\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 963 Yueyang Forest & Paper Co.Ltd(600963) )
Event:
The company released the first quarterly report of 2022: the revenue in the first quarter of 2022 was 1.669 billion yuan, a year-on-year decrease of 14.97%; The net profit attributable to the parent company was 124 million yuan, a year-on-year decrease of 25.63%; The net profit deducted from non parent company was 113 million yuan, a year-on-year decrease of 26.49%; The basic earnings per share is 0.07 yuan.
Guoyuan view:
Q1 revenue is under slight pressure, and the subsequent performance is expected to improve marginally
Due to the industry’s gradual entry into the traditional peak season, high raw material and supply chain costs and other factors, the company’s 22q1 revenue / net profit attributable to the parent company reached 1.669124 billion yuan respectively, a year-on-year decrease of 14.97% / 25.63%, compared with 2021q4 – 19.05% / + 309.64%. On the demand side, the repeated epidemic situation in China still has a certain impact on overall consumption. With the continuation of the “double reduction” policy in the education industry, the demand for cultural paper is still under pressure. On the supply side, high energy prices are superimposed, the supply chain has been impacted to a certain extent under the influence of the epidemic and geopolitical war, and the cost pressure is still large. Looking forward to the follow-up, with the shutdown and production reduction of paper separation enterprises in the industry, the operating rate of cultural paper has declined, the overall inventory of cultural paper has been removed, the impact of superimposed imported cultural paper has been weakened, the supply side is expected to shrink, and the supply and demand structure is expected to improve. In addition, since 21q4, the pulp price has maintained a rapid upward trend, up about 50% from the 21-year low. The company is expected to give full play to its high proportion of self-produced pulp to control production costs.
Profitability has been repaired month on month, and the expense rate has remained basically stable
As a whole, the company benefited from the marginal improvement of demand, the gradual implementation of product price increase, the marginal improvement of cost control and other factors. The gross profit margin of 22q1 was 18.70%, an increase of 11.52pcts compared with 21q4, and a decrease of 2.40pcts compared with the same period last year; The net interest rate was 7.50%, increased by 10.33pcts compared with 21q4, and decreased by 1.03pcts compared with the same period last year. On the expense side, the expense rate during 22q1 increased by 0.24pcts to 11.72% year-on-year, of which the expense rates of sales, management, R & D and finance changed by -2.65pcts / + 1.13pcts / – 0.07pcts / + 1.82pcts to 1.39% / 4.85% / 3.13% / 2.34% year-on-year respectively. In terms of cash flow, the net operating cash flow was 22 million yuan, a year-on-year decrease of 24.95%, mainly due to the marginal release of operating structural deposits and the rise of raw material prices and labor costs.
The scale effect gradually appeared, and Senhai carbon sequestration plan continued to promote to support the company’s long-term growth
The company is one of the leading enterprises in the integration of Forest Pulp and paper, with obvious supply chain and scale advantages and strong technical strength. The company has nearly 2 million mu of forest resources. At the same time, it strategically deploys the forest sea carbon sequestration plan by taking advantage of multiple advantages such as resource endowment, technical experience and enterprise background. It is expected to develop 50 million mu of forest carbon sequestration in 2025. The layout of the company’s forestry carbon sequestration project has been expanded to 18 provinces, covering 58 cities, counties and districts. The follow-up is expected to drive the long-term sustainable growth of the company’s performance.
Profit and investment forecast
Considering the subsequent marginal improvement of the supply and demand of cultural paper and the industry entering the traditional peak season, but the pressure of policy, supply chain and cost is still large, we adjust the profit forecast. It is expected that the company will achieve a revenue of RMB 8.463103.52/12.054 billion, a net profit attributable to the parent company of RMB 335/4.07/546 million, an EPS of RMB 0.19/0.23/0.30, a corresponding PE of 26.16/21.49/16.02 times, and maintain the “overweight” rating.
Risk tips
Price fluctuation of raw materials; Demand growth is less than expected; The expansion of forestry carbon sequestration business was less than expected.
