In the first three quarters of 2022, the company realized operating income of 27.351 billion yuan, an increase of 4.38%, and a net profit of 1.634 billion yuan, down 10.24% and 49.24% respectively. In the third quarter, the company's revenue was 10.506 billion yuan, up 6.25%. The net profit returned to the mother was 493 million yuan, down 16.79% and 53.48%. It is expected that with the steady growth of infrastructure and the slow recovery of real estate, cement demand will improve and the company's buying rating will be maintained.
Support the main points of rating
Demand and cost are under double pressure, and profit margins are down a lot. The real estate downturn continued in the third quarter, the physical workload of infrastructure construction is still slow, while hot weather restrained construction in July-August, and coal prices are also relatively high. The price of cement in North China has maintained a certain degree of resilience, but sales are expected to decline more. Under multiple pressures, the company's profit margin has declined more. In the first three quarters, the company's gross profit margin was 21.58% and net profit margin was 6.34%, respectively compared with the same period last year-6.05pct/-5.24pct. The gross profit margin of the third quarter is 18.23% and the net profit rate is 4.80%, which is respectively year on year-5.92pct/5.41pct and month-on-month-6.72pct/-7.72pct.
A small improvement is expected in the fourth quarter from the previous quarter, but flexibility may be next year. Since September to October, with the improvement of temperature and the implementation of off-peak production, the average cement price in the whole country has increased slightly. North China is still the only region where the price of cement is not lower than that of the same period in recent years, with a certain degree of toughness. We expect cement sales to improve in the fourth quarter and the company is expected to benefit.
Looking forward to next year, the main line of stable infrastructure growth and weak real estate recovery will remain unchanged. Looking forward to next year, infrastructure is still expected to prop up the economy, and real estate is expected to recover slowly under the accumulated loose policies. Supported by steady infrastructure growth and weak real estate recovery, the cement industry and companies are expected to fully benefit.
Valuation
The company's performance is under pressure, and we have lowered our profit forecast for this year. It is estimated that the company's income from 2022 to 2024 is 366.7 yuan, 379.2 yuan and 39.42 billion yuan, the return net profit is 21.4,27.9 yuan and 3.32 billion yuan respectively, and the EPS is 0.80,1.05,1.25 yuan respectively. It is optimistic that the main line of steady growth of infrastructure and slow recovery of real estate will promote the marginal recovery of the company's performance on a low base and maintain the company's buy rating.
Main risks faced by rating
Coal prices continue to rise, the physical workload of infrastructure is less than expected, and real estate remains depressed.