\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 862 Avic Aviation High-Technology Co.Ltd(600862) )
Key investment points
Event: the company released its 2021 annual report on March 15. The net profit attributable to the parent company was RMB 2023758 billion, a year-on-year increase of 4.858 billion, with a net profit attributable to the parent company of RMB 2023758 billion, a year-on-year increase of 4.858 billion. At the same time, the company issued an announcement on the forecast of related party transactions. In 2021, the actual sales of goods to affiliated units of aviation industry of related parties were 2.773 billion yuan, with a year-on-year increase of 18.75%. It is estimated that the amount of related party transactions in 2022 will be 3.8 billion yuan, with a year-on-year increase of 37.01%.
The main business of aviation composite materials has continued to grow at a high speed, and the transformation of machine tool business has achieved initial results. On the revenue side, the revenue in the single quarter of 2021 was RMB 991 million, RMB 943 million, RMB 916 million and RMB 957 million respectively, with a year-on-year growth rate of 28.55%, - 5.49%, 61.20% and 66.62% respectively. The company basically achieved the goal of balanced delivery. In terms of business, the new material business achieved a revenue of 3.612 billion yuan in 2021, with a year-on-year increase of 32.89%. As the company's largest main business, the new material business continued to maintain a high growth rate. The revenue of machine tool business was 118 million yuan, a year-on-year increase of 8.82%. On the profit side, the net profit attributable to the parent company in the single quarter of 2021 was RMB 237 million, RMB 146 million, RMB 185 million and RMB 23 million respectively, with year-on-year growth rates of 27.61%, 7.60%, 134.56% and - 23.78% respectively. While the revenue maintained growth, the company's profit in the fourth quarter fell year-on-year, mainly because the company spent RMB 89 million on research and development expenses in the fourth quarter, accounting for 58.65% of the whole year, with a year-on-year increase of 309.75%. In terms of business, in 2021, the aviation new materials division (with business transactions among the three reporting divisions) realized a net profit attributable to the parent company of 678 million yuan, with a year-on-year increase of 38.93%, and the profit of aviation new materials business continued to increase. The machine tool business segment realized a net profit attributable to the parent company of - 30 million yuan, with a year-on-year loss of 07 million yuan. The transformation of the machine tool business to the field of aviation special equipment has achieved initial results.
The profitability continued to improve and the operating condition improved significantly. In 2021, the gross profit margin of the company was 30.07%, with a year-on-year increase of 0.04pct, and the net profit margin was 15.53%, with a year-on-year increase of 0.73pct. In terms of business, the gross profit margin of new materials business was 30.90%, down 1.05pct year-on-year, mainly due to the increase of raw material procurement cost (up 39.68% year-on-year). The gross profit margin of machine tool business was 8.82%, with a year-on-year increase of 9.74pct, mainly due to the improvement of profitability brought by business transformation. In terms of period expenses, the company's three expenses accounted for 7.20% in 2021, with a year-on-year decrease of 3.14 PCT, of which the sales expense rate, management expense rate and financial expense rate decreased by 0.35, 2.61 and 0.19 PCT respectively, indicating a significant improvement in the company's management efficiency. The company's R & D expenditure was 151 million yuan, with a year-on-year increase of 66.86%, and the R & D expenditure rate was 3.97% (year-on-year + 0.86pct). Continuously increasing R & D investment is conducive to maintaining the company's long-term core competitiveness. In 2021, the net operating cash flow of the company was 382 million yuan, with a year-on-year increase of 145.27%. The high increase of cash flow indicates that the operating condition of the company has been greatly improved. At the end of 2021, the company's contract liabilities were 696 million yuan (year-on-year + 585 million yuan, month on month + 309 million yuan), indicating that the company has abundant orders on hand. The accounts receivable was 1.409 billion yuan (year-on-year + 617 million yuan, month on month -707 million yuan), and the inventory was 1.362 billion yuan (year-on-year -97 million yuan, month on month -342 million yuan), indicating the smooth delivery of the company's products.
The sales volume of related party transactions is expected to grow by 37.01%, and the demand for composite materials of Chinese military aircraft continues to be strong. In 2021, the company actually sold 2.773 billion yuan of goods to affiliated units of aviation industry, a year-on-year increase of 18.75%, which was lower than the expected 3.5 billion yuan (the actual completion rate was 79.34%), which was lower than the expected due to the change of product demand rhythm of some customers. It is estimated that the related party transaction volume will be 3.8 billion yuan in 2022, with a year-on-year increase of 37.01%, and the deposit limit will be increased from 2 billion yuan to 2.5 billion yuan. As the core supplier of aviation composite materials in China, the company has the triple advantages of shareholders, technology and industrial scale. It is expected to continue to benefit from the large volume of domestic military aircraft and the continuous increase of the consumption of composite materials of advanced military aircraft.
The smooth expansion of civil aviation business has opened up the company's long-term growth space. During the reporting period, the company continued to promote the application of prepreg, honeycomb and other materials in the field of civil aviation, and the delivery quantity of honeycomb export increased significantly year-on-year. One kind of interior honeycomb was selected into COMAC QPL catalogue. At the same time, the company was successfully selected as the only supplier of COMAC cr929 front fuselage work package, and the research and production work on C919, ag600 and other models has been steadily promoted. The subsidiary Youcai Baimu continued to promote the localization and replacement of civil aviation aircraft brake disc pair, and completed the airworthiness certification of one model aircraft brake disc pair and eight wheel brake accessories. In the field of commercial aeroengine, the company has completed the research and development of commercial aeroengine composite fan blades, runner sectors, cascades and other products. The market space of civil aviation far exceeds that of military aircraft. The company has outstanding technical ability in the field of aviation composite materials, and is expected to fully benefit from the recovery of civil aviation and the delivery and operation of domestic commercial large aircraft.
Investment suggestion: due to the substantial increase in R & D investment, the company's performance in 2021 is slightly lower than expected. We reduce the company's profit forecast. It is expected that the company's revenue in 20222024 will be RMB 5.085/65.71/8.181 billion respectively, the net profit attributable to the parent company will be RMB 848/11.75/1.543 billion respectively (the value before 202223 is RMB 1.085/1.573 billion), the corresponding EPS will be RMB 0.61/0.84/1.11 respectively, and the corresponding PE will be 37.8/27.3/20.8 times respectively, China's aviation composite material market has entered a period of rapid growth. The company has the strength of military products and actively distributes civil products. Its performance is expected to continue to grow at a high speed and maintain the "buy" rating.
Risk warning: the progress of military aircraft train loading is less than expected; The construction of civil aircraft project is less than expected; The transformation of machine tool business did not meet expectations; The risk that the performance forecast and valuation judgment do not meet the expectations.
