Chongqing Beer (600132) Annual Report 2018 Review: High-end Strategy Continues to Promote Price Increase & Efficiency Increase to Improve Profit

Chongqing Beer (600132) Annual Report 2018 Review: High-end Strategy Continues to Promote Price Increase & Efficiency Increase to Improve Profit
The company’s product structure has continued to upgrade. The performance of high-end new products such as pure wheat Guobin is worth looking forward to. At the same time, the supply chain has improved significantly and its profitability has continued to improve.Optimistic about the company’s continuous advancement of high-end strategy. Performance review: Revenue / net profit increased by 9 in 2018.19% / 22.62%.In 2018, the company achieved operating income of 34.670,000 yuan, an increase of 9.19%; net profit attributable to mother 4.04 billion, with an increase of 22.62%.Among them Q4 realized income 5.4.3 billion, an increase of 11.26%, net profit attributable to mothers was 19.33 million yuan, an increase of 44.15%. Revenue analysis: The effect of price increase is apparent, and the product structure continues to upgrade.The company’s beer revenue in 2018 was 33.4.6 billion, an increase of 8.54%.In terms of sales, the company achieved sales of 94 in 2018.430,000 kiloliters, an increase of 6.40%, mainly because the company’s mid-to-high-end products continue to exert force, high- / mid-range product sales increased by 4 respectively.92% / 9.63%, of which the Lebao brand performed well, and sales increased by 16.11%; from the ton price point of view, the company’s ton price in 2018 was 3544 yuan per thousand liters, an increase of 2.The price increase of 01% was mainly due to ① the initial increase in prices of some high-end and low-end products by about 5%, and ② the upgrading of the company’s product structure, of which the sales of mid-range products, mainly Lebao and Chongqing Guobin, increased by 2.11.By region, Chongqing / Sichuan / Hunan achieved income of 25 杭州桑拿网 respectively.31/5.64/2.5.2 billion, an increase of 6.02% / 21.96% / 7.76%, of which Q4 increased by 9 respectively.6% / 84.33% /-26.At 38%, the difference between Hunan and Sichuan was mainly due to the transfer of Hunan-based processing to Yibin, Sichuan, with partial prices. In 2018, the volume of Chongqing / Sichuan / Hunan increased by 4%.75% / 15.89% / 2.98%, the price increased by 1.21% / 5.25% / 4.64%. Earnings analysis: Price increases and upgrades drove up gross margins, and factory closures helped optimize costs.The company’s gross profit margin increased by 0 in 2018.59pct to 39.93%, mainly benefiting from price increases and product structure upgrades, high, medium and low gross profit margins increased by 0.8/0.6/0.1 point to 57% / 41% / 14%.Selling expense ratio decreased by 1.52 cases, mainly due to the company’s increase in cost efficiency, reduction in market costs, and long-term advertising and market expense ratios1.16 cases; the management expense ratio decreased by 0.46pct is mainly due to the continuous upgrade of the company’s operating cost management projects and the optimization of its organizational structure. It has been optimized by arranging the management expense rate on average, and the shutdown rate has dropped by 0.22 points.In addition, in 2018, the company’s transfer of subsidiaries’ asset disposal income increased by 44.61 million yuan.Taken together, the company’s net profit margin increased by one.28% to 11.65%. Future outlook: The planned sales volume in 2019 will increase slightly, and product upgrades will continue to be promoted.According to the company’s annual report, the company plans to achieve net income after tax of 32 in 2019.50 trillion, the same increase in the number of units, the plan is to achieve sales of 950,000 kiloliters, a flat increase in ten years.Leading domestic beer industry companies have gradually promoted irregular price increases in different markets and made efforts in the high-end and high-end markets. The company is leading the industry in this regard.On the product side, the high-end and differentiated products perform well. The 2019 upgraded version of the pure wheat guest is worth looking forward to; on the regional side, Chongqing is adjacent to the solid and continues to promote product upgrades. The Sichuan market’s targeted product layout and dealer transformation in cities are worthylook forward to. Risk factors: The beer industry is sluggish, product upgrades are not up to expectations, and asset injections are less than expected. Investment suggestion: Considering that the company’s factory closures have improved significantly, the high-end process has continued to advance, and the company’s EPS forecast for 2019/2020 is raised to 1.01/1.19 yuan (was 0.98/1.16 yuan), plus EPS forecast 1 in 2021.36 yuan, maintain “Buy” rating.