Performance summary: the company released the third quarter report of 2020, from January to September, the operating income was 37.167 billion yuan, an increase of 5.82% over the same period last year; the net profit of shareholders belonging to listed companies was 1.236 billion yuan, down 16.72% from the same period last year, equivalent to 0.48 yuan for EPS; and the net profit after deducting non-return was 1.213 billion yuan, down 16.41% from the same period last year. Among them, Q3 realized operating income of 14.163 billion yuan, an increase of 15.68% over the same period last year, an increase of 15.0% over the same period last year, and a net profit of 463 million yuan, an increase of 111.87% over the same period last year, a month-on-month decrease of 23.88%, equivalent to 0.18 yuan for EPS.
Per ton steel data: the company achieved net profits of 164 million yuan, 608 million yuan and 463 million yuan respectively in the first three quarters. According to the operating data disclosed by the company, steel sales in the first three quarters were 1.77 million tons, 2.4 million tons and 2.45 million tons respectively. The corresponding net profit per ton of steel was 93 yuan, 253 yuan and 189yuan respectively, down 64 yuan in the third quarter compared with the second quarter.
Financial data: from January to September 2020, the comprehensive gross profit margin was 7.43%, down 1.62PCT from the same period last year. Although the average unit price in the first three quarters fell 7.11% from the same period last year, sales increased by 14.26% year-on-year, and revenue increased by 5% year-on-year.
82%, while the cost side was affected by the increase in mineral prices by 7.71% year-on-year, and the gross profit margin decreased slightly. The expense rate for the period from January to September was 3.54%, which was 3.32% lower than the same period last year and 0.9PCT was lower than the same period last year. The specific data for the third quarter are as follows: Q3 comprehensive gross profit margin of 7.03%, year-on-year increase of 0.24PCT, month-on-month decline of 1.97PCT, mainly due to the large month-on-month increase in mineral prices led to 17.48% upside of the cost side, 3.21% of expenses during the Q3 period, a year-on-year decline of 1.61PCT, a month-on-month decrease of 0.09PCT of Q3 net interest rate of 3.27%, an increase of 1.48PCT, and a month-on-month drop of 1.67PCT.
The performance of Q3 long wood is not as good as that of plate: according to our calculation, excluding the raw material inventory cycle, the average gross profit per ton of 2020Q3 hot rolling, cold rolling, rebar and medium and heavy plate is 273 yuan,-44 yuan, 135 yuan and 46 yuan respectively, with a month-on-month change of 131,226,195 yuan and-101 yuan, with changes of 992.5%, 83.6%,-59.2% and-68.8%, respectively. The differentiation of profit performance of long wood and plate is mainly due to the obvious improvement of the prosperity of the construction machinery and automobile industry downstream of the plate, while the construction industry has experienced a rapid rebound in Q2 and slowed down after entering the third quarter. the profit trend of the company's rod and wire rod-based product structure is consistent with the industry, but the overall decline is better than the industry.
Increase the capital of Guangxi Iron and Steel: recently, the company issued an announcement that it intends to increase the capital of Guangxi Iron and Steel through monetary funds and obtain new shares in Guangxi Iron and Steel. After the completion of this capital increase, listed companies will gain control of Guangxi Iron and Steel. Realize the consolidation of Guangxi Iron and Steel (of which 6 billion of the monetary funds increase the registered capital of Guangxi Iron and Steel, and the rest enter the capital reserve. The specific capital increase price is based on the valuation of June 30, 2020). After the completion of this transaction, Guangxi Iron and Steel will become a holding subsidiary of the company, and listed companies will deeply participate in the follow-up construction of Fangchenggang base, which is conducive to the coordination of production and management in the future. After Guangxi Iron and Steel has been put into production, the main steel products include high-strength rebar, alloy steel bar, high-quality wire rod, hot-rolled wide strip steel, cold-rolled steel, hot-dip galvanized coil and other steel for construction, automobile, machinery and other industries, it will help the company to improve the existing product supply system, optimize product structure and meet the diversified needs of customers. At the same time, listed companies can make use of the geographical advantages of Fangchenggang steel base to actively open up the market of ASEAN countries, enhance the company's industry status and brand influence, and enhance the company's sustainable profitability.
Investment suggestion: as a leading steel enterprise in Guangxi, the company's products are mainly rods and wires. after increasing investment in Guangxi Iron and Steel, it will enrich the company's product structure and enhance its sustainable profitability, but after the real estate regulation and control was upgraded again in July, there are signs of a decline in sales and construction in September, coupled with the lack of infrastructure capacity this year, the demand of the construction industry is facing greater pressure in the later period. The decline in industry profits may have a negative impact on the company's performance growth. We expect the company's EPS to be 0.65, 0.67 and 0.71 yuan from 2020 to 2022, maintaining a "hold" rating.
Risk hints: the sharp decline in the macro-economy has led to pressure on demand; supply-side pressure continues to increase.