Event: on the evening of October 24, the company released its third quarterly report for 2021. 2021Q1-Q3, the company realized revenue of 1.148 billion yuan, + 49.38% compared with the same period last year, and realized net profit of 138 million yuan, + 89.20% year-on-year.
2021Q3, the company achieved revenue of 390 million yuan in a single quarter, + 28.08% year-on-year,-1.53% month-on-month, and realized net profit of 56.96 million yuan, + 67.98%, and + 34.15%, respectively.
The quantity and price of hydrofluoric acid and sulfuric acid have risen simultaneously, and the completion of the technical renovation project has created the advantage of the industrial chain. Q3 in 2021, due to the rapid rise in the price of raw material sulfuric acid, the price of hydrofluoric acid in China has risen rapidly. According to Baichuan Yingfu data, as of September 30, 2021, the domestic price of hydrofluoric acid rose by about 14.8% in a single quarter. The average price of Q3 rose by about 2.1% month-on-quarter. At the same time, with the improvement of downstream demand, the company's hydrofluoric acid product sales increased significantly. In addition, during the reporting period, the subsidiary Gaobao Technology completed the technical renovation project with an annual output of 200000 tons of sulfuric acid, providing raw material support for the company's hydrofluoric acid production. Under the background of the rise in the price of Q3 hydrofluoric acid, the company's Q3 gross profit margin increased by about 5.2 percentage points month-on-month. At the same time, in addition to self-use sulfuric acid, the total amount and price of sulfuric acid exported by the company also increased significantly. According to Baichuan Yingfu data, the average domestic sulphuric acid price of 2021Q3 has increased by about 54.7% compared with the previous month. Driven by the increase in the price of hydrofluoric acid and sulfuric acid, the profitability of Gaobao Technology, a subsidiary of 2021Q3, has improved significantly.
Fund-raising projects on the ground to contribute to sales, the company's performance will continue to increase. During the reporting period, the company's initial public offering to raise funds to invest in the construction of "50 tons of nenoxacin cycloic acid construction project" and "1500 tons of BPEF project" have reached the pre-booked state. With the completion of the fund-raising project, the sales volume of fund-raising products has increased steadily, promoting the company's long-term performance to continue to rise. In addition, on August 26, 2021, the company officially listed its first non-public offering. this time, the company issued a total of about 25.91 million shares and raised 442 million yuan to invest in the "annual production of 5000 tons of 4ppm-difluorobenzophenone" project and the "Fujian Gaobao Mining Co., Ltd. Fluorine fine chemicals series expansion project". The former will be completed and put into production by the end of 2021, while the latter will be built in two phases. It is expected to be completed and put into production by the end of 2022. Dichlorobenzophenone can be used to synthesize PEEK not only as a pharmaceutical intermediate but also as a new material intermediate. The expansion project of fluorine fine chemicals series of Fujian Gaobao Mining Co., Ltd. can add 20,000 tons / year fluorobenzene, 3000 tons / year 4-fluorobenzoyl chloride, 53,000 tons / year high purity potassium fluoride, 14,000 tons / year high purity sodium fluoride and 30,000 tons / year anhydrous hydrofluoric acid production capacity.
Profit forecast, valuation and rating: thanks to the rise in the volume and price of hydrofluoric acid and sulfuric acid and the completion and commissioning of fund-raising projects, the company's performance improved significantly compared with the same period last year. We raised the company's profit forecast for 2021-2022 and added the company's profit forecast for 2023. The company's net profit for 2021-2023 is expected to be 1.73 (up 13.1%) / 2.01 (up 6.3%) / 233 million yuan, respectively. Thanks to the gradual improvement of the company's fluorine chemical industry chain and the completion of the construction of investment projects, the company will continue to develop and maintain the company's "overweight" rating.
Risk tips: product price fluctuation risk, project construction risk, production safety risk