Event: the company issued an annual performance forecast on the 29th day of 2021. It is estimated that the net profit attributed to shareholders of the listed company in 2020 is about 360 million yuan, a decrease of about 21.19% compared with the same period last year. The net profit after deducting non-recurring profits and losses belonging to shareholders of listed companies is about 330 million yuan, which will increase by about 136 million yuan over the same period last year and 70.32% over the same period last year.
Comment
The performance of the fourth quarter increased significantly compared with the previous quarter: the company achieved a net profit of 297 million yuan in the fourth quarter, an increase of 430.36% compared with the same period last year, down 1.98% from the same period last year. The net profit after deducting non-profit in the fourth quarter was 173 million yuan, an increase of 54.46% over the previous year, a substantial increase over the loss of 5 million yuan in the same period last year.
Profits in the main business of coke rebounded: according to the announcement, the company's operating profit (excluding investment income) increased by about 105 million yuan in 2020 compared with the same period last year, mainly because the company's production and operation was relatively stable in 2020. although the production and sales volume of the main products decreased by the epidemic, the main business income decreased accordingly, but the price of raw material coking coal decreased more than the sales price of coke products in the first three quarters. At the same time, the sales price of coke products increased significantly in the fourth quarter, so the average gross profit of coke products increased year on year.
The improvement of the downstream industry is expected to bring greater performance flexibility for the company. The company uses JN60-6 coke oven with a design capacity of 2.4 million tons / year. in addition, the company also has a 1.2 million ton / year H-beam production line, which adopts mature and reliable advanced technology and equipment at home and abroad, and can produce more than 50 product specifications of various H-beam, mainly medium and large H-beam. It is the first professional H-beam production line in China and even in Asia that can produce extra-large size HN1000*300 series. In recent years, the iron and steel industry has maintained a relatively high boom and sound profits. The plight of low concentration and substantial overcapacity in the coke industry has been gradually solved with the help of industry capacity removal. At present, the capacity utilization rate of the industry has been raised to a higher level, while capacity removal is still going on. Under the background of high utilization rate of actual production capacity, the price increase caused by coke supply contraction is more flexible, and coke price is expected to rise. With the continuous implementation of the capacity removal of the coke industry, the supply and demand pattern of the industry will change from the previous surplus to the net shortage. It is expected that after 2021, the industrial concentration will increase, the two major problems troubling the industry will be fully solved, and the industry will recover. It is expected to achieve sustainable profits. According to the Coke Federation, the 15th round of coke price increases started this week, and if it hits the ground smoothly, the cumulative increase will be 1000 yuan / ton. Under the background of low inventory on the demand side, demand recovery after the Spring Festival, and insufficient release of new production capacity on the supply side, we expect that coke prices still have room to rise after the Spring Festival, which is expected to bring greater performance flexibility for the company.
Investment advice: increase holdings-An investment rating, 6-month target price of 3.24 yuan. We estimate that the return net profit of the company from 2020 to 2022 will be 360Universe 1.083Compact 1.109 billion yuan, corresponding to the EPS of 0.36Universe 1.08Universe 1.10 yuan per share.
Risk hint: Coke prices fall sharply, section steel prices drop sharply
