Ad shares ( Yonggao Co.Ltd(002641) )
The company released the first quarterly report of 2022 on April 28. In the first quarter, the operating revenue was 1.71 billion yuan, an increase of 8.1% at the same time; The net profit attributable to the mother was 32.22 million yuan, down 57.1% at the same time.
Key points supporting rating
In the first quarter, the income increased and the profit decreased, and the cash flow performance was relatively stable. In the first quarter, the operating revenue was 1.71 billion yuan, an increase of 8.1% at the same time; The net profit attributable to the mother was 32.22 million yuan, down 57.1% at the same time; The cash flow from operating activities was 2.57 billion yuan, an increase of 4.3% and the net operating cash was 300 million yuan, a decrease of 5.9%; Earnings per share is 0.03 yuan / share. In the first quarter, the company’s revenue growth was still robust, but the cost pressure remained unabated, and the net profit decreased significantly year-on-year. Cash flow performance remained stable, basically flat year-on-year.
Seasonal factors and cost pressure jointly compressed the profit space: the comprehensive gross profit margin of Q1 company was 15.9%, down 4.1pct year-on-year and 3.2pct month on month; The net interest rate was 1.9%, down 2.9pct year-on-year and 6.7pct month on month. In the first quarter, the four expense rates of sales / management / R & D / finance were 4.3 / 5.9 / 3.5 / – 0.8% respectively, with a month on month increase of 1.7 / 2.1 / 0.7/ and a decrease of 0.4pct respectively. The four expense rates totaled 12.9%, with a month on month increase of 4.2pct and a year-on-year decrease of 0.9pct.
The leader accelerates regional expansion and is optimistic about medium and long-term development: the company’s strategic plan is to deeply cultivate the plastic pipeline product market dominated by PVC in East China. At present, the market development is progressing smoothly and the industry position is stable. We continue to be optimistic about the company’s market development in advantageous areas, and at the same time, we are optimistic about the company’s market development in weak areas through channel sinking, municipal engineering and real estate. This year’s steady growth policy is relatively clear. As an important starting point, infrastructure and real estate are expected to gradually develop in the second and third quarters, and the company may benefit first.
Valuation
Considering that the pressure on raw materials is still high and it is difficult to reduce expectations, we partially lowered the original profit forecast. It is estimated that the company’s revenue will be 10.4 billion yuan, 12.01 billion yuan and 13.63 billion yuan respectively from 2022 to 2024; The net profit attributable to the parent company was RMB 700 million, RMB 840 million and RMB 1 billion respectively; EPS was 0.57, 0.68 and 0.81 yuan, maintaining the company’s buy rating.
Main risks of rating
Rising raw material prices, intensified market competition, overcapacity and bad debt risk of a single customer.
