\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 720 Gansu Qilianshan Cement Group Co.Ltd(600720) )
The company released its 2021 annual report on March 17, with an annual revenue of 7.67 billion yuan, a decrease of 1.8% at the same time; The net profit attributable to the parent company was 950 million yuan, with a decrease of 34.1%. Among them, Q4's revenue was 1.85 billion yuan, an increase of 3.1% at the same time; Deduct the net profit not attributable to the parent company of RMB 100 million, with a decrease of 75.3%.
Key points supporting rating
Pressure on 21q4 profit due to multiple factors: the company's net profit attributable to the parent company in the fourth quarter of a single year lost 06 million yuan, deducting 14 million yuan of net profit not attributable to the parent company, with a decrease of 75.3%; The reasons are as follows: 1. The sales expense rate in the fourth quarter was 1.7%, an increase of 13.1pct; 2. The subsidiary Zhangxian Cement Co., Ltd. is expected to pay a total of 54 million yuan in environmental protection and administrative fines for cross-border mining; 3. The company accrued 61 million yuan of asset impairment loss in the fourth quarter.
The contradiction between regional supply and demand intensifies, and the annual cement sales decline: according to our calculation, the annual cement clinker sales volume of the company is about 23.536 million tons (- 193000 tons), the unit price is 300.0 yuan (- 0.2 yuan), and the ton cost is 214.8 yuan (+ 27.4 yuan); Gross profit per ton is 85.2 yuan (- 27.7 yuan). Throughout the year, insufficient capital construction was superimposed on the impact of low-cost cement from other provinces, and the contradiction between regional supply and demand was intensified, resulting in pressure on the company's cement sales.
Profit decline caused by cost pressure: coal prices rose sharply throughout the year, and the price centers of bituminous coal in Lanzhou, Xi'an and Hami rose 36.8%, 82.0% and 44.3% respectively, resulting in a significant increase in the company's fuel cost, dragging down the annual gross profit margin of 27.6% and net profit margin of 13.4%, with a year-on-year decrease of 7.8pct and 6.4pct respectively.
We are optimistic about the demand increment brought by steady growth. As a regional leader, the company has performance flexibility: the demand increment brought by infrastructure investment under the tone of steady growth in 2022 is worth looking forward to; On the one hand, the construction of the three "counting from the east to the west" computing hubs, including Gansu, Ningxia and Inner Mongolia, is expected to boost the regional cement demand, on the other hand, it may reduce the inflow of cement from other provinces and improve the regional supply and demand pattern. As the leader of cement in Gansu, the company has strong performance flexibility after the recovery of demand and the repair of ton profit.
Valuation
The company's performance was lower than expected. Considering the impact of regional supply and demand contradiction and coal cost pressure, we partially lowered our profit forecast. It is estimated that from 2022 to 2024, the company's revenue will be 8.36 billion yuan, 8.85 billion yuan and 9.12 billion yuan respectively; The net profit attributable to the parent company is RMB 1.69 billion and RMB 1.64 billion respectively; EPS was 1.99, 2.10 and 2.18 yuan, maintaining the company's buy rating.
Main risks of rating
The growth rate of infrastructure and real estate investment was lower than expected, the impact of cement in Ningxia and Shaanxi and the rise of coal prices.
