\u3000\u30003 Dongguan Winnerway Industry Zone Ltd(000573) 00057)
Event: Shantou Wanshun New Material Group Co.Ltd(300057) disclosed the annual report of 2021. In 2021, the company realized an operating revenue of 5.437 billion yuan, a year-on-year increase of 7.28%; The net profit attributable to the shareholders of the listed company was -44 million yuan, a year-on-year decrease of 156.99%. Among them, the revenue of 21q4 was 1.364 billion yuan, a year-on-year decrease of 5.68% and a month on month increase of 12.58%; The net profit attributable to the parent company is – 66 million yuan, which is converted from profit to loss; 2021q4 realized deduction of non net profit of – 70 million yuan.
The revenue of aluminum processing business increased at the same time, and the traditional paper packaging business decreased slightly. By business, 1) aluminum processing business contributed to the company’s main revenue: in 2021, the company’s aluminum processing business achieved a revenue of 2.849 billion yuan, a year-on-year increase of 11.12%. Among them, the sales volume was 123500 tons (aluminum foil + aluminum strip), a year-on-year decrease of 4.8%; The selling price of a single ton was 23100 yuan, a year-on-year increase of 16.7%. Since 2021, affected by the tight supply and demand in the aluminum foil market, the processing fee of aluminum foil in the industry has increased by more than 10%. In addition, the price of aluminum also rose from 1.6 in Q1 to 20000 yuan / ton in Q4, an increase of 23%. 2) The paper packaging business remained basically stable: in 2021, the company’s paper packaging business revenue was 507 million yuan, a slight decrease of 0.02% over the same period; The sales volume of paper packaging was 40000 tons, a year-on-year decrease of 3%. Affected by the rise of raw materials, the selling price of the company’s paper packaging business was 12700 yuan / ton, a year-on-year increase of 3.07%. 3) Functional film business: the rise of raw materials and epidemic situation and other factors affect the downstream demand. The company’s product structure changes and sells some long-term products with low price. The functional film business achieved a revenue of 333848 million yuan, a year-on-year decrease of 33.52%. Among them, the price of a single 10000 square meters decreased from 5784 in 2020 to 447900 yuan, a year-on-year decrease of 23%. Looking forward to the future, the company actively develops high-tech products such as carrier copper film and antireflection (AR) film. At present, it is in the downstream sample delivery verification link.
In 2021, the company was greatly affected by the price fluctuation of raw materials and impairment losses. 1) Aluminum processing business: due to the large fluctuation of raw material aluminum ingot price and aluminum price difference outside China in 2021, and the time difference between the company’s pricing date and delivery date, the single ton cost of direct materials in aluminum processing business increased from 15500 yuan to 18200 yuan, with a year-on-year increase of 17.62%. Under the background of upward processing fees in 2021, the gross profit per ton of the company’s aluminum processing business was 2273 yuan, a slight increase of 0.51% year-on-year; The gross profit margin decreased from 11.4% to 9.9%, a year-on-year decrease of 1.58pcts. 2) Paper packaging business: in 2021, the price of raw materials such as white cardboard increased, the direct material cost increased from 8618.3 yuan to 956973 yuan / ton, with a year-on-year increase of 11.04%, and the gross profit per ton decreased from 27 yuan to 2200 yuan, with a year-on-year decrease of 20.1%. 3) Functional film business: due to the fierce competition in the downstream market, the company accrued 285331 million yuan of goodwill impairment loss for its subsidiary Shantou Dongtong photoelectric materials Co., Ltd., 154457/447091 million yuan of fixed assets, inventory depreciation loss and contract performance cost impairment loss respectively, with a total asset impairment of 747871 million yuan.
The improvement of traditional business is on the way, and the adverse factors are expected to gradually weaken in 2022. 1) Raw material fluctuation risk: the company actively responded to the raw material risk. From 2021q4, the company adjusted the settlement pricing period with most customers to shorten the pricing and delivery time to reduce the risk of aluminum price fluctuation. In addition, the company strengthened the management of inventory and loan return, and used hedging and other means to hedge risks. 2) Asset impairment risk: according to the company’s disclosure, the above asset impairment is unsustainable.
The aluminum foil leader will start again and actively layout the battery aluminum foil business. 1) In 2021, the company’s battery aluminum foil business trial bull knife: the company’s battery aluminum foil sales volume in 2021 was 2886 tons, with a year-on-year increase of 825%. Customers include Ningde BofA, youfoil talents, Ruipu energy, Huzhou Tianfeng and other companies. At the same time, the sales volume of battery aluminum foil blank of the company was 23000 tons, with a year-on-year increase of 155%. Customers include Limu new materials, Yongjie new materials, changaluminum, Huabei aluminum, etc. 2) Looking forward to the future, we will make great strides in the field of battery aluminum foil: the company is currently producing 40000 tons of battery aluminum foil, and has successfully entered the Contemporary Amperex Technology Co.Limited(300750) supply chain system; The phase II 32000 ton project has been started. In January 2022, the company announced that it plans to raise no more than 1.7 billion yuan to invest in the field of 100000 tons of power and energy storage battery aluminum foil and continue to develop the field of battery aluminum foil. In addition, the company accelerated the layout of upstream raw materials, invested 1.192.2 billion yuan to establish Sichuan Wanshun Zhongji aluminum industry, and planned 130000 ton aluminum sector and strip project (including 80000 tons of battery aluminum foil blank) to further reduce costs.
Profit forecast and investment suggestions: it is assumed that the output of battery aluminum foil in 2022, 2023 and 2024 will be 3.5/5.370000 tons respectively, and other traditional businesses such as paper packaging will remain unchanged. We adjusted the net profit of the company in 2022, 2023 and 2024 to 278, 375 and 450 million yuan respectively (the value before 20222023 is 302 / 375 million yuan. According to the production schedule of the company’s battery aluminum foil, we mainly adjusted the shipment of battery aluminum foil in 2022 from 40000 tons to 35000 tons). As of March 29, 2022, the market value was 5.4 billion yuan, corresponding to 19 / 14 / 12x PE from 2022 to 2024, maintaining the “buy” rating of the company.
Risk warning events: price fluctuation of main products, raw material cost fluctuation, industrial policy change, project progress is less than expected, the risk of decline in processing fees due to increased market competition, and the risk of lag in the use of public information in research reports.
