Remove the "shroud", the environmental industry has changed the sky
Just past 2022, the environmental protection industry has experienced the "worst year". According to the "environmental protection circle" incomplete statistics, according to 44 listed environmental companies disclosed 2022 performance forecast, 31 companies have a decline in net profit, accounting for up to 70.5%. Seventy percent of environmental protection companies net profit decline, what is the reason? Most companies attributed it to the epidemic, is the epidemic led to the environmental protection business market development is blocked, personnel flow restrictions, project construction stoppage, product orders delivery is also quite affected.
In the "environmental protection circle", the epidemic may also be just a piece of "shame" of the decline in the performance of the environmental protection industry. From a long-term perspective, the traditional pollution control market is becoming saturated, the inflection point has arrived, in fact, is the real reason for the development of the whole industry stall.
1 epidemic "shame cloth"
2022 environmental investment projects are actually more
Undeniably, in 2022, the epidemic did bring a great impact on the environmental industry. Dongzhu Ecology said that in 2022, the national new crown epidemic repeatedly, the company's region and most of the project site sealing control frequently, resulting in the company this year to undertake fewer new projects, under construction project logistics obstruction, labor difficulties, project materials sent and transport, project construction progress, etc. are seriously affected, the project progress is slow, project acceptance, audit and other work seriously delayed.
In the case of waste incineration companies, for example, the epidemic control will also lead to the inability of some regions to coordinate the garbage to enter the site, reducing the amount of incoming garbage and capacity utilization, which in turn will lead to a reduction in the revenue of waste incineration plants. The impact of the epidemic on environmental protection companies, especially in terms of returns. In the case of Zhuo Jin Environmental Protection, the epidemic impacted the government, local investment platforms and corporate customers in general, and the company was slow to make repayments. As a result, bad debt accruals had to be made in accordance with accounting policies, resulting in an impairment of contract assets of about $7 million and credit impairment losses of $8 million, with an overall impact of up to $15 million.
Interestingly, however, according to statistics from the Ecological and Environmental Protection Division of Hejun Consulting, there were actually not many ecological and environment-related investment projects in 2022, with a total of 588 for the year and a total winning bid amount of 563.7 billion yuan.
This figure, up 72% year-on-year from 2021, a three-year compound growth rate of 9%; the total winning bid amount is up 131% year-on-year, a three-year compound growth rate of 37%. In other words, there is actually no shortage of projects in the environmental industry in 2022. Contrary to what everyone feels, 2022 is actually the year with the most environmental protection investment projects in the past three years.
The impact of the epidemic on environmental protection companies, mainly in several other areas - market development is blocked, new projects reduced; staff mobility, material flow restrictions, raw material prices; project construction is slow, some months stop, product orders delivery is also quite affected.
Environmental protection circle contributor "environmental protection Lao Yue" once said that the epidemic is actually like a "catalyst" to shorten the evolution of the original need for several years to occur within a few months. Previously, changes in the environmental protection industry is "warm water boiled frog" type, companies do not feel obvious. And now it is presented to you at once, so you are very difficult. So, we can't blame the epidemic for the poor performance of the environmental industry in 2022. Instead, we should also think about what deep-seated problems the epidemic has exposed to the industry. What lessons can we learn from the epidemic?
2 Traditional environmental protection market is becoming increasingly saturated
Sewage, waste and other areas of the inflection point to come
In fact, the real crisis in the environmental protection industry is actually the growing saturation of the traditional environmental protection market.
One of the most typical segments is the atmosphere. He Kebin, academician of the Chinese Academy of Engineering and director of Tsinghua University's Ecological Civilization Research Center, said that according to their model projection, the traditional way of reducing air pollution will reach the "limit" by 2030, and seems to be weak. The industrial level is also very obvious, the most typical is the air purifier industry. With the dissipation of the haze, the industry has long been no longer the fire of yesteryear, many companies closed down, the rest also had to seek transformation, "pollution is no industry is also gone.
