Event description
The company issued a semi-annual performance forecast for 2023: the company is expected to achieve a net profit of 80-950 million yuan in the first half of 2023, turning losses into profits compared with the same period last year.
Event comment
With both volume and price rising, the cost has improved, and the performance of thermal power is expected to be significantly repaired. In the first half of 2023, the company completed coal power generation of 44.909 billion kilowatt hours, an increase of 13.08 percent over the same period last year, and gas power generation of 8.57 billion kilowatt hours, an increase of 28.75 percent over the same period last year. The company's coal and gas power have both achieved substantial growth, on the one hand, due to rigid electricity demand, on the other hand, the base is low last year. In the second quarter, coal power generation increased by 22.54 percent over the same period last year, up 11.48 percent from the previous year; gas power generation increased by 38.39 percent from the same period last year, up 42.43 percent from the same period last year. Due to the peak winter in the first quarter, the month-on-month increase in thermal power in the second quarter highlights the unique advantages of the region, and the increase in electricity further dilutes the fixed cost of kilowatt-hour electricity to achieve cost optimization. In addition, the annual electricity price of the long Association of Guangdong Province has risen to the top in 2023, and the company's thermal power revenue in the first half and second quarter is expected to achieve year-on-year and month-on-month growth driven by the rise in volume and price. In terms of cost, since the beginning of this year, thanks to the continued loose supply and demand environment of coal, the average market price of Q5500 thermal coal in Qinhuangdao in the first half of the year was 1022.68 yuan / ton, down 165.52 yuan / ton from the same period last year, and the average price in the second quarter was 916.82 yuan / ton. Although there is a lag effect in the reduction of power plant cost due to inventory and spot coal structure, the relief of cost pressure is a deterministic trend. Overall, in the context of substantial growth at the revenue end and rapid optimization at the cost side, the company's thermal power business performance in the first half and second quarter is expected to achieve significant repair and realize performance flexibility.
With the rapid growth of wind power, new energy business may achieve eye-catching performance. In the first half of 2023, the company completed wind power generation of 2.584 billion kilowatt hours, an increase of 16.66 percent over the same period last year, of which wind power generation in the second quarter was 1.261 billion kilowatt hours, an increase of 26.35 percent over the same period last year.
Since the second half of 2022, the company has installed 374600 kilowatts of wind power, an increase of 19.01%. As offshore wind power is the main part of the company's stock wind power installation, offshore wind power utilization hours have significant advantages over onshore wind power, and even in this case, the company's power growth rate is still higher than that of installed wind power. Therefore, the company is expected to increase the number of wind power utilization hours in the first half and the second quarter. In addition to the excellent performance of wind power, the company completed 339 million kilowatt-hours of electricity generation in the first half of the year, a decrease of 4.43 percent over the same period last year, but 195 million kilowatt-hours in the second quarter, an increase of 26.36 percent over the same period last year. Photovoltaic power generation in the first half of the year completed 51 million kilowatt-hours, are net new increments. Affected by the dry water supply, the company completed 98 million kilowatt-hours of electricity generation in the first half of the year, a decrease of 28.68 percent over the same period last year. Driven by the excellent performance of wind power, the company's new energy business performance is expected to achieve eye-catching performance in the first half and second quarter. Overall, the company is expected to achieve a net profit of 8-950 million yuan in the first half of the year, of which 7.1-860 million yuan is expected in the second quarter, turning losses into profits over the same period last year.
The reserve project resources are abundant, and the thermal power repair logic may continue. In 2022, the company's new approval / filing project has a planned installed capacity of up to 18.035 million kilowatts, with abundant resources to ensure the company's long-term growth space. In addition, the annual bilateral negotiated electricity price in Guangdong Province increased by 11.44% in 2023 compared with the same period last year, and as of July 7, the market price of Q5500 thermal coal in Qinhuangdao Port was 850 yuan / ton, which was lower than the average coal price in the second quarter. The third quarter is the peak season for thermal power output. The double optimization logic of thermal power business cost and income is expected to continue in the third quarter, and the company's thermal power business will release sufficient performance flexibility in 2023.
Investment advice and valuation: we expect the company's EPS from 2023 to 2025 to be 0.48,0.60,0.73 yuan respectively, corresponding to 15.64x, 12.40x and 10.28x PE respectively, maintaining the company's "buy" rating.
Risk hints: 1, the production progress and benefit of the new project is lower than the expected risk; 2, the wind condition and light resources are not as good as the expected risk.