Incident: On the evening of April 18 and 27, the company released its 2022 annual report and 2023 quarterly report.
The 2022 results were in line with expectations. The first quarter report of 2023 fell short of expectations of achieving revenue of 17.4 billion yuan in 2022, an increase of 7.6% over the previous year; Guimu's net profit was 6.2 billion yuan, an increase of 5.1% over the previous year. Among them, wind turbine revenue was 163 billion yuan, up 3.8% year on year, accounting for 94% of revenue; power generation business revenue was 260 million yuan, up 20.4% year on year, accounting for 1.5%; and new energy EPC general contracting revenue was 4.2 billion yuan, accounting for 2.4%. 2023Q1 achieved revenue of 3.48 billion yuan, an increase of 2% over the previous year; the net profit of the mother was 0.7 million yuan, a decrease of 34% over the previous year, mainly due to credit and asset impairment preparations, which reduced net profit by a total of 78 million yuan.
Profitability remained stable. Gross margin increased 0.93 pct year on year in 2022, 2023Q1 decreased 1.7 pct year on year Profitability: 1) gross profit margin in 2022 was about 17.77%, up 0.93 pct year on year; 2023Q1 was about 16.67%, down 1.7 pct year on year; 2) Net sales profit: net interest rate in 2022 was about 3.55%, up 0.48 pct year on year; 2023Q1 was about 2.13%, down 1.13 pct year on year. The company's profitability has remained relatively stable against the backdrop of a continuous decline in bid prices for fans. Expense side: The cost rate during 2022 was 11.85%, a year-on-year decrease of 0.69pct, mainly due to the decline in sales and R&D expense rates, which declined year-on-year respectively. The fee rate for the 2023Q1 period was 12.36%, a year-on-year decrease of 0.65 pct.
The company's on-hand orders are strong. The number of new 2023Q1 orders and cumulative on-hand orders increased 140% and 48% respectively. In 2022, more than 90% of the new orders were for fans of 5 MW or more. The trend of large-scale expansion was remarkable; the number of new orders for 2023Q1 was about 4.52 GW, an increase of 140% over the previous year. As of 2023-3-31, the company had a total of 19.81 GW of on-hand orders, an increase of 48% over the previous year. Looking at the breakdown, 2-3 MW (not included) fans are 0.55 GW, accounting for 2.8%; 3-4 MW (not included) fans are 2.29 GW, accounting for 11.6%; 4-5 MW fans are 1.72 GW, accounting for 8.7%; 5-6MW (not included) fans are 7.29 GW, accounting for 36.8%; fans above 6 MW are 7.96 W, accounting for 40.2%.
The “two seas” strategy achieved a historic breakthrough, and the “one master, two wings” strategy continued to advance the “two seas” strategy: 1) Overseas markets: The company continued to deepen its regional layout in Vietnam and other regions, and achieved breakthroughs in markets such as Europe and South America. Recently, the company signed an agreement with Fintel Energia to become its preferred supplier for the 854MW wind power project in Serbia. The agreement includes the supply and installation of 112 7.7 MW fans and operation and maintenance services for the next 10 years; 2) Offshore Wind Power: The company achieved zero breakthroughs in offshore wind power in 2022 and won the bid for China Power's Zhejiang Ningbo Xiangshan No. 1 (Phase II) 500,000 kilowatt offshore wind project. In April 2023, the company won the bid for the Dalian Zhuanghe offshore wind power project. “One master, two wings” strategy: 1) Investment and operation of new energy power plants: In terms of resource acquisition, in 2022, the company obtained more than 4 million kilowatts of wind storage resources development targets in Hunan, Yunnan and other regions, an increase of 150% over the previous year. It added the equity capacity of approved and registered wind power photovoltaic projects of 1,1621 million kilowatts and 100,000 kilowatt-hours of energy storage projects, laying the foundation for subsequent business development. 2) New energy EPC general contracting: In 2022, the company entered this field for the first time, adding more than 5 billion yuan of new orders and contracts throughout the year, achieving revenue of 422 million yuan.
Profit forecasting
Net profit for 2023-2025 is expected to be 770, 933, and 1.2 billion yuan respectively, up 25%, 20% and 29% from the previous year. CAGR = 24.6%, corresponding PE is 12, 10, and 8 times, maintaining the “buy” rating.
Risk warning: 1) Wind power installation falls short of expectations; 2) Upstream component prices are rising.