Haitian Flavor (603288) 2019 Third Quarterly Report Review: Soy Sauce & Oyster Sauce Performs Stably

The company’s soy sauce and oyster sauce performed steadily in Q3 2019, and the seasoning sauce continued to accelerate, and other categories of vinegar and other categories achieved rapid growth, and the profitability steadily improved.

We are optimistic that the company ‘s “Three Five-Year Plan” has been successfully promoted, and the leading companies have gradually consolidated and maintained a “Buy” rating.

In the first three quarters of 2019, revenue / net profit / non-net profit were increased by 16 each.

62% / 22.

48% / 23.


The company achieved sales revenue of 148 in Q1-Q3 2019.

2.4 billion, an increase of 16.

62%; net profit attributable to mother 38.

3.5 billion yuan, an increase of 22.

48%; deduction of non-net profit 36.

3.8 billion, an increase of 23.


Of which Q3 earned 46.

6.4 billion, an increase of 16.

85%; net profit attributable to mother 10.

8.5 billion, an increase of 22.

84%; deduct non-net profit 10.

3.8 billion, an increase of 31.

68%, continued solid performance, as expected.

Revenue share: The performance of soy sauce and oyster sauce is steady, and the sauce category continues to accelerate.

In terms of categories, the company’s soy sauce oyster sauce performed solidly, and the soy sauce business achieved revenue of 26 in Q3.

90 trillion, the same increase of 14.

08%, a total increase of 13 in the first three 杭州桑拿网 quarters.

76%; Oyster sauce business achieved revenue in Q38.

3 billion, an increase of 18.

70%, a total increase of 20 in the first three quarters.

33%; Seasoning sauce business channel adjusted significantly, and achieved revenue in the third quarter5.

4 billion, an increase of 13.

80%, chain speed continued to increase (Q1 / Q2 increased by 6 respectively.

13% / 9.

32%); other products such as vinegar achieved high growth, and Q3 achieved revenue3.

7.4 billion, an increase of 39.


In terms of channels, the online / offline revenue of the companies in Q3 2019 increased by 13 respectively.

17% / 16.

79%, online and offline speed up.

By region, Q3 is relatively mature in the east / south, with income increasing by 14 as well.97% / 14.

51%; West / Central continued high growth, with income increasing by 30%.

68% / 23.

41%; Northern distributors increased by 283 to 1671, which accelerated the development.

Profit analysis: Gross profit margin and sales expense ratio decreased, and profitability continued to improve.

In terms of gross profit margin, the company’s gross profit margin in 2019Q3 was 43.

8%, down by 1.

32 PCTs are mainly due to: ① the increase in the prices of raw materials and packaging materials; ② the increase in equipment depreciation vendors due to technological transformation and production; ③ changes in the product structure, and the proportion of low-margin oyster sauce products increased.

In terms of expense ratio, Q3’s sales expense ratio fell by 2.

81Pcts to 12.

87%, mainly due to the decline in transportation costs caused by some of the company’s distributors.

The management expense ratio increased slightly by 0.

65PCT; R & D expense ratio decreased by 1.

32PCTs; the index cost rate is also reduced by 0.

66PCT, mainly due to an increase in interest income of 39 million.

In addition, changes in accounting adjustments caused some income to be transferred from investment income to income from changes in fair value, and Q3’s total total revenue decreased by only 1.


In summary, Q3’s net margin increased by 1.

13PCT to 23.


Future expectations: Year-to-date performance is stable and robust, maintaining a double-digit compound growth judgment for five years.

The company’s revenue / net profit targets for 2019 will increase by 16% / 20%, respectively. The company’s performance in the first three quarters is solid, and it is possible to achieve its performance targets.

2019 is the first year of the company ‘s “Three Five-Year Plan”. The company continues its steady performance and lays a good start for the company’s five-year plan.

We predict that the company ‘s soy sauce / oyster sauce / sauce will increase exponentially in the next five years, with low double / medium double / low double exponential growth, the market share steadily increasing to about 25%, and profitability steadily improving. Based on a comprehensive judgment of the company from 2018-2023Revenue / net profit achieved compound double-digit / medium-high double-digit compound growth respectively.

risk warning.

Risks of raw material price fluctuations; food safety risks; risk of industry prosperity decline.

Profit forecast and estimation.

Maintain 2019/2020/2021 EPS forecast to 1.



80 yuan, corresponding to a growth rate of 20% / 22% / 19%, maintain “Buy” rating.