Baichuan Energy (600681): 18 years of rapid growth in performance Suizhong LNG terminal project

Baichuan Energy (600681): 18 years of rapid growth in performance Suizhong LNG terminal project
Event: The company released its 2018 annual report.The company achieved operating income of 47 in 2018.53 ppm, an increase of 59 in ten years.90%, realizing net profit attributable to mother 10.0.6 million yuan, an increase of 17 in ten years.29%, slightly lower than Shen Wanhongyuan’s expected 10.7.3 billion. Investment highlights: 18-year performance growth has increased, and high gas prices at the beginning of the year have dragged on cumulative gross profit margins.Benefiting from the Beijing-Tianjin-Hebei region’s “coal-to-gas” reform since the second half of 2017, and Jingzhou Gas and Fuyang Guoyang Gas were consolidated at the end of 17 and August 18, respectively, gas sales in 2018 were completed9.700 million cubic meters, the gas sales business achieved revenue of 24.40,000 yuan, an increase of 120 in ten years.87%; completed 330,000 households with gas connection and realized connection income7.63 ppm, an increase of 26 in ten years.82%; realized sales income of gas appliances7.63 ppm, an increase of 14 in ten years.05%.Affected by the high base effect in the second half of 2017, the results of the third and fourth quarters of 2018 were reversed.Due to the increase in the proportion of low-margin gas sales and the high cost of gas sources during the heating period in early 2018, the company’s comprehensive gross profit margin for 2018 was 31.55%, 42 before 2017.15% significantly curled.However, in terms of quarters, the combined gross profit margins of Q3 and Q4 in 2018 were 39.73% and 34.65%, a significant improvement from the beginning of the year. The acquisition of 100% equity interest in Fuyang Guoyan Gas has been completed, and the outbound M & A strategy is expected to further develop.Following the acquisition of 100% equity of Jingzhou Gas in November 2017, the company completed the acquisition of 100% equity of Fuyang Guoyan Gas in August 2018. Fuyang Gas became a wholly-owned subsidiary of the company, and the country’s layout is next.Fuyang City has a resident population of nearly 10 million, a gasification rate of only about 10%, and a market space for penetration.In the context of clean energy, the demand for upstream natural gas has grown rapidly. Guoyan Gas, the largest natural gas supplier in Fuyang, Anhui, will directly benefit from the increase in the local gasification rate.As of the end of 2018, the company’s asset and debt restructuring48.25%, coupled with the expansion of cash flow recovery capacity of the main gas business, strongly supports the company to maintain an efficient pace of mergers and acquisitions expansion. At the same time, the current constant gas supply and the situation of a large number of local gas companies have provided favorable objective conditions for outsourcing mergers and acquisitions of the company. The company 北京桑拿洗浴保健 is expected to increase the scale of revenue and regional layout through acquisitions. The LNG receiving station project in NG is advancing rapidly, which is of strategic significance in the context of tight gas sources.At present, the demand for natural gas continues to grow rapidly, and the lack of domestic production has led to a continued increase in the dependence of gas sources on external sources. LNG has become the main source of supply.The company plans to invest US $ 3.5 billion to construct a 2.6 million-ton medium-LNG receiving station project with an annual turnover of 2.6 million tons to protect gas demand in the company’s operating area. At present, the project has been included in the “Special Plan for Natural Gas Storage and Construction Facilities in Liaoning Province” (2018-2022), and reported to the National Development and Reform Commission for review. The company actively promotes project approval and preparation for construction within the year. Earnings forecast and grade: With reference to the 2018 results, we lowered our net profit forecast for mothers for 19-20 years to 12.96, 14.1.3 billion (13 before adjustment).53 and 14.4.3 billion), adding 2021 profit forecast15.37 trillion, corresponding EPS is 1.26, 1.37, 1.49 yuan / share, the current sustainable corresponding PE is 11, 10 and 9 times.As the Beijing-Tianjin-Hebei gas leader, the company has benefited from the continuous advancement of the “coal-to-gas” plan. The existing gas supply volume in the supply area is expected to maintain rapid growth. The outbound M & A strategy continues to develop the company’s development space and maintains a “buy” rating.

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