Chenming Paper (000488): The cost advantage of pulp and paper leading is obviously recommended
Event summary The company achieved operating income of 288 in 2018.
76 ‰, a decrease of 2 per year.
02%; realized attributable net profit of 25.
1 billion, down 33 a year.
41%; realized non-net profit deducted from the parent company.
54 ‰, a decrease of 42 per year.
Net operating cash flow was 141.
Ten percent of 00, a year-on-year increase of 592 times.
Our Analysis and Judgment (1) The scale of revenue has fallen slightly, and the downturn in the market has led to a decrease in profits. In 2018, the company achieved operating income of 288.
76 trillion, a decrease of 5 from the previous year.
From an industry perspective, mechanism paper / finance leasing contributes revenue 243 respectively.
02 trillion, a year-on-year change of -19.
34 ppm, with a ten-year growth rate of -7.
52% / 11.
90%, the two account for 84% of total revenue.
17% / 7.
63% is an important part of the company’s revenue.
From the perspective of the main mechanical paper products, white cardboard, double-adhesive paper, coated paper, electrostatic paper, release paper, and household paper respectively achieved revenues of 64.
49 trillion, the corresponding revenue increase is -4.
66 / -2.
13 / -7.
60 ppm, a ten-year increase of -6.
35% /-14.44% / 1.
39% / 0.
02% / 8.
Among them, white cardboard, double offset paper and coated paper accounted for 71% of the total paper machine business revenue.
By region, domestic / foreign revenue was 245.
15 trillion, respectively contributed revenue increase of -9.
84 ppm, a ten-year increase of -3.
84% / 9.
78%, of which the domestic region contributed 85% of operating income.
06%, most of the main content.
The net profit attributable to shareholders of the listed company for the current period was 25.
100,000 yuan, a decrease of 12 from the previous year.
The reasons for the decrease in profit come from two aspects: First, due to the downturn in the papermaking market in the second half of the year, the company’s paper sales fell, the price fell, and the profitability of the company fell.As a result, the company’s financing costs have risen and financial costs have increased.
(2) Comprehensive gross profit margin decreased 2.
64pct, the cost rate during the period dropped by 2.
16pct’s consolidated gross profit margin for 2018 was 31.
27%, a decrease of 2 compared with the same period last year.
From the perspective of the main products and industries, the gross profit margins of white cardboard, double-adhesive paper, coated paper, electrostatic paper, release paper, and finance lease were 16 respectively.
23% / 26.
60% / 27.
47% / 40.
11% / 39.
74% / 92.
The gross profit margins of the three major paper types of white cardboard, double offset paper, and coated paper in 2018 increased by 14 compared with the same period last year.
20% / 0.
09%, usually caused by a slight increase in revenue; electrostatic paper / anti-stick paper / finance lease gross margin increased from the same period last year.
51% / 5.
63% / 6.
72%, a gap of growth.
The decrease in the gross profit margin of white cardboard and coated paper was mainly due to the decrease in the market price of white cardboard and coated paper, and the increase in the gross profit margin of electrostatic paper and release paper was mainly due to the decrease in costs.
Expenses for the company during 2018 16.
97%, ranking fell 2 last year.16 units.
The sales / management / financial expense ratios are 4 respectively.
12% / 3.
35% / 9.
49% change in the same period last year -0.
The increase in financial expense ratio was mainly due to the increase in interest expense.
Of the 2018 financial expenses, interest expenses increased by 10.
(3) Integrated layout of forest pulp and paper with significant cost advantages The company has started to implement the strategic layout of forest pulp and paper integration since 2001. In the domestic paper industry, the company has a high self-sufficiency rate of wood pulp until the end of December 2018, The company has a capacity of 328 additives for homemade wood pulp.
According to the report baseline, Huanggang Chenming’s annual output of 30 targeted chemical wood pulp projects has been put into production in mid-November 2018, and Shouguang Meilun’s 40 chemical wood pulp projects have also entered the production commissioning stage 西安耍耍网 and will soon be put into production.
The commissioning of these projects can further improve the self-sufficiency rate of wood pulp, change the contradiction between supply and demand of wood pulp raw materials, and reduce production costs.
Compared with the ratio of purchased wood pulp, the cost advantage of self-made pulp is significant, which ensures that the company’s paper products continue to lead the industry in terms of gross profit margin: It is reported that the company’s average ton paper price is about 5,626 yuan / ton (compared with 5298 yuan / ton in the same period last year).), Gross profit per ton of paper is about 1721 yuan / ton (1544 yuan / ton in the same period last year).
As the company’s self-sufficiency in wood pulp increases, gross profit per ton of paper is expected to increase further.
In addition, the price of wood pulp raw materials is relatively stable, the advantages of bulk material procurement and the expansion of supporting logistics services greatly reduce the logistics and transportation costs of raw materials and finished products, which greatly improves the company’s cost advantage and quality stability.
(IV) Leading paper production capacity, scale advantage highlights the company as a leading company in the Chinese paper industry. After years of development, it has now formed a capacity of more than 1,100 tons of pulp and paper, and has a scale that rivals international paper companies.Hubei, Jiangxi, Jilin, Wuhan and other places have built paper production bases.
The large-scale centralized production and operation model makes the company have obvious economic benefits, and makes the company have alternative market influence in terms of raw material procurement, product pricing, and industry policy formulation.
In addition, in recent years, environmental protection policies have been intensively introduced, the industry has accelerated the clearance of small and medium-sized production capacity, and the concentration of the industry has increased significantly. Large and large enterprises can continue to increase the barriers to entry into the industry through the advantages of large-scale production and enjoy the industry’s new profit cycle.
Investment suggestion As a leader of Chinese papermaking companies, the company has a leading industry in terms of production capacity and significant scale advantages.
There is a full range of paper products, with the main products occupying the forefront in the market. The leasing business has made more efforts and the profitability is stable.
Through the development of upstream pulping business, the company has improved the self-sufficiency rate of wood pulp, which can significantly reduce production costs, enhance the company’s core competitiveness, and provide strong support and guarantee for the company’s future development.
In terms of environmental protection, we have sound pollution control facilities. These environmental protection indicators are at the forefront of the country and the world.
At the same time, the company actively cooperates with universities, scientific research units and international advanced enterprises to increase technical innovation capabilities and scientific research and development efforts. It has 18 invention patents and participated in the formulation of 5 national standards to lead the latest and highest-end technologies of the Chinese paper industry.
Therefore, we predict that the company will achieve revenue of 314 in 2019/2020/2021, respectively.
1.7 billion, net profit 32.
07 ‰; corresponding to PS0.
62 times, corresponding to PE7 / 6/5 times, the first time “recommended level”.
Risks indicate the risk of fluctuations in raw material prices; the risk of excess capacity and reduced demand; the risk of changes in environmental protection policies.