\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 497 Yunnan Chihong Zinc & Germanium Co.Ltd(600497) )
The performance has increased significantly, the assets have been fully sorted out, and 22 young people have entered the battle. In 2021, the company’s operating revenue was 21.72 billion yuan, a year-on-year increase of 13.3%, and the net profit attributable to the parent company was 584 million yuan, a year-on-year increase of 23.7%. The net cash flow from operating activities was 3.24 billion yuan, a year-on-year increase of 21.3%. In the first quarter of 2022, the revenue was 5.45 billion, a year-on-year increase of 3.66%, and the net profit attributable to the parent company was 548 million, a year-on-year significant increase of 48%. In 2021, the gross profit margin of non-ferrous metal mining and smelting, the main business, reached 26.74%, with a year-on-year increase of 4.21 percentage points, reversing the decline in recent years. In 2021, the company’s roe rose to 3.93%, with a year-on-year increase of 0.8 percentage points. At the end of 2021, the company’s asset liability ratio reached 39.85%, a year-on-year decrease of 1.57 percentage points, and the asset liability ratio continued to decline.
In 2021, the average spot price of zinc in China is 22976 yuan / ton (including tax); The average annual price of lead spot is 15365 yuan / ton (including tax). While enjoying the market opportunity of substantial increase in the price of zinc products, the company continued to control the cost side, and the sales expenses and financial expenses decreased by 2.23% and 23.52% respectively, so as to further reduce costs and increase efficiency.
The company’s performance in 2021 was lower than expected, mainly due to the impairment and scrapping of long-term assets during the reporting period, of which the provision for impairment was 283 million and the scrapping and disposal of fixed assets was 448 million, a total of 731 million, with an overall decrease in the net profit attributable to the parent company in 2021 of 672 million yuan. Combined with the impairment items of the company in recent years, we believe that the company has sorted out the assets of smelting sector, overseas project sector and China mining right sector, solved the problems left over by history, further improved the overall asset quality level of the company and benefited the long-term development of the company.
The profit forecast refers to the current zinc price and the assumption that the zinc in 2022 is basically good. The company’s revenue from 2022 to 2024 is expected to be 25.5 billion yuan, 26.4 billion yuan and 29.1 billion yuan respectively; The corresponding net profit attributable to the parent company is 2.42 billion yuan, 2.69 billion yuan and 3.23 billion yuan, and the diluted EPS is 0.48, 0.53 and 0.63 yuan respectively. The current stock price corresponds to pe11.5 billion yuan 58, 10.45 and 8.68 times, maintaining the “buy” rating.
Risk tip: the company’s output is less than expected; Downstream demand is lower than expected; Zinc prices fell sharply
