Xinji Energy (601918) 2019 Interim Report Comments: Stable Operation but Impairment Expectations Still Impact Estimates to Rise
In the first half of 2019, the company’s production and operation 淡水桑拿网 remained relatively stable. Looking ahead, the company’s follow-up coal mines still have continued resources, and it is expected that profit growth will increase.
Although the impairment pressure may be improved, it will still increase the uncertainty of the company’s profit forecast, and therefore maintain the company’s “overweight” rating.
Net profit fluctuated slightly in the first half of 20193.
39%, of which Q2 performance increased by nearly 19%.
The company achieved operating income of 46 in the first half of the year.
20,000 yuan, ten years +0.
88%; net profit attributable to mother 7.
390,000 yuan, at least -3.
39%, EPS is 0.
29 yuan, the increase in half-year results was mainly due to production costs exceeding 200 million US dollars.
Q2 single-quarter net profit was 3.
3.1 billion, with a 四川耍耍网 molecular weight of 18.
87%, mainly due to an increase of 100 million yuan in management expenses.
Commercial coal production is increasing by 2 per year.
58%, the gross profit margin of the coal business precipitated nearly 9 pcts.
In the first half of the year, the company produced commercial coal 806.
62 Initially, at least +2.
58%; sales 799.
65 initially, at least +3.
The average coal sales price was 472.
60 yuan / ton, at least -3.
17%; the cost per ton of coal is 289.
93 yuan, +13 for ten years.
12%, mainly due to the decline in the gross margin of the coal business due to environmental protection and rising labor costs.
84% to 38.
The company’s power generation is 50.
7.1 billion kWh, ten years -6.
99%; online power 48.
1.8 billion kWh, ten years -7.
04%; the average on-grid price (excluding tax) is 0.
3148 yuan / kWh, +1 in ten years.
In terms of the three expense ratios, the company’s sales, management, and financial expense ratios are 0.
42% / 5.
45% / 10.
40%, ten years +0.00 / -1.
43 / -0.
96 cases, the management expenses obviously benefited from the company’s good budget cost control.
Resources to be developed in the future are abundant, and energy diversification continues to advance.
At present, the company’s production capacity has been reduced to 2050, but the succession of alternative resources is abundant. The Banji coal mine (300 tons) is expected to be completed and put into operation in 2020. In the future, there will be mines such as Kizxi and Zhangou to be developed.
The next step is through the construction of Yangcun Coal Mine Underground Coal Gasification Project, and the company’s products will be more diversified, which will help consolidate part of the company’s regional energy leader.
Risk factors: breakthroughs in cost and impairment fluctuations; fluctuations in thermal coal prices, affecting performance growth, etc.
Investment suggestion: Considering the reduction of the company’s impairment pressure in 2019 (the impairment last year affected the net profit).
8.8 billion) and interim results, we raise the company in 2019?
The EPS forecast for 2021 is zero.
67 yuan (previous forecast was 0.
Current advantages 2.
92 yuan, corresponding to 2019?
2021 P / E will be 7/5 / 4x.
We give the company a target price of 3.
36 yuan, corresponding to 2019 P / E8x, maintaining the company’s “overweight” rating.