Incident: Recently, the company released its 2024 quarterly report and 2023 annual report. In 2023, the company achieved revenue of 7.786 billion yuan, a year-on-year decrease of 7.24%; net profit to mother of 2,036 billion yuan, a year-on-year decrease of 19.43%; deducted non-net profit of 1,990 billion yuan, a year-on-year decrease of 21.5%. 2024Q1 achieved revenue of 2,051 billion yuan, a year-on-year decrease of 8.34%; net profit to mother of 431 million yuan, a year-on-year decrease of 29.09%; deducted non-net profit of 433 million yuan, a decrease of 27.56% over the previous year.
The drop in coal prices has dragged down the company's performance, and its ability to control costs is strong. In 2023, the company sold 7.618,600 tons of commercial coal, up 8.19% year on year; coal business revenue was 7.556 billion yuan, down 7.18% year on year; the average price of coal sold was 958.11 yuan/ton, down 14.24% year on year. Among them, the price of mixed coal was 541.1 yuan/ton, up 3.1% year on year; the price of washed refined coal was 1703.9 yuan/ton, down 15.9% year on year; the cost of a ton of coal was 516.99 yuan/ton, down 6.09% year on year; and the gross margin of commercial coal sales was 46.67%, down 4.15 pct year on year. 24Q1 achieved commercial coal production of 1.948,800 tons, up 11.64% year on year; commercial coal sales volume was 1.9171,000 tons, down 2.71% year on year; the price of tons of coal was 1017.15 yuan/ton, down 5.18% year on year; and ton coal cost was 561.16 yuan/ton, down 3.24% year on year.
The renovation and expansion of coal mines increased production, and the electricity business progressed steadily. The Hengyuan coal mine renovation project is expected to be completed and put into operation in June 2024; the Qianziying coal mine renovation and second-level deepening project and Hengtai Company's deepening technical improvement project are progressing according to plan; the main project of the Qianziying Power Plant Phase II project is progressing steadily; the Qidong distributed photovoltaic power plant begins to be put into operation; the company's Wanheng New Energy 300 megawatt wind power project and distributed photovoltaic projects in the Huaibei mine are expected to be completed and completed. The first phase of the 300,000 kilowatt wind power project is expected to be completed and put into operation in 2025, and the second phase of the 500,000 kilowatt wind power project is expected to be completed and put into operation after the first phase Plan progress.
The dividend rate is 50.1%, and the dividend rate is 6.7%. The company plans to pay a cash dividend of 0.85 yuan (tax included) per share, with a total cash dividend of 1.02 billion yuan (tax included), accounting for 50.1% of net profit attributable to mother in fiscal year 23. Based on the closing price of April 30, 2024, the company's current dividend ratio is 6.7%.
Investment advice: The company's revenue is expected to be 80.85/85.05/8.842 billion yuan in 24-26, +3.84%/+5.19%/+3.96% year on year; net profit to mother is 20.63/22.39/2.00 billion yuan, +1.34%/+8.52%/+7.21% year on year; EPS is 1.72/1.87/2.00 yuan respectively, corresponding to the current stock price PE of 7.43/6.84/6.38 times, considering the company's steady operation and continuous increase in coal mine production and expansion The electricity business, which is undervalued and has high dividends, is given a “buy” rating.
Risk warning: the decline in coal prices exceeded expectations; additional production capacity fell short of expectations; production safety risks.