Main points of the report
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Ruihe shares released the 2016 mid-term report, with operating income of 1.025 billion yuan during the reporting period, up 25.45% from the same period last year, gross profit 14.26%, down 0.02%, and net profit attributable to 54 million yuan, up 41.42% from the same period last year.
Based on this, it is calculated that the company achieved revenue of 507 million yuan in the second quarter, up 23.57% from the same period last year, gross profit 14.23%, down 0.01% from the same period last year, and net profit attributable to 29 million yuan, up 48.60% from the same period last year.
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Against the current, the performance increased significantly: the decoration industry declined in the first half of the year, and the company actively opened up the market, making breakthroughs in the northeast, northwest and south China markets, leading to a 25.45% increase in overall revenue. Profitability remained basically stable, and the gross profit margin of the decoration business, which accounted for the largest proportion, fell slightly, resulting in a 0.02% decline in the overall gross profit margin. In terms of expenses, due to the increase in short-term borrowing, the increase in interest expenses led to an increase in financial expenses by 124.68%, and the increase in investment in R & D materials led to an increase in R & D investment by 92.84%. In addition, the increase in the loss of bad debts in the current period led to an increase of 25 million yuan in asset impairment losses. at the same time, the increase in long-term equity investment income led to an increase of 11 million yuan in investment income, and finally achieved a net profit of 54 million yuan, an increase of 41.42%.
The company issued a performance forecast that the net profit in the first three quarters was 0.69 million yuan, an increase of 30%, 60%, 0.48 yuan, 0.59 yuan over the same period last year. Based on this, the net profit in the third quarter was calculated to be 0.15-31 million yuan, an increase of 1.33% 106.66% EPS0.11 yuan 0.22 yuan over the same period last year.
Decoration orders continue, the industry position is stable: the company is one of the leaders in China's public building decoration industry, in the first half of the year in the industry recession, the company still maintained steady growth. The company received a total of 165 million decoration contracts with Washington Real Estate, Dalian Shicheng and Evergrande in February, and 516 million decoration contracts signed with Wuxi Industrial and Construction Center, Shenzhen Ningjia Real Estate, Huatze Investment and Xiangyang Industry in May. Benefiting from the government's destocking policy, the company, as an industry leader, will continue to enjoy policy dividends.
Fixed increase landing, accelerate the layout of photovoltaic industry: the company set an increase landing in the first half of the year, raising 850 million yuan to invest in Jinzhai County Baitazhai Xinyi 100MWp photovoltaic grid-connected power station project, photovoltaic building integrated R & D center project and other projects to further strengthen the layout of photovoltaic business. In addition, the company increased its investment in Credit Suisse Energy in the first half of the year to invest in photovoltaic power generation projects. at present, part of the photovoltaic power station has been connected to the grid. In the future, the company will continue to promote the integration of photovoltaic buildings and cultivate new profit growth points.
It is estimated that the company's EPS in 2016 and 2017 will be 0.73 yuan and 0.89 yuan respectively, and the corresponding PE will be 58 and 47 times respectively, with a "buy" rating.
Risk hint: business risks brought about by industry regulation.