The company released its three-quarter report for 2022, with operating income of 3.803 billion yuan in the first three quarters, an increase of 47.20% over the same period last year, a net profit of 431 million yuan, an increase of 38.41%, and a non-return net profit of 482 million yuan, an increase of 62.85% over the same period last year. Among them, the operating income in the third quarter was 992 million yuan, an increase of 59.00% over the same period last year, the net profit of returning to the mother was 101 million yuan, an increase of 22.68% over the same period last year, and the net profit of non-return was 162 million yuan, an increase of 102.18% over the same period last year. The deduction of non-difference is mainly due to the influence of foreign exchange, and the quarterly results exceed market expectations.
Pesticide prices gradually return to the normal level, and the stability of multi-base layout is prominent. In the third quarter, the overall pesticide market is weak, and the price fluctuates in the normal range. According to Zhongnong Lihua, the average prices of imidacloprid, acetamiprid, methamidazole, thiamethamide, thiazide and butyl ether urea in pesticides were 15.92 (YoY+4.97%,QoQ+2.27%), 15.08 (YoY+21.22%,QoQ-2.87%), 82.08 (YoY-13.95%,QoQ-5.41%), 12.85 (YoY+5.50%,QoQ+1.95%) and 12.31 (YoY+35.02%) respectively. QoQ-1.54%), 14.11 (YoY+3.27%,QoQ-3.73%) 10,000 yuan / ton The average prices of pyraclostrobin, difenoconazole and propiconazole in fungicides were 25.47 (YoY+64.32%,QoQ+2.99%), 17.68 (YoY+1.77%,QoQ+1.32%) and 18.71 (YoY+21.00%,QoQ+0.62%) ten thousand yuan / ton, respectively.
In mid-August, Shandong Hailier stopped production due to the accident. The company's pesticide output in the third quarter was 12100 tons, down 18.52% from the previous quarter, and its sales volume was 11700 tons, down 26.10% from the previous quarter. However, the gross profit margin of the single quarter increased by 27.27% compared with the previous quarter by 1.7 pct, reflecting the profit stability brought by the production capacity climbing of Qingdao Hengning base.
Hengning Phase II rich product categories, prothionazole advantage products to expand the chain. The first phase of the Hengning project has entered trial production in June, and the second phase is also under construction, including 1000 tons of star insecticide chlorobenzamide and 8000 tons of prothionazole, the company's dominant variety. For prothionazole, the company announced in April that after planning a production capacity of 3000 tons in Hailier, Shandong Province, the company announced in June that it had acquired a 26% stake in Jinxinyi, Shaanxi Province, and further enhanced its ability to control the key intermediate α-acetyl-γ-butyrolactone. At present, there are many domestic planned production capacity of prothionazole, and the company is expected to seize the market dividend through the advantages of scale and industrial chain.
Adjust the earnings forecast to maintain the "buy" rating. In the third quarter, some bases of the company stopped production due to the accident, so we adjusted our profit forecast for this year. It is estimated that the company's operating income in 2022-2023 will be 43.78,62.96 and 8.098 billion yuan respectively (previously 4.572 billion yuan in 2022), and the net profit of returning home will be 5.60,7.75,891 million yuan respectively (prior to 627 million yuan in 2022). Corresponding to 15X/11X/10X, respectively, we will maintain the "buy" rating.
Risk hint: product prices drop, production capacity is lower than expected