Matters: the company released its three-quarter report for 2020. During the reporting period, the company realized operating income of 28.338 billion yuan, an increase of 37.40%, a net profit of 217 million yuan, a decrease of 14.39%, and a non-return net profit of 419 million yuan, an increase of 53.60%. Of this total, Q3 revenue was 11.892 billion yuan, up 55.73%, 18.20%, 83 million yuan, 22.38%, 88.64%, 449 million yuan, 169.21%, 73.36%, respectively. Basically in line with expectations.
The rise in gold prices and the increase in output contributed to a big increase in non-deduction performance in the Q3 quarter. In the third quarter, the average price of gold was 1908.56 US dollars per ounce, an increase of 29.62% and 11.54%. At the same time, it superimposed the increase in production brought about by the increase in the operating rate of the company. The company achieved a gross profit of 792 million yuan in the Q3 quarter, an increase of 59.04%, a ring increase of 38.70%, and a gross profit margin of 6.66%, the highest in nearly six quarters.
The fixed increase is completed, the asset-liability ratio is reduced, and the subsequent financial expenses may be saved by about 100 million yuan. During the reporting period, the company obtained a fixed increase in fund-raising, and the net assets returned to the mother increased by 57.52%. Cash and equivalents increased by 2.022 billion yuan to 3.016 billion yuan at the end of the quarter, and the tight cash flow of the company was greatly alleviated, with the asset-liability ratio falling to 62.62%, a big drop in 10pct compared to H1. The low utilization rate of the company's product capacity is mainly due to the shortage of liquidity of the company, which restricts the development of the company. The company is scheduled to increase by 2.5 billion yuan, 2 billion will be used to repay interest-bearing loans, and the rest will be used to replenish the flow. After the problem of tight liquidity is solved, according to Jiangtong's "three-year innovation doubling" plan, with the goal of increasing revenue, the company's product operating rate may be greatly increased, and the unit cost may be reduced under the advantage of scale. In addition, after the repayment of 2 billion interest-bearing loans, the financial expenses may be reduced by about 100 million yuan, and the asset-liability ratio will be reduced from 71.19% at the end of 2019 to 55.74%.
Liaoshang Gold Mine started construction, and after it was put into production, the output of self-produced gold may be greatly increased. During the reporting period, the company turned over the first batch of proceeds from the transfer of mining rights in Liaoshang Gold Mine. Liaoshang Gold Mine has a reserve of 75.53 tons and a grade of 3.71g / ton. the company plans to invest 1.232 billion yuan to build an annual ore project with an annual output of 900,000 tons per year. The company predicts that it will increase revenue by 535 million yuan, profit by 238 million yuan, and profit margin of 44.49%. After reaching production, the problem of less money produced by the company will be greatly alleviated, and the overall profit margin of the company will be improved.
Jiang Copper endorses to create a gold listing platform
At the end of 2018, Jiang Copper Group formulated the "Jiang Copper Group" action plan for doubling innovation in three years, and strived to double its sales revenue and reserves of retained resources by 2021, and ranked among the top five in the world's mining industry. the goal of assets, profits and market capitalization in the top 10 of the world's mining industry. When Jiangxi Copper acquired the control of the company, it promised to use the company as the development platform of Jiangxi Copper gold plate, to inject high-quality gold assets of Jiangxi Copper and its controlling shareholders into listed companies, and to speed up the acquisition of high-quality gold mineral resources. build a gold listing platform.
Profit forecast and rating: due to large fluctuations in non-recurring profit and loss, adjusted 20-22 net profit attributable to 3.50,5.50 and 760 million yuan, EPS is 0.38,0.60 and 0.84 yuan per share, PE is 38X, 24X and 18X. Consider the subsequent production of Liaoshang Gold Mine and epitaxial mergers and acquisitions to maintain the "buy" rating.
Risk hint: the risk that the Liaoshang project does not progress as expected, the risk of acquisition failure, and the risk of large fluctuations in gold prices.