COSCO Hite (600428) Interim Report Comments: Performance Meets Expectations Semi-Submersible Ships Have Large Growth Space

COSCO Hite (600428) Interim Report Comments: Performance Meets Expectations Semi-Submersible Ships Have Large Growth Space

The performance was in line with expectations, and the rebound in freight rates drove profit growth in the first half of the year. COSCO Hai Te released its 2019 interim results.

In the first half of 2019, the company achieved operating income of 39.

10%, an increase of 17.

2%; net profit attributable to mothers is RMB 94.43 million, a substantial increase of 67 per year.

6%.

Profit growth growth was mainly driven by rising freight rates.

In the first half of 2019, the company’s long-term business average time charter freight rate increased by 15%.

9%.

Looking forward to the second half of the year, with the growth of macroeconomic 合肥夜网 growth and increasing trade uncertainty, we expect the company’s earnings growth to improve and the constant sector changes will be under pressure.

We have lowered our 2019/2020/2021 earnings forecasts14.

6% / 0.

4% / 2.

6% to 2.

5/3.

5/3.

600 million.

Based on 0.

90x-0.

95x 2019E PB estimated multiple (2019E BVPS 4.

58 yuan), given a target price range of 4.

1-4.

4 yuan to maintain the “overweight” level.

The semi-submersible ship business contributed a significant profit, and the growth potential in the first half of 2019, the company’s semi-submersible ship business gross profit recorded a 1.

90,000 yuan, an increase of 18 in ten years.

8%, profit growth was mainly driven by rising freight rates.

From January to June, the company’s semi-submersible time charter level was US $ 33,180 / day, an increase of 36.

7%; completed semi-submersible freight.

1 Initially, it is reduced by 13 per year.

9%.

In June this year, the company announced that it plans to build one five semi-submersible vessels for the newly awarded North American natural gas transportation project this year.

At the same time, the company’s semi-submersible ship business relocation of offshore engineering platform transportation installation business extended to the old platform disassembly business, etc., is expected to further open up the company’s semi-submersible ship business growth space.

The volume and price of the main business vessels varied, and the overall profit grew slowly in the first half of each year. The company’s multi-purpose vessels and heavy-lift vessels contributed gross profits respectively.

40,000 yuan (10 years growth of 27.

3%) and 1.

0 million yuan (reduction of 11 per year).

1%), with gross margins of 9, respectively.

7% and 14.

6%. Among them, the multi-purpose time charter level is USD 10,203 per day (over 7 per second.

9%), and completed 370 shipments.

April (one year down 28.

3%); time charter for heavy-lift vessels is $ 11,414 per day (down 1 in ten years.

0%), the volume is 120.

9 highest (18 months).

2%).

Due to the decrease in China’s export of foreign machinery and the decrease in overseas contracted projects, the company’s main market demand for supplies was sluggish.

Prior to this, it is expected that the overall market recovery is expected to continue to drive the company’s freight rates higher and hedge against the decline in demand.

Overall, we believe that the company’s main ship-type businesses will still achieve steady growth in profits.

The “Belt and Road” national strategy opens up long-term growth space and maintains the “Overweight” rating company as the leader in domestic special shipping. As of 2018, the volume of goods along the “Belt and Road” line accounted for 43% of the company ‘s total cargo volume, and the company is expected to benefit in the long termThe “Belt and Road” strategy has been advanced.

However, under the influence of macroeconomic and trade uncertainties in the short term, the company’s earnings growth rate may move.

We have lowered our 2019/2020/2021 profit forecast to 2 respectively.

5/3.

5/3.

600 million.

Based on 0.

90x-0.

95x2019E PB (three-year average of company history 1.

13x is initially 0.

5 standard deviations, the previous value is 0.

94x-1.

00x 2019E PB), corresponding to the target price range 4.

1-4.

4 yuan to maintain the “overweight” level.

Risk reminders: 1) The freight rate rises less than expected; 2) Geopolitical risks; 3) Oil price rises; 4) Natural factors; 5) The “Belt and Road” policy is gradually pushed ahead of expectations.