Event: the company released its half-yearly report for 2022. During the reporting period, the company realized revenue of 10.353 billion yuan, an increase of 0.19% over the same period last year; net profit of 66 million yuan, an increase of 69 million yuan over the same period last year; and non-net profit of 62 million yuan, an increase of 79 million yuan over the same period last year.
Steady growth in performance and reduction in financial expenses. In the first half of 2022, the company achieved revenue of 10.353 billion yuan, an increase of 0.19% over the same period last year. The return profit was 66 million yuan, an increase of 63 million yuan over the same period last year. The company strictly controls costs, strengthens creditor's rights management, and vigorously collects arrears, which has a positive impact on performance. In the first half of the year, the company's financial expenses were 126 million yuan, a decrease of 140 million yuan compared with the same period last year, mainly due to the company's continuous optimization of financing structure, control of financing scale, reduction of financial expenses, and partial exchange gains due to the fluctuation of the exchange rate of RMB against the US dollar.
The number of newly signed contracts increased by 10% compared with the same period last year, and the number of new contracts signed for industrial projects increased rapidly. In the first half of 2022, the total amount of unfinished contracts was 63.776 billion yuan, and the value of newly signed contracts was 21.433 billion yuan, an increase of 10.0% over the same period last year. Newly signed contracts for engineering survey, design and consultation totaled 1.754 billion yuan, an increase of 24.13 percent over the same period last year. Newly signed contracts for equipment manufacturing totaled 1.412 billion yuan, an increase of 86.77 percent over the same period last year. Newly signed contracts for engineering construction totaled 18.267 billion yuan, up 5.47 percent over the same period last year; of this total, industrial projects signed 9.088 billion yuan, up 78.27 percent; civil construction contracts totaled 7.74 billion yuan, down 717 million yuan; and highway and municipal contracts totaled 1.439 billion yuan, down 61.78 percent from the same period last year. The rapid growth of newly signed contracts for industrial projects stems from the fact that the company has achieved remarkable results in opening up new markets in new areas such as new infrastructure, new energy, and the transformation of new scientific and technological achievements.
The expansion of new areas has achieved remarkable results. The company signed 2.07 billion yuan for Liangtun settlement house EPC construction project general contract, 670 million yuan for Weishi county distributed roof photovoltaic power generation project EPC general contract, and 490 million yuan for Twelve smelter newly signed clean alternative fuel for vehicles-alcohol ether fuel 600000 tons production base and 80 terminal filling stations. The general contract of Mazongshan production stripping project signed by No. 12 Metallurgy is 450 million yuan, and the general contract of Henan Zhongfu 2300mm single-stand cold rolling mill signed by Zhongfu Science and Technology is 150 million yuan. The company focuses on developing photovoltaic, wind power, new energy and other fields in the domestic market, with remarkable results.
Investment advice: the company's performance turned from loss to profit during the reporting period, the newly signed order steadily improved, covered for the first time, recommended "recommended" rating.
Risk hints: the risk of intensified market competition; the risk that the COVID-19 epidemic repeatedly affects the progress of the project; and the risk that the recovery of accounts receivable is not as expected.