Performance Overview

In the first half of 2017, the company achieved operating income of 417 million yuan, an increase of 17.87% over the same period last year, and the net profit belonging to shareholders of listed companies was 10.797 million yuan, an increase of 382% over the same period last year.

Business analysis

Compressor business and Jiayun oil and gas consolidation table, the company's revenue growth and profit increased in the first half of the year. In the first half of this year, revenue increased by 18% compared with the same period last year, and home net profit increased by 382% compared with the same period last year. The main growth points are in two sub-sectors: one is the growth of revenue from compressors and central air-conditioning systems, and the other is that Jiayun Oil and Gas, a subsidiary, is included in the consolidated statement. Oil and gas technical service revenue has increased significantly. From the expense point of view, the period expenses increased year-on-year with the expansion of the sales scale, of which the sales expenses were 29.26 million, an increase of 42.5% over the same period last year, mainly due to the labor costs of sales staff, the increase in transportation costs and the consolidation of oil and gas; the financial expenses were 19.07 million, an increase of 116% over the same period last year, mainly due to the increase in interest expenses and exchange gains and losses. In terms of products, revenue from oil and gas technical service products reached 113 million yuan, an increase of 184.12% over the same period last year; revenue from the compressor sector reached 109 million yuan, an increase of 42.25% over the same period last year; revenue from central air-conditioning systems reached 56.94 million yuan, an increase of 33.49% over the same period last year; revenue from ice-making products reached 138 million yuan, down 28.9% from the same period last year. On the whole, the downstream of the company's products are warming up, and the annual operating performance is expected to be further improved.

The leading position of ice-making equipment is stable, and the business expansion in the field of ice and snow sports is increased. The company has a stable market share in the ice-making equipment industry, and its products are mainly used in cold chain logistics, Shang Chao, food processing, chemical industry, concrete cooling and other fields. With the approach of the Beijing 2022 Winter Olympic Games and the rapid development of domestic ice and snow sports, the company makes use of the advantages of refrigeration technology to expand the business of ice and snow sports. At present, the construction of many ice and snow projects such as the Bird's Nest Curling Hall and China Century Altar Skating Hall has been completed. We believe that with the growth of cold chain logistics demand and the increase in the construction of ice and snow projects, the revenue of company ice-making equipment is expected to stabilize and pick up.

Compressors are gradually becoming the core business plate, and high temperature heat pump products can replace coal-fired boilers. Through the acquisition of SRM in Sweden and RefComp in Italy, the company has mastered the core technology of compressors and become an international high-end equipment manufacturer and system solution supplier in the field of refrigeration. In the field of energy saving and environmental protection, the ammonia heat pump unit developed by the company has been successfully applied to the central heating project of Straubin Energy Station in Germany with stable performance and obvious advantages of energy saving and environmental protection; the company's high temperature heat pump products can completely replace boilers and will focus on developing high temperature heat pump units in the northern region, especially in Beijing-Tianjin-Hebei region.

Master fuel cell compressor technology and speed up the layout of hydrogen fuel cell field. During the reporting period, the company joined Tsinghua University, Yutong bus, Antai Science and Technology, Shanghai Jiaotong University and other 12 enterprises and universities, with the 712 Research Institute of China Shipbuilding heavy Industry Corporation as the supporting unit. the "Rapid dynamic response fuel Cell engine Research and Development Project" was selected into the 2017 annual project announcement list of the national key R & D plan "New Energy vehicle". The company has now mastered the core technologies such as fuel cell air supply system and hydrogen circulating pump, and accelerated its research and application in the field of hydrogen energy. during the reporting period, it and professional investment institutions subscribed no more than 17.6% of Hydrogenics, a Canadian hydrogen fuel cell manufacturer, through an industrial merger fund, in order to seize the commanding heights of new technologies and improve the hydrogen energy and fuel cell industry chain.

Profit forecast

We forecast that the company's operating income from 2017 to 2019 will be 10.8 million yuan (1.31 billion yuan), an increase of 34% (21%) and 18% (respectively) over the same period last year. The net profit from the parent will be 5990 won (117 million yuan), an increase of 79% (52%) and 31% (EPS), respectively, and the corresponding PE will be 0.088 yuan (0.13) and 0.17 yuan (RMB) respectively.

Investment suggestion

We believe that the company is the leading enterprise in the global ice-making equipment industry, mastering the core technology of compressors; considering the broad development prospects in the field of hydrogen energy and fuel cells, the company speeds up the strategic layout of the new energy field. Maintain the company's "buy" rating, with a target price of 14016 yuan for the next 6-12 months.

Risk hint

The demand for refrigeration equipment is insufficient, competition in the compressor industry is intensified, and the progress of hydrogen fuel cells is not up to expectations.