\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 516 Fangda Carbon New Material Co.Ltd(600516) )
Event: the company released the first quarterly report of 2022, realizing an operating revenue of 1.149 billion yuan, a year-on-year increase of 23.50%, a net profit attributable to the parent of 34 million yuan, a year-on-year decrease of 74.81%, and a net profit attributable to the parent of 125 million yuan after deduction, a year-on-year decrease of 9.13%.
In 2022q1, the company’s gross profit was + 14% year-on-year, and the decrease in fair value resulted in a significant decline in the net profit attributable to the parent company. In 2022q1, the operating revenue of the company was 1.149 billion yuan, a year-on-year increase of 23.50%, the operating cost was 832 million yuan, a year-on-year increase of 27.77%, and the gross profit was 317 million yuan, a year-on-year increase of 13.52%. The net profit attributable to the parent company in 20221q1 was – 74.81% year-on-year, mainly due to the decrease of 117 million yuan in the fair value of trading financial assets, derivative financial assets, trading financial liabilities and derivative financial liabilities held by the company, resulting in non recurring profit and loss of – 90.98 million yuan in Q1.
In 2022q1, the supply and demand of graphite electrode were weak, and the industry profit improved significantly month on month. According to the data of Baichuan Yingfu, the output of graphite electrode in China from January to march was 222500 tons, with a year-on-year increase of – 7.33% and a month on month increase of – 6.94%; The average operating rate of 85 household appliance furnace steel monitored by Mysteel from January to march was 44.19%, with a year-on-year increase of – 15.38 percentage points, indicating that the supply and demand of graphite electrode industry were weak in the first quarter. According to the data of Baichuan Yingfu, the average price of graphite electrode in 2022q1 was 21158 yuan / ton, with a month on month increase of + 5.1%, and the gross profit of the industry was – 1538 yuan / ton, with a month on month increase of + 511 yuan / ton.
Since the second quarter, the operation of electric furnace has continued to rise, and the price of graphite electrode is expected to rise further. According to the data of Baichuan Yingfu, the average cost of graphite electrode in April was 28173 yuan / ton, a change of + 10.60% compared with the average value of Q1; The average price of graphite electrode is 23704 yuan / ton, which is + 12.04% higher than the average value of Q1. As of April 29, the operating rate of 85 home appliance furnace steel monitored by Mysteel rose to 72.54%, up 4.13pct from the end of March. The second quarter is the traditional peak season of steel demand. The recovery of electric furnace operating rate will boost the demand for graphite electrode, and its price and profitability are expected to rise further.
The company’s three expense rate fell to 7.19%, a new low level in one year. In 2022q1, the three expense rates (sales, management and Finance) of the company were 7.19% (mom -7.47pct), a new low level in one year, of which the sales expense rate was 2.89% (mom -0.48pct), the management expense rate was 9.41% (mom -5.61pct), and the financial expense rate fell to a new low level of – 5.11% (mom -1.38pct).
Profit forecast, valuation and rating: as a leading enterprise in the graphite electrode industry, the company has both carbon new material business and provides new momentum for future development. The company’s net profit attributable to the parent company from 2022 to 2024 is predicted to be 1.780 billion yuan, 2.606 billion yuan and 3.385 billion yuan respectively, corresponding to EPS of 0.47, 0.68 and 0.89 yuan respectively. The price of graphite electrode continues to rise, and the company’s profit is expected to continue to rise and maintain the “buy” rating.
Risk tip: the development space of photovoltaic industry and nuclear power industry is less than expected; The overcapacity of graphite electrode industry, carbon carbon composite materials and other products has led to the decline of profitability China Fangda Group Co.Ltd(000055) issue payable bonds with the company’s shares as the subject matter, and convert shares on a large scale in the future or affect the company’s share price.
