The company achieved deduction of 41 million yuan in non-return net profit in the third quarter, down 26.49 percent from the same period last year. The company released a 23-year three-quarter report. In the first three quarters, the company realized income / return net profit of 25.76 million yuan, 39.93% compared with the same period last year, and 130 million yuan in the first three quarters, compared with the same period last year.-38.84%. Of this total, Q3 realized income / return net profit of 916,000 yuan in a single quarter, compared with-5.15% and 37.70% of the same period last year, deducting 41 million yuan of non-return net profit, and-26.49% of the same period last year.
Revenue of superplasticizer declined, functional materials increased steadily.
In the first three quarters of 23, the income of high-performance superplasticizer / superplasticizer / functional materials was respectively 14.79 million yuan, 0.79 percent, 0.4% compared with the same period last year, of which Q3 single-quarter income was 5.07 percent, 0.26 percent, 138 million yuan, 10 percent, 10 percent, and 10 percent, respectively, compared with the same period last year. The decline in the performance of high-performance superplasticizer is mainly due to a large decline in sales, Q3 sales year-on-year / month-on-month respectively-21% / month-on-month 18%, price-0.6% on-month / month-on-month 3.8%. The company's production capacity continues to expand, by the end of 23H1, the synthesis capacity of high-performance superplasticizer has been expanded to 649000 tons, and the layout of South China has been further improved after the Jiangmen base project in Guangdong has been completed and put into production. The performance growth of functional materials was mainly driven by the increase in sales volume, with Q3 sales year-on-year / month-on-month + 3% / month-on-month + 3% / month-on-month + 6.7% / month-on-month + 6.7% / month-on-month + 4.2% respectively.
We continue to be optimistic about the medium-and long-term growth of functional materials such as crack-resistant waterproof materials, high-performance wind power grouting materials and traffic materials.
The increase of expense rate drags down the net interest rate, and the cash flow is running well.
In the first three quarters, the company's overall gross profit margin of 35.04%, year-on-year + 0.89pct, of which Q3 single-quarter gross profit margin of 33.06%, year-on-year / month-on-month respectively + 2.40/-2.78pct, the company's average purchase price of ethylene oxide decreased by 15.73% compared with the same period last year. During the first three quarters, the expense rate was 25.14%, year-on-year + 2.21pct, in which the sales / management / R & D / financial expense rate was + 1.30/+0.96/-0.12/+0.07pct respectively, and finally achieved a net interest rate of 7.71%, year-on-year-2.69pct. The company's asset-liability ratio at the end of the first three quarters was 39.84%, compared with the same period last year-1.73pct, and the capital structure was optimized. The net inflow of operating cash flow of Q3 was 326 million yuan, a sharp increase of 225% over the same period last year. Due to the increase in cash-to-cash ratio and the decrease in cash-to-cash ratio, it is estimated that Q3 cash-to-cash ratio is 116%, year-on-year + 26pct, cash-to-cash ratio is 68%, year-on-year-9.6pct.
There is still room to increase the market share of superplasticizer, and to maintain the "buy" rating, we believe that with the increase of the company's production capacity and permeability, the profitability of the main business of superplasticizer is expected to be fully reflected, and functional materials and overseas sectors have more growth potential. In view of the decline in the company's net profit in the third quarter, the company's 23-25 net profit forecast for 23-25 is reduced to 2.0cm 3.5pm (the previous value is 2.3pm). With reference to the comparable company valuation, the company is given a 24-year 18-fold target PE, corresponding to the target price of 14.94 yuan (downgrade, the previous value is 24.12 yuan), and maintain the "buy" rating.
Risk tips: production capacity is not as expected, demand is declining, raw material prices are rising, and so on.