1. 2022H1 revenue continued to grow high, photovoltaic packaging film business performance before the company issued a half-year 2022 performance forecast, expected to achieve revenue of 676 million yuan, an increase of about 51% over the same period last year; to achieve a net profit of 32 million yuan to 34 million yuan, a year-on-year decrease of 50% 53%. Under the influence of the epidemic, the company's revenue in the second quarter continued to grow in the first quarter, with a year-on-year growth rate of 60.85%.
Photovoltaic packaging film: benefiting from the rapid growth of photovoltaic cumulative new installations this year and the impact of the high price of EVA film, the company's revenue of photovoltaic packaging film business increased by about 250% in the first half of 2022 compared with the same period last year. At present, the company has served Dongfang Risheng, Zhengtai Electrical Appliances and other high-quality customers, with a production and sales rate of 92.79% from January to March 2022, showing a booming situation of production and sales as a whole.
Hot melt wall cloth: under the background of high pressure on real estate completion, the company's hot melt wall cloth business still achieves a year-on-year growth rate of about 30%. The wall cloth business continues to strengthen brand building, the supply capacity of differentiated products continues to improve, at the same time, the speed of marketing network coverage is accelerated, and the effect of channel sinking is obvious. In the second half of the year, with the recovery of the local home decoration market, wall cloth business is expected to maintain growth.
Non-homed net profit maintained high growth: commodity prices remained high in the first half of 2022, and the company optimized its supply structure by increasing the share of domestic raw material suppliers. Gross profit margin rose 5 pct to 21.46% in the second quarter compared with the previous quarter. At the same time, it continued to improve internal management efficiency, with the expense rate falling by about 8 pct to 13.31% compared with the same period last year. The main reason for the decline in the company's net profit from the same period last year is that the income from the sale of fixed assets in the first half of 2021 is included in non-recurrent profit and loss, resulting in a higher base for the current period. If the non-return net profit is deducted, the company's profitability in the first half of the year will be significantly improved. The growth rate of non-return net profit is 36% and 50%.
2. The new production line of film has gradually landed, and strengthening the cooperation of major customers is expected to quickly increase the volume of photovoltaic film. The company has accumulated long-term technical experience in the business sector, and its production capacity has not been greatly expanded due to fluctuations in the photovoltaic industry. The installed capacity of photovoltaic is expected to increase steadily in the future. in order to break through the current production capacity limitations, the company plans to build 60 new solar packaging film production lines in Kunshan, Nantong and Hai'an, with an additional production capacity of about 450 million square meters. As of June 29, 2022, 6 of the 14 new production lines planned by the Kunshan base have been installed and 8 have been installed and debugged, and all of them are expected to be installed by the end of July. With the rapid expansion of production capacity, the limitation of relatively small number of large customers caused by insufficient production capacity will be quickly broken. As a result, the company has established a major customer development strategy, including the top five customers. the company's negotiation, sample delivery, testing and batch supply are all advancing as planned. It is expected that under the optimization of the major customer structure, the company's product sales are expected to achieve rapid volume. At the same time, the purchasing end and production end of raw materials, due to the scale growth cost will have a large space to decline, the company's film business profitability is expected to improve.
Investment suggestion: to maintain our previous profit forecast, the company is expected to have revenue of 18.01,31.50 and 4.495 billion yuan in 2022-2024, and net profit of 1.06,1.99,295 million yuan, corresponding to EPS of 0.32,0.60,0.89 yuan respectively. In view of the high demeanor of the company's business, maintain the "buy" rating.
Risk tips: 1) the new installed capacity of photovoltaic is not as expected; 2) the capacity release is not as expected; 3) the risk of raw material and energy price fluctuations.
