Core ideas:
The company released its third quarterly report for 2022, and its performance exceeded market expectations. In 2022, Q1-Q3 achieved revenue of 1.004 billion yuan, + 45.1% year-on-year, and net profit of 336 million yuan, + 109.83%, and basic earnings per share of 1.34 yuan per share. In a single quarter, 22Q3's revenue was 344 million yuan, + 58.5% compared with the same period last year, with a net profit of 108 million yuan, + 192.91% compared with the same period last year.
22Q1-Q3 gross profit margin and net profit margin were 53.4% and 33.47% respectively, the gross profit margin was the same in the first half of the year, and the net profit margin decreased 1pct relative to 22H, mainly due to the slightly upward management expense rate.
Benefiting from the increase in product prices and the appreciation of the US dollar in 2022, the company's performance exceeded market expectations in the first three quarters.
Product prices benefited from tight supply and cost-side factors, with gross profit per ton hitting a record high. The company is the largest industrial fungicide leading enterprise of isothiazolinone in Asia, with a production capacity of more than 40,000 tons. Due to environmental protection and epidemic factors, the industry supply has been continuously tight, and the price of superimposed raw materials has risen. The price of the company's main products has increased significantly since 2022. The average product price in the first three quarters of 22 was 385,000 yuan per ton, compared with 25300 yuan per ton in 2021. The average price has increased by about 50%, and the increase in product price has brought a significant increase in the gross profit per ton of the company's fungicide products. In 2021, the gross profit per ton of the company's fungicide products reached 121,000 yuan per ton, and the comprehensive gross profit per ton of Q1-Q3 products reached 255,000 yuan per ton in 22 years. We expect that in the future, based on the downstream demand, with the gradual improvement of the epidemic, the demand side will usher in restorative growth, and product profitability is expected to be maintained.
Profit forecast and investment advice. Affected by the shutdown and transformation of the Q3 production line, the company's 22Q1-Q3 output is 24100 tons,-16% compared with the same period last year, sales volume is 26100 tons, and the production and marketing rate reaches 108.6%. The company completed the transformation of the production line in mid-September to achieve normal production, and the recovery company based on downstream demand is expected to have a stable price in the future. We estimate that the company's EPS from 2022 to 2024 will be 1.68,1.88,2.15 yuan per share respectively. With reference to the comparable company valuation, give the company 2023 12XPE valuation, corresponding to 22.52 yuan per share, given a "buy" rating.
Risk hint. Product price, exchange rate, raw material price fluctuation and lower-than-expected demand risk, etc.