\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 720 Gansu Qilianshan Cement Group Co.Ltd(600720) )
Core view
The contradiction between regional supply and demand intensified, and the annual performance was lower than expected. In 2021, the company realized an operating revenue of 7.673 billion yuan, a year-on-year decrease of 1.78%, and realized a net profit attributable to the parent of 948 million yuan, a year-on-year decrease of 34.1%. Deducting the net profit not attributable to the parent of 961 million yuan, a year-on-year decrease of 36.7%, EPS was 1.22 yuan / share, and plans to pay 10 dividends of 4.5 yuan (including tax); Among them, Q4 achieved an operating revenue of RMB 1.851 billion in a single quarter, with a year-on-year increase of 3.1%, and the net profit attributable to the parent was RMB -06 million, with a year-on-year increase of 42.77%. Deducting the net profit not attributable to the parent was RMB 14 million, with a year-on-year decrease of 75.25%. The year-on-year decline in performance was mainly due to the insufficient construction of regional infrastructure, the impact of low-cost cement from other provinces, the intensification of the contradiction between regional supply and demand, and the sharp rise in coal prices.
The sales volume was basically flat year-on-year, and the upward cost dragged down profits. In 2021, the company sold 34.54 million tons of cement (including clinker), a year-on-year decrease of 0.8%, 1.4081 million cubic meters of concrete, a year-on-year decrease of 12.17%, and 1.3679 million tons of aggregate, a year-on-year increase of 51.47%. The main reasons for the decline in sales of cement and commercial concrete are as follows: 1) insufficient construction of infrastructure projects in the region, and a large number of surrounding cement hit the regional market at low prices; 2) The local covid-19 epidemic broke out again, the traffic was controlled and the cement factory was blocked. We estimate that the price per ton, cost per ton, gross profit per ton and cost per ton of cement clinker of the company are 300 yuan / ton, 215 yuan / ton, 85 yuan / ton and 32 yuan / ton respectively, which are flat, increased by 27 yuan / ton, decreased by 28 yuan / ton and flat compared with the same period of last year. The increase of cost per ton is mainly due to the increase of cost pressure caused by the sharp rise of raw coal price.
The capital and debt structure is good, and the cash flow is under pressure and declining. At the end of 2021, the company's asset liability ratio was 21.95%, basically unchanged year-on-year, the interest bearing liability ratio was 5.3%, down 0.49pct year-on-year, and the asset debt structure continued to maintain a good structure. In 2021, the net operating cash flow of the company was 1.447 billion yuan, a year-on-year decrease of 36.5%, mainly due to 1) the rise in the purchase price of raw and fuel materials, resulting in a significant increase in the cash paid for purchasing goods and receiving labor services year-on-year (the cash paid for purchasing goods and receiving labor services increased by 1.33 billion yuan to 3.69 billion yuan year-on-year, an increase of 56.28%); 2) Restricted funds increased this year, and the amount of cash flow affecting operating activities decreased year-on-year.
Risk warning: the price of raw fuel has risen sharply; Less than the expected landing area of infrastructure; The epidemic situation is repeated.
Investment suggestions: steady growth or boost regional demand. The increase in shareholding of major shareholders shows confidence and maintains the "buy" company as the leader of cement in Gansu Qinghai Tibet region. The market share of Gansu / Qinghai reaches 45% / 23% respectively. Under the background of steady growth, infrastructure investment is expected to be boosted or drive the recovery of regional demand. At the same time, the new aggregate production lines in Chengxian and Pingliang have been put into operation, and the development of aggregate business is expected to contribute to new performance growth. In addition, the controlling shareholder China building materials plans to increase its shares of the company by no less than 120 million yuan and no more than 150 million yuan, indicating its confidence in the company's development prospects and recognition of its long-term investment value. It is estimated that the EPS in 202224 will be 1.38/1.49/1.58 yuan / share respectively, and the corresponding PE will be 7.2/6.7/6.3x. The valuation is low and has a high safety margin, maintaining the "buy" rating
