Description of the event
The company released its 2023 annual report. In 2023, it achieved operating income of 15.127 billion yuan, a year-on-year decrease of 28.9%, a year-on-year decrease of 14.80%, and realized deducted non-net profit of 1,980 billion yuan, a year-on-year decrease of 14.86%; after splitting into the fourth quarter, the company achieved operating income of 2,584 million yuan, a year-on-year decrease of 64.0%, a year-on-year decrease of 44.56%, after deducting non-net profit of 343 million yuan, a year-on-year decrease of 49.38%. The results fell at the center of the forecast.
Incident comments
Looking at the whole year, the company achieved shipments of 62,700 tons of cathode materials, a year-on-year decrease of 1.2%, mainly due to a slowdown in overall terminal demand growth. Structurally, the company's shipments are still mainly ternary materials. Among them, high-nickel and ultra-high nickel NCM/NCA, NCMA and other diversified material research and development have continued to make breakthroughs. In addition, the company's (manganese) lithium iron materials have been shipped to leading battery manufacturers. High-end solid state battery cathode materials have already been launched by domestic and foreign car companies, and sodium electric cathode materials have broken through overseas customers, with annual shipments exceeding 100 tons; Introduced, the shipment volume exceeded 100 kg. On the customer side, the company continues to optimize its customer structure and actively develop domestic customers. The first, second, and third largest customers accounted for 17.81%, 13.67%, and 11.46% of revenue respectively, and the top five customers accounted for 58.57%. The customers are relatively scattered and the structure is relatively good. In terms of production capacity, the company's Changzhou Phase II and Haimen Phase IV have been completed and put into operation. Currently, the production capacity of the Panzhihua base is being actively promoted. Currently, the production capacity of the Panzhihua base is being actively promoted. Currently, it has 40,000 tons of lithium iron (manganese) iron production capacity, and 40,000 tons of lithium iron under construction to ensure subsequent supply capacity. In terms of profit, the average price of the company's products in 2023 was 238,900 yuan/ton, which was mainly due to a drop in resource prices; gross profit of 42,700 yuan/ton per ton per ton, down 15,000 yuan/ton from the previous year, mainly due to a decrease in the price of resource products, and a slight decrease in processing costs; the net profit per ton is estimated to be around 29,000 yuan/ton, a slight decrease over the previous year, mainly due to the restructuring of terminal customers. The share of domestic customers increased slightly in 2023, and there was a certain gap in domestic processing costs compared to overseas, lowering the overall profit level.
Looking at 23Q4 alone, the company achieved shipments of about 14—15,000 tons, a slight decrease compared to Q3, mainly due to the slowdown in terminal demand growth. In terms of profit, it is estimated that the company's Q4 profit per ton was 22,000 to 23,000 yuan/ton, which declined to a certain extent compared to Q3. It was mainly due to restructuring of end customers. The profit per ton of domestic customers was lower than that of overseas customers, which lowered the company's profit level per ton. In addition, the company's Q4 R&D expenses are mainly due to the transfer of R&D materials to inventory materials.
Looking ahead to 2024, the company is actively adjusting its customer structure. Domestic customers are currently progressing relatively fast, and Sunwoda is also accelerating, providing additional shipments. Overseas customers such as Sk, LG, and Northvolt still maintain their leading edge, and Tesla Cybertrunk are also expected to contribute to new demand growth; in terms of profit, the company's 2023Q4 net profit per ton has declined, mainly affected by customer structural adjustments. Looking at 2024, customer restructuring and processing fee adjustments will put pressure on the profit of a single ton, but overall The profit level is still expected to receive industry premiums. It is expected to achieve net profit of 1.2 billion to 1.3 billion yuan in 2024, and continues to be recommended.
Risk warning
1. Market competition increases risk;
2. The risk that demand in the power battery industry falls short of expectations.