China Power Construction (601669) Interim Review: Bright environmental business performance dragged down by minority shareholders’ profit and loss

China Power Construction (601669) Interim Review: Bright environmental business performance dragged down by minority shareholders’ profit and loss

The total profit grew steadily, and the profit and loss of minority shareholders dragged down the parent and parent company in 1H19 to achieve operating income of 147.3 billion, a year-on-year increase of 16.

3%; realized profits totaled 6.8 billion yuan, a year-on-year increase of +8.

2%, rapid growth in total revenue and profits; net profit attributable to mothers reached 4 billion yuan, YoY-2.

4%, slightly lower than expected, due to the significant increase in the profit and loss of minority shareholders.

Net cash from operating activities increased by 107 trillion, a decrease of more than 27 trillion from the same period last year.

As of the end of June 2019, we estimate that the company has about 1 order in hand.

1 trillion is the company’s revenue last year.

7 times.

Considering the short-term or high proportion of the company’s minority shareholders’ profit and loss, the company’s EPS for 19-21 was slightly reduced to 0.

54/0.

59/0.

63 yuan (0 before adjustment).

56/0.

63/0.

69 yuan), maintaining the “overweight” level.

The gross profit margin of the main business of the project rose slightly, and the orders for the water environment business nearly doubled. The company’s engineering contracting, survey and design revenue reached 116.9 billion in 1H19, + 13% year-on-year, accounting for 80% of the company’s main business revenue.Revenue from non-engineering businesses such as power operations increased rapidly; gross margin increased slightly by zero.

2pct to 11.

4%, to promote the company’s comprehensive gross profit margin to extend to 0.

2 points to 14.

7%.

The company’s newly signed contracts in 1H19 were 302.7 billion yuan, a year-on-year increase of 16%, of which the newly signed infrastructure business contracts were 121.1 billion yuan, accounting for 40%.

The company’s competitiveness in water environment treatment business has been continuously improved. In the first half of the year, the relevant orders were 549 trillion, a year-on-year increase of 97%. China Power Construction Ecological Environment Co., Ltd. achieved net profit1.

3 trillion, 10 times the same period last year.

The gross profit margin 杭州桑拿 of the power operation and real estate business decreased, and the expense ratio increased slightly during the second half of the year. The impact of the operation and operation of overseas thermal power projects in the second half of the year.Down 2.

6pct, we expect the future trend to slow down in the second half of the year.

In the first half of the year, the company added 410,000 kilowatts of newly installed turbine capacity, reaching 14.89 million kilowatts at the end of the period.

In 1H19, the company’s land was expedited to destock and realized revenue of 10.7 billion yuan, a year-on-year increase of 35%; gross profit margin of 25%, a year-on-year decrease of 2.

2pct.

The company’s expense ratio during the first half of the year was 8.

8%, 0 per year.

2pct, mainly the growth of interest-bearing debt and 北京夜网 exchange losses of 0.

70,000 yuan (2 foreign exchange gains in the same period last year.

600 million) led to increased financial expense ratio.

The scale of the interest-bearing coefficient has grown rapidly. It still takes time to reduce the negative interest rate. At the end of June this year, the company ‘s interest-bearing resistance budget was 354.5 billion US dollars, an increase of 53.4 billion (+ 18%) from the beginning of the year.Increment.

With the growth of the company’s traditional engineering construction scale and the completion of investment and financing projects such as BT / PPP, the company’s receivables and long-term receivables increased by 25% and 9% respectively compared with the beginning of the year, and the asset impairment provision exceeded the growth of 132%.
At the end of June this year, the company’s asset-liability ratio was 80.

5%, an increase of 0 from the beginning of the year.

6 points. PB remained below 1 in 19, maintaining “overweight” rating company. After the second half of 18 years, some secondary subsidiaries implemented debt-to-equity swaps, the proportion of minority shareholders’ profit and loss increased to 17%, and 1H19 was 21%.

We raised this ratio to 20% in 19-21, corresponding to the company’s net profit attributable to the parent is 8.349 billion yuan (9.7 billion yuan before adjustment)

We use the relative PB method to estimate that the company’s 19-year BVPS after replacing other equity instruments is 5.

69 yuan, considering that the company has long-term operating assets such as generators and highways, we maintain the company for 19 years.

0-1.

1 xPB, reasonable target price 5.

69-6.

25 yuan to maintain the “overweight” level.

Risk reminder: PPP orders lag behind, the overseas order landing cycle lengthens, and infrastructure competition intensifies.