\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 808 China Oilfield Services Limited(601808) )
Event: on March 24, 2022, the company released its annual report for 2021. In the past 21 years, the company achieved an operating revenue of 29.2 billion yuan, a year-on-year increase of 0.8%; The net profit attributable to the parent company was 313 million yuan, a year-on-year decrease of 88%; The net profit deducted from non parent company is – 35 million yuan. In the Q4 single quarter of the 21st year, the company achieved an operating revenue of 9.3 billion yuan, a year-on-year increase of 24% and a month on month increase of 30%, and realized a net profit attributable to the parent company of -1.139 billion yuan, turning profit into loss year-on-year.
Comments:
The provision for asset impairment dragged down performance: the company’s provision for asset impairment loss of 2.02 billion yuan in 21 years was the main reason for the decline of net profit. Under the influence of multiple factors such as the continuous epidemic of New Coronavirus pneumonia in the world, the fluctuation of international oil and gas industry and the accelerated transformation of the energy industry, the international oil companies have been cautious in their investment in oil and gas exploration and development. The international oil service market has limited improvement in the situation of oversupply, and the competition among the international oil field services is still fierce. The operation price and utilization rate of some large equipment in the China offshore oil field are at a low level, showing signs of impairment.
CNOOC’s “seven-year action plan” provides guarantee, and capital expenditure helps the company’s long-term development: under the background of the central government’s clear demand for increasing oil and gas exploration, the parent company CNOOC actively responded to the national call, formulated the “seven-year action plan” on January 20, 2019, and proposed that the company’s exploration volume and proved reserves should be doubled by 2025 compared with 2019, The “two 20 million” production targets of oil fields in the West and east of the South China Sea are also put on the agenda. CNOOC, the parent company, recently released its business strategy for 2022. The total capital expenditure budget for 2022 is 90-100 billion yuan, of which the proportion of exploration, development, production capitalization and other capital expenditure is expected to be 20%, 57%, 21% and 2% respectively; In 2022, CNOOC, the parent company, plans to drill 227 offshore exploration wells and collect 3D seismic data of about 17000 square kilometers China Oilfield Services Limited(601808) drilling, oilfield technology, geophysical acquisition and engineering survey business will fully benefit from the increase of upstream exploration and development capital expenditure, and the future performance is expected to be thickened.
The industry maintains prosperity and improves the transformation ability of scientific research achievements to provide technical support: IEA recently released monthly report. It is expected that from April, with the implementation of European and American sanctions against Russia and buyers’ avoidance, Russia’s crude oil supply may be reduced by 3 million barrels / day, which will have an impact on the global oil supply. The pattern of crude oil supply and demand is tight, the oil price is expected to remain high, and the petrochemical industry chain will fully benefit. The drilog tool of “D + W” system independently developed by the company, the new synthetic based drilling fluid and its supporting technology have successfully completed the first show of overseas operation, and quast has been independently developed. The breakthrough of the company’s core technology provides guarantee for oilfield technical services.
Profit forecast, valuation and rating: we maintain the company’s profit forecast for 22-23 years and add the profit forecast for 2024. It is estimated that the net profit attributable to the parent company in 22-24 years will be 2.802/3.273/3.853 billion yuan respectively, equivalent to EPS of 0.59/0.69/0.81 yuan / share respectively. Considering the good supply and demand pattern of crude oil in 22 years, the oil price is expected to remain high, the policy of “increasing reserves and production” continues to be promoted, the capital expenditure of CNOOC, the parent company, continues to grow, the prosperity of China’s oil service industry is expected to be maintained, and the company’s future development prospects continue to be optimistic, so the “buy” rating of A-Shares and the “overweight” rating of H shares are maintained.
Risk tip: the risk of international crude oil price fluctuation and CNOOC’s capital expenditure are lower than expected.
