Event: the company issued a forecast of the results for the first three quarters, and it is estimated that the net profit attributed to shareholders of listed companies is 2.7-280 million yuan (+ 41.9% 47.1%). Among them, the net profit attributed to shareholders of listed companies in the third quarter is expected to be 1.2-130 million yuan (+ 65.1% Kui 79.5%).
The performance continued to grow rapidly, and the performance growth in the third quarter was outstanding. According to the performance forecast, the main reasons for the increase in the company's performance in the first three quarters are: 1) the operation, bid raising and water price adjustment of sewage treatment projects in the company's investment and operation business, the increase in the disposal volume of sludge treatment projects and the recovery of part of the accounts receivable, resulting in an increase in net profit in the first three quarters of 2020 compared with the same period last year. 2) it is estimated that the impact of the company's non-recurrent profit and loss on the net profit attributed to the shareholders of the listed company during the reporting period is about 5 million yuan to 10 million yuan. Among them, the growth in the third quarter is eye-catching, which is related to the active development of all kinds of business and the production volume of the project. we look forward to the continuous and rapid release of the follow-up results.
Solid waste business is ready to start, Changchun project significantly thickens the company's profits, the follow-up development is worth looking forward to. The company introduced Japanese YM bacteria high-temperature aerobic fermentation technology for centralized harmless treatment and resource utilization, which is a new driving force for future growth. In 2019, the revenue of sludge business reached 100 million yuan, a year-on-year increase of 71.6 percent, and the net profit of Changchun project was 20 million yuan. 2020 H1 Changchun project handled 192000 tons, with an average daily capacity of 1100 tons, with a net profit of 20 million yuan. It has achieved 98% of the project's annual net profit last year; at the same time, the new Xinjiang project receives Shihezi sludge, with a total sludge treatment volume of 18000 tons, and the follow-up development is worth looking forward to.
Additional investment has been made in Aidi Weixin to develop vaccines and expand other businesses. On March 9, 2020, the company invested 18 million yuan in Beijing Aidi Weixin, holding 4.7% of its equity and enjoying the priority of 12 million yuan for additional investment. 2020H1 companies continue to increase capital to invest in shares, so far a cumulative investment of 30 million yuan. Aidi Weixin focuses on genetic engineering vaccine, DNA vaccine and new vaccine adjuvant technology, and has international technical advantages in the field of vaccine research and development. the company combines the experience of Jiangsu Peng Harrier Pharmaceutical Co., Ltd. in the pharmaceutical field to increase investment in Aidi Weixin's active research and development of vaccines, which can expand investment outside its main business.
Profit forecast and investment advice. It is estimated that the EPS from 2020 to 2022 will be 0.59,0.76 and 0.97 yuan respectively, corresponding to 17x/13x/10x for PE, maintaining the "buy" rating.
Risk tips: the project construction schedule is not up to expectations, water prices are not raised in time, policy risks, and so on.
