Original link: https://ljf.com/2022/07/06/1114/
Business situation discussion and analysis
In 2021, although the prices of main raw materials will rise to varying degrees, the company will continue to improve its management level, make scientific decisions, seize favorable opportunities in the market, and rely on scale advantages, multi-product advantages and cost advantages, the main products of monosodium glutamate, threonine, lysine The price increase of acid, xanthan gum and other feed amino acid products was greater than that of raw materials, and the overall profitability of the company’s main products was further improved. During the reporting period, the company overcame the impact of the new crown epidemic and achieved operating income of 22.837 billion yuan, an increase of 33.94% year-on-year, net profit attributable to owners of the parent company was 2.351 billion yuan, an increase of 139.40% year-on-year, and the weighted average return on equity was 26.32 %, an increase of 15.33 percentage points compared with last year.
During the reporting period, the prices of raw and auxiliary materials, such as corn and soda ash, rose to varying degrees. Based on the accurate analysis of the market supply and demand, the company’s competitive market share and good customer relationship, the price of the company’s main products rose more than the original price. The increase in accessories, the net profit attributable to owners of the parent company in 2021 will increase by 139.40% year-on-year to 2.351 billion yuan, and the earnings per share will increase by 137.5% to 0.76 yuan. The income mainly comes from the main business income, and the profit mainly comes from operating profit . Among the various business segments, the revenue of animal nutrition amino acid products was 11.587 billion yuan, a year-on-year increase of 33.39%; the revenue of food taste properties optimization products was 8.518 billion yuan, a year-on-year increase of 41.61%.
With the continuous increase in production capacity, the company’s funds remain abundant all year round. The net cash flow from operating activities in 2021 will be 3.67 billion yuan, a year-on-year increase of 120.95%. Thanks to the implementation and implementation of standardized management in supply, production and sales over the years, the company continued to maintain efficient operations. During the reporting period, the company’s inventory turnover days decreased from 54 days in 2020 to 51 days, and the accounts receivable turnover days decreased from 2020. 8 days down to 5 days. Taking a leap forward and continuing the chapter, the company’s overall management level and operation level have entered a new stage of development.
During the reporting period, the prices of raw and auxiliary materials have risen to varying degrees. Based on the existing scale, market share, cost and other advantages of the company’s products, the main products of the sales company are monosodium glutamate, threonine, lysine, xanthan gum and other feed amino acids. The sales price of products increased, of which the sales price of lysine increased by 37.63% year-on-year, and the sales price of threonine increased by 44.75% year-on-year in 2020.
The company takes the doubling of the income of front-line employees in the next five years as the company’s main goal for the next step.
Industry situation of the company during the reporting period
According to the “Guidance Catalogue of Key Products and Services for Strategic Emerging Industries” (2016 Edition) issued by the National Development and Reform Commission, the company’s main products belong to the field of “bio-industry bio-manufacturing industry”, and the company’s industry is the bio-manufacturing industry. According to the “Industry Classification Results of Listed Companies in the Third Quarter of 2021” released by the China Association of Listed Companies, the company belongs to the manufacturing industry-food manufacturing industry.
The company is a full-chain synthetic biology company from genome editing to product landing. In order to build a microbial cell factory production system with amino acids as the main product and multiple categories of products, the company has long been committed to the development and construction of synthetic biology technology platforms. With this platform as the cornerstone, the company has realized the rational reconstruction of the microbial cell factory with various industrial production strains such as Escherichia coli, Corynebacterium glutamicum, Bacillus and other industrial production strains as chassis cells, and realized the optimization and upgrading of the production strains of the company’s entire line of products. , greatly improving the iterative development efficiency of production strains. In order to ensure the smooth production and implementation of the new generation of bacteria, the R&D team has built a downstream fermentation and extraction process optimization platform from the beginning, in order to maximize the conversion efficiency from raw materials to products, reduce the addition of raw materials and impurities, and reduce carbon footprint. .
1. The development of synthetic biology technology has broadened the boundaries of biological fermentation, and the future has broad prospects
Synthetic biology is the core technology for realizing green manufacturing of chemicals, and the rapid development of synthetic biology has greatly improved the biological manufacturing capacity of cell factories. The global share of bio-based products in petrochemicals has grown from less than 1% in 2000 to 10% now, and is growing at an annual rate of more than 20%.
According to the Organization for Economic Co-operation and Development (OECD), by 2030, 35% of chemical production will be achieved by bio-manufacturing.
2. The rapid development of amino acid strains using synthetic biology technology provides a guarantee for the low-cost and high-efficiency production of bulk amino acids
3. The company has been deeply engaged in synthetic biology technology for many years, and will further cover new application fields
Industry policy changes: double control of energy consumption has raised the entry threshold for the amino acid industry, and the substitution of soybean meal has increased the demand for amino acids in feed
On March 9, 2021, the Development and Reform Commission of Inner Mongolia Autonomous Region issued a notice on “Several Guarantee Measures to Ensure the Completion of the “14th Five-Year Plan” Energy Consumption Dual Control Targets. Due to the reduction in the consumption of corn and coal, the production of individual products (crystalline sugar) has been suspended or reduced, and the production of amino acid enterprises has been suspended, and other regions have also been affected to varying degrees. The country’s requirement for dual control of energy consumption has virtually raised the entry threshold of the amino acid industry, making it more difficult for new companies to enter the industry. If existing companies in the industry fail to meet the energy consumption standards or fail to take effective measures to reduce energy consumption, it may affect the future. Production. This policy also provides opportunities for the integration of leading enterprises, which is conducive to the development of leading enterprises.
