When the previous repurchase expires, the company intends to buy back 1.7-220 million yuan again. The company announced on the 18th that it intends to repurchase 1.7-220 million yuan for cancellation of shares, the repurchase price does not exceed 10.5 yuan per share, the repurchase period is 6 months from the approval of the shareholders' meeting, and it is expected to buy back 16.19-209500 shares (1.81% of the company's total share capital 2.34%). Prior to this, the company announced in November 2018 to buy back 200-400 million yuan for the cancellation of shares, and then actually repurchased 31.54 million yuan because the stock price warmed up and exceeded the upper limit of the repurchase price. This buyback continues the previous buyback plan, demonstrating the management's confidence in the development of the company.
In the third quarter alone, the performance increased by 78.8% over the same period last year, and the annual report was forecast to grow by 145% over the same period last year.
Benefiting from the influence of the recovery of downstream thermal demand caused by the shutdown of competitors in Fuyang Park, the company's performance picked up significantly this year (last year, due to the decline in thermal demand of enterprises in the park caused by environmental inspectors, the performance base was low). In the first three quarters of 2019, the revenue was 2.54 billion yuan (year-on-year + 20%), the net profit was 230 million yuan (+ 31%), and the net profit in the third quarter was 97 million yuan (+ 78.8%).
With the production of new projects, the company expects its annual performance to grow by 145% Mel 175% compared with the same period last year.
With the acquisition of Pului Energy and Zhongmao Shengyuan, the remote expansion of cogeneration has been accelerated. At present, the company has completed the industrial and commercial change registration of 850 million yuan for the purchase of 85% equity interest in Perri Energy, and announced in September that it intends to purchase 100% equity interest in Shandong Zhongmao Shengyuan with its own capital of 110 million yuan. Platinum Rui Energy is currently working on seven cogeneration projects. Shandong Zhongmao Shengyuan has a heating capacity of 150 steam tons per hour. It is estimated that after all the above acquisition projects are completed and put into production, the company's thermoelectric capacity will be close to 6000 steam tons per hour.
Hot demand recovery + remote expansion capacity release, profits continue to pick up, maintain the "buy" rating.
Excluding the acquisition of Pareto Energy and Zhongmao Shengyuan, we expect the company's EPS to be 0.38,0.47 and 0.57 yuan per share respectively in 2019-2021, with PE corresponding to the latest closing price of 23,18 and 15 times, respectively. We give a valuation of 25 times PE in 2019, corresponding to the reasonable value of 9.39 yuan per share, the company's remote layout is accelerated, "local integration + remote expansion" continues to advance, and the layout of waste incineration power generation is involved in the field of solid waste tail disposal, large buybacks demonstrate management confidence and maintain the "buy" rating.
Risk hint. The fluctuation of thermal demand leads to the fluctuation of profit margin; the progress of project expansion is lower than expected; the improvement of environmental standards leads to the increase of operating costs; and the impairment of assets is uncertain.
