Event: The company announced its 2024 Q1 results. In the first quarter of 2024, the company achieved net profit of 867 million yuan, a year-on-year decrease of 49.78%; operating income of 6.158 billion yuan, a year-on-year decrease of 26.51%, and a sharp drop in volume and price dragged down performance. In the first quarter of 2024, the company's coal business achieved revenue of 4.88 billion yuan, a year-on-year decrease of 33.0%, coal business costs of 2.99 billion yuan, a year-on-year decrease of 18.4%, and gross profit of the coal business of 1.88 billion yuan, a year-on-year decrease of 47.9%.
In terms of production and sales, in Q1 2024, the company's coal output was 8.5 million tons, down 26.5% year on year, down 22.9% month on month, and sold 8.28 million tons of coal, down 22.6% year on year and 11.9% month on month.
In terms of price and profit, in Q1 2024, the company sold for 589 yuan/ton of coal, down 13.4% year on year, -2.2% month on month. The cost of a ton of coal was 361.4 yuan/ton, up 5.5% year on year, up 35.7% month on month, and gross profit per ton of coal was 227 yuan/ton, down 32.7% year on year and -32.3% month on month.
The company has plenty of room to increase its coal production capacity. The company accelerated the pace of construction of 7 yuan and Boli. 7 yuan entered the joint trial operation stage in 2024, and Boli will have the conditions for joint test operation before the end of 2025. 1) Qiyuan coal mine: production scale is 5 million tons/year, geological reserves are 2.06 billion tons, mainly anthracite; 2) Boli coal mine: production scale is 5 million tons/year, geological reserves are 910,000 tons, mainly poor coal and anthracite.
The new energy business is growing steadily. In 2023, the company continued to break through in the new energy business, and 1GWh sodium-ion batteries and PACK batteries entered the trial operation stage. The world's first batch of commercial sodium-ion electric two-wheelers was released.
All four photovoltaic module production lines have been completed. The N-type production line has a maximum daily output of 5.56 MW, and production line efficiency continues to rise. In 2024, the company plans to target leading PV modules in the industry, with P- and N-type yield to reach industry-leading levels, and achieve the annual 3GW sales target; sodium-ion batteries will continue to open up the full “sample-product-commodity” chain to achieve a sales target of 400MW or more for sodium electricity.
Investment advice. By the close of 4/26, the corresponding dividend rate was as high as 7.7%. We expect the company's net profit to be 3.73 billion yuan, 4.29 billion yuan, and 4.51 billion yuan respectively from 2024 to 2026, with corresponding PE being 9.0, 7.8, and 7.5 billion yuan, maintaining a “buy” rating.
Risk warning: Production cuts have exceeded expectations, sodium-ion battery construction progress has fallen short of expectations, and coal prices have collapsed.