Zijin Mining Group Company Limited(601899) ( Zijin Mining Group Company Limited(601899) ) billion yuan, with a year-on-year increase of 31.25%; The net profit attributable to shareholders of listed companies was about 15.673 billion yuan, a year-on-year increase of about 140.80%; The net profit attributable to non listed shareholders increased by about 13.6 billion yuan on a year-on-year basis, deducting about 2.1% from the net profit attributable to non listed shareholders; Earnings per share was 0.60 yuan, a year-on-year increase of 140%.
The volume and price of major mineral metals have risen simultaneously, the cost control is excellent, and the profitability has been greatly improved. In 2021, the average prices of Comex gold, LME copper and LME zinc increased by 1.09%, 50.65% and 32.44% year-on-year respectively, driving the average sales prices (excluding tax) of copper and zinc produced by the company’s main mineral metal mines to rise by 43.59% and 46.93% year-on-year respectively to 53583 and 14136 yuan / ton, and the price of gold produced by mines only decreased by 4.46% to 348.69 yuan / g. In addition, the average selling prices of silver and iron concentrates produced by the company’s mines in 2021 increased by 8.20% and 31.73% to 3.43 yuan / g and 822 yuan / ton respectively. In terms of output, during the reporting period, the company produced 47.46 tons of gold (year-on-year + 17.16%), 584200 tons of copper (year-on-year + 28.83%), 396400 tons of zinc (year-on-year + 15.87%), 37900 tons of lead (year-on-year + 5.18%), 308.81 tons of silver (year-on-year + 3.38%) and 4.25 million tons of iron concentrate (year-on-year + 9.82%). In terms of cost, the unit sales cost of gold production and copper production of the company’s core minerals decreased by 0.66%, 9.46% year-on-year to 176.22 yuan / g and 18194 yuan / ton respectively, and only the zinc production of the mine increased by 12.16% year-on-year to 7369 yuan / ton. In 2021, the gross profit margin of the company’s mineral products increased by 11.27 percentage points to 58.98% year-on-year, driving the company’s comprehensive gross profit margin to increase by 3.53 percentage points to 15.44% year-on-year.
Several world-wide projects have entered the production capacity release period. In 2021, the company’s flagship projects, the first phase of the three world copper mines kamoa kakura copper mine, the upper ore belt of PEGI copper gold mine in Serbia and the first phase of Julong copper mine in Tibet, were put into operation, superimposed with the trial production of 40000 tons of MS mine of Bor copper industry in Serbia, 40000 tons of VK mine, which is expected to be put into operation in 2022q2, and the technical transformation project of buritika gold mine in Colombia, which will greatly increase the output of core minerals of the company in 2022. The company’s output guidelines: in 2022, the output of mineral copper is 860000 tons (year-on-year + 47%), and the output of mineral gold is 60 tons (year-on-year + 26%). The company still reserves a number of key projects, including the implementation of caving mining of four underground large porphyry deposits, including Heilongjiang Tongshan Copper Mine, Fujian Zijinshan lobling copper (molybdenum) mine, Serbia bor copper JM copper mine and Serbia peji copper gold mine lower belt mine, Tibet Julong copper mine phase II project, kamoa kakula copper mine phase II and III project in the Democratic Republic of Congo, Norton binduli gold mine heap leaching project in Australia The commissioning of the zelavshang hot press oxidation gold mine project in Tajikistan will enable the company to produce 1-1.1 million tons of mineral copper and 80-90 tons of mineral gold in 2025.
Strategy to enter the field of new energy and new materials. During the reporting period, the company strategically entered the field of new energy and new materials, acquired the 3Q lithium salt lake project in Argentina, and the phase I 20000 ton battery grade lithium carbonate project is expected to be put into operation by the end of 2023. It also established a joint venture with the National Mining Development Company of the Democratic Republic of the Congo (DRC) to start the first hard rock lithium ore exploration project. It is planned that the company will form a capacity of 50000 tons of lithium carbonate in 2025. At the same time, the company set up a new energy and materials research institute to accelerate the research and implementation of new material projects such as lithium iron phosphate, electrolytic copper foil and high-performance alloy materials.
Investment suggestion: the company’s world-class mining projects have been successfully put into operation, and several key mining projects are still reserved for development. In the future, the output of gold and copper mines will increase significantly with certainty, and it is expected to become a global non-ferrous metal mineral resources giant. In addition, the company strategically marches into the development of new energy resources such as lithium and creates a new growth point of the company. In the case of high energy prices, metal prices are expected to be supported at a high level. It is estimated that the net profit attributable to shareholders of Listed Companies in 20222023 will be 22.4 billion yuan and 25.7 billion yuan, corresponding to EPS of 0.85 and 0.98 yuan in 20222023 and PE of 12x and 11x in 20222023, maintaining the “recommended” rating.
Risk tips: 1) the price of gold, copper and other metals fell sharply; 2) The new project of the company was put into operation less than expected; 3) The release of new production capacity of the company is less than expected; 4) Overseas geopolitical factors.
