Orders are growing rapidly, with photovoltaic accounting for nearly half. In the first half of 2022, the company won 78 new bids, including 50 construction plates and 21 photovoltaic plates, accounting for about 27% of the total. The total amount of winning bids in the first half of the year was 2.315 billion yuan, an increase of 25.13% over the same period last year. Among them, Q1 won the bid for Shandong heavy Industry BIPV roof project, with a winning bid amount of 799 million yuan, accounting for 34.51% of the order volume in the first half of the year. Industry is currently the largest single BIPV project, and the project may be launched this year. The company has joined hands with Longji to expand the BIPV market, and has signed strategic agreements with key customers such as Sanshu, Xugong, Shanzhong, Beixin Building Materials and China Chemical. Building photovoltaic market demand is good in the future, it is expected that there will be more BIPV projects signed on the ground, significantly thickening performance. In order to achieve transformation and upgrading, the company has set up a number of new energy-related subsidiaries in recent years, aimed at increasing the expansion of photovoltaic, new materials and other fields.
Q2 revenue soared year-on-year, while gross profit margin declined. In the first half of 2022, the company achieved revenue of 1.637 billion yuan, an increase of 19.60%. Among them, 2022Q2 achieved revenue of 1.025 billion yuan, an increase of 34.64%, the highest growth rate in a single quarter in the past three years, mainly due to the new photovoltaic business. From a business point of view, the revenue from metal roofing was 1.32 billion yuan, an increase of 2.56% with an increase of 149 million yuan from BIPV, accounting for 9.1% of revenue. It is expected that the permeability will increase rapidly in the future; and the income from soil treatment will be 100 million yuan, an increase of 39.68%. The company's overall gross profit margin was 17.03%, down 1.69 percentage points from the same period last year, or affected by the epidemic, metal roofing business expenditure is relatively rigid, dragging down the overall gross profit margin.
The company does not disclose BIPV gross margin data, but with reference to the industry, we expect this part of the gross margin may exceed 25 per cent. With the increase of the penetration rate of BIPV projects, there is much room for improvement in gross profit margin.
During this period, the expense rate increased and the net profit increased rapidly. During the first half of 2022, the expenditure rate was 10.61%, up 0.63% from the same period last year, of which the sales expense rate was 2.55%, up 0.5%, mainly due to the increase in new business promotion expenses; the management expense rate was 3.32%, which was basically the same as the same period last year; the R & D expenditure rate was 3.56%, up 0.56% The financial rate was 1.18%, a decrease of 0.35%, mainly due to the provision of interest on convertible bonds in the same period last year. In the first half of the year, the impairment of various types is about 55 million yuan, an increase of 18 million yuan over the same period last year. The provision in 2021 is relatively sufficient, and the impairment risk is expected to be small this year. Taken together, the company's return net profit in the first half of 2022 was 71 million yuan, an increase of 25.80%. Of this total, the net profit deducted from non-return was 65 million yuan, an increase of 15.82%.
Cash flow has improved and asset-liability ratios have risen. The company's 2022 income-to-cash ratio was 0.9552, up 14.9 percent, mainly due to a substantial increase in project payback, while the cash-to-payment ratio was 1.0991, down 3.34 percent. Overall, the operating net cash outflow was 197 million yuan, 105 million yuan less than the same period last year; the net outflow of investment activities was 63 million yuan, 30 million yuan more than the same period last year, mainly due to the increase in cash paid by subsidiaries. The company's asset-liability ratio was 53.17%, up 7.77 percentage points, mainly due to a substantial increase in other current liabilities.
Investment advice: with the control of the epidemic and the improvement of experience in dealing with the epidemic, gross profit margin is expected to pick up gradually.
Construction photovoltaic market demand is strong, the company and Longji join hands to expand the BIPV market, helping the company's rapid growth. From 2022 to 2024, the EPS of the company is 0.47,1.06,1.68 yuan per share, and the corresponding PE is 65.5,29.0,18.4 times respectively, maintaining the "overweight" rating.
Risk tips: BIPV business growth is not as expected, the risk of repeated epidemic, the risk of recovery of accounts receivable.