Jiangxi Copper (600362) 2018 Annual Report Comments: Steady Main Business Operations Wait for Acquisition
Event: In 2018, the company achieved revenue of 2152.
900 million, previously increased by 4.
9%, net profit attributable to mother 24.
500 million, an annual increase of 52.
4%, net profit after deducting non-return to mother 13.
600 million, 42 above average.
In the fourth quarter alone, the company achieved revenue of 526.
US $ 900 million, up 6% before and net profit attributable to mothers4.
0 million yuan, an increase of 1511 every year.
9%, net profit after deducting non-return to mother can reach 1.
29 ppm, compared to 4 in the same period last year.
无锡夜网 Opinion: In 2018, the company’s halogen copper segment business was relatively stable, and the segment realized revenue of US $ 122.7 billion, an increase of more than 1%.
05%, gross margin is 4.
7%, 0 compared with the same period last year.
2 units, copper halide production is 146.
4 Initially, an increase of 6 over the same period last year.
The average copper price in the last issue was 50,683 yuan / ton in 2018, an increase of 2 from 2017.
In 2018, the company’s non-net profit was gradually replaced by a substantial shift in the net profit of the precious metal sector.
The gross profit of the precious metal segment in 2018 was 2.
1 ‰, exceeding the average of 77.
Finance costs 8.
100 million, an increase of 76% in ten years.
The first significant increase in the company’s net profit in 2018 is the company’s net investment income5.
90,000 yuan and net income from changes in fair value 6.
Acquisition of Hengbang shares 29.
99% equity, perfecting the industrial layout On March 4, the company announced that Jiangxi Copper intends to acquire Yantai Hengbang shares 2 through agreement transfer.
7.3 billion shares, accounting for 29 of the total shares of the target company.
99%; the transfer price of the underlying shares is RMB 29.
7.6 billion, the unit price is 10.
9 yuan / share.
After the completion of the transaction, Jiangxi Copper will become the controlling shareholder of Hengbang and become the scope of the consolidated financial statements of Hengbang.
The transaction will help to enhance Jiangxi Copper’s business expansion capabilities and capital strength.At the same time, this transaction is an important change in Jiangxi Copper’s perfect industrial layout.
After Jiangxi Copper obtained control of Hengbang shares, it will use Hengbang shares as the group’s future gold plate development platform, and inject Jiangxi Copper and its controlling shareholders’ high-quality gold plate assets into Hengbang shares.
Earnings forecast is based on the trend of copper price is lower than our previous forecast, we lower the company’s profit forecast, 2019?
In 2020, the EPS will be 0.
82 yuan, 0.
98 yuan, another EPS forecast for 2021.
We selected H-shares non-ferrous resources company Zijin Mining, Minmetals Resources, Zhaojin Mining, and Luoyang Molybdenum as comparable companies of Jiangxi Copper Co., Ltd. (H). The company’s PE valuation in 2019 is 17 times.
We give Jiangxi Copper (H) a 17x PE estimate for 2019 with a target price of 16.
We have selected a non-ferrous resource-based company as a comparable company of Jiangxi Copper (A). The PE company’s PE valuation in 2019 is 24 times.
We give Jiangxi Copper (A) a 24x PE estimate for 2019 with a target price of 19.
With the increase in the growth rate of global copper concentrate supply, the progress of the supply and demand scale continues to be optimized, and we are still optimistic about the future rise in copper prices and the company’s subsequent development (acquisition of 30% equity of Hengbang shares, etc.), which will cover Jiangxi Copper for the first time (H)”Buy” rating with a target price of 16.
15 construction; maintain 北京夜网 Jiangxi Copper (A) “Buy” rating, target price of 19.
Risk Warning: Copper price fluctuation risks, the progress of the acquisition exceeds expectations.