\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 186 China Railway Construction Corporation Limited(601186) )
Matters: the company issued its 2021 annual report. In 2021, it realized an operating revenue of 1020 billion yuan, an increase of 12.05% over the same period of last year; The net profit attributable to the shareholders of the listed company was 24.691 billion yuan, an increase of 10.26% over the same period of the previous year, and an increase of 9.07% after deducting non profits. Realize basic eps1 60 yuan, with a cash dividend of 2.46 yuan (including tax) for every 10 shares.
Operating revenue grew steadily and the structure of engineering contracting business continued to be optimized: the company achieved an operating revenue growth rate of + 12.05% in 2021, which was higher than the growth rate (+ 9.62%) in 2020, and generally maintained a steady growth rate, which was the second highest growth rate of revenue growth since 2014. Quarter by quarter, the company achieved year-on-year revenue growth of + 61.23%, + 12.79%, – 2.47%, – 0.62% from 2021q1 to Q4 respectively. From the perspective of business structure, the main businesses of the company achieved revenue and growth rate respectively (excluding inter segment offset): project contracting was 893820 billion yuan (year-on-year + 9.90%), real estate was 50.662 billion yuan (year-on-year + 23.78%), industrial manufacturing was 21.862 billion yuan (year-on-year + 21.13%), survey and design consulting was 19.42 billion yuan (year-on-year + 5.20%), and logistics trade was 103723 billion yuan (year-on-year + 35.36%). The proportion of project contracting business income reached 87.63% (year-on-year -1.72 PCT), which was the main source of income. During the period, the business structure of project contracting sector was continuously optimized, the proportion of housing construction and municipal business increased significantly, and the mining and prefabricated construction business developed rapidly. In addition, the real estate development business of the company achieved contrarian growth in 2021, with annual sales of 143.2 billion yuan and sales area of 9.9058 million square meters, with a year-on-year increase of 13.20% and 14.45% respectively. From the perspective of market structure, the revenue of domestic business reached 973045 billion yuan (year-on-year + 11.64%), accounting for 95.40% (year-on-year -0.35 PCT); The revenue of overseas business reached 46.966 billion yuan (year-on-year + 21.35%), accounting for 4.60% (year-on-year + 0.35 PCT), and the revenue at home and abroad increased rapidly. In terms of net profit growth, the growth rate of net profit attributable to the parent company was + 10.26%, down 0.61pct from the growth rate (+ 10.87%) in 2020. In a single quarter, the net profit attributable to shareholders of listed companies increased by + 68.50%, + 15.07%, + 0.04%, – 9.26% year-on-year in 2021q1 ~ Q4 respectively.
The gross profit margin has rebounded, and the cost rate control during the period is effective: in terms of gross profit margin, the company’s comprehensive gross profit margin reached 9.60% during the reporting period, an increase of 0.33 PCT compared with 2020. From the perspective of business structure, the gross profit margin of each main business is: engineering contracting 7.88% (year-on-year + 0.67 PCT), real estate development 17.56% (year-on-year -2.77 PCT), industrial manufacturing 22.67% (year-on-year -1.30 PCT), survey and design 33.06% (year-on-year -0.30 PCT), logistics trade 7.65% (year-on-year -2.07 PCT). The gross profit margin of engineering contracting business rebounded significantly during the period, which was the highest level in recent five years, driving the improvement of the level of comprehensive gross profit margin. In terms of period expenses, in 2021, the company’s period expense rate was 4.98% (year-on-year -0.13 PCT), including 0.60% (year-on-year -0.02 PCT), 2.03% (year-on-year -0.06 PCT), 1.99% (year-on-year -0.06 PCT) and 0.36% (the same as the same period). The company’s ability to reduce costs and control expenses continued to show, and the period expense rate has been declining since 2018. During the period, the company’s asset impairment and credit impairment losses increased by 6.141 billion yuan year-on-year, mainly due to the company’s provision for losses on financial assets such as receivables of customers in a real estate industry during the reporting period. The net profit rate of the listed company is 87.05% higher than that of the listed company in 2020, and the net profit rate is 2.05% higher than that of the listed company in 2020; Roe (average) is 9.44%, which is lower than the level in 2020.
