occurrences
China Airlines Shen Fei released its 2023 annual performance report. In 2023, it is expected to achieve revenue of 46.248 billion yuan, an increase of 11.18% over the previous year, and net profit to mother of 3.08 billion yuan, an increase of 30.51% over the previous year.
The company issued the “Notice on the Implementation of Daily Related Transactions in 2023 and the Forecast Status of Daily Related Transactions in 2024”. The company's actual procurement amount from related parties in 2023 was RMB 21.927 billion, and the estimated procurement amount from related parties was RMB 24.623 billion in 2024.
reviews
1. Steady growth in operating income. In 2023, the company achieved revenue of 46.248 billion yuan, an increase of 11.18% over the previous year, and completed 100.3% of the operating plan; realized net profit of 3.08 billion yuan, an increase of 30.51% over the previous year, and completed 103% of the operating plan.
2. Purchases from related parties are expected to increase by 3.4% year on year in '24. In 2023, the actual amount of purchases made by the company from related parties was RMB 21.927 billion, an increase of 9.3% over the previous year. In 2024, the company expects to purchase 24.623 billion yuan from related parties, an increase of 3.4% year-on-year over the estimated amount of 23.804 billion yuan in 2023.
3. It is proposed to raise an additional capital of 4.2 billion yuan to improve the company's main business capacity. In December '23, the company plans to issue no more than 35 (inclusive) specific investors, including aviation industry groups and aviation investments, to raise no more than 4.2 billion yuan in total capital. The capital raised will be used for Shen Fei's partial relocation and construction project to invest 1,922 million yuan, the composite material production line capacity building project to invest 486 million yuan, the titanium alloy production line capacity building project to invest 355 million yuan, the aircraft maintenance service guarantee capacity improvement project to invest 393.3 million yuan, the repayment of special debts, and the proposed investment of 943.7 million yuan in supplementary working capital. We believe that this fixed increase is expected to accelerate the upgrading of the company's equipment system, industrial system and capacity system, continue to reduce costs and increase efficiency, achieve leading development, and further enhance the company's core competitiveness.
4. Profit forecast and investment rating: We expect the company's net profit to be 36.30 billion yuan and 4.453 billion yuan respectively, up 21% and 23% year-on-year, corresponding to the current stock price PE of 29 and 24 times, respectively, to maintain a “buy” rating.
Risk warning:
Military orders fell short of expectations; military price reductions exceeded market expectations; market expansion fell short of expectations, etc.