Events:

According to the company's three-quarter report, the main income was 709 million yuan, up 65.11% over the same period last year; the net profit of returning to the mother was 124 million yuan, up 38.58% from the same period last year; deducting 94.326 million yuan from non-net profit, up 2237.55% over the same period last year; among them, the main income in the third quarter was 266 million yuan, up 58.83% from the same period last year; the net profit of returning to the mother in a single quarter was 38.4701 million yuan, up 3412.09% from the same period last year The deduction of non-net profit in a single quarter was 28.4525 million yuan, up 1,068.94 percent from the same period last year. At the same time, the company plans to acquire 14.86% minority stake in Feiyuan Gas with 113 million yuan. After the acquisition, the company will hold 72.83% stake in Feiyuan.

Comments:

There was a significant increase in profitability in a single quarter, a substantial increase in R & D expenses, and a significant increase in revenue in the first three quarters, mainly due to the continuous increase in market demand and the rapid growth of the company's electronic special gas and other businesses. The single-quarter gross profit margin in the third quarter was 43.57%, down 1.37% from the same period last year and 1.17% from the previous year, and the net profit rate per quarter was 20.08%, up 15.48% from the same period last year and down 4.33% from the previous quarter.

The main reason for the increase in net interest rate compared with the same period last year was the marked decline in the rate of sales expenses, which was 4% in the third quarter, down 5.74 percentage points from the same period last year. At the same time, the company's R & D expenses increased significantly, up 76.05% in the third quarter from the same period last year, and 11.58% in the first three quarters compared with the same period last year, indicating the company's continued investment in R & D.

The acquisition of minority stake in Feiyuan Gas thickens the performance of the company, and high-end photoresist steadily promotes the acquisition of Feiyuan in 2019. Feiyuan Gas has become one of the major producers of nitrogen trifluoride and sulfur hexafluoride in the world. Feiyuan through cooperation with the company's customers, technology and other cooperation, as well as capacity expansion, technological innovation to achieve cost reduction and efficiency, has become one of the company's main sources of profit. As of September 2021, Feiyuan Gas has built a production line of 3800 tons of nitrogen trifluoride and 3500 tons of sulfur hexafluoride per year. At the same time, the company's photoresist production work is also in steady progress, the annual output of 25 tons of ARF photoresist production line has passed the expert group performance evaluation and acceptance in July, laying the foundation for the company's long-term performance growth after mass production.

Profit forecast

Maintain the company's 21-23 net profit forecast of 1.42,1.59 and 175 million yuan, and maintain the "overweight" rating.

Risk hint

The progress of R & D and mass production of the company is not as expected, and the demand of downstream customers is not as expected.