Production and operation are stable as a whole, and the layout of the industrial chain extension will be accelerated. The company released the third quarter report of 2023: in the first three quarters of 2023, the sales of fluorine refrigerants, fluorine foaming agents and hydrogen fluoride decreased compared with the same period last year, and the prices of fluorine refrigerants and hydrogen fluoride products decreased compared with the same period last year. The company achieved operating income of 2.609 billion yuan (year-on-year-30.76%) and net profit of 238 million yuan (year-on-year).
Among them, in 2023 single quarter, the company achieved revenue of 873 million yuan (year-on-year-27.23%), net profit of 108 million yuan (year-on-year-7.97%) and non-net profit of 44.4 million yuan (year-on-year-62.05%). The company's interest income in the single quarter of 2023Q3 was 108 million yuan, an increase of about 71 million yuan compared with the single quarter of 2023Q2, and the capital occupation fee of 2023Q3 in the single quarter was 83.9535 million yuan.
In the past three years, the company as a whole has achieved stable and orderly production and operation, further consolidated the position of the refrigerant industry, and continued to speed up the layout of the industrial chain. In addition, the company's actual controller has recently proposed to use share repurchases for equity incentives or employee stock ownership plans at an appropriate time in the future.
The price of fluorine foaming agent rose 23% compared with the same period last year, and the prosperity of the third-generation refrigerant industry is picking up. The average purchase price of raw materials decreased significantly in the first three quarters of 2023 compared with the same period, including sulfuric acid, tetrachloroethylene, chloroform, dichloromethane and trichloroethylene-64.42%,-48.56%,-45.21%,-37.08% and-36.65%, respectively.
Under the weak support of raw materials, the prices of some of the company's main products have also been reduced: in the first three quarters of 2023, the average prices of fluorine refrigerants and hydrogen fluoride were 21447 yuan / ton and 7446 yuan / ton respectively,-22.30% and-9.78% respectively compared with the same period last year. In terms of blowing agents, affected by the accelerated reduction of fluorine blowing agent quotas in 2023, the supply of domestic manufacturers is relatively tight, downstream demand is also relatively stable, and prices are up 22.88% from the same period last year. In terms of refrigerants, the third generation refrigerants have gradually recovered, and the prosperity of the industry continues to improve.
To fluorine refrigerants, fluorine fine chemicals, fluoropolymer direction of industrial chain integrated investment layout. In recent years, the company has actively distributed new materials, new energy and other business areas, and extended to the downstream high value-added areas of fluorine chemical industry. At present, the company has laid out projects with an annual production capacity of 3000 tons (500t) of LiFSI, 5000 tons of FEP and 5000 tons of PVDF, 6000 tons of lithium hexafluorophosphate and 6000 tons of high purity phosphorus pentafluoride (PF5), 1200 tons of R116, 20,000 tons of high purity electronic grade hydrofluoric acid and so on.
Risk tips: weak demand for fluorine chemical industry; project production schedule is not as expected; product prices drop sharply and so on.
Investment advice: maintain a buy rating. Fluorine chemical industry prosperity is about to gradually recover from the bottom, the company as the industry leader will lead the industry development. We estimate that the company's homing net profit from 2023 to 2025 is RMB 3.25x481 million respectively, a year-on-year growth rate of-33.1%, 47.8% and 22.1%, respectively, and diluted EPS=0.53/0.79/0.96 yuan, which corresponds to PE=51.5/34.9/28.6X before the share price.