Sangang Minguang (002110) semi-annual report comment: Costs are gradually reduced, profit space, asset integration continues to advance steadily

Sangang Minguang (002110) semi-annual report comment: Costs are gradually reduced, profit space, asset integration continues to advance steadily

Matters: The company announced its semi-annual report for 2019 and realized operating income of 189 in 1H19.

20,000 yuan, an annual increase of 7.

5%; net profit attributable to shareholders of listed companies21.

700 million, down 32 each year.

8%; net profit after deduction is 21.

200 million, a decrease of 11 per year.

84%, the budget income of the reporting period is 0.

89 yuan.

By quarter, 19Q2 achieved net profit attributable to mothers12.

1.1 billion, an increase of 25.

88%, a decrease of 32 per year.


Ping An’s point of view: The cost of raw materials has risen significantly, and the company’s revenue has not increased: in the first half of 2019, the company’s iron, steel and volume were 432.

68, 511.

26, 508.

35 each year, increasing by 1 each year.

7%, 3.

6%, 3.


The consolidated semi-annual report data converted the company’s ton steel amount to 3587 yuan, the ton steel cost was 2,883 yuan, and the gross profit per ton of steel was 703 yuan. Each time it increased by 104 yuan, 333 yuan, and decreased by 229 yuan.The trend is basically the same.

In the first half of the year, the cost of raw materials, especially the price of iron ore, increased significantly, which greatly reduced the profitability of the company’s products and shifted its net profit.

However, from the perspective of the company’s profitability per ton of steel, it still ranks among the advanced in the industry.

The location advantage is obvious, and the product attributes have a high premium: the growth rate of Fujian’s fixed asset investment has been higher than the national level for a long time, and steel consumption is relatively strong.

As a local leading company, the company’s main products have a certain price right to speak in the regional market, and the product price has a premium.

In the first half of the year, the average price of the “Minguang” brand building materials in the general board market was higher than the average prices of “four surrounding places” (Shanghai, Hangzhou, Nanchang, Guangzhou) at 81 yuan / ton and 128 yuan / ton.Guangzhou average market prices were 37 yuan / ton higher and 52 yuan / ton higher.

Rebar and sheet gross margins were 22 respectively.

5% and 20.

2%, which is at the forefront of the industry.

Asset integration continued to advance steadily: After the company completed the integration of Quanzhou Minguang in the first half of 2018, the current crude steel production capacity reached nearly 95 billion U.S. dollars, and the revenue scale and profit level increased significantly, further enhancing market competitiveness.

On January 15, 2019, the company issued an announcement that it intends to use cash to acquire 100% equity of Luoyuan Minguang from shareholders Sangang Group, and in the first half of the year, the company has successfully let Shangang Group Laiwu Steel Xinjiang Co., Ltd.The company’s steel capacity index, which may be used for the Luoyuan Minguang project.

If the Luoyuan Minguang acquisition project is successfully completed, the company will realize the overall listing of the group’s main steel industry, with a total crude steel production capacity of more than 1,100 tons. By then, the market share in Fujian will reach more than 70%, the scale advantage will be further enhanced, and the coastal strategic layout will be further improved.
Profit forecast and investment advice: As a leading steel company in Fujian Province, the company has a premium space for product copyrights. Given the overall profitability of the industry, it is expected that the company’s net profit attributable to its mother will be 45 in 2019-2021.

1.2 billion, 49.

5.6 billion, 51.

10,000 yuan (originally expected to be 75 for 2019-2020 respectively.

4.9 billion, 78.

05 billion).

However, the company’s dividends are stable, and asset integration is advancing steadily. It is estimated that there is room for repair and maintain the “recommended” level. Risk reminders: 1. Macroeconomics significantly reduces risks.

If the sharp decline in the macro economy will lead 成都桑拿网 to continued pressure on the demand of leading industries, leading to further deterioration of the industry’s supply and demand scale, and the company’s performance will also be affected, the performance growth rate may not meet expectations; 2. Risks of excessive increases in raw material prices.

If the prices of raw materials such as iron ore and coking coal increase too quickly, the company’s production costs will rise, the company’s profits will be eroded, and the company’s operations and healthy development will be affected; 3. Environmental protection and safety accident risks.

With the country ‘s stricter requirements for environmental protection and energy conservation and emission reduction, the company ‘s environmental governance costs and operating costs have continued to increase, which has a certain impact on business performance. At the same time, due to the 南京桑拿网 long chain of steel production, safety accidents are prone to occur.Safety accidents may cause the company to carry out safety production rectification and governance, affecting the company’s normal production and operation boots and affecting performance.