consumption, the company set up a professional commercial consumer service team.

In terms of KA, the company has established good cooperative relations with large chain stores, and at the end of 2018, it will directly operate 重庆耍耍网 the company for all large stores.

In addition, the company’s sales channels continue to sink. The current marketing network covers approximately 62% of prefecture-level (county) -level cities nationwide, and full coverage is expected by 2021.

The downward pressure on pulp prices has released cost pressures, and Q2 gross margin has increased significantly.

Benefiting from the improvement of gross profit margin and the control of expense ratio, 2019H1 net profit increased by 0.

94pct to 8.


Among them, the net interest rate in 2019Q2 was 9.

28%, 1 increase every year.

85pct, an increase of 1 from the previous month.

27 points.

2019H1 gross margin increased by 0.

2pct to 36.

69%, of which the gross profit margin for the second quarter of 2019 was 39.

23%, an increase of 4 per year.

85pct, an increase of 5 from the previous month.

22pct, mainly due to the apparent reduction in pulp prices.

As of August 2, 2019, the international prices of coniferous pulp / broad leaf pulp were 602 respectively.

50 USD / ton and 531.

43 US dollars / ton, down 27% / 28% from the beginning of the year.During 2019H1, the expense ratio decreased by 0.

7 points to 25.

64%; sales expense ratio increased by 0.

07pct to 19.

16%; management expense ratio 6.

02%, flat for one year; financial expense ratio fell by 0.

78pct to 0.


Expense rate during 2019Q2 was 27.

65%, an increase of 6 per year.

78pct, up 4 from the previous quarter.

52pct; selling expense ratio 20.

97%, an increase of 3 per year.

58pct, an increase of 3 from the previous quarter.

73pct, the effect of reorganization.

The production capacity layout and industrial chain are gradually improved, and the employee shareholding plan has added momentum.

In 2019, the company’s Hubei and Tangshan will have 10 instances and 5 plug-in capacities put into production, respectively. It is expected to effectively increase the company’s market share in central and northern China, and the total capacity is expected to reach 81 indicators.

In addition, in July 2019, the company plans to invest in 30 bamboo pulp and paper integration projects to extend the industrial chain.

At the same time, the company released the second phase of the employee stock ownership plan (budget), with a total cap of 50 million yuan.

Due to the sharp decline in the price of wood pulp, the company’s cost control situation continues to improve, and the gross profit margin has increased. We have raised our company’s profit forecast from 2019-2021 to its net profit5.

05, 5.

96, 7.

4 billion adjusted to 6.

03, 7.

37, 9.

US $ 0.3 billion, corresponding to current expected price-earnings ratios of 29, 24, and 19 times, respectively, maintaining “strong push” rating; according to the company’s profit forecast and market value of comparable companies, the company’s target market value of 15 billion is correspondingly increased to US $ 20 billion, corresponding to a target price of 15.

31 yuan, corresponding to 33 times PE in 2019.

Risk warning: The macro-downside consumption is sluggish, raw material prices rise, and exchange rate fluctuations increase.