Incident: Company discloses 2022 annual report. The company's revenue for the full year of 2022 was 10.936 billion yuan, -3.67% year on year; operating profit was 394 million yuan, +6.82% year on year; total profit was 3.76 yuan, +1.28% year on year; net profit of the mother was 291 million yuan, -20.04% year on year; net profit of the non-return mother was 301 million yuan, -17.6% year on year. Among them, 2022/Q4 achieved revenue of 2,691 million yuan in a single quarter, with a return of 152 million yuan, an increase of 382.5% over the previous quarter, mainly due to a boost in the gold business.
Successfully entered the gold race track and gained control of the Pachingo gold mine. On November 30, 2022, all of NQM's shares were transferred under the name of Yurun Gold, a wholly-owned subsidiary. The company obtained control of the Parkingo Gold Mine located in Queensland, eastern Australia. NQM was officially included in the scope of the company's consolidated statement, marking that the company had successfully entered the “mining circuit” of gold and precious metals. After the completion of the delivery of the Parkingo project, it has reached full production capacity. According to performance promises, NQM's net profit for 2022, 2023, and 2024 is no less than 36 million Australian dollars, no less than 39 million Australian dollars, no less than 41 million Australian dollars, and a cumulative net profit of 116 million Australian dollars over three years, which will significantly optimize the revenue structure of listed companies and increase profitability.
A single month produced 10,800 ounces of gold, the highest in nearly five years. In December 2022, the Pagingo mining area produced 10,800 ounces of gold in a single month (equivalent to 334.86 kg). Throughout 2022, the Pachingo mining area achieved gold production of 83,500 ounces (equivalent to 2.6 tons). Both the monthly and annual gold production in the Paringo mining area reached the highest level in nearly five years.
The focus is on promoting the implementation of “two-wheel drive” strategies for precious metals and new energy materials and minerals. ① Seize opportunities in the new energy storage market, and the vanadium mine project came to fruition. In December 2022, the company acquired 67% of Shaanxi Shanjin's shares in cash to obtain mining rights for the Loufanggou Vanadium Mine Project in Shangnan County, Shaanxi Province. At the same time, the company joined hands with Dalian Rongke, a “leading enterprise” in the field of all-vanadium liquid flow energy storage batteries, to cooperate around the layout of the entire vanadium ore resource industry chain. ② Actively lay out graphite ore resources in Africa and develop a new materials industry development package. In 2022, the company plans to invest 5 million Australian dollars to invest in companies listed on the Australian Stock Exchange to spur mining and lay out graphite resources in Africa. The Ancuabe Project (Ancuabe Project) owned by Chuiteng Mining is a large-scale and super-large-scale flaky graphite mine. It has about 46.1 million tons of graphite ore resources that meet JORC standards, with a recoverable reserve of 248.95 million tons. The above investment was approved by the Australian Foreign Investment Review Board (FIRB) in April 2023.
Profit forecasts. We expect the company's revenue for 2023-2025 to be 124/139/147 billion yuan respectively, the 2023-2025 net profit forecast is 539/587/630 million yuan respectively, and the PE corresponding to the closing price on April 24, 2023 is 17.2x/15.8x/14.8x respectively. As a gold stock, PE is clearly undervalued and maintains a “buy” rating.
Risk warning: gold price falls short of expectations; gold mine production falls short of expectations; impact of exchange rate fluctuations