On April 25, Jiangsu Linyang Energy Co.Ltd(601222) released the annual report of 2021 and the financial report of the first quarter of 2022. In 2021, the company realized an operating revenue of 5.297 billion yuan and a net profit attributable to the parent company of 930 million yuan; The company’s net assets increased by 31.69% year-on-year, exceeding 14.4 billion yuan. Although the performance fluctuated slightly in the short term in 2021, according to the announcements of project winning, major business cooperation and investment successively issued by the company in 2021, the company has obvious highlights in business layout and other aspects. In the first quarter of 2022, the company made a good start, with an operating revenue of 984 million yuan, a year-on-year increase of 2.93%; The net profit attributable to the parent company was 179 million yuan, a year-on-year increase of 3.68%.
In particular, according to the company’s annual profit distribution plan, the company plans to distribute a cash dividend of RMB 2.20 (including tax) to all shareholders for every 10 shares in 2021. According to the calculation of deducting the shares in the special repurchase account from the current total share capital, the amount of cash dividend is about 453 million, accounting for 48.64% of the net profit attributable to the parent company; The proportion of dividend amount plus 21-year repurchase amount in the net profit attributable to the parent company is 55.64%. In this regard, the company said that the dividend scheme comprehensively considered the financial situation and rewarded all investors based on the company’s sufficient confidence in the future stable operation and sustainable business development.
According to the annual report data, the company’s smart sector achieved a revenue of RMB 2.089 billion in 2021, accounting for about 39% of the total revenue. As one of the current Jinniu businesses of Linyang, the smart sector has always been in the forefront of the centralized bidding market of State Grid and South Grid in its traditional smart meter business. At the same time, in order to seize the opportunity of building a new power system with new energy as the main body in China, the company accelerated the expansion of its product line. The distribution network products developed by its subsidiary Linyang electric, such as new station area integration terminal, distribution automation terminal, 10kV on column circuit breaker, primary and secondary integration complete set of on column circuit breaker, successively passed the pre qualification of the State Grid in 2021, and the products were sold in many provinces and cities. The company adheres to the development of globalization. At present, its products have covered more than 30 countries and regions around the world.
Judging from the recent accelerated layout of the company in new energy, Jiangsu Linyang Energy Co.Ltd(601222) will show good growth in new energy business in the future. According to the annual report, in 2021, Linyang new energy sector achieved a revenue of 3.037 billion yuan, accounting for about 57% of the total revenue. Among them, during the reporting period, the company owned about 1.6gw of various photovoltaic power stations, generated nearly 2 billion kwh of green power, realized 1.454 billion yuan of power generation revenue, and the gross profit margin exceeded 70%; The company’s EPC business achieved a revenue of about 1.48 billion yuan and a gross profit margin of about 16%. By the end of 2021, Linyang operation and maintenance photovoltaic projects had exceeded 3.5gW and reserve photovoltaic projects had exceeded 6Gw.
Driven by the “double carbon goal”, in order to further consolidate its competitive advantages in the field of photovoltaic power station investment, operation and system integration, Lin Yang has accumulated a lot and made little progress by relying on the 10-year accumulation and business layout in the field of new energy. A number of heavy cooperation will be launched in 2021. According to the statistics of public data, Jiangsu Linyang Energy Co.Ltd(601222) obtained more than 1.5gw of ground power stations in Jiangsu, Shandong, Anhui, Hebei and Hubei in 2021 In addition, the company also signed an investment cooperation agreement with the people’s Government of Wuhe County, Anhui Province, and invested in the construction of 2gw new energy power generation project in Wuhe County through the combination of “Fengguang storage +” mode and local characteristics. At the same time, the company has successively expanded the cooperation circle with Huaneng new energy Co., Ltd., Hubei and Anhui branches of SDIC, Hubei Energy Group Co.Ltd(000883) , Guangxi Beitou energy investment group, Huawei Digital Energy Technology Co., Ltd. and other well-known companies by means of joint venture and cooperation, so as to accelerate the depth and breadth of new energy business layout.
Based on Lin Yang’s accelerated layout of the above new energy business, the company is full of confidence. In 2022, it will continue to strengthen the development of China’s affordable projects and large-scale new energy base projects, explore new strategic markets, and actively carry out strategic cooperation with central and state-owned enterprises in the mode of “development + EPC + operation and maintenance”. According to the company’s annual report, the company plans to start the construction of about 2.5gw new energy projects in 2022.
It is worth noting that in addition to the development, construction and operation of various new energy power stations, Jiangsu Linyang Energy Co.Ltd(601222) also actively participates in the power market transaction, enjoys the green power asset transaction dividend and promotes the asset value. It is reported that in the fourth quarter of 2021, Jiangsu Linyang Energy Co.Ltd(601222) as the operator of new energy photovoltaic power station, participated in the annual transaction of power marketization in Jiangsu Province in 2022 for the 45MW photovoltaic parity power station project located in Guannan, Jiangsu Province, and successfully signed the annual bilateral negotiation transaction contract. According to the calculation, the kwh electricity price of Jiangsu Linyang Energy Co.Ltd(601222) participating in the market-oriented transaction this time is about 7.82 points higher than the benchmark electricity price of desulfurization coal in Jiangsu Province of 0.391 yuan / kWh, with an upward proportion of 20%.
