The company's new coal mine production and power units connected to the grid can, to a certain extent, offset the impact of downward coal prices on the company's performance. At present, the company is in a "substantially broken net" state, and there is room for valuation and repair in the future.
In 2019, the performance fell 13.13% from the same period last year, and the scale of the impairment returned to normal. In 2019, the company's operating income was 7.623 billion yuan / net profit was 575 million yuan, with year-on-year changes of + 11.29% and 13.13% respectively over the same period last year. Compared with the impairment of more than 500 million yuan in the previous two years, the impairment of the company dropped to 58 million in 2019, indicating that the historical burden may have been basically solved. The profit distribution plan for 2019 is 0.239 yuan per share (including tax), with a dividend rate of 30% and a corresponding dividend rate of 2.84%.
Commodity coal prices rose slightly by 2% against the trend in 2019, while thermal power and aluminum business sectors are still losing money. In 2019, the company sold 167900 tons of raw coal and 4.94 million tons of washed coal (year-on-year changes + 30.6% hammer 5.5%); the average sales price was 998.43 yuan / ton (year-on-year + 2.09%), and the average sales cost was 587.17 yuan / ton (year-on-year change + 12.22%), mainly because raw materials and labor costs increased by 26% and 13% respectively over the same period last year. The company's power generation in 2019 is 3.488 billion kilowatt-hours (year-on-year + 52.25%), and the increment mainly comes from the commissioning of the company's cogeneration project, with a profit of nearly 2 million yuan, but the overall power business is still losing money, with a unit electricity price of 0.35 yuan per kilowatt-hour (year-on-year + 41.38%) and kilowatt-hour cost of 0.40 yuan per kilowatt-hour (year-on-year + 22.70%).
There is room for the growth of resources in Xinjiang, and there is room for improvement after the loss of the electric power plate. The company has two coal resources in Xinjiang, namely 106coal mine (with a production capacity of 1.8 million tons) and Weizigou coal mine (with a production capacity of 2.4 million tons), of which 106coal mine was officially put into production in 2019 and Weizigou Coal Mine obtained a mining license in September 2019.
In terms of the power sector, the company's 2 × 350MW cogeneration project was officially connected to the grid in mid-2019, using coal gangue and other low calorific value coal for power generation, the cost is expected to decrease significantly, with the gradual increase of electricity in the future, there may be room for improvement.
Risk factors: product prices are greatly affected by the market; aluminum business continues to lose money.
Investment suggestion: combined with the latest coal price forecast, we reduce the company's 2020-2021 EPS forecast to 0.64 yuan 0.79 yuan (the original forecast is 1.28 yuan 1.54 yuan), and give the 2022 EPS forecast 0.90 yuan. The current stock price is 8.42 yuan, which is corresponding to the PE13/11/9 times for the year of 20-22. Give the company a target price of 11.24 yuan, corresponding to PB0.8 times in 2020, and maintain a "buy" rating.
