On October 27, 2023, Qingdao Port released its report for the third quarter of 2023:
In the first three quarters of 2023, the company achieved operating income of 13.659 billion yuan, down 7.72% year on year; net profit of 3.788 billion yuan, up 9.83% year on year; net cash flow from operating activities was 4.306 billion yuan, up 7.10% year on year; basic earnings per share was 0.58 yuan, up 9.43% year on year; and weighted average return on net assets was 9.80%, up 0.24 percentage points year on year.
In the third quarter of 2023, the company achieved operating income of 4.501 billion yuan, a year-on-year decrease of 7.29% and a month-on-month decrease of 2.
28%; net profit was 1,225 billion yuan, up 7.76% year on year, down 6.12% month on month; basic earnings per share was 0.19 yuan, up 11.76% year on year; weighted average return on net assets was 3.16%, down 0 year on year.
06 percentage points.
Throughput has achieved double growth, and the main port business is operating steadily. From January to September 2023, the company and its branches, subsidiaries, joint ventures and associated companies completed a total cargo throughput of 504 million tons, an increase of 5.7% over the previous year; the container throughput was 22.34 million TEUs, an increase of 11.6% over the previous year. The company is actively increasing maritime routes, expanding capacity, and transit, opening land-based trains, building dry ports, and expanding supply sources. The container business continues to increase new momentum. The year-on-year increase in the company's container throughput from January to September 2023 was 7.1 percentage points higher than the overall year-on-year increase in coastal ports across the country. On a quarterly basis, the company achieved container throughput of 688, 7.64, and 7.82 million TEUs in the first, second, and third quarters, respectively, showing a quarterly increasing trend.
Shandong's foreign trade is stabilizing, improving, and the share of the “Belt and Road” has increased. In the first three quarters of 2023, the total import and export value of Shandong Province was 2.41 trillion yuan, an increase of 2.5% over the previous year. By region, imports and exports to ASEAN and the EU have continued to grow, and the share of imports and exports to countries that have jointly built the “Belt and Road” has increased. In the first three quarters of 2023, Shandong's imports and exports to the “Belt and Road” countries were 1.36 trillion yuan, an increase of 5%, accounting for 56.2% of the total import and export value, an increase of 1.3 percentage points. Qingdao Port is an important bridgehead at the “Belt and Road” junction. The company added 15 new container routes in the first half of 2023, focusing on building two major premium route groups: “Belt and Road” and RCEP routes, and direct ocean routes between Europe and the US. It is expected that the high-quality development of the “Belt and Road” will drive a steady increase in the company's throughput.
The integration of port resources continues to advance, and the reform dividends are expected to continue to be released. The company plans to purchase 100% of the shares of the oil company held by Shandong Port Rizhao Port Group, 50% of the shares of Rizhao Shihua, 100% of the shares of Rizhao Port Finance, 67.56% of the shares of Yantai Port held by the Shandong Port Yantai Port Group, 60% of the shares of Laizhou Port, 53.88% of the shares of the Joint Pipeline, 64.91% of the shares of Yantai Port and Shipping, and 100% of the shares of the Operation Guarantee Company.
The assets to be injected have significant synergistic effects with the company's existing port business. It is expected that after the restructuring is completed, the overall competitiveness of the company's dry bulk and liquid bulk sectors will be further strengthened, which is expected to drive the company's profits to increase. This transaction has not yet been completed, so it is recommended to keep an eye on subsequent relevant developments.
The comprehensive goods customs area code is unified, and the Qianwan port area ushered in favorable development. On October 23, 2023, with the support of Qingdao Customs and Huangdao Customs, the customs code for the Qianwan port area was changed to 4218, and the port code was changed to CNQGD, which means that the integrated customs code for the entire cargo category in the Qianwan port area can be realized once, the entire port area can be passed through the entire port area, and fundamentally reduced customer deletions and repeated declarations due to temporary berth adjustments or cross-terminal ship changes. It further simplified the work process, improved the utilization rate of terminal berths, and brought benefits to shipping companies, shippers, port, etc. “1” The effect of “1>2”.
Profit forecast, valuation and investment rating: Without considering the major asset restructuring to be carried out by the company, taking into account the company's business development trends, the company is expected to achieve net profit of 49.02, 54.19, and 6.014 billion yuan respectively in 2023-2025. Earnings per share are 0.76, 0.83, and 0.93 yuan respectively. The current stock price is 6.19 yuan. The corresponding PE is 8.2X/7.4X/6.7X, maintaining the “buy” rating.
Risk warning: downside macroeconomic risk, risk of economic fluctuations in the hinterland, risk of industry rate adjustment, risk of port integration falling short of expectations, risk of model assumptions and calculation errors, risk of untimely information and data updates.