The company's performance increased significantly in 2021, mainly due to a significant increase in investment income by participating in coking coal mines. Combined with the situation in the first quarter of 2022, the company's main coking profits further shrank, considering that it will take time for the company to improve its coking profits, we downgraded the company to "overweight".
Revenue in 2021 increased by 58.10% compared with the same period last year, and the profit mainly came from investment income from coking coal mines. The operating income / net profit of the company in 2021 is 112.27 billion yuan, respectively, which is + 58.10%, 14.86%, 14.86% and 14.85% respectively over the same period last year. The company's 2021Q4 net profit in a single quarter was-586 million yuan, mainly due to the rise in raw coal prices and the decrease in coking coal sales, resulting in the provision for impairment of relevant assets at the end of the year in Feihong Chemical. The increase in the company's annual performance is mainly due to the increase in investment income in China Coal Huajin Coke Coal Mine, which confirmed that the investment income was 1.863 billion yuan, an increase of 17.81% over the same period last year. Excluding investment income, the company's main coking industry is expected to still show a loss. The profit distribution plan of the company is 0.15 yuan per share, the dividend rate is 30.5%, and the corresponding dividend rate is about 2.45%. No, no, no.
In 2021, coke sales increased by 3.43%, unit cost growth was higher than the selling price, and gross profit margin decreased by 6.38pcts.
The company's 2021 coke production / sales volume is 346.44 million tons respectively (year-on-year + 3.87% impulse 3.43%), the selling price / unit cost is 2524.57 pound 2394.91 yuan / ton (year-on-year change + 48.14% / + 58.83% respectively), the unit cost growth rate is higher than the selling price, and the coke business gross profit margin decreased to 5.14%, mainly affected by the increase in the price of raw material washing coal. The company plans to produce 3.6 million tons of coke (wet base) in 2022, a slight increase over 2021.
In 2021, the prices of major products in the chemical business increased by more than 50% compared with the same period last year, and the loss reduction effect of the chemical sector was obvious. In 2021, the sales of carbon black, methanol and pure benzene in the chemical sector of the company were 7.19 million tons (- 12.74%, 5.20%, 5.81%, respectively), the average sales price increased by 57.00%, 53.22% and 91.52%, respectively, and the revenue / cost of the chemical sector was 3.392 billion yuan (+ 23.84%, 10.46%, respectively). The gross profit margin is also slightly higher than that of the coke business (the overall gross profit margin of the company's main coking business is slightly higher than that of the coke business itself 1.35pcts). In 2022, the company plans to process 330000 tons of tar, 115000 tons of crude benzene, 260000 tons of methanol and 82000 tons of carbon black.
The average price of 2022Q1 products continued to rise, and the gross profit margin of coking decreased sharply compared with the same period last year. The operating income / net profit of 2022Q1 company is respectively 31.17 billion yuan (+ 33.01% plus 19.68%). The profit growth still comes from the investment income of coking coal mine, and the investment income of Q1 company is 660 million yuan (year-on-year + 330 million yuan). The coke production / sales volume of 2022Q1 is 88.47 million tons (+ 3.34% of the same period last year), and the average selling price is 2611.54 yuan / ton, an increase of 24.83% over the same period last year. The sales volume of the chemical sector declined, and the average sales price continued to rise. The average sales price of carbon black, methanol and pure benzene increased by 15.84%, 25.43% and 60.77% respectively compared with the same period last year. Although the prices of coking products are all rising, it is expected that the cost pressure is greater. The company's Q1 sales gross profit margin is only 0.68% (year-on-year-11.81pcts).
Risk factors: Coke prices fluctuated sharply; the chemical sector is still difficult to reverse losses.
Investment suggestion: considering that the company's participation in coking coal mine is expected to contribute rich investment income this year, driven by the rise in coking coal prices, but the income may decline next year, we adjust the company's 2022 2023 EPS forecast to 0.95 EPS 0.78 yuan (the original forecast 0.92 shock 1.00 yuan), give 2024 EPS forecast 0.81 yuan, the current price 6.11 yuan, corresponding to 2022 2024 P/E6.4/7.6/7.8x. We give the company a target price of 7 yuan, corresponding to P/E8 x in 2022 (reference industry average valuation level 8 times Ppace E). Considering that it will take time for the company to systematically recover profits in the chemical sector, we downgrade the company to "overweight" rating.