The business of the company during the reporting period
The company is a company based on synthetic biology and other disciplines, using biological manufacturing technology, mainly engaged in the research and development, production and sales of amino acid series products. It has three production bases in Tongliao in Inner Mongolia, Wujiaqu in Xinjiang and Baicheng in Jilin. And Shanghai has two R&D centers, the main products include:
-Animal nutrition amino acid products: lysine, threonine, tryptophan, feed-grade valine, monosodium glutamate residue, starch attached product feed fiber, corn germ, bacterial protein, etc.
– Food taste traits optimization products: glutamic acid, sodium glutamate, disodium nucleotide, disodium inosinate, food-grade xanthan gum, trehalose, natamycin, etc.
– Human medical amino acids: glutamine, proline, leucine, isoleucine, pharmaceutical grade valine, inosine, guanosine, adenosine, pullulan, etc.
-Other products: petroleum-grade xanthan gum, medicinal capsules, bio-organic fertilizers, etc.
Up to now, the company has authorized or applied for more than 70 related patents in the field of amino acid strain redesign, covering all the amino acid varieties currently produced by the company. In recent years, the company has increased R&D investment in synthetic biology. In 2021, it has applied for more than 40 patents related to amino acid synthetic biology, and the output of intellectual property rights has entered a blowout period.
Analysis of core competitiveness during the reporting period
1. The multi-product layout ensures the company’s revenue growth and net profit growth
2. Relying on the advantages of product scale and combination, efficient operation and cost advantages brought by R&D investment
At the end of 2020, the second phase of Baicheng 250,000 tons of monosodium glutamate and supporting projects will be put into operation. In November 2021, the 300,000 tons of lysine and supporting projects of Baicheng Phase III will be put into operation. After the completion of the above projects, the company’s lysine and monosodium glutamate production capacity will reach one million Ton-level and threonine 300,000 tons, the scale of amino acid products ranks in the forefront of the industry. At the same time, the company’s high capacity utilization rate of various products and the synergistic advantage of multi-product portfolio sales have enhanced the company’s competitiveness in the field of biological fermentation.
The company’s operating indicators continue to improve, and the inventory turnover days are maintained within 60 days. Most of the company’s sales are in the form of cash on-the-spot and accounts received in advance, and the accounts receivable turnover days are maintained within 10 days. Higher operational efficiency saves overall management. cost.
In recent years, the company has increased investment in research and development in the application of synthetic biology technology. In 2021, it has applied for more than 40 patents related to amino acid synthetic biology, and the output of intellectual property rights has entered a blowout period. During the reporting period, the company’s overall R&D investment was 649 million yuan. The continuous investment in basic R&D and application R&D has brought about continuous optimization of technical indicators and improvement of conversion efficiency, saving production costs and reducing the carbon footprint in the production process. , reduce energy consumption.
3. Adhere to strong internal incentives and high external dividends to build a value-oriented investment enterprise
The company continued to launch an equity incentive plan from 2018 to 2021, and set challenging company performance goals and personal assessment goals. Combining company development with personal development will help enhance the company’s own industry competitiveness, and also It is conducive to fully mobilizing the enthusiasm and creativity of the company’s business backbone. The company’s operating income has increased from 11.132 billion yuan in 2017 to 22.837 billion yuan in 2021, an increase of 105% in five years. While the scale continues to expand, the company’s net profit margin is also improving. In 2021, the company’s net profit margin is 10.40 %, an increase of 4.5 percentage points from 2020. The company’s per capita revenue generation capacity will increase from 1.23 million yuan in 2019 to 1.76 million yuan in 2021.
The company has been implementing a proactive profit distribution policy to build a value-oriented investment enterprise. In order to ensure sustainable business development and improve shareholder returns, since 2016, the company has distributed a total of 4.7 billion yuan in cash dividends, accounting for 90.64% of the total net profit attributable to the parent during the period. While the company’s scale continues to expand and dividends are high, cash flow remains stable and abundant , the net cash flow from operating activities in 2021 will be 3.670 billion yuan.
Main operating conditions during the reporting period
During the reporting period, the company achieved operating income of 22.837 billion yuan, an increase of 33.94% over the same period of the previous year; net profit attributable to shareholders of listed companies was 2.351 billion yuan, an increase of 139.40% over the same period of the previous year.
Revenue and Cost Analysis
Operating cost was 18.421 billion yuan, gross profit increased by 1.915 billion yuan, and gross profit margin increased by 4.67 percentage points over the same period of the previous year
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