Baosteel Co., Ltd. (600019): Steel prices weakened and ore prices were strong in the first three quarters

Baosteel Co., Ltd. (600019): Steel prices weakened and ore prices were strong in the first three quarters

Event description Baosteel issued a report for the third quarter of 2019 and achieved operating income of approximately 2168 in the first three quarters.

76 ppm, a decrease of 3 per year.

75%; Net profit attributable to shareholders of listed companies was 88.

7.4 billion, previously 43 per second.

65%, the corresponding EPS is 0.

40 yuan.

Among them, the company’s operating income in the third quarter was about 760.

00 ppm, an increase of 0 from the previous month.

66%; Net profit attributable to shareholders of the parent company was approximately 26 in the third quarter.

8.7 billion, down 22 from the previous month.

36%, based on the latest share capital, the company’s EPS in the third quarter was 0.

12 yuan, EPS in the second quarter is 0.

16 yuan.

Event commentary Weak automobile and strong ore prices, the first three quarters of performance change: mainly due to weak automobile sales and rising ore prices, the company’s performance change in the first three quarters of weak replacement.

From January to September, the company’s main downstream automobile production and sales decreased by 11 respectively.

40%, 10.

30%, the company’s main product plate price index fell by 8.

On the raw material side, the average iron ore price in the first three quarters rose by 36%.

90%.

The company’s gross profit margin is 4.

83 up to 10.

72%, gross profit decreased by 117.

The gross profit of 91 trillion tons of steel fell by 342 yuan / ton to 656 yuan / ton in ten years.

However, financial expenses and management expenses were reduced to a certain extent to hedge the company’s performance margin.

In the first three quarters, the company’s financial expenses decreased by 17 due to the annual decrease in exchange losses and interest expenses.

8 ppm; Mainly due to reductions in employee compensation, termination benefits and fair incentives, the company’s administrative expenses decreased by 13.

50,000 yuan, the company’s expense ratio during the first 3 quarters decreased by 0.

70 perfect to 6.

27%.

Finally, in the first three quarters, the company’s net profit per ton of steel replaced the 深圳桑拿网 length of 218 yuan / ton to 271 yuan / ton, and the performance increased by 43.

65%.

Initially, the company’s crude steel output in the first three quarters increased slightly by only half a year.

97%, significantly lower than the industry average of 8.

The 4% increase has not effectively helped the company’s performance.

Expenses decreased, but gross profit margin decreased, and the third quarter performance decreased month-on-quarter: In the third quarter, the decline in the downstream automotive plate market narrowed, but continued to grow negatively, and the average plate price index decreased by 3 months.

52%; ore prices continued to rise, and the average Platts index in the third quarter increased by 1 from the second quarter.

9%.

Due to the double squeeze of rising raw materials and falling steel prices, the company’s gross profit margin decreased by 1 from the previous month.72 averages to 10.

10%, the company’s gross profit per ton of steel fell by 83 yuan / ton to 634 yuan / ton.

Due to the decrease in management expenses, the company’s management expense ratio decreased by 0 in the third quarter.

88 up to 1.

29%, during the period, the expense ratio decreased by 0.

64 up to 6.

26%, it must be lowered to lower the performance level.

In the end, the company’s net profit per ton of steel in the third quarter dropped 60 yuan / ton to 241 yuan / ton, and the company’s performance decreased 22 chain.

36%.

It is expected that the company’s EPS in 2019 and 2020 will be 0.

54 yuan, 0.

56 yuan, maintain “Buy” rating.

Risk Warning: 1.

Demand for downstream automotive panels continues to decline; 2.

Industry supply has grown rapidly.