Event
According to the interim report released by Lijun shares in 2022, the operating income from January to June 2022 was 420 million yuan, down 19.83% from the same period last year; the gross profit was 179 million yuan, down 25.58% from the same period last year; the operating profit was 121 million yuan, down 27.72% from the same period last year; and the net profit attributed to the parent company was 102 million yuan, down 28.01% from the same period last year.
Comment
Affected by the epidemic, the low carry-over of aviation business income and the insurance strategy of roller press, the company's operating income and profit decreased significantly compared with the same period last year, but the gross profit increased year on year and month-on-month in 2022. From January to June, the operating income was 420 million yuan, down 19.83% from the same period last year; the gross profit was 179 million yuan, down 25.58% from the same period last year; and the operating profit was 121 million yuan, down 27.72% from the same period last year. The net profit attributed to the parent company was 102 million yuan, down 28.01% from the same period last year. The comprehensive gross profit margin reached 42.48% in mid-2022, a decrease of 3.29 percentage points compared with mid-2021 and an increase of 0.38 percentage points compared with the whole of 2021.
In the second quarter of 2022, the company realized operating income of 169 million yuan, down 38.02% from the same period last year; realized gross profit of 74 million yuan, down 35.09% from the same period last year; and realized net profit belonging to the parent company of 32 million yuan, down 49.93% from the same period last year. The company achieved a comprehensive gross profit margin of 43.79%, an increase of 1.88 percentage points year-on-year compared with the second quarter of 2021 and 1.73 percentage points higher than the first quarter of 2022.
The company's revenue growth in the second quarter was lower than expected compared with the same period last year, mainly due to the impact of the epidemic in the second quarter and the adjustment of the company's roller press business strategy to guarantee gross profit margin and cash flow instead of blindly pursuing income. In the medium term, the company's operating income and profit were significantly negative and the gross profit margin decreased, mainly due to the impact of the roller press business due to the delivery of the epidemic in the second quarter and the carry-over rhythm of revenue from aviation parts and work design and manufacturing business.
Profit forecast
The company's interim results are slightly lower than we expected, so carefully consider that we should adjust our profit forecast appropriately. We estimate that in 2022-2024, the company will achieve operating income of 11.32,13.97 and 1.752 billion yuan, net profit belonging to the parent company of 2.58,3.36 and 444 million yuan, and a total share capital of 1.033 billion shares, corresponding to EPS0.25, 0.32 and 0.43 yuan. On August 26th, 2022, the stock price was 7.31 yuan, corresponding to the market capitalization of 7.6 billion yuan, and the PE from 2022 to 2024 was about 29, 23 and 17 times.
The company's roller press and related equipment business has obvious competitive advantages, benefiting from capacity replacement and equipment upgrading in the mining industry, strong profitability after equipment services and large room for growth. Aerospace parts and tooling design and manufacturing business is the main driving force for future growth, we maintain the "overweight" rating.
Risk tips: lower-than-expected delivery and carryover of roller presses and aviation, and low revenue due to the company's roll press insurance strategy.