Event
The company released three quarterly results for 22 years: revenue in the first three quarters was 3.03 billion, + 15.8% compared with the same period last year; net profit from home was-89 million, down 90 million from the same period last year; net profit after deduction was-36 million, down 38 million from the same period last year; revenue corresponding to Q3 was 1.17 billion, year-on-year + 24.4%, month-on-month + 26%; net profit from home was 6 million, which reversed losses compared with the same period last year and month-on-month.
Brief comment
The impact of the epidemic subsided + viscose staple outside processing, the company's performance in the third quarter to reverse losses.
The company achieved revenue of 3.02 billion in the third quarter of 2022, + 15.8% compared with the same period last year; realized net profit of-89 million, down 90 million from the same period last year; realized net profit of-36 million, down 38 million from the same period last year; realized revenue of 1.17 billion corresponding to Q3, + 24.4% year-on-year and + 26% compared with the same period last year; realized net profit of 6 million, and reversed losses compared with the same period last year.
Q3's single-quarter performance turnaround is mainly due to outside processing of viscose staple fiber. the company has a nominal production capacity of 100000 tons of viscose staple fiber. This sector achieved revenue of 544 million in the first half of the year, accounting for 29.20%, but affected by the rising price of raw materials and sluggish demand. Gross profit margin is only 0.15%, a drag on the company's overall profit, is the company's main source of loss in the first half of the year. On July 15, the company announced that the business of viscose staple fiber would be transferred to outsourced processing mode through commissioned processing, which would improve the overall profitability of the company while transferring operational risks.
In addition, in the first half of the year, the company lost 73 million yuan in parking due to the epidemic, which also affected the company's profits. with the gradual recovery of the impact of the epidemic, Q3 single-quarter gross profit margin / net profit margin was 7.86% / 0.88% respectively. Compared with Q2 gross profit margin / net profit margin level of 6.27% Compan 4.85% has been greatly improved.
In other product sectors, on June 27, the company acquired 2% stake in Qifeng Chemical Fiber, which is a leading acrylic fiber manufacturer in China, with a production capacity of 140,000 tons per year. Qifeng Chemical Fiber profits will be included in the company's investment income according to the corresponding shareholding ratio, thickening the company's performance. The downstream demand and profit contribution of viscose filament are relatively stable, and the integrated production capacity of carbon fiber composite is also expected to be put into operation around Q4, and the company's performance is expected to further improve in the future.
The carbon fiber composite integration project is just around the corner, and there are broad prospects for long-term growth. In terms of carbon fiber, the company has a 49 per cent stake in Jilin Baodi, which has an annual production capacity of 8000 tons of large tows, while its wholly-owned subsidiary Jilin Cameca has a production capacity of 600tons of small tows. In terms of construction capacity and future planning: the company announced in November 21 that it would raise an additional 1.2 billion yuan to invest in the construction of carbon fiber composite and supporting carbon fiber projects. at present, the fixed increase has been completed, and the project is expected to be completed and put into production around Q4 in 22 years. the formation of an annual output of 12000 tons of carbon fiber composite and upstream supporting carbon fiber capacity. In addition, in March this year, the company proposed in an announcement that its shareholder, Jilin Chemical Fiber Group, promised to inject a controlling stake in Jilin Guoxing carbon Fiber Co., Ltd. into listed companies in the next three years. The actual controllers of Guoxing carbon Fiber and Jilin Chemical Fiber are both Jilin Municipal SASAC, the former is the largest large tow carbon fiber enterprise in China, after the acquisition of Guoxing carbon fiber assets, the company expects to form a platform development pattern of at least 60,000 tons of carbon fiber + 100000 tons of composite material during the 14th five-year Plan period, the integrated layout of carbon fiber will be more complete, and the competitiveness of the industry will be further strengthened.
Profit forecast and valuation: the company's net profit in 2022, 2023 and 2024 is expected to be 0.2,2.5 and 340 million yuan respectively, corresponding to 423X, 40.1X and 29.2X PE in 2022, 2023 and 2024 respectively, maintaining the "buy" rating. This profit forecast does not take into account the increase in the profits of listed companies after the acquisition of Guoxing carbon fiber.
Risk hints: (1) downstream demand is lower than expected: the profit of viscose fiber of the company's main products is greatly affected by demand, and the decline in demand may affect the company's operation; (2) the risk of product price reduction: if the price of the company's related product industry chain goes down, it will affect the product profit; (3) the development of new products is not as expected. (4) the project is put into production less than expected: the company has more capacity in construction and production, if the project production schedule is not as expected, it may affect the profit growth of the company; (5) the intensification of market competition at home and abroad: the intensification of market competition will affect the profitability of the industry and the company; (6) the risk of personnel loss and shortage; (7) rising prices of raw materials and energy: may affect the cost of the company.