Net profit to mother increased 122-195% in 24Q2
The company expects 2024H1 net profit to mother of 0.076-0.091 billion, an increase of 76-111%; net profit without deduction of 0.057-0.068 billion yuan, an increase of 66-98%. Among them, 24Q2 net profit attributable to mother was 0.046-0.061 billion, an increase of 127-201%; net profit after deducting non-return to mother was 0.034-0.045 billion, an increase of 122-195%. The pre-increase in the company's performance was mainly due to the successful increase in production capacity of the Jingzhou project, effective reduction in factor resource costs, and a year-on-year increase in business volume.
Proposed repurchase of 15-30 million yuan of company shares
The amount of shares to be repurchased by the company shall not be less than RMB 15 million (inclusive) and not more than RMB 30 million (inclusive), and the repurchase price shall not exceed RMB 16.00 per share (inclusive); the source of capital shall be the company's own capital. The share repurchase period is used for share incentives; the share repurchase period is within 12 months from the date the board of directors of the company reviews and approves the share repurchase plan.
The Wuhu+Jingzhou production base is two-wheel drive. In the future, it will fully cover the Yangtze Delta+Pearl River Delta company's first-line layout along the Yangtze River. Relying on the Yangtze River Golden Waterway, the Wuhu headquarters production base and Jingzhou production base will be built using rich and high-quality water resources and convenient transportation channels; after all the projects are completed, the sales network can achieve full coverage of the Yangtze River Delta and Pearl River Delta.
Among them, Wuhu is located in the middle and lower reaches of the Yangtze River, with convenient water transportation; Jingzhou in Hubei Province is located in the central region, rich in cotton resources and well-developed transportation. The production base's convenient land and water transportation network not only effectively reduces procurement costs and sales logistics costs, shortens the transportation time for procurement and sales, but also can approach and serve customers in a timely and efficient manner.
The 0.06 million-ton project accelerated production, and the 0.11 million-ton project progressed steadily
The company invested in the establishment of Hubei Fuchun Dyeing and Weaving in 2021 to build a high-quality tube yarn dyeing production project with an annual output of 0.06 million tons in the Jingzhou Economic Development Zone. In April 2024, Hubei Fuchun Dyeing and Weaving Workshop No. 2 was put into operation, mainly for bleaching tube yarn. With the use of Workshop No. 2, Hubei Fuchun Dyeing and Weaving is in a state of full production. Hubei Fuchun Dyeing and Weaving is expected to reach 1.2 billion yuan for the full year of 2023.
Furthermore, in 2023, the company will launch a new project with an annual output of 0.11 million tons of high-quality tube yarn. The project plans to build and add new production workshops and supporting facilities such as environmental protection, and purchase advanced energy-saving printing and dyeing equipment, expand the printing and dyeing production capacity of high-quality tube yarn, resolve the company's production capacity bottlenecks, and raise the company's overall profit level.
Maintain profit forecasts and maintain buying ratings
As one of the leading domestic manufacturers of colored yarn, the company's main business is R&D, production and sales of colored yarn. We continue to be optimistic that the company will rely on the Yangtze River Golden Waterway and use two-wheel drive at the Wuhu and Jingzhou production bases to accelerate the release of production capacity and drive performance growth. We estimate that the company's net profit for 24-26 will be 0.223/0.28/0.325 billion yuan, EPS will be 1.49/1.87/2.17 yuan/share, respectively, and the corresponding PE will be 8/6/5X, respectively.
Risk warning: Market competition risk; risk of raw material price fluctuations; risk of new projects falling short of expectations; performance forecasts are only preliminary estimates. The specific data is subject to the officially released financial report.