Event: the company released its semi-annual report of 2022, with revenue of 1.515 billion yuan in the first half of the year, an increase of 35.49% over the same period last year, a net profit of 99 million yuan, an increase of 113.49% over the same period last year, and 102 million yuan of non-net profit, an increase of 163.38% over the same period last year. Among them, 2022Q2 realized revenue of 817 million yuan, year-on-year + 29.91%, month-on-month + 16.91%; return-to-mother net profit 7 million yuan, year-on-year-69.52%, month-on-month-91.83%; deduction of non-net profit 11 million yuan, year-on-year-41.61%, month-on-month-88.42%.
Q2 performance is under pressure due to the high gross profit margin, the loss of investment income and the dilution of Hunan Yacheng equity ratio. 1) the gross profit margin remains high: the gross profit margin of the company's three major 22H1 sectors all increased compared with the same period last year. The gross profit margin of lithium materials, transmission and distribution equipment and power engineering plate was 31.37%, 18.64% and 48.63% respectively, which was + 6.83pct, + 5.79pct and + 17.45pct, respectively. 22Q2's overall gross profit margin is 24.02%, which is lower than that of 22Q1 by 4.42pct, with a gross margin of 196 million yuan and-1.27% compared with the previous month. 2) the increase of investment income and loss: the investment income of the company's 22Q2 is-25 million, mainly due to the influence of the epidemic in Tianjin and the sharp fluctuation of nickel price in the first half of the year, which leads to the increase of the loss of the associated company Tianjin Maolian. 3) Hunan Yacheng introduced Huayou and other investors, and minority shareholders' rights and interests expanded: Hunan Yacheng, a subsidiary of Hunan Yacheng, was an important business platform for lithium cathode precursors of the company, and 22H1 introduced strategic investors such as Huayou, Vision, BAIC, as well as investors such as actual controller related parties, employee shareholding platform, etc., and the proportion of shares in the company decreased from 100% to 69.37% at present, affecting the minority shareholders' rights and interests of 22Q2 to 28 million yuan.
The production capacity of iron phosphate is expanding rapidly, and the downstream leader is introduced to enhance the certainty of investment. 1) Ferric phosphate capacity is expected to expand 2.5 times this year: Hunan Yacheng has 60,000 tons of ferric phosphate production capacity, 50,000 tons of ferric phosphate expansion project target 22Q3 put into production; Guizhou Yayou started 300000 tons of ferric phosphate project, the first phase of 100000 tons has been started, is expected to enter trial production this year. 2) the introduction of Huayou and other war investments is conducive to the release of production capacity: Hunan Yacheng, a subsidiary of 22H1, introduced strategic investors such as Huayou, Vision and BAIC, and the equity ratio was diluted to 69.37%. Guizhou Yacheng, a subsidiary of Hunan Yacheng, introduced Huayou Holdings as a strategic investor in July, and Hunan Yacheng's shareholding was reduced to 55%. The introduction of Huayou and other downstream leading customers as strategic investors will not only enhance the capital strength of the relevant business platform, but also is expected to form a closer cooperative relationship with it, which is conducive to the rapid digestion of new production capacity and performance.
Profit forecast and investment advice: taking into account the rapid expansion of the company's iron phosphate production capacity, the introduction of downstream leader as a war investment is conducive to capacity release, and the net return profit of 2022max 2023max in 2024 is expected to be 2.45pm 372pm 475 million, giving it a "overweight" rating for the first time.
Risk tips: downstream demand is lower than expected, product prices fluctuate, and projects under construction are not as expected.