Ad shares ( Yonggao Co.Ltd(002641) )
The annual revenue grew rapidly, and the profit side was under pressure
On the evening of April 11, the company released its annual report for 21 years. In the past 21 years, the company achieved a revenue of 8.88 billion yuan, a year-on-year increase of + 26.2%, and a net profit attributable to the parent company of 580 million yuan, a year-on-year increase of – 25.0%. The company’s annual revenue still achieved a high growth, and the performance was slightly lower than the previous performance express. Quarter by quarter, the revenue of 21q1-4 company in a single quarter was + 87% / + 21% / + 24% / + 10% year-on-year respectively, and the net profit attributable to the parent company was + 98% / – 26% / – 59% / – 6% year-on-year respectively. Since 21q2, the profit side of the company has been under obvious pressure due to the repeated epidemic, the rise of raw material prices and real estate regulation.
The sales volume increased steadily, and the rising price of raw materials led to the decline of profitability
In terms of business, the company achieved 729000 tons of plastic pipeline sales in 21 years, with a year-on-year increase of + 12.6%, and the average sales price was 10600 yuan / ton, with a year-on-year increase of + 10.3%. The average price rise was related to the rise of raw material prices; The revenue from pipe business was 7.76 billion yuan, a year-on-year increase of + 24.3%, of which PVC / PE / PPR pipes achieved a revenue of 4.45/16.7/1.36 billion yuan respectively, accounting for 50% / 19% / 15% respectively, accounting for + 2.0 / – 2.9 / + 0.3pct respectively compared with 20 years; In 21 years, the gross profit margin of the company’s sales was 18.8%, with a year-on-year increase of – 6.8pct; the gross profit margin of plastic pipes was 20.3%, with a year-on-year increase of – 7.1%. The gross profit margin of PVC / PE / PPR was 13.2% / 22.3% / 39.7% and – 8.2 / – 6.6 / – 4.2pct respectively, mainly due to the sharp year-on-year increase of 30% in the price of raw materials such as resin in 21 years. The price adjustment of the company could not fully transmit the price pressure of raw materials, resulting in a significant decline in the gross profit margin.
The ability of cost control is enhanced, and the cash flow is tight
During the 21 years, the company’s expense rate was 11.7%, with a year-on-year increase of -1.5pct, of which the sales / management / R & D / financial expense rate changed by -1.1/0.1 / – 0.2/0.04pct respectively year-on-year. With the increase of revenue, the company’s expense control ability was enhanced. In the 21 years, the net operating cash flow of the company was 340 million yuan, with a year-on-year ratio of – 68.3%, a cash to receive ratio of 105.4%, a year-on-year ratio of – 3.7pct, a cash to pay ratio of 113.5%, and a year-on-year ratio of – 2pct. We believe that the rise in the price of raw materials and the tension in the real estate capital chain led to the increase in the company’s accounts receivable and inventory, which made the company’s cash flow more tense; In 21 years, the company’s assets and credit impairment losses totaled -52 million yuan, with an additional loss of 27 million yuan year-on-year. The company changed the provision for impairment of Evergrande’s receivables from aging combination to individual provision, which increased the credit impairment loss, thus forming a certain erosion on the profit side.
Capacity is expected to continue to release, medium and long-term profit growth is supported, and the “buy” rating is maintained
By the end of the 21st century, the company had a plastic pipeline production capacity of more than 1 million tons. Except for the production bases in Shanghai and Shenzhen, the production capacity of other production bases could be improved. The real estate end of 22q2 is expected to hit the bottom and pick up. With the increase of plastic pipeline demand brought by pipe network investment during the 14th Five Year Plan period, the scale effect of the company is still expected to appear gradually in the future. With the accelerated pace of integration in the industry, the continuous release of the company’s production capacity and the further optimization of channel layout are expected to support the growth of medium and long-term profits, and the optimization of cost control is expected to drive the increase of gross profit margin. Considering that the price of raw materials has decreased since 22q1 compared with 21q4, and the company is expected to lock the price of raw materials through hedging, the net profit attributable to the parent company in 22-24 years is expected to be RMB 710 / 86 / 10.1 billion (the value was RMB 680 / 850 million in 22-23 years ago), With reference to the valuation of comparable companies, 11 times PE in 22 years is given, corresponding to the target price of 6.38 yuan (the previous value of 5.50 yuan), and the “buy” rating is maintained.
Risk warning: the price rise of raw materials exceeds expectations; Real estate policy continued to tighten; Capacity release was less than expected.
