The performance in 2019 is in line with expectations, and the potential of marine engineering is expected.
In 2019, the company achieved revenue of 2.46 billion yuan (+ 77%), net profit of 269 million yuan (163%), revenue of 980 million yuan (+ 58%) and net profit of 125 million yuan (+ 198%) in the fourth quarter. It is estimated that the annual sales of wind towers are between 26 and 290000 tons, and the net profit per ton of steel has increased from about 700 yuan in the first half of the year to more than 850 yuan. The sales scale and profit margin are in line with expectations. During the reporting period, the company actively promoted the manufacture of offshore wind power equipment, and the offshore wind turbine tower business grew to a certain extent.
The epidemic affects short-term shipments, and the growth rate of 20Q1 performance is expected to be 80%. It is predicted that the epidemic will affect 20Q1 shipments of 0-30%, Q1 shipments of 35-50 million tons, and home-to-home net profit of 5000-66 million, an increase of 80-130% over the same period last year. In 2020, the new hoisting of wind power in China will be about 33GW, and the total demand for wind towers will be more than 3.3 million tons, but the actual hoisting affected by the epidemic may be delayed by 0-10% to 2021. The company's market share is about 10-11% in 2019, so it is estimated that wind tower shipments will reach 33-360000 tons in 2019 (26-290000 tons in 2019), and revenue will maintain rapid growth.
Successfully entering the Vestas supply chain and laying the foundation for the internationalization of the market the company has successfully entered the Chinese supply chain of the international fan giant Vestas, and the supply volume is expected to increase with the development of Vestas's business in China in 2020. The gradual deepening of cooperation between the two sides will improve the company's management level, process technology and quality control system.
Risk hint: if China abandons the wind and power cuts worsen again, it will cause the new installed capacity in the industry to fall short of expectations, and the company's new energy operating performance will not meet expectations; if steel prices rise quickly, profitability will improve less than expected. If the scenery resources fluctuate seasonally, the performance of the company's new energy operation plate will fall short of expectations.
Investment advice: maintain the profit forecast and valuation, maintain the "buy" rating of the leading domestic wind tower enterprises forward-looking layout of the three north and offshore wind power markets, the recent rapid increase in capacity utilization, performance blossoms. Maintain the company's profit forecast, maintain a reasonable valuation range of 17.36-23.03 yuan per share, a premium of 11-47% over the current share price, and maintain a "buy" rating with a PE of 9.5-12.6 times in 2019.