Description of the event
The company achieved revenue of 178.358 billion yuan in 2023, an increase of 13.09%; attributable net profit of 5.426 billion yuan, an increase of 0.20% over the same period.
In Q1 2024, we achieved revenue of 44.939 billion yuan, an increase of 5.51%; attributable net profit of 1,216 billion yuan, an increase of 9.50% over the same period.
Incident comments
Revenue from the main chemical engineering industry increased by more than 20%, driving rapid overall revenue growth. In 2023, it achieved revenue of 178.358 billion yuan, an increase of 13.09%. Among them, the chemical engineering business achieved main business revenue of 142.373 billion yuan, an increase of 20.35% over the previous year, accounting for 80.02% of the main business revenue, an increase of 4.79 pcts over the previous year. The main reason for the revenue increase was the company's increased undertaking tasks and project development and construction efforts. On a quarterly basis, revenue for the fourth quarter was 47.322 billion yuan, up 25.64% year on year, and achieved revenue of 44.939 billion yuan in the first quarter of 2024, an increase of 5.51% year on year.
Both gross margin and expense ratio increased slightly, and credit impairment increased year-on-year. The company's annual comprehensive gross profit margin was 9.41%, up 0.07pct year on year. By business, chemical engineering gross profit margin was 9.87%, down 0.06 pct year on year, and infrastructure gross profit margin was 7.09%, down 0.07 pct year on year; in terms of cost ratio, the company's annual expense ratio was 5.31%, up 0.14 pct year on year. Among them, sales, management, R&D and financial expenses changed by -0.01, 0.02, -0.002, 0.13pct to 0.28%, 1.67%, 3.46% and -0.09%, respectively Credit impairment increased year-on-year in 2023, with annual credit impairment losses of 600 million yuan, an increase of 364 million yuan year-on-year.
The gross margin and expense ratio also increased slightly in the first quarter. The company's comprehensive gross profit margin for the first quarter was 8.01%, up 0.09pct year on year, and the cost ratio increased 0.04pct year on year. Among them, sales, management, R&D and financial expense ratios changed by -0.04, 0.25, -0.23, 0.06pct to 0.19%, 2.06%, 2.13%, and 0.39%, respectively.
In terms of orders, overseas orders are growing rapidly. In 2023, the company signed 326.751 billion yuan, up 10% year on year, including 310.671 billion yuan for construction projects, up 11% year on year, 4.528 billion yuan for survey and design, -2% year on year, 6.510 billion yuan for industry, up 6% year on year, and modern service industry signed 3.512 billion yuan, -20% year on year. By region, domestic and international contracts were -13% and +165%, respectively. Looking at 2024Q1, the total number of new signings was 127.916 billion yuan, an increase of 22% over the same period last year, of which 8% and 240% were registered at home and abroad, respectively.
Cash flow improved year on year, and net operating cash flow inflow increased. The company's net cash flow inflow from operating activities for the year was 9.134 billion yuan, with a year-on-year increase of 7.634 billion yuan, a year-on-year decrease of 6.75pct; in a single quarter, 2023Q4 net cash flow inflow of 12.501 billion yuan, a year-on-year increase of 4.617 billion yuan, revenue ratio 103.25%, down 1.88pct year on year; 2024Q1 net cash flow outflow from operating activities was 6.770 billion yuan, up 30.99 pcts year on year. .
The company's equity incentives give a CAGR of not less than 15%, making it the highest growth rate for non-international engineering central enterprises and setting future growth expectations. In the second half of 2022, the company issued an equity incentive draft, which sets out the goal of a weighted average return on net assets of not less than 9.05%/9.15%/9.25% for 2023-2025; based on 2021 results, the compound growth rate of non-attributable net profit is not less than 15% during the same period. Since 2023, the overall business situation of the company has been good, the future outlook is stable, and the long-term growth of the company is optimistic. The company's net profit for 2024-2026 is estimated to be 60.95, 67.97, and 7.585 billion yuan, corresponding PE of 6.92, 6.20, and 5.56 times, maintaining a “buy” rating.
?
Risk warning
1. Industrial transformation falls short of expectations; 2. Raw material prices fluctuate greatly.