铀矿资源板块，成本优势构筑护城河。受益于2024 年天然铀矿价格维持高位运行，公司海外铀矿投资收益同比上涨71%达到10.16 亿港元。其中，谢公司的谢矿及伊矿2024 年产量964 吨，单位成本28 美元/磅，贡献合营利润3.99亿港元，同比增加46%。谢矿及伊矿的合计剩余储量7700 吨铀，如按当前产量继续开采可持续5-6 年。奥公司的奥矿及扎矿2024 年产量1,739 吨，同比增加12%，单位成本为24 美元/磅，联营业绩6.17 亿港元，同比增加93%。扎矿2025 年产能或提升至2,000 吨铀/年，产能提升将为公司带来新增长。Incident: CGN Mining's 2024 revenue increased 17% to HK$8.624 billion, but net profit fell 31% year over year to HK$0.342 billion due to increased income tax and unconventional one-time profit and loss. The company has low-cost uranium resources, and the trade business is under short-term pressure but flexible. The upward trend in global nuclear power expansion and uranium price cycles is clear. The company's long-term value as a leading uranium resource in China is prominent. It can be positioned at a low price and maintain a “buy” rating.
Report summary
Profit before tax increased sharply by 48%, and net profit to mother declined due to unconventional profit and loss. In 2024, GN Mining achieved revenue of HK$8.624 billion, up 17% year on year; gross profit loss of HK$0.066 billion; realized profit before tax of HK$0.814 billion, up 48% year on year; realized net profit of HK$0.342 billion, down 31% year on year; achieved basic profit of HK$4.50 billion per share, down 31% year on year. The company's gross profit loss in '24 was mainly due to an increase in international uranium prices that greatly exceeded expectations. The price was inverted with the signed underwriting price framework, leading to gross profit losses. The new price framework will be signed in the second half of this year, and market factors will be fully taken into account. It is expected that the gross profit loss situation will be resolved. In addition, the decline in net profit was due to losses from discontinued operations and a sharp rise in income tax expenses, and income tax expenses reached HK$0.287 billion, an increase of 361% over the previous year. The reason for this was the tightening of the application of preferential tax rates under the Kazakh agreement, and the applicable tax rate increased from 5% to 15%. The company carefully considered supplementary payment of dividend tax in 2020-23; Furthermore, the company plans to pay a dividend of HK0.7 cents per share, with a dividend ratio of 23%.
The uranium ore resource sector has a cost advantage to build a moat. Benefiting from the high level of natural uranium ore prices in 2024, the company's overseas uranium investment income rose 71% year over year to HK$1.016 billion. Among them, Xie Company's Xie Mine and Yi Mine produced 964 tons in 2024, with a unit cost of 28 US dollars/pound, contributing HK$0.399 billion to the joint venture profit, an increase of 46% over the previous year. The total remaining reserves of 7,700 tons of uranium in Xie Mine and Iran Mine can continue to be mined for 5-6 years at current production levels. Austrian mining and mining production in 2024 was 1,739 tons, an increase of 12% over the previous year. The unit cost was 24 US dollars/lb. The joint operating results were HK$0.617 billion, an increase of 93% over the previous year. Mining production capacity may increase to 2,000 tons of uranium/year in 2025, and the increase in production capacity will bring new growth to the company.
One-off impact on the performance of discontinued businesses. Fission Uranium, a joint venture of CGN Mining, was acquired by Paladin Energy in December 2024, and 11.26% of the company's shares were converted to 2.61% of Paladin's shares (approximately 10.4 million shares) at a transaction price of HK$0.381 billion. However, when Fission's shares were confirmed, due to the fall in Paladin's share price, its book value was higher than the fair value of Paladin shares, resulting in a one-time HK$0.17 billion book loss. Furthermore, changes in fair value of the sale of investment properties resulted in a loss of HK$14.76 million. The above projects are not expected to drag down profits for 25 years.
The industry has a clear upward cycle trend. It is optimistic about long-term development and maintains a “buy” rating. By the end of 2024, global nuclear power plants are operating 417, with an installed capacity of 377 GW, and China is operating 57 units, with an installed capacity of 59.4 GW. Global demand for nuclear power is expected to continue to grow steadily. We estimate the company's revenue for 2025-2027 at 10.36 billion/11.73 billion/HK$12.33 billion; net profit to mother of 0.66 billion/1.16 billion/HK$1.31 billion, EPS of HK$0.088/0.152/0.172, corresponding PB of 2.59/2.15/1.80 times. Maintain the target price of HK$2.25 and maintain the “Buy” rating.
Risk warning: Shortage of raw materials for mining and rising prices; development of nuclear power falling short of expectations; government tightening of nuclear power policy; sharp drop in natural uranium ore prices; sudden nuclear accidents.
