\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 547 Shandong Gold Mining Co.Ltd(600547) )
Event: Shandong Gold Mining Co.Ltd(600547) released the annual report of 2021 and the performance forecast of the first quarter of 22 years. In 2021, the company realized an operating revenue of 33.935 billion yuan, a year-on-year decrease of 46.70%, a net profit attributable to the parent company of -194 million yuan, a year-on-year decrease of 109.57%, and a net profit not attributable to the parent company of -553 million yuan, a year-on-year decrease of 123.47%; Among them, Q4 achieved an operating revenue of 16.230 billion in 21 years, a year-on-year increase of 62.24%, a month on month increase of 178.05%, a net profit attributable to the parent company of 1.061 billion, a year-on-year increase of 156.28% and a month on month increase of 873.39%. In Q1 2022, the company expects to realize a net profit attributable to the parent company of 315 million, with a year-on-year increase of about 644 million, turning losses into profits year-on-year.
In 2021, affected by the safety inspection, the production and sales of self-produced gold decreased, affecting the company’s annual performance.
In terms of volume, in 2021, the company produced 24.78 tons of gold (yoy-36.06%), sold 26.20 tons (yoy-30.42%), purchased 30.99 tons (yoy-74.24%), sold 31.50 tons (yoy-74.15%), produced 26.73 tons (YoY + 594.54%) of small gold bars and sold 26.61 tons (YoY + 600.24%). Due to the impact of safety inspection in the first half of 21 years, the company’s self-produced gold output decreased (in H1 of 21 years, the self-produced gold output was 9.80 tons, yoy-51.07%); In the second half of the year, the company fully promoted the resumption of work and production. The gold output increased from 1.629 tons per month in June 2021 to 2.811 tons per month in December. The H2 mineral gold output in 21 years was 14.98 tons, and the production and operation recovered rapidly.
In terms of price, the average price of Comex gold in 21 years was 179899 US dollars / ounce (YoY + 1.10%), and the average price of SHFE gold was 375.79 yuan / gram (yoy-3.53%). In 2021, the overall gold price remained high. Under the joint influence of the recovery of demand, the tension of supply chain and the sharp rise of commodity prices, overseas inflation rose to an all-time high, and it is difficult to alleviate short-term inflation. We expect that high inflation will continue to support the gold price.
The company’s expense rate has increased. The company’s expense rate during the 21 year period was 12.81%, an increase of 6.68 PCTs over the same period last year. Specifically, 1) in terms of sales expenses, the sales commission of the subsidiary Shanjin futures increased by 675.70% year-on-year, accounting for 79.51% of the sales expenses. The sales expenses increased by 237.4% year-on-year to 361 million yuan, and the sales expense rate increased by 0.89 PCTs from 0.17% → 1.06%; 2) Due to the year-on-year increase of 34.10% in employee compensation in this period, the management expense rate increased by 4.62 PCTs from 4.01% to 8.63%; 3) In terms of financial expenses, as the company’s interest expenses in the past 21 years decreased by 10.35% year-on-year, the total financial expenses were 711 million yuan, a year-on-year decrease of 16.94%, and the financial expense rate increased by 0.76 PCTs from 1.34% to 2.10%; 4) The R & D expense ratio increased by 0.41pcts from 0.61% to 1.02%.
The “three-year development path” has been steadily implemented, and extensive M & A has promoted resource integration, further consolidating its leading position. During the reporting period, the company continued to promote the integration of resources in Shandong Province, accelerated the merger and reorganization of high-quality resource projects outside the province, and constantly consolidated the leading position of gold. Outside the province, in 2021, the company promoted resource integration in Xinjiang and Africa through the acquisition of 100% equity of Hengxing gold and Ghana cardino. In the province, the company realized the integration of gold resources in Laizhou region through the acquisition of 100% equity of Laizhou Zhangjian investment, 100% equity of Tiancheng mining, Ludi gold mine, Shandong Geological mine Laijin holding, 45% equity of Laizhou Hongsheng mining and Jiaojia mining right, with 95.31% equity of Jiaojia Gold Mine. By the end of 2021, the company had 147926 tons of gold resources (YoY + 41.3%), 128065 tons of equity metal resources (YoY + 50.6%), 592.41 tons of metal reserves (YoY + 52.7%) and 499.62 tons of equity metal reserves (YoY + 73.5%).
Profit forecast and investment suggestion: in terms of output, from January to February 2022, the company achieved a “good start”, and the output of mineral gold increased by about 24% year-on-year. It is expected that the output of mineral gold of the company in 2022 is expected to return to the normal level, assuming that the gold output of the company in 22-24 years is 40 / 41 / 42 tons respectively. In terms of gold price, high inflation is difficult to ease in the short term, which forms a continuous support for the gold price. We adjust the gold price assumption, and the average price of gold futures in 22-24 years is assumed to be 380 / 370 / 365 yuan / g. It is estimated that the company’s net profit attributable to the parent company in 22-24 years will be 2.171 billion, 2.339 billion and 2.401 billion respectively (the value was 2.728 billion and 2.723 billion before 22-23 years), corresponding to 48 / 44 / 43 times of the company’s PE in 22-24 years, maintaining the company’s “overweight” rating
Risk warning events: macroeconomic risk, gold price fluctuation risk, repeated epidemic risk, mining enterprise shutdown risk, safety management risk, environmental protection management risk, uncertainty risk of the implementation of the shareholding increase plan, etc.
