The company issues semi-annual report 2023
23H1's revenue was 8.13 billion yuan, + 2.09% compared with the same period last year, and its net profit was-410 million yuan, 179.97% compared with the same period last year. 23Q2's revenue is 3.908 billion yuan, year-on-year / month-on-month ratio-18.2% Universe 7.4%, net profit-136 million yuan, year-on-year / month-on-month-133.1% Universe 50.3%.
Production and sales are booming, cost improvement lags behind, dragging down performance
23H1 climbed with the company's Suotong Yun Aluminum Phase II production capacity of 300000 tons, and the pre-baked anode production capacity was maintained at full load. The first half of the year output was 1.4559 million tons, + 10.02% year-on-year, and sales volume was 1.4209 million tons, + 12.28% year-on-year, of which exports were 294800 tons, year-on-year-11.76%, domestic sales 1.1261 million tons, year-on-year + 20.9%. The company's profit pressure in the first half of the year was mainly due to the lag in cost improvement. According to wind,23H1, the average market price of pre-baked anodes in China was 6183.52 yuan / ton,-9.04% compared with the same period last year. During the same period, the average price of petroleum coke, the main raw material (refer to Fushun No.2 Petrochemical Plant), was 4817.68 yuan / ton,-36.63% compared with the same period last year. The drop on the cost side was greater than that of the average product price, and cost improvement lagged down the performance. In addition, the decline in the price of anode and petroleum coke also made the company provision for large inventory impairment losses, of which Q1/Q2 set aside 291pm 0.75 million yuan respectively.
H2 demand is expected to pick up and is optimistic that profits will bottom out and pick up.
Since June, the price of petroleum coke has bottomed out and rebounded slightly, the current price has stabilized, and the price of pre-baked anode has also stopped falling. The impact of Q3 inventory price loss is expected to gradually weaken, followed by electrolytic aluminum operating rate repair, optimistic demand upward to drive the company's profits hit bottom and rebound.
Layout of high-quality overseas anode production capacity, steady promotion of lithium anode
At present, the company has a total capacity of 2.82 million tons of pre-baked anodes, Shandong Innovation Phase II project of 340000 tons, Longxi Suotong 300000 tons of aluminum carbon, Hubei Zhijiang 1 million tons of calcined coke project has been carried out in an orderly manner. In June, the company signed a "Memorandum of understanding on Investment" with EGA to promote overseas pre-baked anode production capacity construction. The company strives to achieve a total capacity of 5 million tons by 2025. In addition to the anode, the company's lithium negative electrode project is advancing steadily, with an output of 12900 tons and sales of 9400 tons in the first half of the year. The company plans a total of 300000 tons of lithium negative electrode capacity, and is expected to form 80,000 tons of negative material capacity by the end of 2023, of which the first phase of 40,000 tons of graphitization project and Shengyuan negative electrode project in Inner Mongolia will be put into production in the first half of the year. Lithium anode will grow into the company's second growth curve.
Investment suggestion
The prices of raw material petroleum coke and pre-baked anode continued to decline in the first half of the year. Taking into account the cost lag improvement and asset impairment losses, the company's profit forecast was lowered. We expect the company's net profit from 2023 to 2025 to be 1.52 trillion yuan, 807 picks, 1.16 billion yuan respectively, compared with-83.2%, 432%, and 43.8%, corresponding to PE 65X/12.2X/8.5X, maintaining the "Buy" rating.
Risk hint
The construction of overseas projects fell short of expectations, the price of petroleum coke fell sharply, and downstream demand continued to decline.