Packaging / Advertising & Office

In 2020, when the epidemic is overwhelming, regarding China's economic situation, the media news is almost full of beautiful words between the lines. It can be summed up in two points: 1. China is the only major economy that maintains positive growth; 2. Disruption in the global supply chain Under the circumstances, Chinese manufacturing alone supports the overall situation, and a large number of foreign orders flood into China.

However, the packaging and printing industry, which is a barometer of the real economy, has shown no signs of recovery amidst the media bombardment of "strong recovery of domestic demand + foreign orders flooding into the country." Do you think it is unexpected?

Today, Xiaobian Bao brought you 17 transcripts of listed companies. Through an accurate analysis of their packaging orders, they discovered a big truth.

—— Even with the blessing of replacing plastics with paper, large capacity expansion and the Matthew effect, the listed companies, which are the best representatives of the packaging and printing industry, still show their obvious lack of orders.

What truth do the 17 transcripts of listed packaging and printing companies tell?

Donggang shares: During the 2020 reporting period, the company achieved operating income of 1,180,859,259.81 yuan, a year-on-year decrease of 21.05%. The report pointed out that due to the impact of the epidemic, customers have reduced their product demand. At the same time, due to the accelerated trend of electronic bills, the demand for printing business has declined, resulting in a decline in operating income during the reporting period.

Jiamei Packaging: Total operating income in 2020 is 1,992,409,458.53 yuan, a decrease of 24.07% over the same period of the previous year. The main reasons affecting performance are: in the first half of 2020, due to the impact of the new coronavirus pneumonia epidemic, the scenes of gatherings and visiting relatives and friends have been greatly reduced, the company's downstream food and beverage customer sales have been blocked, and the lack of terminal consumer demand has led to a significant decline in the company's product orders.

Hongxing Printing Group: The 2020 financial report shows that the group's annual turnover is HK$2.554 billion, a year-on-year decrease of 17.18%. The announcement pointed out that in 2020, due to factors such as the epidemic, the turnover and operating profit of the four business divisions of the group will fall.

Yongxin shares: In 2020, the company achieved operating income of 2.737 billion yuan, a year-on-year increase of 5.30%. Judging from the report, the main reason for the company's revenue growth is the smooth entry of breathable membrane products into the field of medical equipment and their application in medical protective clothing, ensuring the company's performance growth. In short, the business of the packaging sector is still experiencing negative growth.

Tianyuan shares: 2020 revenue will reach 1.02 billion yuan, an increase of 1.14% year-on-year. The report shows that last year the company's total assets reached 1.58 billion yuan, a year-on-year increase of 59.64%. This means that the company has expanded its production scale, and taking into account the soaring price of raw materials, its order volume has also shown a certain degree of negative growth.

Origen: During the reporting period of 2020, the company achieved operating income of RMB 10,561,012,720, a year-on-year increase of 12.72%. Corresponding to the fourth quarter of 2020, the operating income was 2.678 billion yuan, a year-on-year decrease of 8.08%. The main reason was that under the influence of the epidemic, the sales of downstream products of two-piece cans in the catering channel fell short of expectations. In addition, the price of aluminum, the main raw material for two-piece cans, rose by about 20% from October to November 2020. In 2021, the industry reached an agreement with some beer companies to increase prices, and the price of a single can was increased.

Shengtong shares: the 2020 annual report released by Shengtong shares, the financial report shows: during the reporting period, Shengtong shares’ operating income was 2.040 billion yuan, a year-on-year increase of 4.48%, and the net profit attributable to shareholders of listed companies was -346,267,900 yuan. A year-on-year decrease of 345.03%. If you take into account the increase in the price of printed matter and the company's increase in the company's comprehensive service income in the entire industry chain, including creative design, frame layout, capacity management, raw material supply chain, and book warehouse distribution, its order volume may be a negative growth.

Hongbo shares: total operating income in 2020 is approximately 471 million yuan, a year-on-year decrease of 24.81%. Hongbo's business covers security printing, new lottery channel services, book printing and high-end packaging printing.

Long Lide: Revenue in 2020 is 710 million, a year-on-year decrease of 18%, and its order volume has shrunk a bit. This number is even less than the sales revenue of the carton segment in 2019 of 755 million yuan.

Global Printing: Global Printing (002799) recently released its 2020 annual report. During the reporting period, the company achieved operating income of 1,875,342,223.97 yuan, a year-on-year increase of 50.35%. However, a careful analysis of its business sector found that its color printing business was about 520 million in 2019 and rose to 580 million in 2020, an increase of only 11%. You must know that Global Printing has been an epidemic stock in 2020. If the price increase factor is taken into account, the increase in its order volume will not be obvious.

