Huaibei Mining (600985): Steady profit growth and continuous improvement in financial quality

Huaibei Mining (600985): Steady profit growth and continuous improvement in financial quality

This report reads: As a regional leader, it continues to enjoy supply-side reform dividends, maintain high-quality cash flows, keep the debt rate at the lowest level, and increase coke prices better than the industry average. It will continue to benefit from market consolidation in the future.

Investment points: Maintain profit forecast and maintain “overweight” rating.

The company released the third quarter report for 2019, and the first three quarters achieved revenue of 462.

52 ppm, a decrease of 4 per year.

90%; net profit attributable to mother 28.

33 ppm, an increase of 14 佛山桑拿网 years.

51%, earnings are in line with expectations.

Maintain prediction 2019?
EPS1 in 2021.

71, 1.

80, 1.

88 yuan, maintaining 12.

63 yuan target price, maintain “overweight” rating.

The price and volume fell slightly in the third quarter.

The growth rate of the company’s first three quarters was slower than that of the mid-term report of 16.

98% decreased slightly, and the profit in the third quarter decreased by 1 compared with the second quarter.

100 million US dollars, mainly due to a slight increase in coal production and sales, and coking coal prices have improved.

The company’s single quarter coal production and sales volume were 509 in the third quarter.

6,415.

2 samples, a decrease of 26 compared with the second quarter.

2, 21.

6 Initially, it was mainly due to the nuclear reduction of 140 at 都市夜网 the end of July to supplement the capacity replacement of the Tahutu mine after the capacity reduction; the average sales price in the third quarter was estimated to be 722 tons of coal gross profit.

7,279.

4 yuan / ton, down -33 compared with the second quarter of a single quarter.

8, -27.

8 yuan / ton.

Cash flow remained optimistic, leading to improved earnings.

Net cash flow from operating activities in the first half of the year 64.

0 ppm, an increase of 22 in ten years.

9%, maintaining continuous cash inflows; asset-liability ratio of 63.

91%, the lowest level since restructuring.

Company 27.

The 600 million convertible bonds have been reviewed and approved by the CSRC on August 30. After the completion of the issuance, US $ 700 million will be used to repay the company’s debt, further reducing financial costs.

The coke business has benefited from market consolidation.

The company’s average coke sales price in the first three quarters was 1884.

91 yuan / ton, an increase of 0 in ten years.

42%, while the average price of first-class metallurgical coke at mainstream ports in the country dropped by 4 over the same period.

3%, stronger than the market as a regional leader.
Under the background of progressive environmental protection, the coking industry will continue to integrate. In the future, eastern provinces such as Hebei, Shandong, Anhui, and Jiangsu will still have capacity to withdraw, further enhancing the company’s coke business leader and bargaining power.
Risk warning: Real estate starts to fall more than expected; coal mine construction progress is less than expected.