The company announced its 14-year semi-annual report on August 26th, with operating income of 305 million yuan, an increase of 5.85% over the same period last year. The net profit of shareholders of a listed company was 3.4816 million yuan, an increase of-38.57% over the same period last year, and the net profit of shareholders of a non-listed company was-13.8385 million yuan, an increase of-1753.7% over the same period last year. The realization of EPS0.0124 yuan was in line with market expectations.
Main points of investment:
Revenue in the second quarter increased by 11.79% over the same period last year, and the net profit after deducting non-profit improved significantly compared with the same period last year. The main reason for the year-on-year increase in revenue in the second quarter was the pick-up of the wind power industry and the increase in the operating rate of the structural bubble; the net profit of the shareholders of the listed company was 1.375 million yuan in the second quarter, and the net profit of the shareholders of the listed company after deduction was about 176900 yuan. The net profit of shareholders of the listed company was-14.016 million yuan in the first quarter of the same period last year, and the company is gradually recovering.
There has been an inflection point in global wind power demand in the past 14 years, and it is expected that the change in supply and demand under the oligopoly pattern will lead to a rise in the price of structural bubbles. GWEC forecasts that the growth rate of new wind power installed worldwide in 2014 will be as high as 34%. It is expected that with the emergence of the inflection point of downstream wind power demand, the structural foam operating rate will gradually return to full load, up from 72% last year. At the same time, due to the current production of structural foam materials by three major companies in the world, the decrease in global production capacity has led to a contraction of about 20% of the supply end of structural foam by 30%. Due to the tight supply and demand, some new leaf shapes of structural foam have been raised one after another. It is expected that there is still room for further price increase in the second half of the year with the continuous tightening of supply and demand and the continuous improvement of the profits of the whole machine enterprises downstream of the company. Assuming that the price of structural foam increases by 20% throughout the year, the thickened EPS is about 0.16 yuan.
Through the mode of capital operation to cut into new markets, expand downstream while raising valuations. In 2014, the company bought 100% equity of Xinguang Environmental Protection with 400 million yuan. The company's product line extends from polymer foaming materials to post-processed products to railway, rail transit and other fields. Xinguang Environmental Protection promises that the net profit of shareholders of the parent company will not be less than 26 million yuan, 36 million yuan and 58 million yuan respectively from 2014 to 2016. Judging from the current outstanding orders, there is a high probability of excess profits in 14-15 years. In the future, the company will break into new application fields through capital operation such as acquisition.
Post-processing business is growing at a high speed, providing the company with abundant cash flow. In the past, the downstream customers of the company's post-processing business were mainly foreign enterprises, and the company will build a number of production lines in 14 years to increase the market share in the field of optical thin films, and the domestic market will become the main incremental market of post-processing business in the future. the rapid growth of post-processing business will provide the company with abundant cash flow and provide guarantee for the follow-up launch of new products and capital operation.
From 2014 to 2016, the EPS of the company is 0.19,0.27,0.37 yuan respectively, and the corresponding PE is 56.82,40.56,29.83. considering that the enterprise is in a period of transition from upstream wind power to new materials in other fields, the target price for the next 6-12 months will be raised to 14 yuan and continue to be rated as "recommended".
Risk hint: post-processing gross profit margin fell more than expected, global wind power recovery was lower than expected