The company released its semi-annual performance report for 2023, with operating income of 2.663 billion yuan in the first half of 2023, down 5.24% from the same period last year, and net profit of 331 million yuan from the same period last year, up 0.47% from the same period last year, deducting 378 million yuan from non-home net profit, up 17.99% from the same period last year. Of this total, the operating income in the second quarter was 1.433 billion yuan, down 11.02% from the same period last year, and the net profit returned to the mother was 179 million yuan, down 4.29% from the same period last year. The non-return net profit was 229 million yuan, up 26.08% from the same period last year.
The proportion of propylthiazole increased, consolidating the company's profit resilience. Pesticide prices did not perform well in the second quarter.
According to Zhongnong Lihua and Baichuan, the second-quarter average prices of imidacloprid, acetamiprid, methamidazole, thiazide, butyl ether urea were 9.29,8.32 (YoY-46.41%,QoQ-22.52%), 53.62 (YoY-40.98%,QoQ-24.40%), 8.79 (YoY-30.22%,QoQ-26.17%) and 6.58 (YoY-47.32%) respectively. QoQ-38.75%), 11.98 (YoY-18.27%,QoQ-9.61%) 10,000 yuan / ton The average prices of difenoconazole, pyrazolyl ester and propiconazole in fungicides were 12.71 (YoY-27.19%,QoQ-18.97%), 21.34 (YoY-13.72%,QoQ-18.71%) and 12.89 (YoY-30.66%,QoQ-22.68%) ten thousand yuan / ton, respectively. In the second quarter of 2023, the company's pesticide output increased by 16.43%, with an annular increase of 21.59%, and sales increased by 16.63%, with an increase of 29.59%. Under the background of the decline in pesticide prices, the increase in sales offset some of the adverse effects. In addition, the company's prothionazole products have good profitability, and its sales share has increased the overall gross profit margin, making the company's profit level more robust.
Hengning Phase II adjustment to increase investment, propylthiazole planning capacity increase. Shandong Hailier, a wholly owned subsidiary of the company, has officially entered the trial production stage of 3000 tons of prothiazole in December 2022. If the project is fully put into production, the design capacity of propylthiazole in Hailier, Shandong Province will reach 5000 tons. In addition, in April, the company changed the investment project of Qingdao Hengning Phase II project, further increased the investment intensity, and increased the investment scale from the previous 504 million yuan to 2.021 billion yuan, increasing or decreasing some projects. among them, the production capacity of prothiazole increased from 8000 tons to 10000 tons. The increase of the proportion of prothiazole in the product portfolio will help to improve the company's profitability and market competitiveness.
Maintain earnings forecasts and maintain "overweight" ratings. It is estimated that the company's operating income from 2023 to 2025 will be 57.52,72.36 and 8.102 billion yuan respectively, and its net profit will be 5.57,6.83 and 855 million yuan respectively, corresponding to 10X/8X/7X for PE, maintaining the "overweight" rating.
Risk hint: product prices drop, production capacity is lower than expected