On April 10, Tianshan Aluminum Group Co.Ltd(002532) ( Tianshan Aluminum Group Co.Ltd(002532) ) disclosed the performance forecast for the first quarter of 2022. In the first quarter of this year, the company realized a net profit attributable to listed companies of 1.1 billion yuan, a substantial increase of 34.38% year-on-year; Deduct non net profit of 1.06 billion yuan, with a year-on-year increase of 35.74%; The basic earnings per share was 0.24 yuan, an increase of 33.33% over the same period last year.
What does the net profit of RMB 1.1 billion in a single quarter mean to Tianshan Aluminum Group Co.Ltd(002532) ? According to the previously disclosed annual report of 2021, Tianshan Aluminum Group Co.Ltd(002532) 202 had a net profit of 3.83 billion yuan last year. If the company’s annual capacity of 1.2 million tons in 2021 was estimated, the profit per ton would be 3190 yuan. The net profit in the first quarter of 2022 was 1.1 billion yuan, which also meant that the company’s single ton profit increased to 3660 yuan.
As for the reasons for the performance growth, Tianshan Aluminum Group Co.Ltd(002532) pointed out that the aluminum industry has maintained a high prosperity since this year, and the price has remained between 20000 yuan / ton and 23000 yuan / ton, so as to improve the overall profit of the company; At the same time, thanks to the abundant coal resources and price advantages in Xinjiang, the company continues to maintain the advantage of low power cost, and the rise of power cost is far lower than the industry level. In addition, the complete layout of the upstream industrial chain effectively avoids the risk and price fluctuation of raw material supply, and also enables the company to ensure the safe, stable and full load operation of all production lines in the face of multi factor disturbance of the epidemic, so as to successfully complete all production and operation indicators in the first quarter. During the reporting period, the output of anode carbon project increased by 51% year-on-year, and the self-sufficiency rate was further improved.
It is reported that since 2021, due to the shortage of power supply and the sharp rise of energy prices, some aluminum enterprises have stopped production and reduced production outside China. The shortage of aluminum supply and strong market demand stimulate the strengthening of aluminum prices. In 2022, the impact of bulk commodities caused by the conflict between Russia and Ukraine further increases the expectation of aluminum supply shortage, and the market expects that aluminum prices will maintain a strong trend Tianshan Aluminum Group Co.Ltd(002532) relying on the low-cost competitive advantage of integrated and complete industrial chain, it has benefited a lot from this round of aluminum strong cycle.
In addition to the cost competitive advantage of the upstream, the layout of Tianshan Aluminum Group Co.Ltd(002532) in the downstream industry is of great concern. In the high-purity aluminum sector, production and sales in the first quarter of this year further increased. The report shows that the company’s high-purity aluminum output in the first quarter increased by 156% year-on-year, the sales volume increased by 158% year-on-year, the profit increased by 226% year-on-year, and the performance entered the runway of rapid growth.
At present, Tianshan Aluminum Group Co.Ltd(002532) the high-purity aluminum new material base is located in the national Shihezi Economic and Technological Development Zone. The 60000 ton production capacity planned to be constructed in phase I will be put into full operation. The company plans to increase the production scale to 100000 tons per year. The company’s Tianzhan brand high-purity aluminum has been highly recognized by customers at home and abroad and signed long-term orders, and the products are in short supply. According to the annual report, the export of high-purity aluminum products accounted for 37.6% in 2021, mainly sold to the field of high-end electronic products, and Japan became the largest overseas market.
In 2022, Tianshan Aluminum Group Co.Ltd(002532) also started to make efforts in the downstream aluminum processing sector. It is planned to invest in advanced equipment in Jiangyin and Xinjiang to build aluminum foil production bases for power batteries. In phase I, it is planned to build a production capacity of 100000 tons to provide positive aluminum foil materials for power batteries for electric vehicles.
Power battery aluminum foil is the key material in the field of new energy vehicle power battery at present. It is expected that the annual market demand increment will exceed 100%, the demand growth will be strong, the product supply will not meet the demand, the profit will be considerable, and the development prospect will be broad. Due to the high technical and technological threshold of the product, only a few enterprises in the market have certain production capacity Tianshan Aluminum Group Co.Ltd(002532) has been engaged in the production of aluminum foil for nearly 20 years. Based on the original production base and technical team, it actively introduces the professional technical team and technology of battery foil, invests in advanced equipment, quickly cuts into the power battery foil track, and strives to be put into operation in 2023. After the first phase is completed and put into operation, the company will continue to increase investment according to market demand and build the power battery foil into a global leading manufacturer of scale, technology and products.
The production of high purity aluminum and power battery aluminum foil is expected to become a new profit growth point of the company, which will further enhance the competitive advantage of Tianshan Aluminum Group Co.Ltd(002532) whole industry chain integration.
