Event: the company issued a mid-term report in 2023, during which the company achieved revenue of 822 million yuan, + 3.98% year-on-year, and net profit of 81 million yuan,-26.09%, compared with the same period last year. Among them, the revenue in the second quarter was 444 million yuan, + 5.27% from the same period last year, + 17.78% from the previous year, and the net profit from the mother was 48 million yuan,-5.27% from the same period last year, and + 44.22% from the previous year.
Revenue grew steadily in the first half of the year, and profits were under pressure from the same period last year. The company's H1 revenue grew steadily in 2023, which mainly contributed to the revenue growth of oil filtration products and the newly developed green building energy-saving materials, which are expected to become a new growth point in the future. Due to factors such as the high price of H1 bulk raw materials in 2023, the incomplete release of new production capacity, the increase in fixed fees, and the change in product income structure, the company's H1 return net profit declined year on year in 2023, with H1 gross profit of 24.12% in 2023, down 4.92pct from the same period last year.
Market demand gradually picked up, and the performance in the second quarter improved significantly from the previous quarter. The company's Q2 revenue increased month-on-month in 2023, mainly due to a rebound in market demand and a substantial increase in revenue from clean air products. In 2023, the income of Q2 clean air products was + 28.52%, of which the income of purification equipment and air filter paper was + 37.36%. In 2023, the income of Q2 high-efficiency and energy-saving products was + 2.61%. Among them, the income of micro-glass cotton products is + 11.92%. The company's output continues to increase, unit fixed fees have declined, and capacity climbing has brought about an improvement in profitability. the company's Q2 gross profit margin in 2023 was 25.2%, an increase of 2.4pct from the previous month.
New products and new applications are constantly expanding, and it is proposed to sell the global layout of the distant environment. The company is committed to the scientific and technological innovation and transformation of materials and application technologies in the fields of "clean air" and "high efficiency and energy saving", and actively opens up new products, new applications and international markets. continue to promote domestic substitution in semiconductors, electronics, medicine, new energy vehicles, aerospace and other fields.
In addition, the company plans to transfer 70% of its subsidiary, Yuanyuan Environment, to Manhumer Singapore Holdings, which is the world's leading provider of filtration technology solutions. Zaisheng and Manhumer Group will jointly devote themselves to the innovative development of clean air filtration products and have a very good synergy for brand complementarity, product development and market development. It will also help the company to expand its layout in the new energy vehicle sector and enhance the company's global business scale.
Profit forecast and investment advice: the company is a leader in the field of filter materials in China, and is one of the few companies in the world that can simultaneously provide a variety of filter materials, such as high-performance glass fiber filter material, low resistance melt-blown filter material, high-efficiency PTFE membrane, micro-electrostatic filter material and chemical filter material, with clean air and high efficiency and energy-saving as the core, with a wide range of downstream applications, and is optimistic about the development of new application scenarios and gradually realize domestic substitution. The company carries on the global layout and is optimistic about the long-term development.
We forecast that the net profit from 2023 to 2025 will be 183 million, 234 million and 285 million respectively, corresponding to the current PE of 26 times, 20 times and 17 times respectively, maintaining the "buy" rating.
Risk tips: downstream demand is lower than expected, new business progress is not as expected, capacity release is not as expected, raw material prices fluctuate, and so on.