The short-term net outflow of operating cash flow and the debt ratio decreased to the lowest level since listing: during the reporting period, the company’s operating net cash flow was -7.304 billion yuan, a year-on-year decrease of 47.413 billion yuan compared with the net inflow in 2020, mainly due to the increase in cash paid for goods and services during the period. Quarterly, the company’s 2021q1-q2 operating net cash flow was -50.135 billion yuan / – 6.051 billion yuan respectively, 2021q3-q4 net inflow of operating cash flow was 7.955 billion yuan / 40.927 billion yuan respectively. The net cash flow of investment was -61.070 billion yuan, an increase of 10.773 billion yuan compared with the net outflow in 2020, mainly due to the increase of external equity investment during the period. The net cash flow from financing was 10.602 billion yuan, a decrease of 27.637 billion yuan (- 72.27%) compared with the net inflow in 2020, mainly due to the year-on-year increase in cash paid for debt repayment within the period. According to the annual report, the year-on-year growth rate of the company’s short-term loans / other current liabilities / long-term loans during the period was -7.66% / 20.83% / 3.63% respectively. At the end of the reporting period, the company’s monetary capital balance was 126821 billion yuan, a decrease of 32.54% over the end of 2020. In terms of capital structure, the company’s asset liability ratio at the end of the period was 74.39%, a decrease of 0.37 PCT compared with the end of 2020, the lowest debt ratio since the company was listed. In terms of accounts and notes receivable, the company’s notes and accounts receivable at the end of the period were 168407 billion yuan, an increase of 17.00% year-on-year compared with the end of 2020, mainly due to the expansion of the company’s business scale during the period, and the accounts receivable increased by 23.85% year-on-year.
There are sufficient orders on hand to ensure sustainable development, and infrastructure leaders are expected to fully benefit from steady growth: the company has signed 2819652 billion yuan of new contracts in 2021, an increase of 10.39% over 2020. From the perspective of business structure, the newly signed contracts in the engineering contracting sector amounted to 241504 billion yuan, with a year-on-year increase of 8.54%, including railway yoy + 30.17%, highway yoy + 4.14%, urban rail transit yoy-13.73%, housing construction yoy + 13.41% and municipal business yoy-6.30%. The newly signed contracts in the railway business increased significantly, which mainly benefited from the launch of national key construction projects. The company gave full play to its industrial competitive advantages to maximize orders. The newly signed contracts in the non engineering contracting sector amounted to 409147 billion yuan, with a year-on-year increase of 22.67%, including survey and design yoy + 17.74%, industrial manufacturing yoy-1.24%, logistics trade yoy + 51.12% and real estate development yoy + 13.20%. From the perspective of regional structure, the newly signed contracts of domestic business reached 2562351 billion yuan, a year-on-year increase of 10.38%, accounting for 90.87%; Overseas business achieved 257.3 billion yuan of newly signed contracts, a year-on-year decrease of 10.52%, accounting for 9.13%. By the end of 2021, the outstanding contract amount of the company was 4854898 billion yuan, a year-on-year increase of 12.41%, equivalent to 4.8 times of the company’s operating revenue in 2021. During the 14th Five Year Plan period, infrastructure remains one of the important construction contents, the investment structure will be continuously optimized and the investment space will be continuously expanded. The main construction fields in 2022 include “two new and one heavy” major projects, the strategy of building a strong transportation country will be steadily promoted, and the investment plans for major projects in 2022 will be issued in many places. As one of the giants of China’s central infrastructure enterprises, the company is expected to continue to benefit from the increase in the growth rate of infrastructure investment.
Investment suggestion: we predict that the revenue growth rate of the company from 2022 to 2024 will be 11.2%, 10.0% and 10.0% respectively, and the net profit growth rate will be 10.1%, 9.6% and 10.9% respectively. The EPS will be 2.00 yuan, 2.19 yuan and 2.43 yuan respectively, maintaining the “Buy-A” investment rating of the company.
Risk tips: the risk of large macroeconomic fluctuations, the control of the epidemic situation is less than expected, the promotion of policies is less than expected, the risk of decline in the growth rate of China’s infrastructure investment, the risk of failure of overseas project implementation to meet expectations, the risk of project payment collection, etc.
