\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 660 Fuyao Glass Industry Group Co.Ltd(600660) )
Event: the company released its annual report for 2021, achieving an operating revenue of 23.603 billion yuan, up 18.57% year-on-year, and a net profit attributable to the parent company of 3.146 billion yuan, up 20.97% year-on-year.
Comments:
In the past 21 years, the company’s operating performance grew steadily, and the gross profit margin and net profit margin remained basically stable. (1) In the whole year, the company achieved an operating revenue of 23.603 billion yuan, a year-on-year increase of 18.57%; The total profit was RMB 3.819 billion, a year-on-year increase of 22.81%, and the net profit attributable to shareholders of listed companies was RMB 3.146 billion, a year-on-year increase of 20.97%. Among them, the exchange loss was 528 million yuan, and the exchange loss in the same period of last year was 422 million yuan; After deducting the impact of exchange gains and losses, the total profit increased by 23.07% year-on-year. (2) The annual gross profit margin was 35.90%, a slight decrease of 0.60pct year-on-year; The annual net interest rate was 13.32%, a year-on-year increase of 0.27pct. The decrease in gross profit margin was mainly due to the rise in sea freight and soda ash prices, in which the gross profit margin affected by sea freight decreased by 0.98 PCT year-on-year and that affected by soda ash decreased by 0.45 PCT year-on-year. (3) Fuyao’s business situation in the United States has improved significantly. Fuyao America achieved a revenue of RMB 3.896 billion and a net profit of RMB 273 million in 2021. Affected by the epidemic in the same period last year, Fuyao’s total profit in the United States was US $8.921 million.
Q4 achieved the highest single quarter revenue in history. (1) 21q4 achieved an operating revenue of 6.45 billion yuan, an increase of + 5.22% year-on-year and + 14.97% month on month; It is the highest single quarter revenue in the company’s history. (2) The net profit attributable to the parent company of 21q4 was 550 million yuan, a year-on-year decrease of 37.36% and a month on month decrease of 33.49%; The net profit attributable to the parent company after deduction was 440 million yuan, a year-on-year decrease of 44.96% and a month on month decrease of 39.05%. The lower than expected net profit was mainly due to exchange losses, shipping costs and the rise in soda ash prices.
With the reform and development of the industry, the pulling effect of the company’s high-end and high value-added products is obvious. With the development of the new four modernizations of automobile, more and more new technologies are integrated into automobile glass, which provides new opportunities for the development of automobile glass industry. The proportion of high value-added products such as intelligent panoramic ceiling glass, dimmable glass, head up display glass and super insulating glass is increasing. The company’s skyline glass and HUD windshield and other products are gradually infiltrated, which is expected to accelerate the improvement of single vehicle consumption and single vehicle ASP. In the past 21 years, the proportion of high value-added glass such as thermal insulation, head up display and dimmable lighting increased by 3.31 percentage points compared with the same period last year, and the proportion of high-end products is expected to continue to increase.
Overseas markets reflect profit elasticity, and Fuyao America is expected to open up new space. Fuyao United States achieved a revenue of RMB 3.896 billion and a net profit of RMB 273 million in 2021; The total profit of Fuyao in the same period was US $3.92 million, including US $5.92 million, which was greatly affected by the epidemic in the United States. We expect that as the overseas epidemic eases and production capacity continues to climb, North American factories are expected to continue to contribute to profit elasticity. In the long run, Fuyao America will become another “springboard” for Fuyao to enter Europe, or create another “Fuyao”.
Investment suggestion: the company has achieved steady growth in business performance in the past 21 years. In the medium and long term, the pulling effect of high-end and high value-added products is obvious, the proportion of high-end products continues to increase, and the leading position and competitiveness in subdivided fields remain unchanged, which is expected to accelerate global penetration. Considering that the impact of raw materials and shipping costs on the company’s gross profit in 22 years may continue, we lowered the company’s net profit attributable to the parent company in 22 and 23 years from 4.81 and 5.71 billion yuan to 3.85 and 4.51 billion yuan, corresponding to EPS of 1.47 and 1.73 yuan / share, maintaining the “buy” rating.
Risk tip: the demand for automobiles is less than expected, the price of raw materials and shipping costs continue to rise, and the company’s new business development is less than expected.