Jiangsu Linyang Energy Co.Ltd(601222) said that if more provinces incorporate new energy into electricity market-oriented trading in the future, the company can make full use of the business layout and experience accumulated in the field of new energy for many years, actively participate in new energy electricity market-oriented trading, show the advantages of green power in carbon emission and energy consumption control through premium, and constantly explore a more efficient and high-quality new energy business model.
With the determination of the “30.60” double carbon target, in the construction of a new power system with new energy as the main body, energy storage, as the key technology and basic equipment supporting the new power system, will have a deeper integration relationship with new energy. Since 2021, national policies related to energy storage have been issued frequently to continuously assist the industry, especially the new energy side energy storage, showing a good momentum of rapid growth. Recently, policy documents such as the implementation plan for the development of new energy storage in the 14th five year plan and the plan for the modern energy system in the 14th five year plan have been released one after another, clarifying the development objectives and key directions of new energy storage in the next five years. Up to now, including the national energy administration, about 18 provinces including Hebei, Shandong, Anhui and Hubei have successively issued relevant policies requiring new energy power generation to be equipped with energy storage systems with an installed capacity of 5% – 20% and a charging time of 1-2 hours.
In 2021, Lin Yang grasped the explosive growth opportunity of China’s energy storage market and strategically laid out the energy storage business sector with the focus on building competitive energy storage products, system solution suppliers and innovative “centralized shared energy storage” operation business model. It is reported that in order to enhance the competitiveness of the company in the new round of development of the energy storage market, the company attaches great importance to improving the upstream and downstream industrial chain layout of energy storage.
During the reporting period, Lin Yang basically achieved full coverage of key industrial chain nodes of energy storage through joint ventures and cooperation. In 2021, the company and Hubei Yiwei Power Co., Ltd. jointly funded the establishment of a joint venture Jiangsu Yiwei Linyang Energy Storage Technology Co., Ltd., with an investment of 3 billion yuan to build a production base project of lithium iron phosphate battery for energy storage with an annual capacity of 10gwh. At present, the project has started construction and is expected to be completed and put into operation in 2022. At the same time, the company signed a strategic cooperation framework agreement with Huawei Digital Energy Technology Co., Ltd. to jointly develop innovative products and system solutions related to large-scale lithium-ion energy storage, and jointly create a high-safety and cost-effective system solution for energy storage based on lithium iron phosphate energy storage battery.
2021 is the first year of the 14th five year plan. Linyang energy storage business takes the lead in promoting the construction of new energy supporting energy storage by means of “centralized shared energy storage power station” in the industry, and improves the energy storage income on the power generation side of new energy through the innovative business model of “energy storage capacity leasing + auxiliary service income”. At present, energy storage projects based on this model are rapidly and orderly promoted in Jiangsu, Anhui, Hubei and other provinces. Among them, the construction of Hubei Xiantao 200MW photovoltaic + 120mwh shared energy storage project has been started, and the Anhui Bengbu Wuhe scenery storage integration base project has recently been included in the “list of Anhui power source network load storage integration and multi energy complementarity pilot projects”, in which the scale of supporting energy storage power station reaches 540mw / 1.08gwh, and the phase I project has been started. At the same time, the company actively promoted in-depth cooperation with central enterprises and strategic partners in energy storage business. During the reporting period, the company signed a number of energy storage cooperation agreements to provide partners with new energy supporting energy storage power station system integration solutions. According to the data of the annual report, the various energy storage projects currently reserved by Lin Yang have exceeded 3gwh. In 2022, the company will seize the explosive growth opportunity of the energy storage market, create innovative energy storage system integration advantages and “centralized shared energy storage” operation business model, build a large-scale energy storage pack phase I project 2gwh in 2022, and plan to build 5gwh energy storage projects in the next three years.
In addition to the business layout of “intelligence, new energy and energy storage”, Lin Yang’s bright spot in cash flow is also commendable. According to the annual report data of 2021, the company’s overall cash flow performance is good, and the net cash flow generated from operating activities is 1.055 billion yuan, which is mainly due to the stable performance contribution of the company’s smart sector business, the stable cash flow of photovoltaic power station electricity revenue and the risk control of the photovoltaic EPC system integration business model for the development of live station resources. By the end of 2021, the company’s asset liability ratio was 29.41%, and the overall financial performance showed good anti risk ability. At the same time, the monetary capital and trading financial assets in hand reached 4.414 billion yuan, which can fully contribute to the high-quality development of the company’s business in the future.
According to the company’s annual report, Jiangsu Linyang Energy Co.Ltd(601222) 2022 will strive to achieve the goal of operating revenue exceeding 8 billion yuan by actively promoting the business landing of smart grid, new energy and energy storage.
