occurrences
In the first three quarters of 2023, the company achieved operating income of 11.930 billion yuan, a year-on-year decrease of 12.98%, net profit of -332 million yuan, net profit of -332 million yuan, 965 million yuan for the same period last year, and -331 million yuan for non-net profit compared to 960 million yuan for the same period last year.
reviews
Q3 turned a loss into a profit, and the sales target remained the same throughout the year. 2023Q3 achieved operating income of 3.800 billion yuan, a year-on-year decrease of 33.87%, a year-on-year decrease of 2.75%, and realized net profit of 777 million yuan, a year-on-year decrease of 78.64%, turning a month-on-month loss into a profit. From January to September 2023, the company sold about 2.23 million tons of pre-baked anodes, keeping the annual sales target of 2.88 million tons unchanged.
Prices of pre-baked anodes declined in the first half of the year, and industry pressure increased, and production capacity was cleared. The one-sided decline in prices in the pre-baked anode industry in 2023 put a lot of pressure on the entire pre-baked anode industry. Some smaller pre-baked anode companies with poor geographical location, insufficient investment in environmental protection, and no fixed customers faced shutdown or transition. For example, old production capacity of less than 100,000 tons/year in places such as Henan and Shandong has been basically eliminated, and some enterprises with a production capacity of 100,000 to 200,000 tons/year have switched to graphite box plates, crucibles, etc.
The project is progressing steadily, and 5 million tons of pre-baked anodes are planned for 2025. The company's carbon materials project with an annual output of 300,000 tons for aluminum in Longxi, a project with an annual output of 340,000 tons of pre-baked anodes and 300,000 tons of post-calcined coke in Binzhou, and a new carbon material project with an annual output of 1 million tons in Zhijiang are all progressing steadily. The above projects are scheduled to be completed and put into operation in the first half of 2024. Construction of a box board project for the production of 250,000 tons of high-conductivity and energy-saving aluminum carbon materials and 50,000 tons of high-end anode materials for lithium batteries, located in Qijiang District of Chongqing, has begun. After the completion of the above project, the company's total pre-baked anode production capacity will reach 3.71 million tons, while forming a production capacity of 50,000 tons of box plates. The company's pre-baked anode production capacity is expected to reach 5 million tons in 2025.
Actively explore overseas markets and build a global petroleum coke supply system. Costs are expected to be reduced.
2023H1 signed an “Investment Memorandum of Understanding” with UAE Global Aluminum (EGA), laying a solid foundation for joint venture cooperation with global high-quality primary aluminum producers. At the same time, the company and International Marine Terminal (IMT) have reached a logistics terminal and petroleum coke storage business cooperation in North America, which is expected to further reduce raw material procurement and logistics costs.
Cash flow improved significantly, and negative profit improved. Q3 The company's net cash flow from operating activities was 664 million yuan, an increase of 277% over the previous month. The company's inventory turnover efficiency continued to improve, and it held bank acceptance drafts, and liquidity improved markedly. The utilization rate of the company's new anode production capacity continued to increase, and the company's negative electrode business revenue and profitability improved Q3 month-on-month.
Profit forecasting
The company's net profit from 2023-2025 is expected to be -0.25/9.65/1,433 billion yuan, corresponding to EPS of -0.05/1.78/2.65 yuan, and PE of -366.5/9.6/6.4 times, maintaining the “buying rating”.
Risk warning:
The price of raw materials continued to fall, and the price of pre-baked anodes fluctuated greatly, and the project fell short of expectations.