Incident: The company achieved revenue of 1,825 million yuan in 2022, a decrease of 36.54%, and Guimu's net profit of 112 million yuan, an increase of 6.48%, after deducting net profit of 87 million yuan from non-Gimu, an increase of 14.01%.
Q4 Profits accelerated markedly, and revenue from the full-process engineering consulting business grew rapidly. On a quarterly basis, Q1, Q2, Q3, and Q4 revenue increased 3.27%, -29.44%, -44.52%, and -49.15%, respectively; net profit of Q1, Q2, Q3, and Q4 increased 50.78%, -2.34%, 1.21%, and 10.29%, respectively, and Q4 profit growth increased. By business, revenue from the architectural design, general contracting, cost consulting, and full-process engineering consulting business was 1,229 million yuan, 318 million yuan, 223 million yuan, and 51 million yuan respectively, up -20.12%, -70.71%, -1.66%, and 146.71% respectively. By region, the revenue of South China, Central China, East China, Southwest China and other businesses was 1,566 million yuan, 154 million yuan, 68 million yuan, 23 million yuan and 14 million yuan respectively, down 36.56%, 26.48%, 46.71%, 52.96%, and 34.76% respectively.
Gross margin has increased, impairment has decreased, net interest rates have increased, and operating cash flow has improved. In terms of gross margin, the company's gross margin increased 8.33 percentage points to 29.21% year on year. Among them, architectural design, cost consulting, and general engineering contracting increased 2.85, 3.42, and 0.48 percentage points year-on-year respectively. In terms of the period cost rate, the overall period expense ratio increased 4.86 percentage points year on year to 16.06%, of which the sales expense ratio was 2.45%, up 0.72 percentage points year on year; the management expense ratio (including R&D expenses) increased 4.24 percentage points year on year to 13.33%; and the financial expense ratio decreased 0.12 percentage points year on year to 0.27% year on year. The total impairment of assets+credit amounted to $97 million, a year-on-year decrease of $61 million. In terms of net interest rate, the company's net interest rate rose slightly by 3.38 percentage points year-on-year to 7.92% in '22. ROE rose 0.25 percent year over year to 7.73%.
The net inflow of operating cash flow was $265 million, an increase of $27 million over the same period last year; of this, revenue increased 1.04 percentage points over the same period last year to 101.96%, and disbursements decreased 21.31 percentage points to 40.05% from the same period last year.
Following the general trend of digital transformation in the construction industry, the company actively participated in domestic BIM software research and development. In 2022, the company and Zhongwang Software jointly established a joint venture. Relying on the advantages of Zhongwang Software in the field of industrial software development, Huayang International and Huayang International's rich application scenarios and application software development experience in the architectural design industry were jointly carried out domestic BIM (Building Information Modelling) software research and development. In 2022, the Huayang International Building Digital Industrialization Research Institute was recognized as a key enterprise research project by the Shenzhen Science and Technology Innovation Commission. The company has gradually built BIM forward design capabilities for all specialties such as architecture, structure, water supply and drainage, HVAC, electricity, and assembly. The construction of BIM forward design platforms is getting better and better, raising the granularity of control to the parameter level. In addition, the company has successively developed and launched the V4.14 version of the iBIM platform and the 2022 edition of Huayang Express Construction, which includes subsystems such as family library management, product management, Huayang Express Construction, cloud computing management, design management, and Huayang Classroom.
Profit forecasts and ratings. The company's traditional design business has benefited from increased downstream concentration and increased collection efforts, and prefabricated design has benefited from the high level of industry prosperity and its own first-mover advantage. The company continues to increase investment in BIM R&D, and the business is expected to maintain steady growth in the future. We expect the company's EPS for 23-24 to be 0.73 and 0.86 yuan respectively, giving a price-earnings ratio of 20-21 times that of 2023, with a reasonable value range of 14.60-15.33 yuan, maintaining the “superior market” rating. Risk warning. Repayment risk, business development risk, policy risk.