Event
The company issued a pre-announcement of the results for the first quarter of 2019: the net profit of Q1 is 7366-97.99 million yuan, an increase of 225.76%, 333.35%, and 0.0755-0.1004 yuan over the same period last year. The reason for the increase in the company's performance compared with the same period last year: the power generation of thermal power and hydropower plants owned by Q1 company increased compared with the same period last year, the company's operating income increased, while the coal-fired unit cost of its thermal power plant decreased compared with the same period last year.
Q1 Jiangxi electricity consumption growth rate is as high as 9.6%, the tertiary industry electricity consumption led to the province's high power consumption growth Q1 Jiangxi Province has maintained a high growth rate in recent years, the province's electricity consumption is 35.192 billion kilowatt-hours, an increase of 9.6% over the same period last year. In terms of sub-industries, the primary industry consumed 187 million kilowatt-hours of electricity, up 11.2 percent over the same period last year; the secondary industry consumed 19.467 billion kilowatt-hours, up 2.3 percent; the tertiary industry consumed 6.57 billion kilowatt-hours, up 18 percent; and urban and rural residents consumed 8.967 billion kilowatt-hours of electricity, up 22.1 percent.
The proportion of industrial electricity consumption continued to decline, the proportion of power consumption in the service industry gradually increased, the power consumption structure was further optimized, and the pace of industrial structure adjustment in the province was accelerated: industrial electricity consumption increased by 1.7%. Industrial electricity accounted for 53.7% of the total electricity consumption of the whole society, down 9.6% from last year, and the electricity consumption of the three industries accounted for 18.7%, an increase of 2.2%.
Jiangxi power supply and demand is tight, Fengdian Phase III can solve the urgent need of electricity consumption, the company is making every effort to promote the resumption of work in Jiangxi Province in recent years, the electricity consumption of the whole society has increased year by year, limited by resource conditions and other factors, the new thermal power units are limited, the new new energy equivalent installed capacity is less, and the utilization hours of stock units are significantly increased. In 2018, the utilization hours of thermal power units in the province are 5197 hours, ranking first in the country. In the short term, it is difficult to alleviate the shortage of electricity in Jiangxi Province.
Fengdian Phase III is a wholly-owned project of the company, which will build 2 × 1 million kilowatt ultra-supercritical coal-fired generating units. After the "11 / 24" safety accident, the company is on the list of suspension of construction, and the company is actively promoting the resumption of work. At present, only one of the 49 supporting documents (smoke tower construction permit issued) is being processed.
On March 18, 2019, the Fengcheng Phase III project was removed from the "blacklist"; we believe that this means that the rectification and reform of the project has been recognized by the relevant departments, and the biggest obstacle to resumption may have been removed. The current power consumption situation in Jiangxi Province is tight, and the Fengdian Phase III project can effectively alleviate the current situation of tight power supply and demand in the province. In addition, the current asset-liability ratio of the company is only 38.21%, the asset-liability ratio is low, and there is room for financing, so a variety of financing methods can be used for future project construction.
Profit forecast: Q1 has a good performance under the influence of the increase in electricity generation and the decline in coal prices, so we adjust the forecast for the company's electricity generation and coal prices, and raise the company's profit forecast. We adjusted the company's 2019-2020 net profit from 2.54 and 267 million yuan to 3.42 and 372 million yuan, and EPS from 0.26,0.27 yuan per share to 0.35,0.38 yuan per share, maintaining the target price of 7.26 yuan and maintaining the "buy" rating. In addition, we estimate that the full production of Fengdian Phase III will increase the company's return net profit by 350 million yuan according to the coal price of 840 yuan per ton per hour in 4800 years.
Risk tips: the resumption of work is not up to expectations, coal prices are rising, electricity consumption is not up to expectations, and electricity prices are reduced.
