Event: when the company released its 11-year annual report, the company achieved operating income of 1.23 billion yuan, down 12.60% from the same period last year; net profit of 79.23 million yuan, up 2.31% from the same period last year; and net profit of 11.86 million yuan after deducting non-recurrent profit and loss, down 84.28% from the same period last year. The company plans to hand out 1 yuan for every 10 shares.
Comments: the gross profit margin of the company's main products has declined significantly in the past 11 years, of which the gross profit margin of BOPP capacitive membrane decreased by 19.95%, 7.44%, 9.45%, 0.48%, 9.67% and 21.79% respectively. Gross profit margin will continue to be under pressure due to the increase in production capacity in the industry and the high price of crude oil.
Non-recurrent profit and loss contribution Huisheng Plastics, a subsidiary of the company, relocated according to the requirements of the Zhuji Municipal Government's industrial land, from which the company obtained 157 million yuan in demolition compensation and Huisheng Plastics obtained 45.84 million yuan in demolition compensation. The company accounts for non-operating expenses of 97.64 million yuan for the disposal of fixed assets and intangible assets, 9.51 million yuan for demolition expenses and shutdown losses, and accounts for management expenses; 180 million yuan of the compensation received is recognized as non-operating income, and the remaining 11 million yuan is included in deferred income, together with 12 million yuan of unreceived compensation, to make up for the expected demolition expenses and losses in the future period. Therefore, the non-recurrent profit and loss of the company in the past 11 years is the main factor affecting the net profit.
The additional issuance project brings the company into the field of high-tech thin films. In September, 2011, the company raised 1.26 billion yuan through a private offering to build a high-temperature resistant ultra-thin capacitive film project with an annual output of 8000 tons, which is expected to be put into production by the end of 12 years. 60 million square meters of lithium battery separator project, has ordered two lithium battery ion isolation membrane production lines with an annual capacity of 13 million square meters, and is expected to be put into production by the end of 12 years. The 120 million square meter photovoltaic cell packaging material project has ordered an EVA film project with an annual production capacity of 75 million square meters, which is expected to be debugged in October and put into production by the end of 2012; a solar cell back film production line has been ordered and is expected to be debugged by the end of 2012.
To give the "prudent recommendation" investment rating, we expect the company's EPS for 11-13 years to be 0.13,0.16 and 0.24 respectively, and to give the "prudent recommendation" investment rating.
The risk indicates that the construction progress and sales of non-public additional issuance projects are lower than expected.
