Report summary:
The company released its 2017 interim report. In the first half of 2017, the company achieved operating income of 829 million yuan, an increase of 29.35% over the previous year, net profit of 87 million yuan, an increase of 49.63% over the previous year, and basic earnings per share of 0.141 yuan.
Component sales grew steadily, and the overall industry chain layout: In the first half of 2017, the company achieved component sales of 428 million yuan, an increase of 18.08% over the previous year. The company currently has 5 production bases, laid out in the entire photovoltaic industry chain, completed collaboration and complementarity in the industrial chain, brought good cost control and risk resistance, and contributed to the long-term steady growth of the company's performance.
EPC revenue increased dramatically, and the cost advantage was significant: the company achieved project revenue of 211 million yuan in the first half of 2017, a sharp increase of about 24 times over the same period last year. The company has integrated advantages in the field of power plant EPC, can provide customers with integrated services for components, design, installation and subsequent operation and maintenance, and has strong cost competitiveness. The company is actively undertaking EPC projects for ground-based power plants and poverty-alleviation power plants nearby in the regions where the industry has settled. In the first half of 2017, it received a total of about 51 MW of power plant EPC projects. It is expected that it will continue to maintain a good growth trend in the future.
Continued development of its own power plants will support its performance: starting in 2013, the company began to deploy in the field of photovoltaic power plants, which is conducive to the consumption of its own production capacity and can also lay a solid foundation for performance growth. In the first half of 2017, the Shaanxi Tuori 20MW power plant project and the 70MW power plant project involving central enterprises and state-owned enterprises were all successfully connected to the grid. Up to now, the total number of photovoltaic power plant projects owned and operated by the company is 260 MW, and there is an opportunity to reach 1 GW in the future. The company continues to expand in the field of ground power plants, and at the same time continues to advance in distributed and photovoltaic poverty alleviation projects. The power plant business will be an important performance support for the company.
Profit forecast: The company's EPS for 2017-2019 is expected to be 0.13, 0.16 and 0.18 yuan respectively. The company's industrial chain cost control capabilities are strong, performance is growing steadily, and its own power plant and EPC business continue to gain strength, maintaining the increase rating.
Risk warning: (1) Power plant and EPC business development falls short of expectations; (2) PV installed capacity falls short of expectations