The company publishes its semi-annual report for 2022. 2022H1 achieved an operating income of 3.979 billion yuan, an increase of 0.7% over the same period last year, a net profit of 271 million yuan, a decrease of 36.5%, and a non-return net profit of 243 million yuan, a decrease of 43.3% over the same period last year. The operating income of 2022Q2 Company was 121 million yuan, down 45.7% from the same period last year and 18.7% from the previous year; the net profit from non-return was 99 million yuan, down 56.1% from the same period last year, and 31.7% from the previous year, and the performance was weaker than we expected.
The import of waste aluminum is becoming stricter, and the volume and profit of products are falling. Quantity: 2022H1's aluminum alloy ingot output was 117900 tons, a decrease of 20% compared with the same period last year, mainly because the domestic waste aluminum import standards were strictly enforced, the company's waste aluminum import decreased significantly, and the processing of supplied materials was cancelled. in addition, the company's production line also carried out maintenance; the company recovered 301500 tons of ferrous metals, a decrease of 8% over the same period, and 38700 tons of non-ferrous metals, an increase of 4% over the same period. Benefits: 2022H1, domestic aluminum waste price difference of 4518 yuan / ton, an increase of 873 yuan / ton over the same period last year, but due to internal and external aluminum prices upside down, transportation costs rise, the company's profitability decreased.
Q2 investment income increased month-on-month, while the decline in aluminum prices led to an increase in impairment losses. Compared with 22Q2, the main gain points are fair value change profit and loss (+ 13.41 million yuan) and investment income (+ 6.22 million yuan), mainly due to the appreciation brought by the company's transactional financial assets held by the company; the impairment point has impairment loss (- 25.78 million yuan), mainly because Q2 aluminum price has dropped more, inventory price loss and contract performance cost impairment loss increased, gross profit (- 7.2 million yuan) The three fees were basically unchanged from the previous month, and the financial expenses of the 22Q2 were 19.29 million yuan, an increase of 966% over the previous month, mainly due to the devaluation of the RMB and the increase in the company's exchange losses. 22Q2 year-on-year, the main gain point is fair value change profit and loss (+ 25.65 million yuan), the main reduction point is gross profit (- 81.53 million yuan), impairment loss (- 32.33 million yuan), fees and taxes (- 14.73 million yuan).
Recycled aluminum plate low cost + high growth, active layout of heat-free alloy. ① waste aluminum guarantee ability + low-cost advantage: with the increasingly prominent importance of recycled aluminum, waste aluminum channel construction is particularly important, the company recycling channels at home and abroad, waste aluminum supply guarantee capacity is strong. The purchasing cost of waste aluminum overseas is generally lower than that at home. According to SMM data, the average price difference between domestic and American waste aluminum reached 4614 yuan / ton in the first half of 2022, and the cost gap is large. ② high growth: part of the civil works of the 1.3 million ton expansion project in Malaysia has been completed, and the first phase of 650000 tons is expected to be put into production in the second half of 2023. After reaching production, the company's total capacity in Malaysia will reach 1.5698 million tons, an increase of 482% compared with the original production capacity of 269800 tons. ③ actively develops the process of heat-free alloy.
The company cooperates with well-known colleges and universities to use recycled aluminum as raw materials to overcome the problems of deformation and surface defects in the heat treatment process of large castings, so as to improve the strength and toughness of the raw materials. at present, the first batch batching tests have been completed and the heat-free treatment business has been initially formed.
Investment suggestion: the company's global layout of scrap aluminum acquisition, outstanding raw material procurement advantages, the future commissioning of Malaysian projects will help the company's performance to maintain rapid growth. Taking into account the impact of strict import control of waste aluminum on the company's output, we expect the company to achieve a net profit of 696 million yuan, 1.083 billion yuan and 1.624 billion yuan in 2022-2024, with a PE of 13x, 8x and 6x corresponding to the closing price on August 17, maintaining the "recommended" rating.
Risk tips: the progress of the project is not as expected, the price difference of fine waste aluminum has dropped, and the import and export policy of waste aluminum has changed.