Brief comment on performance
The company's 2018H1 operating income was 4.61 billion, up 79.8% over the same period last year; the net profit returned to the mother was 340 million, up 48.0% from the same period last year, and the basic earnings per share was 0.23 yuan, which was in line with expectations.
Business analysis
The comprehensive expansion of water, railway and highway, and multimodal transport stimulate revenue growth: waterway transport is the dominant sector of the company. By the end of the reporting period, the company operated 111ships, an increase of 10 compared with the end of 2017, with a total capacity of 1.985 million deadweight tons, ranking second among domestic container enterprises. However, the pattern of the domestic trade collection and transportation industry is relatively stable, and the growth rate is stable. The container throughput of ports above the scale of 2018H1 is 120 million TEUs, an increase of only 5.4%. The company changed its thinking in time and expanded to land transport through the way of "water transport + railway + highway".
By the end of the reporting period, the company had set up 22 railway networks, an increase of 4 compared with the end of 2017, more than 400 direct railway lines, about 500 sea railway lines, 235000 TEU of 2018H1 railway natural cabinets and 830 million revenue from the railway sector, an increase of 731.15%. The outbreak of railway transport has led to the company's overall multimodal transport business, with waterway + road revenue growing by about 53.4%. The improvement of railway + road transport capacity is expected to make the proportion of door-to-door in the company's business more than 50%, which will help to provide customers with one-stop comprehensive logistics solutions and improve customer stickiness.
The business structure has been adjusted and the gross profit margin has dropped slightly: the rapid development of the railway has increased its share of revenue by 6.9pct to 18.0% this period. However, due to the small number of standardized railway transport trains, the difficulty of intermodal transport, and the need to outsource railway transport services to do business, the gross profit margin of the railway is significantly lower than that of the waterway, superimposed by the rise in oil prices, which makes the gross profit margin of the company fall by 5.2pct to 14.1% in this period.
Release the fixed increase plan and concentrate firepower on the development of multimodal transport: the company issued the fixed increase plan at the end of March, raising about 3.4 billion to invest in the multimodal transport base and container ship project. The completion of two multimodal transport bases in Tangshan Seaport and Quanzhou will improve the transport efficiency when turning water into iron. The national "transit railway" policy will support the railway transportation, and the company has invested in 30% of the Beijing Antie supply chain to further supplement the company's layout in railway transportation and fully demonstrate the company's new position as a container multimodal transport logistics service provider.
Investment suggestion
While maintaining the advantage of waterway transportation, the company turns its attention to the development of multimodal transport, obtains the value of the whole logistics industry chain, accelerates the expansion of revenue scale, forms economies of scale, reduces logistics unit costs, and further attracts customer resources. form a virtuous circle of revenue. It is estimated that the company's EPS from 2018 to 2020 will be 0.55, 0.70, 0.84 yuan, respectively, corresponding to PE, which is twice that of 17-14-11, maintaining a "buy" rating.
Risk hint
The demand for domestic trade is declining, the development of multimodal transport is not as expected, and the management risk of multimodal transport base.