Water pollution management field is similar, the Ministry of Ecology and Environment Chief Engineer, Water Ecology and Environment Division Director Zhang Bo said that after several years of hard work, China's water environment has been a "turning point" change, China's water environment physical and chemical indicators have been about the same as medium developed countries.
In the future, the "water pollution prevention and control is the main", to "water resources, water ecology, water environment and other elements of the watershed system management, integrated promotion" change, and strive to make a breakthrough in the prevention of surface pollution, water ecological assessment, ecological water security. In other words, the traditional "water pollution prevention" has made great achievements, the focus of future work will gradually shift to "surface source pollution prevention, water ecology assessment, ecological water security" three new areas.
Solid waste, the situation is similar. Last year, "environmental protection circle" had statistics, the first half of 2019, the country's new waste incineration projects or 47, the total scale of treatment of 55,900 tons / day; but in the first half of 2022, it became a new project 26, the total scale of treatment of 20,100 tons / day. 4 years, the country's new The number of waste incineration projects and the scale of treatment fell by 45% and 64% respectively. As a result, waste incineration companies had to start a "fancy self-help" journey. Take waste incineration co-disposal/technical reform as an example, there were as many as 24 cases in the first half of last year.
TÜV Rheinland Consulting analyzes that under the influence of multiple factors, some environmental segments have exceeded expectations and are expected to reach the inflection point ahead of schedule. These early to reach the inflection point of the sector, including water supply, sewage, domestic waste, livestock and poultry waste, sanitation, etc..
I believe many of my peers share this conclusion. The past decade, China's environmental industry is a "great leap forward" decade, we use a short decade to make up for decades of development in China's short board.
One of the side effects of the "Great Leap Forward" is that - as many areas of the short board gradually fill, in the traditional pollution control market, leaving less and less space for everyone. To use a famous phrase, if we still keep the traditional "acre of land", then 2022 may be the worst year of the past decade, but the best year of the next decade.
3 Looking for the "second growth curve"
Early layout to deal with the industry's big changes
In summary, the environmental protection industry in 2022, the performance of the dismal situation, the direct cause seems to be the epidemic, in fact, the deep-seated reason or industry development into a bottleneck, the traditional pollution control market is becoming increasingly saturated, to the need to switch ideas of the moment. The face of this situation, environmental protection companies should do? An important way out is to find a "second growth curve. Keeping the traditional business can not eat, then look for new incremental. Into the "14th Five-Year Plan", with the battle of pollution prevention and control from "resolutely good" to "in-depth fight", there have been more and more sub-sectors gradually released.
Water track, for example, according to Zhang Bo, director of the traditional "water pollution prevention" has done almost, but "surface source pollution prevention, water ecological assessment, ecological water security" and other aspects of a large short board, the future to increase investment.
And the government's input direction, is the direction of future development of environmental protection enterprises. There is demand, there is money, there will naturally be business, there is performance. Looking for a "second growth curve", there are individual companies have tasted the sweetness. Greenmax, for example, they expect 2022 net profit attributable to shareholders of listed companies of 1.2 billion - 1.477 billion yuan, a year-on-year jump of 30% - 60%.
The reason for such bright results is that Greenmax's new energy business is leading the growth, with shipments of its core product - ternary precursor materials for power batteries - exceeding 140,000 tons.
In the future, what new tracks are expected to become the environmental industry's "second growth curve"? At the end of last year, the "environmental protection circle" has given you an inventory of 2022 environmental industry's top ten "new blue ocean", which such as pipe networks, sludge, waste-free cities, new energy, etc., many of which will be "trillion "volume. And, compared to those already mature sewage and solid waste markets, the competitive market pattern in this area has not yet solidified, leaving a lot of room for newcomers to rise.
If you can participate in it earlier and accumulate technology, experience and branding, etc., in the future when these efforts are widely rolled out, the relevant companies will be able to gain a certain leading position, thus reaping new growth in the new track. I hope that every environmental protection company can be prepared for danger and see the future trend, so as to make a good layout in advance to deal with the upcoming industry changes. (Note: The original article is redacted)