Main points of investment:
The performance is in line with expectations. In 2023, H1, the company achieved a total operating income of 1.535 billion yuan, down 12.08% from the same period last year, and the net profit attributed to shareholders of listed companies was 176 million yuan, down 1.96% from the same period last year. The net profit after deducting non-return was 155 million yuan, an increase of 5.09% over the same period last year. Among them, Q2 achieved revenue of 774 million yuan in a single quarter, down 10.08% from the same period last year, realized net profit of 100 million yuan, an increase of 25.25% over the same period last year, and realized net profit of 89 million yuan after deducting non-return, an increase of 30.96% over the same period last year. The decline in revenue was mainly affected by factors such as the high base income brought about by the start-up of Jinyuan Industry in the same period last year, and the performance was in line with our expectations in the forward-looking report.
In terms of business segment, white power compressor business, according to industry online data, H1 household air conditioning industry achieved total / internal / external sales of 9824,5778,4046 million units by 2023. Compared with the same period last year, + 12.7%, + 12.7%, 24.8%, and 1.0%, respectively. Benefiting from the high production volume of the home air industry since March this year, the company's Q2 production lines, including new production, are in full-load production. 23H1 compressor parts revenue + 3.38% compared with the same period last year In terms of construction machinery business, affected by the high base figure caused by the transfer of overseas orders from 22H1 in the same period, the company's revenue in the first half of the year was-21.79% compared with the same period last year. In consolidating the European and American markets that were originally mainly covered, the company is now actively expanding other overseas markets such as Japan and South Korea to seek business increment. We expect 23H2 to achieve a continuous increase in production. In terms of auto zero business, 23H1's auto zero business revenue is + 19.21% compared with the same period last year, which is mainly affected by: 1) 22H1 is affected by the low base in the same period caused by the repeated epidemic in East China and 2) the new production line of 22H2 is put into production. At present, the company has full 23H2 orders, and we expect that steam zero business will accelerate in the second half of the year.
Profitability improved significantly compared with the previous month, and the 23H1 net interest rate reached the best level in the same period in 19 years. In 2023, H1, the company achieved a sales gross profit margin of 23.37%, an increase of 5.61 pcts over the same period last year. We expect that the sharp increase in gross profit margin is mainly due to the improvement of the layout of new production lines, such as white electric compressors and steam zero, which were put into production in the second half of last year. In terms of period expense rate, the company's H1 sales expense rate in 2023 was 1.01%, year-on-year + 0.25 pcts, management expense rate increased by 1.38 pcts to 5.27%, financial expense rate increased by 0.55 pcts to 1.80%, mainly due to the increase in interest expenses on convertible bonds. In addition, the R & D expense rate increased by 0.69 pcts to 3.46%, and the company achieved a net sales interest rate of 10.76% in the first half of the year. Up 0.95 pcts from the same period last year, the best level for the same period since 2019. Among them, Q2 achieved a gross profit margin / net profit margin of 25.05% / 12.23% in a single quarter, + 8.22 / + 3.78 pcts in the same period last year, and 2.96 pcts in a month-on-month comparison, respectively, and its profitability was greatly improved.
Maintain a "buy" investment rating. We maintain our previous profit forecast for the company from 2023 to 2025 to 4.04 yuan 5.38 / 703 million, an increase of 53.2% and 33.2% respectively over the same period last year, corresponding to a current price-to-earnings ratio of 12 times / 9 times / 7 times. With the gradual release of production capacity, the scale of the company's white power compressor, construction machinery and steam zero business will continue to expand, and we are optimistic that under the background of high downstream air conditioning production since March this year, the company as an upstream parts supplier is expected to continue to benefit and maintain its "buy" investment rating.
Risk tips: raw material price fluctuation risk; exchange rate fluctuation risk.