Key points of investment:
The company released its 2023 annual report: During the reporting period, the company achieved revenue of 1,616 billion yuan (YoY -17%), net profit of 335 million yuan (YoY -13%), net profit after deduction of 244 million yuan (YoY -30%), gross profit margin of 36.81% (YOY-1.05pct), net profit margin 20.72% (YoY+1.13pct), sales, management and financial expenses ratio of 11.57% (YoY 2.03pct). Among them, in the 23Q4 single quarter, the company achieved revenue of 417 million yuan (YoY -17%, QoQ +5%), net profit to mother of 86 million yuan (YoY -21%, QoQ +12%), and realized net profit withholding non-return to mother of 77 million yuan (YoY -20%, QoQ +151%). The single-quarter results improved significantly from month to month. The company's comprehensive gross profit margin for the 23Q4 quarter was 38.29%, with year-on-month changes of +1.86pct and +5.21pct, net profit margin 20.57%, and year-on-month changes of -1.01pct and +1.27pct, respectively. The company's 2023 profit share plan plans to distribute a cash dividend of 1.90 yuan (tax included) for every 10 shares to all shareholders.
The company released its 2024 quarterly report: During the reporting period, the company achieved revenue of 435 million yuan (YoY +8%, QoQ +4%), realized net profit of 90 million yuan (YoY +6%, QoQ +5%), and realized net profit of 59 million yuan (YoY +4%, QoQ -23%). The single quarter results were in line with expectations. The company's comprehensive gross profit margin for the 24Q1 quarter was 34.39%, with year-on-month changes of -2.47pct and -3.9pct, net profit margin of 14.62%, and -0.50pct and +0.18pct year-on-month, respectively. 24Q1 The company's sales expenses were 0.33 million yuan, a decrease of 19 million yuan over the previous month. At the same time, the company obtained 34 million yuan in industrial incentive funds from the Hebei Feixiang Economic Development Zone Management Committee to increase the company's profits.
Market demand has been weak since 2023, profits in the display panel industry have declined significantly, and the company's operating performance has been under pressure in the short term. According to the company's 2023 report, the company's electronic specialty gases achieved revenue of 1,486 billion yuan (YoY -14%) and a gross profit margin of 36.06% (YoY-0.98pct); the trifluoromethanesulfonic acid series achieved revenue of 100 million yuan (YoY -23%) and a gross profit margin of 29.26% (YoY 0.38pct). By field, integrated circuits, display panels, lithium battery new energy, pharmaceuticals, display materials, chemical materials, and others achieved revenue of 9.78, 4.25, 0.09, 0.58, 0.20, 0.14, and 0.83 billion yuan, with year-on-year changes of -11%, -18%, -51%, -23%, +28%, -36%, and -16%; gross margins were 39.46%, 28.14%, 31.91%, 27.96%, 36.55%, 23.22%, 36.50% year-on-year, respectively. , -7.19pct, -16.59pct, +5.26pct, -10.72pct, -2.52pct, +3.30pct. By product, production and sales of nitrogen trifluoride were 7658 and 7130 tons, respectively, with year-on-year changes of -8.6& and -7.5%; tungsten hexafluoride production and sales were 963 and 989 tons, respectively, with year-on-year changes of -14.8% and -7.8%; and trifluoromethanesulfonic acid production and sales were 151 and 148 tons, respectively, with year-on-year changes of -34.2% and -29.4%, respectively. Looking ahead, the semiconductor and panel industries are gradually recovering steadily, and demand for the company's products is expected to return one after another.
Aiming at “stuck neck” specialty products, expanding capacity and expanding products against the industry cycle to help localize and replace them; derivative layout of trifluoromethanesulfonic acid series products, and the diversified layout injects new momentum for growth. By the end of 2023, all 4 construction projects in the company's fund-raising projects had reached the scheduled state of use.
In May 2023, the company set up a subsidiary in Shanghai and plans to invest 697 million yuan to build electronic specialty gas and advanced materials production and R&D projects; in February 2024, the company set up a subsidiary in Hohhot, and plans to invest 1363 million yuan to build a high-purity electronic gas project (Phase I), adding an annual production capacity of 7,500 tons of nitrogen trifluoride, 10,000 tons of ultrapure ammonia, and 75,000 tons of liquid nitrogen. At the same time, the company plans to complete the research and development of 14 high-energy products in 2024, including 4 types of pure gas, 4 types of gas mixtures, and 6 types of precursor products. Based on the electrofluorination process, the company develops and produces a series of trifluoromethanesulfonic acid products. Currently, the production capacity of trifluoromethanesulfonic acid has reached 660 tons, and the production capacity of lithium bis (trifluoromethanesulfonyl) imide has reached 600 tons. Among them, lithium bis (trifluoromethanesulfonyl) imide is one of the important components of lithium electrolytes. It is used as an electrolyte additive, which can improve the electrochemical stability of the electrolyte and improve high and low temperature and circulation performance. The application prospects are broad.
Investment analysis opinion: Temporarily maintain the 2024-2025 net profit forecast of 391 million yuan and 496 million yuan, add the 2026 net profit forecast of 625 million yuan, and the PE corresponding to the current market value is 37, 29, and 23X, maintaining the “increase” rating.
Risk warning: 1) Project construction, new production capacity climbing, downstream demand, etc. fall short of expectations; 2) Domestic competition intensifies, prices of major products such as nitrogen trifluoride fall; 3) New product development falls short of expectations.