Liuzhou Iron & Steel Co., Ltd. (601003): Second-quarter results increased significantly compared to the previous quarter
Event: The company released 2019 H1 results and reported that the combined companies completed steel production and sales of 390 respectively.
21 for the first time, growing by 4 each year.
31%; operating income of 228.
7.8 billion, the net profit attributable to 西安耍耍网 the parent company was maximized.
65 ppm, an increase of 1 each year.
Expansion of revenue by volume supplements, second-quarter results increased significantly by 129%.
The reported baseline average unit sales price was 3498.
95 yuan / ton, excluding 1 for the time being.
55%, sales increase by 2 every year.
31%, achieved a counter-increasing growth in revenue and increased operating income by 1.
Realize net profit attributable to mother 12.
400 million in the second quarter, net profit attributable to mothers.
8.1 billion, an increase of 129% from the first quarter.
The cost control ability appeared.
We believe that the company’s cost control ability is very effective. In the face of the constant and sequential increase in the cost of raw materials such as iron ore and a 20% increase in industry costs, operating costs in 2019H1 have only increased by 4%.
The company said that years of experience in iron ore procurement have enabled the company to do a better job in timing procurement, effectively hedging the impact of iron ore price increases.
The gap between supply and demand in Guangdong and Guangxi regions is large, and the premiums of major products are obvious.
The company is a leading construction steel company in the two regions of Guangdong and Guangxi. The demand for steel in the region is strong, supply and demand continue to be tight, and product prices have been higher than the market average for a long time.
At present, the price of Nanning rebar (HRB400 20mm) is higher than that of Beijing and Shanghai, which are 260 yuan / ton and 210 yuan / ton, which guarantees the company’s profitability.
In 2019H1, the net profit per ton of steel was 324 yuan / ton, and the net profit per ton of steel in the second quarter was about 450 yuan / ton. The profit level of ton steel is at the forefront of the industry.
Cash flow from operating activities increased by nearly 18 times, and financial expenses dropped significantly.
Asset-liability ratio 58 at the end of each monthly reporting period.
36%, a decrease of 6 per year.
At 08 per share, the asset-liability ratio has returned to a reasonable level.
The financial expenses of companies in 2019H1 have decreased by 71 every year.
56%, and management costs fall by 16 each year.
The report totals the company’s total expenditure on research and development5.
64 ppm, up from 2 in the ten years of 2018.
The US $ 6.7 billion was more than doubled, and the company stated that some of the costs of accounting changes were included in research and development.
The company’s net cash flow from operating activities was 27.
340,000 yuan, an increase of 1771 in ten years.
64%, mainly because the company increased the proportion of bills payable for purchases, indicating that the company’s industrial chain level has increased. A large number of connected transactions with the holding parent company Liugang Group are seeking solutions.
The company has a total capacity of 1,200 millimeters of crude steel, and nearly 500 tons of crude steel billets are provided to the parent company for use, and there are a large number of related transactions.
The company is currently seeking a solution. The key issue is the compliance of some assets within the group.
Profit forecast and investment grade: We expect the company to achieve operating income of 467 in 2019-2021.
04 billion, 446.
49 ppm and 454.
4.5 billion; net profit attributable to mothers was 24.
01 billion, 23.
6.5 billion, 24.
51 ppm (earnings 34.
800 million, 34.
3 ppm and 33.
2 ppm, lowered mainly due to the increase in cost of iron ore prices; EPS are 0.
94 yuan, 0.
92 yuan and 0.
96 yuan, the corresponding PE is 5.
5x and 5.
3 times, maintaining “strongly recommended” level.
Risk reminders: 1. The environmental protection and production limitation is less than expected; 2. The change in fixed asset investment.