Meihua Group: Amino acid production and revenue growth can hardly compensate for the decline in gross profit margin

2012, the company's operating income was RMB7.470 billion, up 8.79% YoY; net profit attributable to shareholders of listed companies was RMB608 million, down 15.52% YoY; and net profit attributable to shareholders of listed companies, net income after deducting non-recurring profit and loss, was RMB560 million, down 6.09% YoYIncreased sales led to revenue growth, while the rise in the price of raw materials and the fall in the price of finished products led to a reduction in profit marginsIn terms of amino acid sales, in 2012, amino acid operating income was RMB1,897 million, up 28.39% YoY, operating costs were RMB1.441 billion, up 5.83% YoY, and gross margin was 20.61%, down 1.22 percentage points YoYThe main reason for the increase in revenue was the increase in output at Tongliao base, but the gross margin decreased due to the fierce competition associated with the expansion of production capacity in the amino acid industry and the increase in raw material costsIn 2012, the company's export situation is better, especially the export of susine, export growth of 41% year-on-yearLysine 2012 new products, mainly in the domestic, a small number of exports in September, in addition to the company to ensure the cooperation of major customers, respectively, in Chengdu, Shanghai and Guangzhou to add three peripheral warehouses, but also save costsueu2012 the company's operating income was RMB7.470 billion, up 8.79% YoY; net profit attributable to shareholders of listed companies was RMB608 million, down 15.52% YoY; and net profit attributable to shareholders of listed companies, net income after deducting non-recurring profit and loss, was RMB560 million, down 6.09% YoYIncreased sales led to revenue growth, while the rise in the price of raw materials and the fall in the price of finished products led to a reduction in profit marginsIn terms of amino acid sales, in 2012, amino acid operating income was RMB1,897 million, up 28.39% YoY, operating costs were RMB1.441 billion, up 5.83% YoY, and gross margin was 20.61%, down 1.22 percentage points YoYThe main reason for the increase in revenue was the increase in output at Tongliao base, but the gross margin decreased due to the fierce competition associated with the expansion of production capacity in the amino acid industry and the increase in raw material costsIn 2012, the company's export situation is better, especially the export of susine, export growth of 41% year-on-yearLysine 2012 new products, mainly in the domestic, a small number of exports in September, in addition to the company to ensure the cooperation of major customers, respectively, in Chengdu, Shanghai and Guangzhou to add three peripheral warehouses, but also save costs