Event description
The company released its semi-annual report in 2023, achieving revenue of 13.61 billion yuan (year-on-year-21.3%), net profit of 610 million yuan (year-on-year-83.3%), and non-net profit of 550 million yuan (year-on-year). Among them, Q2 realized revenue of 7.04 billion yuan (year-on-year-17.5%, month-on-quarter + 7.1%), net profit of 160 million yuan (year-on-year-91.6%, month-on-month-64.6%), and non-net profit of 140 million yuan (year-on-year-93.2%, month-on-month-66.7%).
Event comment
Product prices have fallen sharply, and the company's performance has declined significantly. In the first half of 2023, the global glyphosate was still in a big stock removal cycle, the terminal had few purchase orders for raw drugs, and product prices continued to fall; the silicone industry still showed a surplus, the overall economy continued to decline, and prices went down all the way. Affected by this, the prices of glyphosate products, organosilicon products, specialty chemicals, food additives and yellow phosphorus were 26728, 12565, 10110, 10682 and 24181 yuan per ton respectively in the first half of 2023, which were-56.4%,-42.4%,-39.7%,-12.6% and-20.9% respectively compared with the same period last year. In the second quarter of 2023, the price of the company's main cyclical products continued to decline compared with the first quarter of 2023, resulting in a continuous decline in performance compared with the previous quarter.
Product prices have picked up recently, and it is expected that the cycle plate will meet the marginal improvement. For glyphosate, affected by overseas depots and falling prices of raw materials, the price fell to about 23000 / ton at the end of May. In June, the rising price of raw material yellow phosphorus led to a pick-up in costs, and the industry's continuous low-load production led to effective digestion of inventories. Domestic supply and demand tightened, superimposed glyphosate third quarter overseas sales season expectations and other factors, glyphosate market price rose to about 26,000 yuan / ton by the end of June. As of late August, the price of glyphosate fluctuated up to 32,000 yuan / ton. In terms of phosphate rock, from April to June, due to the downward influence of fertilizer and yellow phosphorus, the main products downstream of phosphate ore, the opening of downstream factories decreased, the demand for phosphate rock weakened, and the market price of phosphate ore declined slowly. by the end of June, the price of 28% grade phosphate ore ship plate fell to about 800 yuan / ton. As of late August, the price of 28% grade phosphate ore ship plate rose slightly to 850 yuan / ton. In terms of fertilizer, the market price of monoammonium phosphate fell to 3000 yuan / ton at the end of June, and the market price of diammonium phosphate was about 3400 yuan / ton, which was 600 yuan / ton lower than that at the beginning of the year. By late August, the market prices of monoammonium phosphate and diammonium phosphate were about 3300 yuan / ton and 3600 yuan / ton respectively, slightly higher than at the end of June. Entering the third quarter, the overall bottom of the company's cyclical products has rebounded, and the performance is expected to usher in marginal improvement.
A number of projects are progressing steadily to accelerate the transformation to science and technology-based green chemical new materials enterprises. In the first half of 2023, the company's key projects progressed steadily. Hubei Xingrui 550t / a silicone microcapsule pilot production line was completed in March this year and has now achieved batch sales; Hubei Ruijia 200,000 t / a RTV project (phase I) entered the trial operation stage after it was completed in mid-July; the phosphating agent project has completed the 800t / yr pilot test and is carrying out 5000 t / an industrial plant design. The company's 5000 cubic meters / year aerogel felt project, the holding subsidiary Hubei Xingyou 200,000 tons / year battery-grade iron phosphate project phase I project, and the participating company Hubei Youxing 300,000 tons / year lithium iron phosphate first phase project, phosphate fluorine lithium industry 100000 tons / year battery-grade lithium dihydrogen phosphate project will be completed and put into production this year. New projects have been launched to contribute to the performance increment to accelerate the company's transformation to a new material enterprise.
Maintain a "buy" rating. The company is the leader of the phosphorus chemical industry, with the industry's unique industrial chain advantages of "integration of mine electrification", "coordination of phosphorus and silicon salt" and "combination of mineral and fertilizer". At present, it is speeding up the transformation and upgrading to scientific and technological green chemical new materials enterprises.
It is estimated that the 23-25-year net profit of the company is 16.5,25.9 and 3.42 billion yuan respectively.
Risk hint
1. The risk of macroeconomic weakness
2. The project construction is not up to the expected risk.