Ordos (600295) first quarterly report in 2019: cashmere clothing and investment income drive the company’s performance to grow slightly Complete the acquisition of minority shareholders’ equity and raise profit forecast

Ordos (600295) first quarterly report in 2019: cashmere clothing and investment income drive the company’s performance to grow slightly Complete the acquisition of minority shareholders’ equity and raise profit forecast
Investment Highlights: The company achieved operating income of 52 in the first quarter of 2019.68 ppm, an increase of 11 in ten years.37%, down 9 from the previous month.44%; net profit attributable to mothers2.12 ppm, a 10-year increase2.06%, down 50% from the previous month.07%, in line with our expectations, about the basic EPS 0.21 yuan. Ferrosilicon: In Q1 2019, the average price of ferrosilicon in Inner Mongolia dropped 28.17%, down 12 from the previous month.57%.In the first quarter, the national ferrosilicon output decreased by 1 every year.42%, a decrease of 10 from the previous month.66%.The decrease in national output was mainly due to the increase in prices that continued to reduce production costs, and the industry’s profits continued to shrink, resulting in a large number of active sheltered production.Silicomanganese: In the first quarter of 2019, the average price of silicomanganese in Inner Mongolia dropped 8.26%, down 11 from the previous month.25%.The national silicon and manganese production in the first quarter increased further.84%, a decrease of 6 from the previous month.63%.Although the output has increased, it is also obvious that the output has decreased from the fourth quarter of 2018 due to the increase in profits.1) The company’s gross profit declines with the industry.The company achieved a gross profit of 14 in the first quarter.00 billion, a previous decrease of 13.97%; overall gross profit margin 26.57%, ten-year average.83 units.Overall profitability is broken down by industry. 2) The four expense ratios decreased slightly, investment income increased, and cashmere clothing led to an increase in net profit.Except for the four R & D expense ratios of the company, which were increased due to the R & D expansion of the subsidiary Power Metallurgy 佛山桑拿网 Company, the rest were reduced to varying degrees.15%, down 2 from the same period last year.63 units.In the first quarter, the company’s investment income increased by 53.72 million (+ 102%) annually.In addition, the profit and loss of minority shareholders of the company decreased by 95.15 million (-52%). We judge that the decrease in profit and loss of minority shareholders was due to the growth of business of its subsidiaries. In the second quarter, the price of ferroalloys is difficult to rise. The cashmere clothing business is traditionally in the off-season. The company’s performance is difficult to significantly improve, and the chain is replaced.Although the output of ferroalloys in the first quarter decreased due to a portion of the profit, it was still at a historical high. The current production activities of 都市夜网 downstream steel mills mean that demand is acceptable, and overall supply and demand are booming.However, due to the tight social inventory of alloys, it still takes time to digest, and the price is difficult to have an upward trend.As of the end of April, the average price of ferrosilicon and silicon-manganese in Inner Mongolia decreased by 5 from the average price of the second quarter of 2018.97% and 2.99%, an increase of 2 from the average price in the first quarter of 2019.52% and down 2.37%.The second quarter is the off-season of the company’s cashmere clothing business, which has limited contribution to performance.It is expected that the company’s performance in the second quarter will not be significantly improved, and the chain will be extended again. The acquisition of shares in the Power Metallurgy Company further strengthened the “coal-electricity-ferrosilicon alloy” industry chain.The company’s complete “coal-electricity-silicon ferroalloy” industrial chain, owns coal mines and pithead self-contained power plants, produces almost 100% self-sufficient power, and the cost of electricity accounts for about 70%, 20%, 50% of the production cost of ferrosilicon, silicon-manganese, and PVC%, So the price of the alloy will increase the company’s performance flexibility.On April 1, the company completed the acquisition of the power metallurgy held by the company’s controlling shareholder Inner Mongolia Ordos Cashmere Group Co., Ltd.06% equity, thereby further strengthening its metallurgical integrated industrial chain. Upgrade earnings forecast and maintain “overweight” rating.The company’s “circular economy” model has strong advantages in terms of raw material reserves and power costs.Since the company completed power metallurgy 14.06% equity acquisition, we raised our profit forecast.It is expected that the net profit attributable to mothers for 2019-2021 will be 9.26/8.60/8.3.9 billion (was 7).83/7.23/7.500,000 yuan), corresponding to EPS0.68/0.63/0.62 yuan, currently in line with the corresponding PE 13/14/14 times.Maintain the “overweight” level!

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