Release 16 Annual report: profit decline compared with the same period last year
The company released its annual report on March 28, with operating income of 696 million yuan in 16 years, down 23.63% from the same period last year; net profit of 21 million yuan, down 31.43% from the same period last year, corresponding to 0.0417 yuan of EPS in 16 years; of which, operating income of 264 million yuan and net profit of 8 million yuan in the fourth quarter were lower than we had expected. During the reporting period, the production and sales of the company's main chromium mineral products declined, and the performance was affected. In the future, with the project construction and technology optimization, the product production capacity is expected to be improved.
Chromium mineral energy has not yet been replaced, dragging down the revenue of the main business.
As the company's main mining area Luobusa's original proven reserves are basically exhausted, the existing reserves belong to Jiwo Mine, with an annual output of only about 20,000 tons, so the company's chromium business revenue and gross profit decreased significantly during the reporting period. The company's 16-year chromium production and sales volume of 25000 tons and 47000 tons, respectively, decreased by 30.51% and 38.9% respectively over the same period last year. As the remaining chromium ore inventory of the company has been basically exported in the past 16 years, it is difficult for the chromium ore to recover quickly before the construction and production of the company's investment mine project.
Transportation affects the sales of lithium ore, and process optimization continues to advance.
The output of lithium products increased steadily in the past 16 years, but due to some problems in the transportation of lithium concentrate, sales declined compared with the same period last year, and business revenue growth was lower than expected. During the reporting period, the company formed a relevant agreement with the Salt Lake Center of the Chinese Academy of Geological Sciences to optimize and upgrade the crystallization process of solar ponds in Zabuye, Tibet; at the same time, the 1000 t / a battery-grade lithium carbonate test production line is in stable operation and the demonstration work is continuing. At present, the company has an annual production capacity of 5000-6000 tons of Zabuye lithium concentrate, which needs to give full play to its resource advantages after technological breakthroughs to achieve stable growth in product scale and performance.
Complete the injection of chromium ore resources and continuously promote the construction of mining projects
During the reporting period, through a non-public offering, the company injected 0.702 square kilometers of mining rights into the chromite mining area in the south of the Luobusa I and II ore group, resulting in an increase of 2.01 million tons of chromite resources. After the completion of the chromite mining project in the south of Luobusa I and II ore group, the production of chromite is expected to increase by 100,000 tons per year, which is expected to solve the bottleneck of the current chromite production. At present, the selection of bidding agencies for mining projects in the south of the mining area has been completed, and project construction bidding and project construction work will be carried out one after another.
Long-term room to increase production and maintain the company's "overweight" rating
The company's chromium ore resources are thickening, and the production and sales of chromium lithium products in the short term are subject to the progress of the project. On the basis of the initial production of the chromite mine in 19 years and the stable production capacity of the salt lake, according to the company's production plan, it is assumed that the sales volume of chromite in 17 years is 24000 tons, which is lower than the 16-year level, and the output of lithium concentrate is 5000 tons. At the same time, chromite and lithium carbonate refer to the 16-year price. Corresponding to the appropriate downward adjustment of the profit forecast, the company's income from 2017 to 2019 is expected to be 612 million yuan, 701 million yuan and 847 million yuan respectively, and the corresponding EPS is 0.05,0.07,0.09 yuan respectively. The current stock price corresponds to 366,273,197 times of PE, respectively, maintaining the company's "overweight" rating. As the new energy industry downstream of the company's lithium products still has a booming prospect, a certain valuation premium is given, corresponding to a reasonable share price range of 18.7-19.5 yuan.
Risk tips: chromium lithium product prices fell, the company Zabuye salt lake resources development progress continued to be lower than expected; chromium mine fund-raising project construction is lower than expected.