\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 711 Chengtun Mining Group Co.Ltd(600711) )
Event: the company released 2021 annual report and 2022q1 quarterly report. In 2021, the company achieved a revenue of 45.237 billion yuan, a year-on-year increase of 15.3%; The net profit attributable to the parent company was 1.031 billion yuan, a year-on-year increase of 1645.6%; Net profit deducted from non parent company was 651 million yuan, with a year-on-year increase of 378%. In 2022q1, the company's revenue was 6.226 billion yuan, a year-on-year decrease of 45.8%, a month on month decrease of 20.8%, the net profit attributable to the parent was 375 million yuan, a year-on-year decrease of 10.0%, a month on month increase of 181.1%, and the net profit not attributable to the parent was 452 million yuan, a year-on-year increase of 7.2% and a month on month increase of 261.1%. The performance is in line with our expectations.
The production capacity of copper, cobalt and nickel was released, and the product volume increased at the same time. Due to the capacity release of Youshan nickel industry and CCR project, the company's copper cobalt nickel output increased significantly. Volume: the sales volume of zinc products was 256400 tons, with a year-on-year increase of 3.12%; The sales volume of nickel products was 40100 tons, with a year-on-year increase of 1358%; The sales volume of cobalt products was 10200 tons, with a year-on-year increase of 52.4%; The sales volume of copper products was 39400 tons, with a year-on-year increase of 38.27%. Profit: with the economic recovery and the rapid development of new energy vehicles, the price of copper, cobalt and nickel rose sharply, and the profitability of the company increased significantly. The gross profit per ton of zinc was 1084 yuan, a year-on-year decrease of 153 yuan, mainly due to the decrease of zinc concentrate processing fee; The gross profit per ton of nickel was 41807 yuan, an increase of 19229 yuan year-on-year; Gross profit per ton of cobalt was 112878 yuan, with a year-on-year increase of 66079 yuan; The gross profit per ton of copper was 28779 yuan, an increase of 11417 yuan. The gross profit margin and net profit margin of the company were 9.71% and 5.60%, up 5.56pct and 5.05pct respectively.
Non recurring profit and loss changed greatly, and impairment loss dragged down the performance in 2021. In 2021, the non recurring profit and loss of the company changed greatly, of which the net income from changes in fair value was 450 million yuan, an increase of 422 million yuan, mainly because the income from trading financial assets increased by 261 million yuan; The asset impairment loss was RMB 363 million, with a year-on-year increase of RMB 266 million, mainly due to the increase in the impairment of intangible assets, other current assets and construction in progress, and the increase in credit impairment loss of RMB 165 million, mainly due to the significant increase in other receivables, which affected the net profit attributable to the parent company by RMB 308 million. 22q1 asset impairment loss decreased and performance increased month on month. From a year-on-year perspective, the increase in performance was mainly due to the rise in both volume and price.
Future highlights: 1) the industry maintains high prosperity and strong product price performance. High global inflation, continued supply chain problems, reduced zinc production due to the European energy crisis, and high copper and zinc prices; The demand for new energy vehicles is strong, while the supply growth is slow, and the price of nickel and cobalt is strong. 2) Implement the "upper control of resources and lower expansion of materials" "Strategy and integrated layout are gradually taking shape. Upstream: CCM3 million tons of copper, 5800 gold tons of cobalt hydroxide project capacity climbing, kalonway 30000 tons of copper and 4000 tons of cobalt project strive to be put into operation by the end of the year, and Shengmai nickel 40000 tons of nickel project is progressing steadily. Downstream: the output of high-end cobalt products of kelixin is no less than 3000 tons; focus on promoting the construction of 300000 tons of nickel sulfate, 300000 tons of iron phosphate and 10000 tons of cobalt containing battery materials in Guizhou, phase I 1510000 tons of nickel sulfate will be put into operation in the first half of 2023. 3) There is great potential to increase reserves of resources, and the upstream management and control ability is enhanced. Both kalongwei and FTB projects are located in the rich ore belt and near the large copper cobalt deposit. They have good prospecting prospects and great potential for increasing reserves in the future.
Investment suggestion: the price of copper, cobalt and nickel is high. With the gradual release of production capacity, the company's performance will increase significantly. We expect the company to realize the net profit attributable to the parent company of 1.918 billion yuan, 2.456 billion yuan and 3.291 billion yuan from 2022 to 2024, with EPS of 0.68 yuan, 0.87 yuan and 1.16 yuan respectively. The PE corresponding to the closing price on April 29 is 10, 8 and 6 times respectively, maintaining the "recommended" rating.
Risk tip: energy prices rise sharply, capacity release is less than expected, downstream demand is less than expected, etc.
