Fangda Special Steel (600507) 2019 Third Quarterly Report Review: Blast Furnace Accidents Impact Performance Automotive Leaf Springs Perform Poorly

Fangda Special Steel (600507) 2019 Third Quarterly Report Review: Blast Furnace Accidents Impact Performance Automotive Leaf Springs Perform Poorly

The company achieved net profit attributable to its mother in the first three quarters of 12.

77 trillion, a decrease of 44 a year.

82%; operating income 110.

9.4 billion, an annual decrease of 13.

21%; basic income is 0.

88 yuan, a decrease of 46 per year.


One quarter of the third quarter achieved net profit attributable to mothers2.

2.2 billion, 62% from the previous month.

  Comment: The blast furnace accident affected production and sales.

On May 29, an accident occurred at the company’s No. 2 blast furnace (capacity of 1,050 cubic meters, and the molten iron production capacity was about 125 tons / year). The average daily molten iron production was reduced by about 3500 tons. No announcement has been issued to resume production.

That is to say, during the third quarterly reporting period from July to September, the blast furnace was in a state of suspension. The quarterly output impact was about 35. Based on the net profit of 300 yuan per ton of steel, the impact on performance was about 100 million.

Thread profit in the third quarter was obvious, further affecting the company’s performance.

During the off-season of the summer, the heavy steel warehouse was decomposed, and the steel price declined collectively in the third quarter. The quarterly average price of the thread fell by 228 yuan month-on-month, the largest decline among all varieties.

The company’s main variety is rebar, so the single quarter in the third quarter was further extended.

Heavy truck sales data is poor, which is expected to affect leaf spring performance.

The production and sales of automobiles have been poor this year. The company’s spring leaf steel and automobile leaf springs are mainly heavy trucks downstream, so their performance during the year is also relatively poor.

The company’s subsidiary, Jiangxi Western Special Steel Automotive Suspension Group Co., Ltd., which mainly produces automotive leaf springs, has been closed for the first half of the year.

Equity incentive accrual enters the second stage, and the single quarter equity incentive fee is zero.

Around 8.5 billion, management costs have been significantly reduced.

The amortization of the company’s equity incentive expenses is divided into two cycles. The first cycle is from April 13, 2018 to April 13, 2019, and the monthly amortization is 0.

86 megabytes, the second cycle is from April 13, 2019 to April 13, 2020. Amortization is the accumulation of the first cycle, and the monthly amortization is 0.

About 28.5 billion yuan, that is, the third quarter of a single quarter equity incentive expenses.

85 million, significant pressure on management expenses.

Dividends are expected.

The company’s historical dividend rate is high, and the dividend payment ratio in 2017 and 2018 was 83.

5% and 84%. If the dividend payment rate of 84% is maintained this year, assuming that the blast furnace resumes production in the fourth quarter, and the net profit attributable to the mother in a single quarter is 400 million, it can be attributed to the mother’s net profit16.

7.7 billion, with a total 杭州桑拿论坛 dividend of 1.4 billion and a dividend yield of 11.

8%, dividends are expected to be high.

Investment suggestion: We expect the company to achieve revenue of 137/156/159 billion in 2019-2021 (originally forecasted 158/181/185 billion); net profit attributable to mothers will be 17/21/23 billion (originally predicted 25 /340,000 yuan), the corresponding PE is 7.

1X, 5.

7X, 5.

2 times, considering that the company’s performance this year was affected by accidental accidents and the increase in management costs caused by fair incentives, these factors will be eliminated next year. Excluding these effects, it is expected that the current performance will reach 2.5 billion, and 7 times will be given based on the 2.5 billion performanceIt is estimated that the target price is maintained at 12.

3 yuan, maintaining 杭州桑拿网 the “strong push” level.

Risk warning: steel demand declines, and the production limit in the heating season is less than expected.