Main points of investment:
News / bulletin. According to the 2018 annual report released by Rizhao Port, the company achieved a total revenue of 5.13 billion yuan in 2018, an increase of 6.78% over the same period last year, and its net profit was 644 million yuan, an increase of 74.69% over the same period last year. After deducting 634 million yuan of non-parent net profit, an increase of 73.04% over the same period last year, the company finally realized basic earnings per share of 0.21 yuan, with a weighted average ROE of 5.86%, an increase of 2.34% over the same period last year. The performance is basically in line with expectations.
Throughput grew steadily by 4.85%, with coal and iron ore contributing mainly to the increase. During the reporting period, the total throughput of the company reached 237 million tons, an increase of 4.85% over the same period last year, exceeding the growth rate of cargo throughput of coastal ports by 0.65%. Among them, the throughput of iron ore was 142 million tons, an increase of 1.93% over the same period last year, accounting for 59.9% of the total throughput, mainly benefiting from the commissioning of high-quality steel bases; the throughput of coal and products was 44.21 million tons, up 21.36% synchronously, accounting for 18.7%, mainly benefiting from the volume on the Wati line. In addition, the throughput of timber was 21.59 million tons, an increase of 12.86% over the same period last year, grain decreased by 2.95% to 12.13 million tons affected by trade frictions, and steel products decreased by 12.6% to 5.46 million tons affected by domestic trade diversion. On the whole, the logic of the company's two main commodities, iron ore and coal, led to the steady growth of the company's throughput in 2018.
Wari online volume and steel boutique base put into production logic, coal and iron ore throughput growth far exceeds the industry. In terms of coal, the company's railway Wari Line is one of the four "West-to-East Coal Transportation" lines. After it was officially opened at the end of the 16th, the coal transport accelerated. Rizhao Port, as a water port of the Wari Line, directly benefited from the Wari Line's volume of 4.55 million tons in 2018, which led to a 21.36% increase in the company's coal throughput, which was 17.45 percentage points higher than that of the Northern Seven Ports. In terms of iron ore, Shandong Iron and Steel Rizhao boutique base is located near Lanshan Port area of Rizhao Port, which is divided into two phases and four steps, of which the "one phase, one step" project was put into production at the end of 2017, driving the company's iron ore throughput to increase by 1.93% compared with the same period last year, 3.33 percentage points higher than the national iron ore arrival volume. In the future, the Wati line will further accelerate the volume, while the iron and steel boutique base will continue to be put into production in the first phase and two steps, and the two goods will continue to drive the company's throughput steadily upward.
Depreciation policy adjustment affects pre-tax profit of 231 million yuan, excluding accounting changes affecting the original growth rate of 26%. According to the degree of innovation of the existing terminals and equipment, the company will extend the depreciation of some fixed assets from January 1, 2018, affecting the operating cost of 231 million yuan in 2018. If calculated according to the current income tax rate and the profit and loss amount of minority shareholders, excluding the impact of changes in accounting policies, we estimate that the return net profit will increase by about 26%.
Adjust the earnings forecast to maintain the "buy" rating. According to the current business state of the company, we recalculate and adjust the 1920 earnings forecast for 19xamp, and add to the 2021 forecast. We expect the 2019-2021 net profit to be 810 million yuan, 1.111 billion yuan and 1.471 billion yuan respectively (the original 20-year forecast for 19Che is 814 million yuan and 1.174 billion yuan), and the corresponding stock price PE is 13 times, 10 times and 7 times respectively. The company's business will maintain steady growth in the future, and we maintain our "buy" rating.
Risk hint: the amount of watri online is less than expected.
