\u3000\u3 Guocheng Mining Co.Ltd(000688) 239 Guizhou Aviation Technical Development Co.Ltd(688239) )
In 2021, the net profit attributable to the parent company was + 91.13%, which reflected the scale effect and significantly enhanced the profitability
The company released its 2021 annual report. The company achieved an annual operating revenue of 960 million yuan, a year-on-year increase of + 43.11%. The operating revenue achieved sustained and stable growth, mainly due to the increase of market and customer demand in the downstream aviation, aerospace, gas turbine and energy equipment fields of the company. The net profit attributable to the parent company was 139 million yuan, with a year-on-year increase of 91.13%, and the net profit deducted from non attributable to the parent company was 124 million yuan, with a year-on-year increase of 76.25%, which exceeded the expected growth; The gross profit margin of sales was 32.60%, with a year-on-year increase of + 3.76 PCTs; The net profit margin on sales reached 14.48%, a year-on-year increase of + 3.64pcts. Under the large-scale effect, the company further reduced costs and increased efficiency, and its profitability was significantly improved.
By product, the aviation forging business achieved a revenue of 669 million yuan, a year-on-year increase of + 29.99%, and a gross profit margin of 32.55%, a year-on-year increase of + 2.14 PCTs; The aerospace forging business achieved a revenue of 150 million yuan, a year-on-year increase of + 97.71%, and a gross profit margin of 31.50%, a year-on-year increase of + 4.27 PCTs; The gas turbine business achieved a revenue of 38 million yuan, a year-on-year increase of + 60.54%, and a gross profit margin of 34.34%, a year-on-year increase of + 7.42%; The energy forging business achieved a revenue of 65 million yuan, a year-on-year increase of + 112.41%, and a gross profit margin of 40.56%, a year-on-year increase of + 17.10 PCTs; Other forging business achieved a revenue of 22 million yuan, a year-on-year increase of + 107.32%, and a gross profit margin of 38.73%, a year-on-year increase of + 29.52 PCTs.
We believe that many new aeroengines in China are in the accelerated landing period of converting the models under research to batch production, and the company has participated in the synchronous development of ring forgings of many pre research and under research aeroengines in China. The research participation and flow share of parts and components in the new generation of aeroengine models are expected to be higher than those of mature models, and it is expected to benefit more fully from the new aeroengine entering the batch production and volume period, Enter the track of long-term and high-speed growth. At the same time, the company may usher in the improvement of capacity utilization brought by the optimization of product structure (small batch and multiple varieties affect capacity allocation). At the same time, with the addition of the decline of marginal cost under the scale effect after the climbing of new products (including the reduction of allocation of fixed costs and the decline of variable costs caused by manufacturing upgrading), the profitability will enter the track of continuous improvement on the basis of large-scale.
The foreign trade business will gradually recover or return to the pre epidemic level in 2022
In 2021, the company's overseas business achieved a revenue of 195 million, a year-on-year increase of + 50.58%, returning to 84.49% of the overseas revenue in 2019 before the epidemic. The impact of the epidemic on production has been significantly controlled, and the overseas business has accelerated the recovery. We expect that with the covid-19 epidemic gradually controlled worldwide, overseas civil aviation engine business orders are expected to further resume.
Prepayment + 131.55%, actively preparing for production and goods, and accelerating product delivery
At the end of 2021, the company's advance payment reached 52 million yuan, a year-on-year increase of + 131.55%. The book balance of raw materials in inventories at the end of the period was 289 million yuan, an increase of 50.46% over the same period of last year; The book balance of products was 120 million yuan, an increase of 109.86% over the same period last year. The company is in the stage of active production and goods preparation, and the delivery speed of products may continue to improve.
Raise funds to expand core production capacity and promote the digital upgrading of aviation forging system
The investment project raised by the company's IPO is mainly used for the construction of precision manufacturing industrial park of special alloy ring rolled forgings for aeroengines and gas turbines. It is expected to be put into operation in August 2022 and reach full production after two years of operation. After reaching the production capacity, it is expected to increase the sales revenue by 1.162 billion yuan per year, which is 121.03% of the revenue in 2021, and increase the average annual net profit by 185 million yuan (including two years of construction period). We believe that the new capacity will continue to help the company increase the scale of operating revenue, reduce production costs, optimize the company's financial indicators, and further improve profitability and market share.
Profit forecast and rating: we believe that the company's main business will benefit from the accelerated assembly and upgrading of our military's aviation equipment during the 14th Five Year Plan period, and is expected to maintain rapid growth in the next three years; At the same time, with the landing of domestic large aircraft projects and the reduction of the impact of the epidemic on the overseas commercial aviation market, the company's ring forgings and other businesses in the commercial direction are expected to achieve leapfrog volume. Due to the obvious rise in nickel price recently affecting the purchase price of raw materials purchased by the company, we adjusted the net profit attributable to the parent company from 218 / 325 million yuan to 206 / 303 million yuan in 20222023, and 400 million yuan in 2024, with a corresponding P / E of 35.42/24.05/18.20x, maintaining the "buy" rating.
Risk warning: the risk of military products business fluctuation; Risk of raw material supply; The risk that the progress and income of the raised investment project do not meet the expectations, etc.
