\u3000\u30 Beijing Zznode Technologies Co.Ltd(003007) 37 Keshun Waterproof Technologies Co.Ltd(300737) )
Event:
The company released its annual report for 2021, and achieved an operating revenue of 7.77 billion yuan, an increase of 24.6% at the same time; The net profit attributable to the parent company was 670 million yuan, with a decrease of 24.5%; Deduct the net profit not attributable to the parent company of 570 million yuan, with a decrease of 35.4%. The company’s revenue increased by 2.09 billion yuan in the same quarter; The net profit attributable to the parent company was -01 million yuan, up from 320 million yuan in the same period last year; Net profit deducted from non parent company was – 50 million yuan, compared with 310 million yuan in the same period of last year. 22q1, the operating revenue was 1.74 billion yuan, an increase of 18.7% at the same time; The net profit attributable to the parent company was 100 million yuan, with a decrease of 40.8%; Deduct the non parent net profit of RMB 80 million, with a decrease of 49.2%.
Comments:
The rise in cost superimposed the provision for asset impairment, which affected the performance in 21 years. In 2021, the delivery of the company maintained a steady growth, and the overall sales volume of waterproof materials was 456 million square meters, a year-on-year increase of + 29.5%. The growth rate of 21q4 revenue decreased to 9.8%, mainly due to the company’s implementation of the idea of stable operation and the initiative to reduce shipments to high-risk customers. The annual construction income of waterproof coiled materials, waterproof coatings and waterproof works was 4.55/16.8/1.53 billion yuan respectively, with a year-on-year increase of + 12.2% / + 46.2% / + 54.4%. As the prices of upstream raw materials such as asphalt and lotion rose sharply, the gross profit margin declined. The gross profit margin of waterproof coiled material, waterproof coating and waterproof engineering construction business was 32.7% / 22.1% / 23.0% respectively, with a year-on-year increase of -6.6pct / – 13.1pct / – 7.1pct. The company’s comprehensive gross profit margin was 28.5%, a year-on-year increase of -8.4pct. In addition, the provision for asset impairment of the company totaled 280 million yuan, of which the credit impairment loss (mainly accounts receivable) was 250 million yuan, eroding more profits.
22q1 cost pressure has not been relieved, and the expense rate has increased during the period. 22q1, the price of petrochemical products such as China Asphalt remained high. The average price of SBS modified asphalt in East China was 4270 yuan / ton, an increase of 17.5% at the same time. The gross profit margin of the company’s sales is 25.7%, with a decrease of 6.4pct; The net profit margin on sales was 5.7%, with a decrease of 5.7pct. During the period, the expense rate was 16.3%, year-on-year + 1.7pct, of which the sales / management / financial expense rate was 7.3% / 8.0% / 1.0%, year-on-year + 0.5 / + 0.6 / + 0.5pct respectively.
At present, there is still some pressure on operating cash flow. In 2021, the net cash flow from operating activities of the company was 610 million yuan, a year-on-year increase of + 10.7%; The cash to cash ratio was 0.9, with a year-on-year increase of -0.01. 22q1 net cash flow from operating activities was – 1.1 billion yuan, compared with – 270 million yuan in the same period of last year; The cash to cash ratio was 0.7, year-on-year -0.3; The net cash ratio was – 11.1, compared with – 1.6 in the same period last year. At present, the capital environment of the real estate chain has not been fundamentally reversed, and the return of the company’s funds is still affected. In addition, due to the impact of the epidemic on normal shipments and raw material reserves, the inventory increased significantly, 22q1 was 720 million yuan, a year-on-year increase of + 66.4%.
The company will strive to achieve the goal of annual sales revenue of more than 10 billion in 2022. Specific measures include: vigorously promote the dealer system and increase the number of dealers; Strengthen the development of high-quality real estate customers; Increase the proportion of non real estate income. In 2021, the company successfully acquired Fengze shares, entered the earthquake mitigation and isolation market, and explored the second growth point other than waterproof. On April 28, taking advantage of the platform financing advantages of listed companies again, the company plans to issue convertible bonds to unspecified objects, raising no more than 2.2 billion yuan for capacity expansion and replenishing cash flow. On April 29, the company announced to repurchase shares with its own funds of RMB 80-160 million, and the repurchase price is no higher than RMB 16 / share, demonstrating its confidence in long-term development.
Profit forecast, valuation and rating: at present, the policy direction of stabilizing real estate is clear. When the epidemic situation is alleviated and the effectiveness of policy transmission is brought into play, it is expected to see the inflection point of real estate fundamentals, and then consumer building materials will also usher in real allocation opportunities. We are optimistic about the realization of the company’s “10 billion” scale target. In view of the fact that the current cost side pressure has not been significantly relieved, we lowered the company’s 22-23 year return to parent net profit forecast to RMB 1.088 billion and 1.438 billion respectively (down 22.9% and 14.8%), and gave the company a 24-year return to parent net profit forecast to RMB 1.948 billion. Based on confidence in the company’s long-term growth, we maintained the “buy” rating.
Risk tips: the downstream real estate enterprises are short of funds, the demand for waterproof materials is less than expected, the cash flow continues to deteriorate, the upgrading range of waterproof material standards is less than expected, and the price of raw materials in the petrochemical industry chain rises.
