Huaxin Cement (600801) Company Comments: Pre-increasing performance concerns Hubei, Yunnan and Tibet exceeding expected contributions
The event company released a semi-annual report of pre-increasing results announcement, it is expected that H1 return to the mother net profit of 30.
1.7 billion, an increase of 9 per year.
4.9 billion, an increase of 46-56%, after deducting non-return to the mother’s net profit increased by 45-55%.
The outstanding performance was in line with expectations.
Both quantity and price rose, focusing on Hubei, Yunnan, and Tibet. Contributions reported. Growth in cement and clinker sales increased by 11%, and aggregate sales increased by nearly 29% (18 years of revenue from the aggregate business accounted for 3 percentage points). The performance contribution in the reporting period mainly came from cement.business.
The company’s characteristic layout, Hubei and Yunnan, and the performance of Tibet’s demand are the main reasons for this increase in sales volume. For example, from January to May, the growth rate of cement production increased from the angle of Hubei (+12.
67%), Yunnan (+5.
9%), Tibet (+21).
28%); January to May the highest angle of new housing construction expansion, Hubei (+5.
8%), Yunnan (+110.
6%), Hunan (+14.
70%); from the perspective of infrastructure construction, the opening of the Hubei Military Games will soon begin with municipal and stadium construction and Wuhan urban construction, and Tibet’s transportation construction will drive company demand.
The new production capacity includes the Tibet production line which was put into operation in the second half of last year and the towering Chongqing which was consolidated only in April last year. Considering the small scale, although it is supplemented, the impact is small.
Demand is the cornerstone of the price. The supply side passes the peak of the Spring Festival and voluntarily stops the kiln. The market spontaneously shifts the supply contraction, effectively controls the off-season inventory, and pave the way for a tight balance of supply and demand in the peak season.
In terms of price, the prices of cement, concrete and aggregate have increased by 9%, 16%, and 5%, respectively. Volume and price have risen. We estimate that the cost of cement in the second quarter will be about 200 yuan, and the gross profit will be about 160 yuan.Reached 100 yuan.
Future resilience is related to regional distribution and business development.
The company’s operating flexibility includes (1) poor regional demand expectations for the cement business, increasing production capacity to facilitate digestion.
According to the statistics of Zhuochuang Information, Yunnan will increase its production capacity by about 567 tons in 2019, with a capacity shock rate of 6%, and an increase of 155 tons in 2018, with an impact rate of about 1.
Guizhou added 434 tons in 19 years, and the output shock rate was about 4.
We believe that the demand for supplementary production capacity targets is sustainable, such as Yunnan’s 2018 fixed asset investment growth rate11.
6%, Guizhou 15.
8%, Hubei 11%, Sichuan 10.
2%, Hunan 10%, Chongqing 7%, while the national growth rate of 5 during the same period.
9%, 2019 will continue to maintain a high growth rate, Yunnan plans to 12%, Guizhou about 13%, Hubei 10.
About 5%, Sichuan 10%, Hunan 10%, Chongqing 8%.
(2) Continuous high growth of high gross profit aggregate business (The gross profit margin of aggregate in 2018 was 63.
84%), and the accelerated layout of environmental protection business.
The internal control elasticity mainly refers to the ton cost, the ton cost can be further reduced, and the cost structure can be continuously optimized.
Profit forecast: The short-term focus on the impact of the “Military Games” on the subsequent construction 北京夜网 rhythm, the opening of the Menghua Railway is expected to reduce coal costs, and the Southwest demand boom is maintained.
In the preliminary perspective, we expect the price to be mainly stable. Infrastructure, land demand in Tibet, Southwest, Hubei and other places will continue to support. In the region, after years of bidding companies, peak shifts will continue to deteriorate and change. Capacity at home and abroad will continue to expand.The company’s industrial chain is laid out ahead of time, releasing aggregates, environmentally friendly wall materials, and cooperating with business growth dividends.
Taking into account the outstanding performance of the first half of the year, we will return the net profit of mother to 2019-20 from 56.
700 million is adjusted to 64.
90, 67.61 ppm and EPS are 3.
22 yuan, corresponding to PE is 6.
Risk reminder: Southwest increases production risk, rainwater weather is less than expected.