The company released its 2022 semi-annual report, with operating income of 1.664 billion yuan in the first half of the year, an increase of 60.35% over the same period last year, a net profit of 198 million yuan, an increase of 233.80%, and a net profit of 212 million yuan, an increase of 289.59% over the same period last year. In the second quarter, the company achieved operating income of 1.103 billion yuan, an increase of 86.39% over the same period last year, a net profit of 122 million yuan, an increase of 216.52%, and a non-return net profit of 142 million yuan, an increase of 311.68% over the same period last year. The results in the second quarter exceeded expectations.
The continuous release of new production capacity, in line with the agricultural boom to boost performance growth. The level of global energy and inflation rose sharply in the first half of the year, and agricultural products led pesticide prices to break through new highs in recent years. According to Zhongnong Lihua, the average price of enoxone and isoxazone in herbicides in the second quarter was 15.62 yuan and 8.59 million yuan per ton respectively, up 44.04% and 11.92% respectively over the same period last year; among fungicides, the average price of enoylmorpholine was 9.02 million yuan per ton, down 15.02% from the same period last year. In addition, the company actively promotes the release of production capacity. Liaoning first reached the first phase of 3000 tons of enoxone and 2000 tons of enoylmorpholine, and the second phase of 5000 tons of enoxone has been successfully reached production. in the first half of the year, the company's output of enoxone and dioxin was 4489 and 1542 tons, respectively, up 67.32% and 18.19% over the same period last year. The output of enoylmorpholine was 1501 tons, up 25.45%.
Consolidate the existing advantages of products and new product research and development of two-pronged, the company is expected to usher in great-leap-forward development. The company continues to consolidate the dominant position of the main products, Liaoning first reached the third phase of 1500 tons of crude drugs, 3500 tons of pesticide intermediates have entered the construction stage, is expected to trial production this year, the fifth phase of the project procedures and construction preparations are progressing steadily. The 5000-ton high-end integrated intelligent fungicide workshop project has also completed construction and entered the acceptance stage.
In addition, the company has analyzed and improved a series of Imidazolinone products, imidazole nicotinic acid has completed its workshop project design, various procedures are about to be completed, and it is expected to become a new business growth pole after it is put into production. In terms of overseas registration, the registration of a number of unique active components has been launched in the European Union, Australia, North America, Latin America and other places, and is expected to be certified and sold in some overseas markets next year, providing more profit support for the company's future development.
Raise the earnings forecast to the "buy" rating. The company's performance in the first half of the year exceeded expectations, reflecting the consolidation of the market position brought about by the release of superior pesticide varieties, and the better competition pattern of creating varieties also enhanced the certainty of sustained and rapid growth of the company's performance. We are optimistic that the herbicide boom will continue in the second half of the year, so we raise our profit forecast. It is estimated that the company's revenue in 2022-2024 will be 31.68,35.25 and 4.305 billion yuan respectively (previously 23.40,25.16 and 2.865 billion yuan respectively), and the return net profit will be 4.23,5.66 and 706 million yuan respectively (previously 3.88,5.17 and 618 million yuan respectively), and the corresponding PE will be 10X/8X/6X respectively. Upgrade to "buy" rating.
Risk hint: the price of the product is falling, and the production capacity is not as expected.