On August 18, PUF Software released its 2023 semi-annual report. 23H1 achieved a revenue of 152 million yuan, a decrease of 6.11% compared with the same period last year; the net profit returned to the mother was-31.75 million yuan, and the non-net profit was deducted from the mother-36.93 million yuan, all of which turned into losses over the same period last year.

Revenue pressure fell slightly under seasonal factors, with orders-on-hand fully supporting performance growth in the second half of the year. In the first half of 2023, the domestic economy entered the stage of full recovery. During the reporting period, the company achieved revenue of 152 million yuan, down 6.11% from the same period last year, mainly because the company's business showed obvious seasonal distribution, and sales in the first half of the year accounted for relatively low compared with the whole year. At the same time, the company continued to increase the business expansion of new customers and new areas. The company's contract signing, implementation and delivery, and revenue recognition progress in the first half of the year have a phased lag impact, resulting in a slight decline in revenue. Under the dual influence of a slight decline in revenue and continued growth in operating investment, 23H1's gross profit margin decreased by 42.89% year-on-year 7.11pcts, but we believe that this decline is more short-term fluctuations, the company will maintain a good gross margin level throughout the year. At the same time, by the end of June 2023, the income corresponding to the performance obligations that the company has signed a contract but has not yet been fulfilled or has not been fulfilled is 343 million yuan, and the orders on hand are abundant. Maintaining rapid growth is expected to support the company to achieve better performance growth in the second half of the year.

Strategic customers continue to plough and develop, and the business in advantageous areas continues to expand. 1) Strategic customers: during the reporting period, the company's existing businesses in Petrochina, China Petroleum & Chemical, CNOOC, National Pipe Network, China Construction and China Rallway were all carried out steadily, and strive to expand from the field of financial and group management information construction to the field of production management.

At the same time, with the help of the superior business of the treasurer, the company actively expands the new business of group management and control, and strives to cultivate new strategic customers, and its "stepping stone" role is also gradually emerging. 2) advantage business: in the treasurer business, the company currently serves nearly 30 central enterprises, local state-owned enterprises, industry leading groups and other large group enterprises, and 23H1 has won the bid for two large group customers, Sinochem and Shandong Energy. In terms of sharing services, the company accelerated the expansion of product system, product capacity and coverage, and provided digital transformation services for the sharing center. 23H1 completed the delivery of Shandong high-speed industry Caizhongtai and Haier Group expense platform, and won the bid for Sinochem's financial sharing project. In terms of financial supervision and XBRL data application, the company focuses on creating risk management, compensation second-generation and XBRL data application products. During the reporting period, risk management products have been promoted and applied in overseas China Insurance, Bank of Communications Life, Aiheyi, Lian Life, HSBC Life, AIA and other customers.

Actively open up new business areas and continuously strengthen the research and development work of Xinchuang. 1) Development of new business areas: during the reporting period, the company is not only deeply ploughing the original superior customers and business areas, but also actively exploring new business areas. Based on years of operation and practical experience of petroleum and petrochemical, the company has set up a team to develop an independent, controllable and technologically advanced asset management system for production equipment and facilities, starting with equipment management into the field of production management. At the same time, the company grasps the demand and opportunity of intelligent mine safety construction, controls Beijing Lianfang Company, integrates the advantageous resources of both sides, focuses on the research and development and promotion of comprehensive management and control platform and intelligent safety platform products of the mining industry, and has been applied in some coal mines belonging to China Coal Group, Kailuan Group and Jinchuan Group. 2) Xinchuang R & D: in terms of Xinchuang ERP R & D, the company has completed the research and development of the group's financial core module based on the Xinchuang environment, and has achieved a number of breakthroughs in key performance indicators and functional innovation applications, from domestic chips, operating systems, middleware to databases, fully support the Xinchuang product system, and are currently actively exploring the landing of the pilot.

Profit forecast and investment advice: we expect the company's operating income from 2023 to 2025 to be RMB 922nd 11.50 / 1.408 billion, respectively, and the net profit from its parent to be RMB338 million, corresponding to PE, which is twice that of 28-22-16, maintaining the "buy" rating.

Risk reminder events: the risk of the decline of the prosperity of the petroleum and petrochemical industry; the risk that the business development of the construction industry is not as expected; the risk that strategic customers and new business areas are not as expected; the risk that the promotion of industry innovation is not as expected.