\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 808 China Oilfield Services Limited(601808) )
The central price of oil rises, and the leading recovery of oil service is imminent. Maintain “buy” rating
The company released an annual report, and achieved a revenue of 29.2 billion yuan in 2021, a year-on-year increase of + 0.8%; The net profit attributable to the parent company was 310 million yuan, a year-on-year increase of – 88.4%. Due to the repeated epidemics and the slight lag in the recovery of oil service and Soviet Union, we appropriately lowered the profit forecast for 20222023 and added the forecast for 2024. It is estimated that the net profit attributable to the parent company will be 2.81 (- 7.3) / 3.53 (- 9.0) / 4.43 billion yuan in 20222024, with a year-on-year increase of 795.8% / 25.8% / 25.4%, and EPS of 0.59 (- 0.15) / 0.74 (- 0.19) / 0.93 yuan respectively; The current share price corresponding to PE is 23.5 / 18.7 / 14.9 times respectively. Considering that the oil price is expected to remain high and the inflection point of the oil service industry is approaching, we are optimistic about the future development prospect of the company and maintain the “buy” rating.
Asset impairment and drilling sector drag down performance, and the industry inflection point may be coming
The provision for impairment loss of fixed assets is 2.01 billion yuan: affected by covid-19 epidemic, fluctuations in the oil and gas industry, energy transformation and other factors, the international oilfield service competition is fierce, the operating price and utilization rate of some large equipment of the company are low, and there are signs of impairment. The provision for impairment of fixed assets in 2021 has an impact on the performance of 86.6%. The performance of the drilling sector is low, and the turning point of the industry may be coming: the utilization rate of drilling platform is down 3.1%, the average daily income is down 13.7% and the gross profit is down 99.1% year-on-year. The drilling sector has become the only negative growth sector. In 2021, despite the steady recovery of oil prices, affected by the epidemic and the investment in oil exploration and development, the recovery of oil service market is slow. Since 2022, the average price of Brent crude oil has increased by 35% compared with 2021, and the oil price center has further increased. It is expected that the global upstream exploration and development investment will continue to increase, and the industry inflection point may come.
High dependence on foreign crude oil, steady performance growth of the “seven-year action plan”
Ensure energy security and benefit the oil service market: from 2019 to 2021, China’s external dependence on crude oil exceeded 70%, natural gas exceeded 40%, and China’s external dependence on oil and gas continued to rise. Before 2040, the main body of global energy is still fossil energy, which ensures China’s energy security and benefits the oil service market. The “seven-year action plan” ensures the development of the company: CNOOC’s “seven-year action plan” specifies that the exploration volume and proved reserves of the company in 2025 will double compared with 2019, the total capital expenditure budget of CNOOC in 2022 will be 90-100 billion yuan, and the net output target will increase by 5.3% – 7.0% year-on-year. In July 2021, the National Energy Administration held another work promotion meeting to vigorously improve oil and gas exploration and development. The company benefited from the increase of upstream capital expenditure, and its future performance entered the recovery channel.
Adhere to technology driven and develop new energy industry
Heavy assets to heavy technology: develop new technologies such as ultra-high temperature and high pressure wireline logging, “Xuanji” system and deepwater hem drilling fluid, and adhere to the transfer from heavy assets to light assets and heavy technology. The company’s technological innovation will not only ensure the main business of oil service, but also reduce performance fluctuations. Expand offshore wind power: in November 2021, the company pioneered the installation of offshore wind turbines on the drilling platform, established the capital and expanded the new, and accelerated the development of new energy business. The company is expected to continue to benefit from low-carbon transformation.
Risk tips: the risk of sharp fluctuations in oil prices, the risk of sharp cuts in daily fees, and the risk that the policy promotion is less than expected
