Core ideas:
1. Event
According to the company's 14-year annual report, the company's operating income, net profit and deduction for non-return were 15.102 billion yuan, 40 million yuan and-124 million yuan respectively, with year-on-year changes of-6.60%, 71.53% and 61.61%, and EPS of 0.08 yuan.
two。 Our analysis and judgment.
(1) the prices of zinc and indium products have risen and improved continuously.
In 2014, domestic zinc and indium prices rose 5.49% and 17.72% respectively compared with the same period last year. As a result of this benefit, the sales prices of the company's zinc products and indium products increased by 9.40% and 84.80% respectively over last year, driving the gross profit margins of its zinc products and rare and precious products (mainly indium) up 0.78% and 7.86% respectively compared with the same period last year. According to CRU statistics, combined with demand, zinc will shift from surplus to shortage in 2015 due to bottlenecks in zinc smelting and mining capacity. The global zinc concentrate market shortages in 2015, 16 and 17 are 25000 tons, 275000 tons and 550000 tons respectively. While the demand for indium in downstream LCD, LED and even thin film solar cells is growing rapidly, it will continue to be in short supply. It is expected that zinc and indium prices will still be on the rise in 2015, which is good for the company's performance growth.
(2) the exchange loss is relatively large, and the financial expenses have increased substantially.
The company's financial expenses, sales expenses and management expenses were 265.19 million yuan, 115.13 million yuan and 312.17 million yuan respectively, with year-on-year changes of 33.41%, 5.36% and 0.50%. The total of the three expenses increased by 11.79% over the same period last year.
Among them, the company's financial expenses increased significantly by 33.41% over last year, mainly due to exchange losses caused by the continued strengthening of the US dollar in 2014. In addition, the increase in corporate financing costs has also led to a 10.55% increase in interest expenses compared with last year.
3. Investment advice.
We are optimistic that zinc prices and processing fees will rise in the next few years, covering for the first time and giving a "cautious recommendation" rating.
4. Risk hint.
The prices of zinc and indium fell sharply.