Event: Hangxiao Steel structure released its annual report in 2021 and quarterly report in 2022. In 2021, the company's total operating income / return net profit was 96,100,000,000 yuan respectively, which was + 18% and 43% respectively compared with the same period last year. 22Q1, the company realized total operating income / return net profit of 21 million yuan respectively, compared with the same period last year, + 10% and 40% respectively.
Comments:
The growth rate of newly signed 22Q1 contracts is significantly faster: in the past 21 years, the company's industrial / construction / service business achieved operating income of 0.983 billion yuan, compared with the same period last year, with a gross profit margin of 9.8%, 14.3%, 2.9% and + 6.7/-0.5/-11.1pcts, respectively. In 2021, the total amount of new contracts signed by the company / steel structure / Wanxian Green Construction was respectively RMB 150,107pm, which was + 17% plus 17% compared with the same period last year. The newly signed contract value of Green Construction in Wanxian County increased significantly. 22Q1, the total contract value of the company / steel structure / Wanxian Green Construction is 100 million yuan in 46-26-20, which is + 85% and 140% respectively compared with the same period last year, and the growth of newly signed contracts is significantly accelerated.
The 21-year gross profit margin was impacted by the rise in steel prices, and the expense rate improved compared with the same period last year: in 21 years, the company's comprehensive gross profit margin was 13.9%, year-on-year-3.9pcts, or affected by the rise in steel prices; the period expense rate was 9.9%, year-on-year-0.4pct, in which the sales / management / R & D / financial expense rates were-0.43, 0.34, 0.34, 0.13 and 0.27pct, respectively, and the credit impairment was 78 million yuan, + 48 percent year-on-year. 2022Q1, the comprehensive gross profit margin is 14.65%, year-on-year-1.14pcts, the year-on-year downward trend has shown a marginal improvement. In 21 years, the company's operating net cash flow was-900 million yuan, year-on-year-890 million yuan, mainly due to: 1) year-on-year decline in net profit; 2) increase in expenditure on raw materials; and 3) year-on-year increase in accounts receivable.
Equity incentives for the core members of Hete Optoelectronics, the target performance may increase the future profits of the company: in July 21, the company increased its capital to buy shares in Hete Optoelectronics, obtaining a 51% stake and becoming a controlling shareholder; in November 21, the first intelligent production line with an annual output of 1 million square meters of BIPV was officially put into production, laying the capacity foundation for the rapid growth of BIPV business income. In order to further encourage the middle and senior managers and core core employees of Hete Optoelectronics, the company plans to buy back 50-10 million shares of the company for the implementation of the employee stock ownership plan. The performance evaluation index is that the net profit of Hete Optoelectronics in 2024 is not less than 0.5 trillion yuan, corresponding to the thickening of the company's parent net profit of 0.26 million yuan, accounting for 6% of the company's 21-year net profit, respectively.
Profit forecast, valuation and rating: Hangxiao Steel structure has a strong competitive advantage in the field of steel structure engineering, while actively laying out the BIPV field, it may enhance the company's competitiveness in the industry in the future. Taking into account the epidemic factors, we downgrade the company's 2022-2023 net profit forecast to 500 million yuan (- 14%), 606 million yuan (- 24%), the new company 2024 net profit forecast 708 million yuan. The company will give equity incentives to the core members of Hete Optoelectronics, target performance or increase the company's future profits, and the current price corresponds to a dynamic price-to-earnings ratio of 16x in 2022, maintaining a "overweight" rating.
Risk hint: downstream steel structure demand is less than expected risk, upstream steel price rise risk, order execution is not as expected risk, epidemic repeated risk.