Third quarterly report: revenue year-on-year + 6.74%, operating cost-3.2%, home net profit + 50%
In the first three quarters, the company's operating income was 1.967 billion yuan, up 124 million yuan or 6.74% from the same period last year; operating cost was 1.553 billion yuan, down 51 million yuan or 3.2% from the same period last year; and the net profit returned to its mother was 282 million yuan, an increase of 50.45% over the same period last year and 0.2886 yuan per share, an increase of 50.47% over the same period last year.
In Q3 single quarter, the company's operating income was 706 million yuan, an increase of 59 million yuan or 9.09% over the same period last year; operating cost was 568 million yuan, an increase of 11 million yuan or 2% over the same period last year; net profit returned to its mother was 94 million yuan, an increase of 7.5% over the same period last year; and the weighted average return on net assets was 2%. The net profit of Q1 and Q2 in a single quarter was 0.85 yuan and 102 million yuan respectively, an increase of 275% and 33%, respectively.
The main reasons for the performance improvement are the increase in electricity sales and the decrease in unit fuel cost compared with the same period last year.
The main reason for the increase in revenue and profit in the three quarters is the increase in electricity sales compared with the same period last year, and the reduction in the unit cost of coal burning. In the first three quarters, the company realized 5.279 billion kilowatt-hours of electricity on the Internet, of which 1.904 billion kilowatt-hours in the third quarter. The proportion of market-oriented trading electricity in the first three quarters was 32.2%, of which Q3 accounted for 48.7% in a single quarter and 22.9% in the first half of the year.
From January to September 2019, the overall thermal coal price index in Jiangxi Province showed a fluctuating downward trend, from 672 yuan / ton in January to 644 yuan / ton in September. Compared with the same period last year, the monthly price index decreased to varying degrees, with year-on-year declines of 5.3%, 6.4% and 6.9% respectively from July to September. We believe that the decline in unit fuel costs is an important factor in the company's performance improvement in 2019, and coal prices are expected to continue the year-on-year decline in the fourth quarter.
The company's single-quarter sales gross profit margin in the first three quarters of 19 years was 20%, 24% and 19.5% respectively, which was significantly higher than that in the same period last year (7.8%, 16.5% and 13.9% respectively in the first three quarters of 18). We believe that the proportion of electricity in market-oriented transactions has increased significantly. We expect the company's market-oriented electricity ratio to continue to increase in the third quarter, but probably no more than 40%. According to our estimates, the company's kilowatt-hour revenue in the first half of the year and the first three quarters are 0.3677 yuan and 0.3679 yuan per kilowatt-hour, respectively, with little fluctuation; we expect the company's annual kilowatt-hour revenue to be basically the same.
The third phase of Fengdian project has collected all 49 necessary supporting documents and is expected to resume construction.
During the reporting period, the company's Fengcheng Power Plant Phase III expansion project is still in a state of suspension. At present, the company is making every effort to promote the reconstruction of the third phase expansion project of Fengcheng Power Plant, and all the 49 necessary supporting documents required in the Circular of the State Council on issuing and issuing the approval Plan for cleaning up and standardizing Investment projects (Guofa [2016] No. 29) have been taken. During the reporting period, the company submitted an application for removal from the list of coal-fired power projects to the Development and Reform Commission of Jiangxi Province and the Central China Regulatory Administration of the State Energy Administration. The company currently has an installed capacity of 1.5 million kilowatts; Fengdian Phase III has a total design capacity of 2 million kilowatts. If it can be completed and put into production, it is expected to significantly improve the unit size and profitability of the company.
Profit forecast: we estimate that the net profit of the company from 2019 to 2021 is 3.42,3.72 and 404 million yuan, and the EPS is 0.35,0.38,0.41 yuan per share. Maintain a "buy" rating.
Risk hint: coal prices are rising, electricity prices are down, electricity consumption is falling, and the resumption of the third phase of Fengdian is not as expected.