Event: recently, the company released its 2021 annual report and 2022 quarterly report. The company achieved revenue of 769 million yuan in 2021, an increase of 25.80%, and a net profit of 180 million yuan, an increase of 11.07%. In the first quarter of 2022, the operating income was 83 million yuan, down 25.92% from the same period last year. The net profit belonging to the owner of the parent company was 1 million yuan, down 91.79% from the same period last year.
Comments:
Seasonal fluctuations led to a decline in Q1 revenue and optimistic expectations for the whole year. The company's 2022Q1 revenue was 83 million, down 25.92%. From a quarterly point of view, the revenue growth rates of 2021Q1-Q4 and 2022Q1 are 71.50%, 0.10%,-56.02%, 83.91% and-25.92%, respectively. The seasonal characteristics of the power grid intelligent inspection equipment industry are obvious, and power grid customers usually begin to focus on bidding after the second quarter, resulting in relatively large income fluctuations compared with the same period before and after two years, and performance fluctuations caused by the epidemic in the second half of last year. In the first quarter of this year, also affected by the epidemic, the delivery of some orders was delayed, but for the whole year, as a starting point for steady growth, investment in power grid infrastructure and supporting investment in intelligent monitoring equipment is expected to increase faster than in previous years. Recently, national grid bidding has begun one after another, and the bidding volume has increased compared with the same period in previous years, or indicates that this year's bidding situation is better than in previous years. In addition, the company is actively expanding the field of rail transportation. Q1 has achieved the first delivery of the Hong Kong subway, and we expect to land more orders this year.
The increase in the price of raw materials, the change of product structure and the increase of expense rate lead to profit pressure. The company's 2022Q1 profit margin fell to 1.64%, the main reason is 1) the gross profit margin of 2020Q1 dropped more, the gross profit margin of 2020Q1 dropped 47.28%, while 12.18pct fell, which was affected by the increase in the price of raw materials and the increase in the proportion of income from fixed-end monitoring equipment. 2) with the increase in expense rate, the company continues to expand the business areas outside the province and outside the power grid, continuously expand the team of personnel, and at the same time continue to increase R & D investment. 2022Q1 sales expense rate is 19.53%, 6.91pct is increased, management expense rate is increased, 8.17pct is increased, R & D expense rate is 26.59%, and 9.67pct is increased. We believe that for the whole year, the company's cost input and income scale will also basically match, the high Q1 fee increase has a certain pre-significance, and the annual expense will be diluted down, because in previous years, the mismatch between the income scale and the investment stage also caused the fluctuation of profitability, but for the whole year, the company's human efficiency continued to improve, and the number of staff and per capita salary increased steadily from 2017 to 2021. However, per capita income increased from 900000 yuan in 2017 to 1.32 million yuan in 2021, and per capita profit increased from 210000 yuan in 2017 to 310000 yuan in 2021.
Issue a 2022 restricted stock incentive plan to strengthen long-term confidence. The company recently issued a 2022 restricted stock incentive plan, with a total of 1.52 million restricted shares to be granted, accounting for about 1.03% of the company's share capital, of which 1.23 million shares are granted for the first time, accounting for 80.92% of the total number of rights and interests to be granted. a total of 32 people are awarded, including deputy general managers, secretaries of the board of directors, financial directors, middle managers and core backbone personnel. 290000 shares are reserved, accounting for 19.08 per cent of the total number of rights and interests to be granted. The grant price of restricted stock for the first time is 18.93 yuan per share. The attribution assessment year of the restricted stock awarded for the first time under this incentive plan is three fiscal years from 2022 to 2024, and the assessment target for 2022-2024 is to choose one of the two: 2021 is the base, the income growth rate in 2022-2024 is not less than 25%, 50%, 80%, or the net profit growth rate is not less than 20%, 40%, 60%, respectively. It is estimated that the target income-side compound growth rate from 2022 to 2024 is 25%, 20%, 20% and 20%, respectively, or the compound growth rate of net profit is 20%, 16.7%, 14.3%, respectively. We believe that the company issues an equity incentive plan to bind the interests of core members and stimulate the enthusiasm of employees. At the same time, the performance goals are clear, which demonstrates the management's confidence in the long-term development of the company.
Profit forecast and investment rating: we expect the company to achieve a net profit of 233 million yuan, 313 million yuan and 393 million yuan from 2022 to 2024, with a corresponding EPS of 1.59 yuan per share, 2.13 yuan per share and 2.67 yuan per share, respectively, and the corresponding share price PE is 15 times, 11 times and 9 times respectively. Maintain a "buy" rating.
Risk factors: the risk of industry policy change, the risk of intensified competition in the industry, the risk of fluctuation of raw material prices, the risk of new business expansion falling short of expectations, etc.
