Event description
The company released the 2023 interim report: in 2023H1, the company realized a revenue of 1.193 billion, down 5.81% year on year; The attributable net profit was 65 million, up 5.84% year on year; Deduct non performance of 60 million, up 3.72% year on year; In 2023Q2, the company achieved revenue of 640 million, up 7.32% year on year; The attributable net profit was 33 million, up 52.18% year on year; Deduct 29 million non performance, up 44.37% year on year.
Event comments
2023H1 automobile&shipping is under pressure. In 2023H1, the company's revenue declined by 5.81%. By product, rail transit increased by 1.11%, construction products increased by 16.78%, auto products declined by 4.11%, shipping supplies declined by 27.55%, and lightweight aluminum products declined by 26.69%; In terms of profitability, the gross profit rate in the first half of the year was 17.3%, up 0.7 pct, or mainly due to the year-on-year decline in raw materials, including 3.1 pct for rail transit and 5.8 pct for construction products, and 3.0 pct, 1.0 pct and 2.3 pct for automobile, shipping and lightweight products; In the first half of the year, the period rate was 9.7%, with a year-on-year decrease of 0.17 pct, of which the R&D rate decreased by 0.41 pct and the sales rate increased by 0.19 pct. Asset impairment loss of 4.08 million yuan and credit impairment loss of 4.67 million yuan were caused by inventory depreciation and other reasons. In the first half of the year, the net interest rate was 5.59%, up 0.56 pct year on year.
Q2 business situation improved significantly. Q2 achieved a revenue of 640 million yuan, a year-on-year increase of 7.32%, and the growth rate was significantly improved compared with Q1; Gross profit rate was 18.58%, up 1.84 pct year on year, and raw material effect was more obvious in Q2; Q2 R&D rate dropped 1.31 pct to 3.73% year on year, mainly due to the substantial reduction of material costs. Credit impairment losses mainly occurred in Q2, with a loss of 14.37 million yuan in the current quarter; Finally, Q2 achieved a net interest rate of 5.26%, up 3.79 pct year on year.
New opportunities from sunroof matching to vehicle sealing. The company has entered a new stage of development of vehicle sealing. Relying on the customer resources accumulated by the sunroof sealing strip, the vehicle business has been comprehensively promoted, and has gradually entered the vehicle sealing system of GAC, SAIC, Chang'an, Great Wall and other automobile enterprises. In July 2022, the company received the letter of intent for the ideal vehicle designation, and in August 2022, it received the notice for the designation of BYD development. We expect the company's vehicle sealing is expected to enter the fast lane of growth. In addition, the company has obvious advantages as a leading benchmark in the rail transit&shipping sealing field. The rail transit field mainly focuses on shield water stop and vehicle sealing, and is expected to make breakthroughs in the field of rail transit vibration reduction in the future; In recent years, the construction industry has bucked the trend, and customers have made continuous breakthroughs, reflecting strong industry competitiveness.
Short frame leader, looking forward to customer breakthrough. The installation of photovoltaic modules requires the use of rectangular aluminum alloy frames to protect the modules and increase the mechanical strength. Many years ago, the company developed pressure block products used in the photovoltaic field, and constantly upgraded and iterated. Now the products are finalized as buckle short frame products with better reliability, which can significantly reduce the use of aluminum profiles in the photovoltaic industry and reduce costs.
Continuous technological innovation. Both the parent company and its subsidiary Kono Seiko are high-tech enterprises. Focusing on the two basic functions of rubber product sealing and vibration damping, the company is committed to the research and development of rubber and plastic components for high-end equipment. From 2015 to 2022, it has been awarded the title of Top 10 Enterprises in China's rubber products industry for 8 consecutive years. During the reporting period, it has obtained 1 invention patent, 7 utility model patents and 2 design patents, and 3 trademark registration certificates issued by the State Intellectual Property Office.
Investment suggestion: It is estimated that the net profit attributable in 2023 and 2024 will be 140 million and 180 million, corresponding to PE 33 and 25 times.
Risk warning
1. The price of raw materials rose significantly;
2. Weak demand in the automotive industry.
