\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 988 Chifeng Jilong Gold Mining Co.Ltd(600988) )
The company released its 2021 annual report and quarterly report for the first quarter of 2022: in 2021, the company achieved a revenue of 3.783 billion yuan, a year-on-year decrease of 17.01%; The net profit attributable to the parent company was 583 million yuan, a year-on-year decrease of 25.69%. Among them, Q4 company achieved a revenue of 1.114 billion yuan, a year-on-year increase of 3.93% and a month on month increase of 11.90%; The net profit attributable to the parent company decreased by 3.2 billion yuan and 6.8% year-on-year. In 2022q1, the company achieved a revenue of 1.488 billion yuan, an increase of 33.52% month on month; The net profit attributable to the parent company was 174 million yuan, an increase of 450.62% month on month.
Dominated by gold and expanded simultaneously with multi metals. In terms of business structure, the gold revenue in 2021 was 2.969 billion yuan (+ 79.1%), with gross profit accounting for 69.34% and gross profit margin of 29.28%; The revenue of electrolytic copper is 337 million yuan (- 79.95%), the gross profit accounts for 16.72% and the gross profit margin is 62.10%. Price side: in 2021, the sales unit price of gold and electrolytic copper changed by - 2.82% / + 53.72% year-on-year. Sales end: the sales of gold and electrolytic copper were + 100.17% / - 86.96% year-on-year respectively.
The short-term performance has declined and the long-term development should be taken into account. The decline of the company's performance in 2021 is mainly due to: 1) the copper conversion of SEPON mine is in the early stage, the recovery rate of mineral gold is at a low level, the progress of superimposed technical transformation projects is less than expected and the epidemic situation interferes with production, resulting in an overall increase in the operating cost of mineral gold, and the net profit calculated by equity decreased by 29.34% year-on-year; 2) Due to the promotion of infrastructure projects, the production efficiency and ore grade of Wulong and Jilong mining in China have been affected, resulting in temporary output reduction and cost rise, with net profits of - 28.09% / - 12.60% year-on-year respectively; 3) Based on the principle of prudence, an asset impairment provision of 192 million yuan was made for the inventory ore in Laos under the low recovery rate. In terms of long-term development, with the implementation of infrastructure and technological transformation projects, the cost of Kejin has a large space to decline and the performance growth potential is sufficient.
Overseas resource extension, extension + endogenous, has broad prospects. 1) Saipan exploration and reserve increase and wassa merger and acquisition have brought a leap in resource reserves. By the end of 2021, the company has a total of 575.37 tons of gold resources; 2) The deep exploration results of Lishan mine of Hanfeng mining industry are outstanding, with 542600 tons of zinc metal, 30900 tons of copper metal, 28600 tons of lead metal and 131 tons of silver metal added; 3) The 3000 meter deep drilling project led by the Ministry of natural resources was officially launched in Wulong gold mine; 4) Rare earth resources have been newly discovered in Saipan mine, and the resource endowment has been further enhanced.
Technological transformation projects will be promoted to reduce costs and increase production. 1) Wulong mining expansion project was officially put into operation at the end of 2021, and the beneficiation capacity was increased to 3000 tons / day. 2) The 1000 t / D concentrator upgrading project of Jilong mining has been started, and the project cycle is expected to be 18 months. 3) Vientiane Mining: the new oxygen station is expected to be fully completed in 2022q3, and the processing capacity of primary ore will be increased by 60%. With the optimization of the project, the recovery rate will be increased from about 55% to 80%. 4) The beneficiation capacity of wassa in Ghana reaches 3 million tons / year. With the construction of shaft project and the increase of underground mining volume, it is expected to contribute 6-8 tons of output. 5) In 2021, the license carrying capacity of Lishan mine will be increased to Shanghai Pudong Development Bank Co.Ltd(600000) tons / year, and the kilometer shaft project will be built. It is planned to be completed in 2022, and the deep resources will be effectively utilized.
Profit forecast and investment suggestions: in 2022, the global inflation level is still high, and the probability of real interest rate continues to decline, which continues to drive the gold price. We expect the net profit attributable to the parent company in 2022 / 2023 / 2024 to be RMB 1.291/17.882426 billion, and the PE corresponding to the closing price on April 29 to be 24x / 17x / 13X respectively, maintaining the "recommended" rating.
Risk tips: the project progress is less than expected, the metal price falls, geopolitical risks, etc.
