\u3000\u3 Shengda Resources Co.Ltd(000603) 885 Juneyao Airlines Co.Ltd(603885) )
Event:
Juneyao Airlines Co.Ltd(603885)
In terms of business, the company transported 18.443 million passengers / yoy + 17.35% in 2021, equivalent to 83.77% of the level in 2019; Ask and RPK increased by 15.25% and 15.95% respectively year-on-year in 2020, equivalent to 88.05% and 78.15% of the level in 2019; The occupancy rate was 75.65% / yoy + 0.46 PCT, down 9.58 PCT year-on-year in 2019.
Among them, 4q2021 company transported 4.0835 million passengers / yoy-22.11%, reaching 76.20% of the level in the same period in 2019; Ask and RPK decreased by 11.92% and 22.96% respectively year-on-year in 2020, reaching 82.71% and 70.13% in the same period in 2019; The occupancy rate was 70.46% / yoy-10.10 PCT, a year-on-year decrease of 12.64 PCT over the same period in 2019.
In terms of finance, the company achieved an operating revenue of 11.767 billion yuan / yoy + 16.49% in 2021, 70.25% of the same period in 2019; The net profit attributable to the parent company was -498 million yuan / yoy-5.03%, deducting the net profit not attributable to the parent company was -666 million yuan / yoy + 0.77%, a year-on-year decrease of 150.04% and 173.61% respectively in 2019. Among them, 4q2021 achieved an operating revenue of 2.638 billion yuan / yoy-10.03%, reaching 70.42% of the same period in 2019; The net profit attributable to the parent company was -448 million yuan, deducting the net profit not attributable to the parent company of -604 million yuan / yoy-858.50%, a year-on-year decrease of 85.46% and 143.30% respectively in 2019.
Key investment points:
The rebound of 4q2021 epidemic dragged down performance, and the annual revenue increased by 16.49%
In terms of passenger transport, affected by the rebound of the local epidemic in the second half of the year, the business recovery process of the company was disturbed. Among them, the passenger volume of 4q2021 decreased by 22.11% year-on-year, and the revenue decreased by 294 million yuan year-on-year, which directly dragged down the annual performance. However, benefiting from the strong recovery of air travel demand in the Chinese market from March to July, the company’s ask still achieved a year-on-year increase of 15.25% and recovered to 88.05% in the same period in 2019. Meanwhile, throughout the year, rasK increased slightly by 2.79% to 0.31 yuan, and the increase in volume and price led to an increase in passenger revenue of 1.731 billion yuan to 11.107 billion yuan, a year-on-year increase of 18.47%.
In terms of cargo transportation, the company realized an air cargo revenue of 509 million yuan, a slight decrease of 111 million yuan year-on-year. Overall, the company’s annual operating revenue increased by 1.666 billion yuan, a year-on-year increase of 16.49%.
The upward cost of oil price is under pressure, and the deduction of non loss narrowed slightly
In terms of cost, the average price of oil distribution in 2021 increased by nearly 60% year-on-year compared with that in 2020, adding to the increase of the company’s business volume, driving the annual fuel cost to increase by 1.157 billion yuan, up 53.09% year-on-year. At the same time, due to the rise of takeoff and landing service fees, labor costs and other factors affected by the increase of flight volume, the company’s operating costs in this period increased by 1.506 billion yuan, a year-on-year increase of 14.66%. Under the new leasing standards, the company’s cask in 2021 was about 0.33 yuan, basically the same as that of the previous year. Benefiting from the continuous appreciation of the RMB, the company realized an exchange gain of 219 million yuan in the whole year, with a year-on-year increase of 73 million yuan, but the investment income fell by nearly 130 million yuan. In addition, the company received a Boeing operating subsidy of 131 million yuan in the current period, which led to a year-on-year increase in non operating income of 26 million yuan, and finally realized a slight narrowing of non deduction loss.
The flight structure continues to be optimized, and this year may be the start of the medium and long-term starting point
The company adopts the “auspicious + nine yuan” dual brand model to make an all-round layout of the two major tracks of full-service and low-cost, continuously optimize the aviation network structure, and continue to increase the proportion of flights at class I and II airports in summer and autumn 2022. At the same time, Boeing 737max has regained airworthiness license in China in December 2021. It is expected that the introduction of Jiuyuan brand fleet will continue to recover. In addition, in the post epidemic era, the utilization rate of the company’s wide body machine will increase, so as to jointly help the company return to the high-speed growth period.
Recently, affected by factors such as industrial safety accidents and the rebound of the epidemic in Shanghai, the prosperity of the aviation industry is at a low level, and the demand for air travel has been significantly restrained. But with the New Coronavirus treatment plan (trial version ninth) released, China’s epidemic has entered the second half, the starting point for the aviation industry will be opened this year, and the inflection point still needs to be patient. In the current cycle caused by covid-19 epidemic, the aviation industry has two logics: Valuation repair and supply-demand elasticity. When the upward phase of the cycle comes, the company is expected to fully benefit.
Profit forecast and investment rating: considering the epidemic situation and the recovery rhythm of the industry, it is estimated that the company’s revenue from 2022 to 2024 will be 13.106 billion yuan, 18.777 billion yuan and 24.668 billion yuan respectively, and the net profit attributable to the parent company will be -394 million yuan, 1.380 billion yuan and 2.107 billion yuan respectively, corresponding to 20.51 times and 13.44 times of PE from 2023 to 2024. Considering that the fundamentals of the aviation industry are at the bottom of the large cycle, the company will fully benefit from the arrival of the upward stage of the future industry cycle and maintain the “buy” rating.
Risk tips: (1) permanent loss risk: Bankruptcy caused by cash flow fracture and passive substantial dilution of shares caused by huge additional issuance at the bottom; (2) Periodic impact risk: at the macro level, the economy fluctuates greatly, the epidemic breaks out again, and major natural disasters, vaccination and related drug research and development are blocked; In terms of industry, major policy changes, aviation accidents, intensified industry competition, etc.
