Incidents:
The company released its 2024 quarterly report. 24q1 has revenue of 5.01 billion yuan, yoy +4.6%, net profit to mother of 260 million, yoy +36.1%, net profit of non-return mother of 260 million, yoy +42.0%. The 24q1 performance continued strong growth based on the high base for the same period last year.
Net interest rates increased by 24q1 due to reduced impairment, exchange gains, and profit growth in Mongolian mining integration projects. Revenue grew steadily on a high basis. 24q1 gross profit margin 9.6%, yoy-3.2pct. It is also due to the year-on-year decline in the efficiency of international engineering and wind power projects (24q1 Croatian electricity price yoy -45.1% to 7.2 euro cents). Fee control is strong, 24q1 fee rate yoy-2.4pct to 3.3%. Mainly due to the sharp increase in exchange earnings, the financial expense ratio yoy-3.2pct to -1.2%. The impact of impairment losses due to lower accounts receivable was drastically reduced (Yoy-1.4pct to 0.2% of revenue). 24q1 net profit margin 5.3%, yoy+1.2pct. The increase in performance may be mainly due to the increase in profits of the Mongolian mine integration project.
The asset structure continues to be consolidated, and the turnover of the two funds has slowed
The balance ratio at the end of 24q1 was 60.6%, yoy-1.4pct, interest-bearing debt ratio 38.1%, yoy-0.9pct.
Futures turnover is slowing down. In 24q1, the number of two-gold turnover days is 120 days, yoy+13 days. 24q1 operating cash flow decreased year-on-year to a net inflow of 360 million to a net inflow of 340 million dollars, and investment cash flow increased by 120 million to a net outflow of 150 million yuan over the same period last year.
Integrated projects support transformation prospects, allow “buy” rating companies to continue to deeply cultivate countries along the “Belt and Road”, and the implementation of overseas projects benefits from the advancement of the Belt and Road.
The integrated project is operating steadily, which strongly supports the company's transformation prospects. The Bangladesh Thermal Power Plant/Congo (DRC) Mining Project Group/Mongolian EPC Project Program are all progressing in an orderly manner or contributing additional volume. We expect the company's 24-26 revenue to be 238/263/29.1 billion yuan, respectively, yoy +11%/11%; net profit to mother will be 10/11/1.3 billion yuan, respectively, yoy +11%/12%, respectively, and a 3-year CAGR of 11%.
The 24-year target PE is 15 times, the target price is 15.23 yuan, and the “buy” rating is given.
Risk warning: raw fuel costs fluctuate greatly, demand falls short of expectations, competition intensifies risks, exports fall short of expectations