Event description
The company released its mid-2023 report that revenue in the first half of the year reached 192.12 billion yuan, an increase of 21.37%; net profit attributable to 2.658 billion yuan, a decrease of 5.34%; and net profit from non-attribution of 2.348 billion yuan, an increase of 32.97%.
Event comment
Revenue in the first half of 2023 increased by 21.37%. From a business point of view, survey, design and consulting business benefited from policy support such as the "three 80 million" of coal power, achieving operating income of 6.37 billion yuan, an increase of 4.97% over the same period last year, and a gross profit margin of 36.29%. In the industrial manufacturing business, the company completed the strategic reorganization of the civil explosion business, and the equipment manufacturing business focused on the strategy of "made in China 2025". The operating income of this business was 15.468 billion yuan, an increase of 28.20% over the same period last year, and the gross profit margin was 18.85%, slightly higher than the same period last year. Investment and operation business achieved operating income of 14.795 billion yuan, an increase of 26.02% over the same period last year; gross profit margin was 29.06%, an increase of 3.27% over the same period last year Revenue from other businesses totaled 3.928 billion yuan, an increase of 15.51% over the same period last year, and gross profit margin remained stable at 15.12%.
In terms of profitability, the gross profit margin increased, the expense rate decreased slightly, the asset / credit impairment loss increased, and the final net profit rate decreased. The vested net interest rate decreased from 0.39pct to 1.38%, mainly due to: 1) other income decreased by 329 million yuan to 243 million yuan; 2) net investment income decreased by 1.053 billion yuan to-78 million yuan; 3) asset impairment loss increased by 133 million yuan to 89 million yuan; 4) credit impairment loss increased by 328 million yuan to 586 million yuan; 5) asset disposal income decreased by 113 million yuan to 58 million yuan 6) the income tax rate will also be increased by 1.88pct to 24.38%. The gross profit margin increased by 0.83pct to 10.93% in the first half of 2023, and the expense rate decreased from 0.04pct to 7.28% during the period, in which the rates of sales, management, R & D and financial expenses changed from-0.03pct,-0.23pct, 0.31pct,-0.09pct to 0.44%, 3.54%, 2.17% and 1.14%, respectively; the vested net profit rate decreased from 0.39pct to 1.38%, and the non-vested net profit rate increased by 0.12pct to 1.22%.
In terms of operating quality, the operating cash outflow decreased in the first half of the year, the cash-to-income ratio increased, and the asset-liability ratio increased compared with the beginning of the year.
In the first half of the year, the company had a net operating cash outflow of 13.632 billion yuan, 161 million yuan less than the same period last year. The ratio of income to cash increased by 2.46pct and 1.32pct to 85.38% and 91.84% respectively. The turnover days of accounts receivable was 73.76 days, an increase of 2.45 days over the same period last year.
The asset-liability ratio was 75.83%, an increase of 1.03 percentage points over the beginning of the year.
The new signing is unilateral, the domestic market has reached a new high, the overseas market has accelerated its expansion, and the performance of new energy is eye-catching. In the first half of the year, the company completed 645.93 billion yuan in newly signed contracts, an increase of 21.2 percent over the same period last year. The value of newly signed contracts in China was 486.35 billion yuan, an increase of 24.9% over the same period last year. Among them, the value of contracts signed by regional headquarters in Southwest, Northwest, East and Central China increased by 165.6%, 78.6%, 37.8% and 15.2% respectively, while that of traditional energy, integrated transportation and housing construction increased by 91.2%, 77.2% and 153.0% respectively. Successfully signed a number of major projects such as Gonghe pumped Storage in Hainan Prefecture of Qinghai Province, Pinglu Canal in Guangxi, and Binhai low-carbon Wisdom City in Qingdao, Shandong Province. The company completed overseas newly signed contracts worth 159.58 billion yuan, an increase of 11.3% over the same period last year. Among them, the value of newly signed contracts in Asia and Europe increased by 42.9% and 17.6% respectively, and in the market along the "Belt and Road Initiative" route increased by 39.1%. Overseas new energy and comprehensive smart energy business increased by 100.7%.
In the first half of the year, the newly signed contract value of the new energy business was 216.4 billion yuan, an increase of 5.2% over the same period last year. The company is expected to fully benefit from the engineering growth driven by the development of the new power system in the future. The company is expected to achieve a net profit of 91 yuan and 11.3 billion yuan in 2023 and 2024, corresponding to the current closing price PE of 10.5,8.4 times, respectively, with a "buy" rating.
Risk hint
1, the policy promotion is not as expected; 2, the business transformation is not as expected.