Event: the company released the mid-2022 report that the company achieved 7.224 billion yuan in revenue in the first half of 2022, + 30.23% year-on-year, and 351 million yuan in net profit, + 50.47% in the same period last year. 22Q2 achieved revenue of 3.733 billion yuan, + 33.73% in the same period last year, and 174 million yuan in net profit in the first half of 2022, + 169.05% in the same period last year.
Our comments on this are as follows:
Revenue end: 22Q2 revenue is growing month-on-month, showing a bright performance. In the first half of 2022, the company achieved revenue of 7.224 billion yuan, + 30.23% compared with the same period last year. Among them, the automotive metal parts lightweight business achieved business income of 6.363 billion yuan, + 33.79% compared with the same period last year, contributing to the main increment, while the navigable aircraft manufacturing business achieved business income of 861 million yuan, + 8.85% compared with the same period last year. 22Q2 achieved revenue of 3.733 billion yuan in a single quarter, + 33.73% year-on-year and + 6.90% month-on-month. Considering that the domestic automobile industry chain was seriously damaged due to the epidemic in the second quarter, and the company's main customers, such as the automobile department and Tesla, Inc., all stopped production, we think that the company's revenue performance in the second quarter is very eye-catching. It is expected that there are two main reasons: the rapid increase in the demand for lightweight products for energy saving and emission reduction of ① vehicles, and the sharp increase in the price of ② raw materials compared with the same period last year, and the optimization of price linkage settlement mechanism makes sales grow faster than the same period last year.
Profit side: 22Q2 gross margin and period expense rate have improved compared with the same period last year, leading to a substantial increase in profitability. 22H1 achieved a net profit of 351 million yuan, while + 50.47% and + 169.05% respectively compared with the same period last year. The performance was better than that of the revenue end. The gross profit margin of the company improved slightly in the second quarter compared with the same period last year, year-on-year + 0.71pct, but month-on-month-2.34pct. It is expected that related to the epidemic in Shanghai in the second quarter, the company has a lightweight and coating plant in Shanghai to stop production due to the epidemic. Although the factories outside Shanghai have normal production, the customer shutdown also leads to poor sales. During the 22Q2 period, the expense rate is year-on-year-3.57pct, and the improvement is more obvious, mainly in the management expense rate year-on-year-1.49pct, and the financial expense rate year-on-year-1.38pct.
Establish the development model of automobile lightweight and navigation business dual-engine drive. The company is committed to becoming a "global automotive metal lightweight promoter", has formed a "magnesium alloy-aluminum alloy-high-strength steel" and other metal materials lightweight application as the main line of automotive parts subdivision leading industry plate. While actively developing the product layout of aluminum alloy and high-strength steel, the company will focus on promoting the application of magnesium alloy products in automobiles. Magnesium Redding, a subsidiary of the company, is one of the most important manufacturers of lightweight magnesium alloy components in the world. it occupies a large share of the magnesium alloy market in North America, and the company will introduce magnesium reading mature products into the domestic market, which is expected to achieve rapid growth. In 2020, the company acquired a 55% stake in the aircraft industry, and the core asset was diamond aircraft, which formally established a dual-engine-driven development model of automobile lightweight and navigation business.
In 2021, the aircraft industry introduced Qingdao Wansheng Chengfeng and Beijing Aviation Development Fund, which are controlled by state assets, as strategic investors to jointly accelerate the development of the domestic navigation market and pry up the navigation industry trillion industry market. As the national policy promotes the development of navigable aircraft, a series of policies such as the General Plan for the Construction of low-altitude Flight Service guarantee system and the Action platform for the Construction of CAAC Type IV Airport (2020-2035) have been promulgated, the future development of general aviation industry begins to accelerate, and general aircraft manufacturing business will become a new industrial growth pole for the company's business in the future, opening up more space for the company's development.
Profit forecast: under the influence of the 22Q2 epidemic in Shanghai, the company's profit improvement exceeded our expectations, kept the company's revenue forecast unchanged, and raised the company's profit forecast. It is estimated that the company's revenue from 2022 to 2024 will be 14.33 billion yuan, 15.62 billion yuan and 17.17 billion yuan respectively, with year-on-year growth rates of 15.2%, 9.0% and 9.9%, respectively. The net profit of homing was 740 million yuan, 850 million yuan and 930 million yuan respectively, and the year-on-year growth rate was 120.5%, 15.2% and 9.6% respectively. Corresponding to the current market capitalization, PE is 20.8,18.1 and 16.5 times respectively, maintaining the "overweight" rating.
Risk tips: domestic passenger car sales are not as expected; raw material prices remain high; magnesium alloy market development is not as expected; navigable aircraft business development is not as expected; goodwill impairment risk; information disclosure risk