1H22 performance is in line with our expectations
The company announced 1H22 results: 1H22 achieved operating income of 484 million yuan, an increase of 38.25% over the same period last year; net profit of 79 million yuan, down 14.23% from the same period last year; corresponding estimates, 2Q22 realized operating income of 291 million yuan, an increase of 82.69% over the same period last year, an increase of 50.34% over the previous year; and net profit of 42 million yuan, an increase of 22.47% over the same period last year, and an increase of 14.90% over the same period last year.
Trend of development
2Q22 revenue increased by 82.69% year-on-year and 50.34% month-on-month; robot products made stable profits, and periodic changes in product structure dragged down the level of comprehensive gross profit margin. At the beginning of the year, the company had relatively sufficient orders on hand (800-900 million yuan). 1Q22 was affected by the epidemic, and the progress of project implementation and acceptance slowed down, achieving an income of 193 million yuan, which was basically the same as last year. 2Q22 accelerated the progress of the project and achieved an operating income of 291 million yuan, an increase of 82.69% over the same period last year, an increase of 50.34% over the previous year, helping 1H22 achieve a year-on-year growth rate of 38.25%. 1H22's comprehensive gross profit margin is 42.10%, year-on-year-16.77ppt, of which 1Q22 is 53.75%, dagger 2Q22 is 34.35% 2Q22, month-on-month decline 19.40ppt, mainly due to changes in product structure, intelligent power distribution room integration project with low gross profit margin during the 2Q22 period to recognize part of the income, excluding the impact of the business, we estimate that the robot business gross profit margin is still around 50%, the main industry profit is stable.
The operating efficiency continued to improve, and the expense rate decreased 14.00ppt during the 1H22 period. On the expense side, the rates of sales, management, R & D and financial expenses of 1H22 are 5.89%, 11.25%, 11.74% and 2.73%, respectively, compared with the same period of last year-1.74ppt,-1.30ppt,-11.26ppt and + 0.29ppt, respectively, with a cumulative total of-14.00ppt. Among them, the R & D expenditure rate decreased more than that of the subsidiary company, which is no longer included in the consolidated report. 1H22's net profit margin is 16.30%, year-on-year-9.97ppt, mainly due to the periodic decline of the comprehensive gross profit margin and the loss of subsidiary Dao Healthcare (including investment income).
A number of new products have been released by 1H22, which continues to be optimistic about the growth potential of platform-type special robot leaders. 1H22 has released a number of new products, including: 1) equipment health management system, which can provide 24-hour continuous monitoring and early warning of faults for electrical equipment, which is the company's preliminary attempt in the field of monitoring and testing from mobile to fixed end. 2) Wisdom sharing charging pile system breaks through the traditional "one-person-one-pile" mode, and has outstanding advantages in economic, convenient and safe, easy installation, saving construction cost and so on. We think that it is expected to achieve rapid replication and promotion in new residential areas and other scenarios. Pilot projects have been promoted in some cities. 3) three-dimensional inspection system, which integrates indoor and outdoor inspection robots, drones, high-definition video cameras, infrared thermal imaging cameras, voiceprint and other intelligent equipment, to build a multi-latitude, comprehensive three-dimensional joint inspection platform, has now received small batch orders.
Profit forecast and valuation
Keep profit forecasts for 2022 and 2023 unchanged. The current share price corresponds to a price-to-earnings ratio of 22.4 times 2023 / 17.3 times earnings. Maintain an outperform industry rating and a target price of 65.00 yuan, corresponding to 23.0 times 2022 price-to-earnings ratio and 17.7 times 2023 price-to-earnings ratio, which has 2.4% upward space compared with the current stock price.
Risk.
The investment in smart grid is lower than expected, the downstream customers are relatively concentrated, and the competition in the industry is intensified.