Event: Andamai released its quarterly report for 2022, with operating income of 9.016 billion yuan, up 25.45% over the same period last year; operating profit of 443 million yuan, up 157.22% over the same period last year; net profit belonging to shareholders of listed companies was 428 million yuan, up 187.43% over the same period last year. Net profit after deducting non-recurring profits and losses was 413 million yuan, up 239.7% over the same period last year. Based on the total share capital of 2.33 billion shares, diluted earnings per share is 0.18 yuan and operating cash flow per share is-0.78 yuan.
The rise in volume and price promoted the strong growth of revenue, and the scale of domestic sales increased rapidly in the first quarter of 2022. In the first quarter of 2022, the company's product sales and prices increased by 14% and 18% respectively compared with the same period last year, and sales increased by 28% in US dollars. Innovation single-quarter sales history, to achieve a strong start to 2022.
From a regional point of view, Europe / Latin America / North America / Asia-Pacific / India, the Middle East and Africa are respectively year-on-year yoy+3.6%/+32.5%/+50.4%/+60.8%/-0.5%, in US dollars, with domestic sales rising sharply by 90.6% to US $237 million in dollar terms. With the exception of the Middle East and Africa, which are less affected by weather-related crop diseases and insect pests, and the larger depreciation of the Turkish lira against the US dollar, sales have decreased slightly compared with the same period last year, while sales in other regions have increased significantly compared with the same period last year. The rapid growth of sales in China is due to the strong demand in the downstream market of fine chemicals, the growth of brand preparations in the plant protection business and the acquisition of Huifeng Biology (renamed Shanghai Dubai). Strong demand for consumer and professional solutions business in North America and significant increases in sales of corn, soybeans, grains and rice in the US plant protection market The Latin American region benefited from good growing conditions, with increased sales of differentiated products such as fungicides and herbicides in Brazil, while France, Romania and Poland in the European region performed well, offsetting and exceeding the decline in sales in Ukraine.
The profit level has improved compared with the same period last year, and the relocation of Jingzhou base has been completed.
Volume and price growth jointly driven the company's profitability, offsetting the negative impact of increased logistics, procurement and production costs and exchange rate changes, achieving a 29% year-on-year increase in comprehensive gross profit to US $414 million and an increase in gross profit margin to 0.2pcts to 29.2% (in US dollars). In terms of period expenses, the total rate of sales, management and R & D expenses of the company was 15.6%, down 7.0pcts from the same period last year; the profit and loss of financial expenses and fair value changes totaled 336 million yuan, an increase of 98 million yuan over the same period last year, mainly due to the higher CPI in Israel and the appreciation of shekels. At the same time, the company has completed the relocation of its Jingzhou base, and the current production capacity has been basically restored. The adjustment cost of the previous provision has dropped sharply in the first quarter, which has a positive impact on gross profit, and the provision of this part of the cost will be stopped in the future. In addition, based on the current conflict between Russia and Ukraine, the company recorded a total of 126 million yuan in credit impairment and asset impairment losses on accounts receivable in Ukraine.
Profit forecast: the company is the leader in the global non-patent crop protection market, taking into account the construction of the new base and the future production capacity. We raised the company's projected net profit for 2022 to 2024 to 1.85 billion yuan (the previous value is 5.05\ 7.0\ 850 million yuan), maintaining the "hold" investment rating.
Risk tips: pesticide boom is declining, product prices are falling, raw material prices fluctuate sharply, and the progress and profitability of new projects are lower than expected.