Main points of investment
The company released its annual report for 2021: revenue of 3.5 billion yuan, up 4.98% over the same period last year; net profit of 1.111 billion yuan, up 11.00%; and net profit of 1.061 billion yuan, up 9.58% over the same period last year. 2022Q1, the company expects to achieve a net profit of 30% to 358 million yuan, an increase of 30% to 50% over the same period last year, and a year-on-year increase of 28.83% to 49.38% after deducting the non-return net profit of RMB 2.99-347 million.
The income from traditional ammunition and information-based ammunition increased significantly. In terms of products, the company's infrared thermal imager and integrated optoelectronic system achieved revenue of 2.615 billion yuan, a decrease of 9.40% over the same period last year, accounting for 74.72% of operating income and 64.90% of gross profit; traditional ammunition and information ammunition achieved revenue of 803 million yuan, an increase of 88.01% over the same period last year, accounting for 22.94% of business income and 26.74% of gross profit.
The reduction of one-time expenses in R & D expenses resulted in a significant reduction in the rate of period expenses: in 2021, the company's overall gross profit margin was 55.93%, a year-on-year decrease of 3.27pct; a net profit rate of 31.74%, an increase of 1.72pct over the same period last year; and a weighted average ROE of 17.46%, a decrease of 8.00pct over the same period last year. The company's R & D expenditure in 2021 was 371 million yuan, a decrease of 18.57% over the same period last year, with an increase of 29.64% after deducting the company's one-time expenses in 2020.
The cash flow generated by operating activities improved significantly: in 2021, the net cash flow generated by the company's operating activities was 1.207 billion yuan, compared with-27.3563 million yuan in the same period in 2020.
Contract liabilities increased sharply from the end of the third quarter. By the end of 2021, the company's receivables totaled 2.087 billion yuan, up 21.23 percent from the same period last year; inventory was 1.656 billion yuan, up 14.61 percent from the same period last year; and contract liabilities were 662 million yuan, up 185.20 percent from the beginning of the year and 148.59 percent from the end of the third quarter.
Sign a large order contract, pay the account in advance and actively prepare production: according to the company's announcement on March 30, 2022, the company signed an order contract with customers for a certain type of infrared thermal camera, with a contract amount of 269 million yuan, accounting for 7.69% of the company's revenue in 2021.
According to our latest earnings forecast, we estimate that the company's net profit from 2022 to 2024 will be 1.497 billion yuan and 1.369 billion yuan respectively, and its EPS will be 0.64 yuan 0.82 yuan per share, corresponding to the closing price of PE on April 8, which is 27.3 shock 21.2 times 17.2 times, maintaining the "prudent overweight" rating.
Risk hint: the progress of product delivery is not as expected, the development of new products is not as expected, and the competition in the industry is intensified.