Key points of investment:
Incident: The company released its 2023 annual report and 2024 quarterly report. For the full year of 2023, the company achieved operating income of 15.31 billion yuan, -21.1% year on year; net profit attributable to mother - 720 million yuan, -179.9% year on year; net profit after deducting non-return to mother - 1.18 billion yuan, -231.0% year on year. 2024Q1 achieved operating income of 3.11 billion yuan, -26.4% year-on-year and -8.1% month-on-month; net profit to mother of -40 million yuan, +84.5% year-on-year, +89.3% month-on-month; net profit after deducting non-return to mother of 60 million yuan.
2024Q1: Prices of pre-baked anodes stabilized, and performance improved month-on-month. Price: In addition to the January reduction of 150 yuan/ton in January, the guide price for 24Q1 Weiqiao pre-baked anodes remained flat from month to month. Q1 The average price of pre-baked anodes in East China was 5087.6 yuan/ton, -34.1% year on year and -6.3% month on month. The mainstream price of high-end products made of artificial graphite anode materials in March was 58,000 yuan/ton, the same as in January. Profit: The company's gross profit gradually recovered, achieving gross profit of 310 million yuan in Q1, +240 million yuan year over year and +4.6 billion yuan month over month. The current period was affected by falling stock prices, and changes in the fair value of transactional financial assets (shares related to performance compensation) lost 110 million yuan.
2023: Pre-baked anode prices declined, putting pressure on performance. Volume: In '23, the company produced 2.96 million tons of pre-baked anodes, up +10.3% year on year, and sold 2.98 million tons of pre-baked anodes, +10.5% year over year, of which 670,000 tons were exported, or -6.9% year on year; lithium battery anode products produced 30,000 tons and sold 26,000 tons. Price:
In December '23, the guide price for Weiqiao pre-baked anodes was 4,028 yuan/ton, down 38.8% from the January guide price; the average annual price of pre-baked anodes in East China was 6286.9 yuan/ton, -23.2% year-on-year. The mainstream price of high-end products made of artificial graphite anode materials in December was 58,000 yuan/ton, down 18.88% from January. Profit: In '23, the company achieved gross profit of 250 million yuan, of which pre-baked anodes contributed 200 million yuan of gross profit, or 2.1 billion yuan year over year, mainly due to continued price decline. The gross profit of 23 pre-baked anode tons was 66 yuan/ton, compared with the previous year - 800 yuan/ton. Xinyuan's impact: The operating performance of Xinyuan Co., Ltd. fell short of expectations. In '23, the company calculated goodwill impairment of Xinyuan Co., Ltd. by about 746 million yuan. According to the compensation clause agreed in the performance promise, the performance committer's ability to perform the contract was comprehensively considered, and the fair value change revenue of about 444 million yuan was confirmed.
2024: The price of pre-baked anodes rebounded steadily, production capacity continued to expand, and the company's profit improved. Amount:
The company will generate 3.46 million tons of pre-baked anode production capacity in 24 years. According to production guidelines, it is estimated to produce 3.3 million tons of pre-baked anodes and 50,000 tons of anode materials in 24 years. Price: In May, the guide price of Weiqiao's pre-baked anode was +60 yuan/ton. The steady rise in price led to an improvement in the company's profit.
Profit forecast and investment advice: According to the latest situation, we lowered the negative profit situation. The company's net profit for 24-26 is estimated to be 8.2/9.7/1.01 billion yuan (the value was 884/999 million yuan 24-25 years ago), and the corresponding EPS is 1.5/1.8/1.9 yuan, respectively, maintaining the “buy” rating.
Risk warning
The price of pre-baked anodes fell short of expectations, and the release of production capacity fell short of expectations