\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 114 Nbtm New Materials Group Co.Ltd(600114) )
Event: Recently, the company released the annual report of 2021 and the first quarterly report of 2022.
Short term performance pressure; In 2021, the revenue increased by 9.4% year-on-year; Revenue in the first quarter of 2022 increased by 3.7% year-on-year
In 2021, the company achieved a revenue of 3.6 billion yuan, a year-on-year increase of 9.4%, a net profit attributable to the parent company of 26 million yuan, a year-on-year decrease of 70%, and a cash flow from operating activities of 260 million yuan, a year-on-year increase of 110%. The gross profit margin of sales / net profit margin of sales was about 22% / 1%, down 1.1/1.9pct respectively year-on-year. The main reasons for the decline in performance are: 1) the rise in the price of raw materials; 2) Rising international logistics costs; 3) Provision for goodwill impairment in MIM segment; The overall performance is in line with the previous performance forecast. In 2022q1, the company achieved a revenue of 900 million yuan, a year-on-year increase of 4%; The net profit attributable to the parent company was 6.89 million yuan, a year-on-year decrease of 85%. The decline in performance in the first quarter was mainly due to 1) the rise in the price of raw materials; 2) Rising energy costs; 3) Equipment depreciation and amortization increased.
Soft magnetic business (SMC) is in the high boom growth channel of the industry, and its revenue increased by 64% year-on-year
SMC: after in-depth study of the development strategy of SMC, the revenue of this sector was about 500 million yuan in 2021, with a year-on-year increase of 64%, accounting for about 14% of the total revenue. The construction of Shanxi base with an annual output of 6000 tons was started in December 2021 and is expected to be put into operation in July 2022. The acquisition of dongmukeda and deqingxinchen new materials was completed in March 2022 to further integrate the SMC sector. It is expected to continue to benefit from the rapid growth of new energy (photovoltaic inverter, high-efficiency power supply, new energy vehicle / charging pile) industry in the future.
The traditional powder metallurgy (PM) sector grew steadily; Metal injection molding (MIM) accelerates integration and base layout
PM: in 2021, the revenue of PM sector was about 1.87 billion yuan, with a year-on-year increase of 15%, accounting for about 53% of the total revenue. In 2021, the company focused on the research and development of common parts between new energy vehicles and traditional fuel vehicles, focused on the development of structural parts in the non automotive field (the sales amount of electric tools increased by 41% year-on-year in 2021), and explored the value extension of PM business in the direction of finishing and assembly. In the future, the company is expected to maintain the steady growth of PM business by strengthening technology research and development and actively exploring overseas markets.
MIM: in 2021, the revenue of MIM sector was about 1.18 billion yuan, a year-on-year decrease of 9%, accounting for about 33% of the revenue. The company has accelerated the MIM sector integration and base layout. At present, the relocation of the old plant in Shanghai has been completed, and the phase I of Jiangsu Lianyungang Port Co.Ltd(601008) base is close to the conditions for operation. The profitability of the business is under pressure in the short term. With the continuous promotion of integration, the future performance is expected to be repaired.
The company expects to achieve a revenue of 4.1 billion yuan in 2022 and expects the coordinated development of the three major businesses in the medium and long term and the recovery of profitability
As the leader in China's other material manufacturing field, the three sectors of PM / MIM / SMC belong to the new material powder metallurgy manufacturing branch. With the further integration of the company, the three sectors are expected to achieve the operation effect of "1 + 1 + 1 3" in the future. Previously, the reversal of PM revenue and the continuous high growth of SMC revenue have been verified. In the medium and long term, the further integration of the company's MIM business will rebound the company's profitability. The company expects to achieve revenue of 4.1 billion yuan in 2022.
Profit forecast
Considering the company's integration, epidemic situation and other factors, it is estimated that the net profit attributable to the parent company from 2022 to 2024 will be RMB 230 / 3.3 / 450 million respectively, with a year-on-year increase of 804% / 40% / 37%, corresponding to pe16 / 12 / 8x. Maintain the company's "buy" rating.
Risk tips
1) the epidemic situation repeatedly affects the operation; 2) Substantial fluctuations in raw material prices affect profitability.
