Event: on April 19, the company released its annual report of 2021 and quarterly report of 2022: operating income of 6.436 billion yuan in 2021, an increase of 4.09% over the same period last year, and a net profit of 425 million yuan belonging to the parent company, an increase of 47.81% over the same period last year. The net profit of 335 million yuan was deducted, an increase of 30.94% over the same period last year. 2021Q4 realized operating income of 15. 5%.
7.8 billion yuan, an increase of 8.7% over the same period last year and 17.98% from the previous year. The net profit attributable to the parent company was 78 million yuan, down 6.92% from the same period last year, up 10.67% from the previous year, and deducting 28 million yuan from the same period last year, down 54.53% from the same period last year and 55.48% from the previous year. 2022Q1 realized operating income of 2.813 billion yuan, an increase of 77% over the same period last year, a net profit of 150 million yuan belonging to the parent company, an increase of 47% over the same period last year, and a net profit of 143 million yuan, an increase of 60.9% over the same period last year.
Comments:
The boom in compound fertilizer has boosted the company's performance. In 2021, the company realized operating income of 6.436 billion yuan, an increase of 4.09% over the same period last year. The net profit attributed to the parent company was 425 million yuan, an increase of 47.81% over the same period last year. The net profit of non-parent companies was deducted from 335 million yuan, an increase of 30.94% over the same period last year. 2022Q1 realized operating income of 2.813 billion yuan, an increase of 77% over the same period last year, and a net profit of 150 million yuan belonging to the parent company, an increase of 47% over the same period last year.
4.3 billion yuan, an increase of 60.9 percent over the same period last year. The sharp improvement in the company's performance is mainly due to the boom in the main business. In 2021, the company's gross profit margin was 18.27%, an increase of 0.16pct year-on-year, a net profit rate of 6.42%, a year-on-year increase of 2.04pctJournal ROE to 8.80%, and a year-on-year increase of 2.42pct. 2022Q1 gross profit margin was 15.09%, down 5.87pct from the same period last year, 2.42pct down from the previous year, net profit rate was 5.32%, 0.97pct was down from the same period last year, ROE was 2.93% from the previous year, 0.77pct was increased and 0.71pct was decreased from the same period last year. Driven by cost support and demand falling short of supply, the company's compound fertilizer business is booming. According to Zhuochuang, the average prices of compound fertilizer 2021 and 2022Q1, the company's main products, are 2845 yuan / ton and 3365 yuan / ton respectively, up 21% and 42% respectively over the same period last year.
The advantage of capacity layout is significant, and the operation efficiency is effectively improved. The company's production base covers most of the planting areas in China, which can quickly respond to the fertilizer demand of various planting areas and reduce transportation costs. In terms of period expenses, the total expenditure rate of the company in 2021 was 11.61%, an increase in 0.27pct compared with the same period last year. Among them, the rate of sales expenses was 5.37%, down 0.25pct from the same period last year, and the rate of management expenses (including R & D expenses, comparable caliber) was 7.04%, up 0. 4% from the same period last year.
6pct, the financial expense rate was-0.8%, a decrease of 0.08pct compared with the same period last year. The total period expense rate of 2022Q1 is 8. 5%.
92%, down 4.8pct from the same period last year. Among them, the sales expense rate was 4.41%, down 1.69pct from the same period last year, the management expenses (including R & D expenses, comparable caliber) rate was 5.04%, the 3.73pct rate was down from the same period last year, and the financial expense rate was-0.52%, increasing 0.62pct over the same period last year.
Cost support superimposed underemployment, compound fertilizer prices are on the rise. On the cost side, the rising prices of raw material sulfur and synthetic ammonia, as well as strong international demand, have driven up the price of monoammonium phosphate; before the export law and inspection policy hit the ground, supply fell short of demand and India issued a new round of urea bidding, and the urea market continued to benefit; potash prices also rose due to insufficient supply and blocked imports. Internationally, after the conflict between Russia and Ukraine in the first quarter, Russia restricted the export of chemical fertilizer, aggravating the tight situation of international chemical fertilizer supply, and the surge in international fertilizer prices led to a rise in domestic fertilizer prices. In terms of start-up, the plant operating rate of compound fertilizer enterprises in 2021 is lower than that in 2019 and 2020. According to Baichuan, the average operating rate of compound fertilizer in 2021 is 40%, which is 7% lower than that of the same period last year. On the one hand, the low operating rate is due to the high tight price of raw materials, the low enthusiasm of manufacturers, and the shortage of raw materials makes enterprises reduce load or stop. On the other hand, environmental protection, safety factors, double control of energy consumption, power restriction and other measures hinder the start-up of some units. Among them, the highest operating rate was in April, with an operating rate of 48.65%. Under the dual effect of cost and start-up, the price of compound fertilizer continues to rise. According to Zhuochuang, the average prices of compound fertilizer 2021 and 2022Q1 are 2845 yuan / ton and 3365 yuan / ton respectively, up 21% and 42% respectively from the same period last year.
Join hands with Hubei Yihua to build iron phosphate, the company's business is expected to reach a new level. In cooperation with Hubei Yihua, the company jointly invests in the construction of new energy material precursor ferric phosphate and supporting facilities (including new mineral processing, sulfuric acid, phosphoric acid, purified phosphoric acid, etc.), comprehensive utilization of residual acid, new fertilizer and purified gypsum by means of increasing capital to Hubei Yihua's wholly-owned subsidiary. According to Hubei Yihua announcement, Songzi Fertilizer Industry has an annual production capacity of 600000 tons of diammonium phosphate. In terms of raw materials, it is equipped with 800,000 tons / year of sulfuric acid, 300,000 tons / year of phosphoric acid, 83,000 tons / year of fluorosilicic acid and 155,000 tons / year of sodium fluorosilicate. Stanley and Hubei Yihua hold 35% and 65% respectively after the capital increase.
This cooperation extends the industrial chain downstream, which will help both sides to give full play to their respective advantages and help the company to open up new growth space.
Profit forecast and investment suggestion: due to the addition of 1 million tons of green and high-efficiency compound fertilizer project, we raise our profit forecast. It is estimated that the return net profit of the company from 2022 to 2024 is 531 million yuan (originally 504 million yuan), 620 million yuan (original 562 million yuan), 7. 4.7 billion yuan (new increase), and EPS is 0.46,0.54,0.65 yuan respectively. We selected Xin Yangfeng, Silt and Yuntianhua, which are also in the field of chemical fertilizer, as comparable companies with an average PE of 12.91,11.17x and 8.95x in 2022,2023,2024 (corresponding to the closing price on April 20, 2022). The current share price corresponds to the PE of 15.72,13.45x and 11.16x in 2022,2023 and 2024, respectively, maintaining the "buy" rating.
Risk hints: downstream demand is less than expected risk; new projects are less than expected risk; raw material price fluctuation risk; based on the data information lag risk.