Among them, Q2 achieved operating income of 595 million yuan in a single quarter, an increase of 6.6%, a net profit of 36 million yuan, a decrease of 44.7% and an annular decline of 17.1%. The pressure on gross profit margin was the main reason for the pressure on performance.
With the rapid development of PE pipe business, PVC and PE gross profit are obviously under pressure. 2021H1's PVC, PPR and PE series pipes have achieved revenue of 805 million (+ 18.0%), 113 million (+ 10.8%) and 127 million (+ 47.7%) respectively, accounting for 75.4% (- 2.8pct), 10.6% (- 1.1pct) and 11.9% (+ 2.0pct), respectively. The company's comprehensive gross profit margin is 19.9% (- 5.5pct), and the gross profit margin is mainly due to the sharp rise in raw material prices. Sub-product gross profit margin: PVC 19.2% (- 5.3pct), PPR 33.2% (+ 1.3pct), PE 14% (- 10.4pct). In the first half of the year, the cost control was good, the expense rate was downward, and the sales, management and financial expense rates were 2.8% (- 1.0pct), 3.7% (- 0.2pct) and-0.1% (+ 0.2pct), respectively. The three expense rates decreased by 1.0pct compared with the same period last year, and R & D expenses were + 26.5% compared with the same period last year.
Continue to promote production capacity construction and deepen the national market layout
At present, the company has an annual production capacity of about 410000 tons and has six major production bases, among which the operation of two production bases in Guangdong and Guangxi has been very mature, the output of Jiangxi and Henan bases has continued to rise, and the Hainan base has been completed and put into production in 2020. the Yunnan base is under construction and is expected to be completed by the end of 2021. The gradual commissioning of the project under construction is expected to further improve the market layout, enhance the company's ability to accept orders in different places, and lay the foundation for the further expansion of the southwest regional market and the development of the national deep market in the future.
Production capacity and market pattern have been continuously improved, and the "buy" rating company has been based on the pipeline industry for many years, with rich product lines, complete types, obvious channel advantages and brand advantages. In order to adapt to the changes of the external environment and market demand, the company strives to optimize the business structure, enrich the product types, and create a multi-level and category product combination line. During the reporting period, the company steadily promoted the landing of additional shares issued to specific targets in 2020 to ensure the smooth implementation of the investment project, the continuous improvement of production capacity and market pattern, and the future performance is expected to be continuously released. It is estimated that in 2021-23, EPS will be 1.03 yuan per share for 0.72, 0.86 and 12.1x respectively, corresponding to PE of 17.4, 14.4 and 12.1x, maintaining a "buy" rating.
Risk hint: the sales expansion in the new area is not as expected; the risk of raw material price fluctuation