Huadian International (600027) 2019 Interim Report Comments： High Performance Increase Meets Expected Earnings Repair Momentum
Huadian International (600027) 2019 Interim Report Comments: High Performance Increase Meets Expected Earnings Repair Momentum
The company’s high H1 performance was in line with expectations, and the main reasons were the downward cost and installed capacity growth.
Taking into account that coal prices are expected to continue to decline in the second half of the year, and supplementary adjustments to electricity prices and positive catalysis, it is expected that the company’s subsequent profitability will continue to be fixed.
Maintain “Buy” rating and target price of 5.
The 50 yuan H1 performance increase was in line with expectations.
The company achieved 437 trillion in revenue in 2019H1, an increase of 5 per year.
2%, net profit attributable to mothers was RMB 16.
500 million, an increase of 67 per year.
4%, converted to EPS0.
145 yuan, the company’s high performance in line with expectations.
In 杭州夜网论坛 terms of quarters, Q2 achieved revenue of 20.3 billion yuan, a year-on-year increase of 6.
6%; net profit attributable to mother 8.
80,000 yuan, an increase of 193 in ten years.
4% growth in installed capacity drives electricity, cost improvement improves overall gross profit margin.
The company’s 2019H grid-connected power will be 94.5 billion kWh, an increase of 5 per year.
The highest increase in on-grid electricity generation was mainly driven by the newly commissioned units. H1’s newly commissioned installed capacity was 3.5 million kilowatts.
H1’s coal-fired unit utilization hours were 2,202 hours, which was basically the same as 2,208 hours in the same period last year.
Benefiting from the decline in coal prices, the company’s comprehensive gross profit margin increased1.
2 up to 13.
6%; during the period, the company’s financial expense ratio decreased by 0.
4 up to 6.
0%, management fee rate interest rate is 0.
6 up to 1.
5%, the initial 18H1 has a one-time US $ 200 million relocation compensation for coal enterprises.
Net cash flow from H1 operating activities was 93.
600 million, maintaining a consistent level of excellence.
Trends in electricity prices and coal prices indicate improvements in performance and a gradual increase in earnings.
With the growth rate down to 13% and implementation in Q2 and the narrowing of market electricity price discounts, the company’s comprehensive electricity price also has room to improve in the second half of the year.
Supply has begun to release, and the coal market is shifting towards easing. It is expected that downward pressure on coal prices will increase in the second half of the year.
Taken together, we believe that the company’s performance improvement trend is expected to continue, and the performance elasticity will continue to be released.
With the rebound in performance and gradually increasing yields, we expect the company’s yield to reach 4 in 2019.
In 2021, the on-grid electricity price including tax is 363/364/364 yuan / MWh, assuming 3 per year.
1% / 0.
1%; maintain 2019?In 2021, the unit price of standard coal into the furnace is 698/677/657 yuan / ton, assuming -3% /-3% /-3% per year.
Risk factors: The coal price has risen sharply; the benchmark on-grid electricity price has been reduced; the discount range of market-based charges has expanded.
Investment suggestion: consider H1 performance in line with expectations and maintain 2019?
EPS0 in 2021.
The 56 yuan forecast is unchanged. The company currently expects the corresponding P / E to be 12/8/7 times. With reference to industry and company historical forecasts, Huadian International (A) 1 is given.
2x target P / B, target price 5.
50 yuan to Huadian International (H) 0.
9x target P / B, target price 4.