Forest packaging: The total operating income in 2020 is 2.189 billion yuan, an increase of 6.97% year-on-year. However, this is mainly due to the super bull market in the paper industry in 2020. Judging from the reports of the past two years, Forest Packaging is more like a papermaking company, because its corrugated box business only accounts for about 20% of the company's revenue. In fact, in the past three years, Forest Packaging's revenue has been hovering around 2 billion.

Dashengda: In 2020, the company will achieve operating income of 1.35 billion yuan, an increase of 6.68% year-on-year. In recent years, the company has established a number of large-scale integrated packaging factories in Hangzhou, Zhejiang, Meishan, Sichuan, Yancheng, Jiangsu, Suzhou, Jiangsu, Xinjiang, and Hanchuan, Hubei. In 2020, the company has reached cooperation with head appliance manufacturers such as Midea and Gree. As a listed company with 97% of the carton business, Dashengda’s growth comes from the release of new production capacity and the introduction of new customers, rather than the growth of end-customer business.

Xin Hongze: Xin Hongze (002836) recently released its 2020 annual report. During the reporting period, the company achieved operating income of RMB 212,913,001.28, a year-on-year decrease of 49.72%. The main reason for the change in performance is that due to the impact of the new crown epidemic, the company's resumption of work after the Spring Festival has been delayed to varying degrees. The pneumonia epidemic and prevention and control measures have caused a certain temporary impact on the company's production and operation.

Jinjia shares: During the reporting period of 2020, the company achieved operating income of 4.2 billion yuan, a year-on-year increase of 5.08%. In the year, Jinjia’s cigarette package business revenue fell by 13%. Although its color box product sales revenue increased by 10.04% year-on-year, it was not enough to make up for the decline in cigarette package revenue. The small growth of Jinjia's annual revenue is entirely dependent on the sales revenue of the new tobacco sector, which has increased by 118.36% year-on-year. Therefore, its orders for packaging and printing business in 2020 are still very weak.

Hexing Packaging: According to the 2020 annual report, Hexing Packaging achieved revenue of 12.007 billion yuan, an increase of 8.20% over the previous year and an increase of 910 million. However, in 2020, Hexing's supply chain services will generate 4.3 billion in revenue, an increase of 900 million from the 3.4 billion in 2019. This shows that in 2020, Hexing's main business packaging manufacturing business will stay in place, which is already very commendable.

Yutong Technology: In 2020, the company achieved annual operating income of 11.789 billion yuan, a year-on-year increase of 19.75%; net profit of 1.120 billion yuan, a year-on-year increase of 7.20%. The opening up of the upside is due to the multi-field layout in recent years, and the continuous release of the production capacity of the previous layout. In addition, while increasing the penetration rate of existing 3C customers such as Huawei, Xiaomi, OPPO, VIVO, and Dyson, Yutong Technology gradually cuts into the facebook and Baidu supply chain through smart hardware.

Shanying International: In 2020, it will realize operating income of 24.969 billion yuan, a year-on-year increase of 7.44%. The annual sales volume of the packaging segment was 1.47 billion square meters, a year-on-year increase of 11.17%. However, Shanying's large packaging business does not grow endogenously, but relies on external mergers and acquisitions to achieve growth. For example, in 2018, Shanying owned 20 packaging and printing companies, which increased to 28 in 2019, and 4 more in the first three quarters of 2020.

From these 17 annual reports of listed companies in the packaging and printing sector, it is not difficult to see that packaging orders in 2020 show a steady decline in listed companies (a few rely on expansion and acquisitions to maintain growth), and small and medium-sized enterprises are rapidly declining. This cold truth runs counter to the perception of most manufacturing professionals.

In fact, since 2020, all walks of life have faced the dilemma of increased operating costs, increased inventory of finished products, and substantial price increases of raw materials. Listed companies can still obtain a large amount of funds from the capital market at a very low cost, while most companies are suffering.

Data source: data collection office

Entering 2021, raw material price increases and financing difficulties, like two iron chains, are firmly tied to the necks of mid- and downstream companies, making it difficult to breathe. Editor Bao shared with you a set of data from Lao Man’s public account "Data Collection Office". From January to April this year, the scale of corporate financing was 6.69 trillion yuan, which was a sharp decline of 2.57 trillion yuan from the 9.26 trillion yuan in the same period in 2020. This actually means that my country's financial system will no longer lend money to companies that are about to break their cash flow on a large scale this year like last year. This is particularly unfavorable for most private small and medium-sized enterprises with low financing capabilities and high financing costs.

On the contrary, under inflation expectations, residents' enthusiasm for buying houses has risen, and residents' financing has risen sharply. From January to April this year, residents' financing of 3.09 trillion, compared with 1.87 trillion in the same period in 2020, has increased by 1.22 trillion. In the case of weak domestic demand, those people with higher net worth choose to invest their money in the real estate industry, which makes the consumption situation so uncomfortable!

There are not many orders and they dare not accept it, and corporate financing is difficult. This may be a common problem faced by the manufacturing industry at the moment. Just do it for yourself.