Sun Paper (002078)： Declining paper prices suppress growth Q1 earnings increase expectations
Sun Paper (002078): Declining paper prices suppress growth Q1 earnings increase expectations
A brief evaluation of performance in 2018, the company achieved revenue 217 net profit attributable to the mother.
68 ppm / 22.
3.8 billion, an increase of 15 each year.
21% / 10.
54%, achieving full diluted EPS0.
杭州夜网 84 yuan, lower than market expectations.
In 2018, the company plans to distribute 1 for every 10 shares to all shareholders.
00 yuan (including tax).
Business analysis 18Q4 paper prices plunged, single-quarter profit pressure weighed on performance.
In the first half of last year, due to the impact of the high prices of cultural paper and wood pulp, the company’s performance in Q1 and Q2 achieved a growth of more than 40%.
However, after entering the second half of the year, the price of cultural paper declined, especially in the Q4 paper price adjustment breakthrough, of which double offset paper fell by 16 in Q4.
35%, coated paper prices fell 17.
The decline in core paper prices has also expanded the impact of the depreciation of the RMB in the second half of last year, resulting in the company’s Q4 gross profit margins falling by 11.
In the end, the formation of performance growth in 18 years formed a penetrating suppression.
New projects have been completed and put into operation, and the new capacity has become the main driving force for the company’s revenue growth.
In 2018, the company’s top 20 high-end special paper project, Laos top 30 chemical pulp project, and Zoucheng top 80 high-end board paper reconstruction and supporting engineering projects were successfully completed and put into production.
At the same time, the company is progressing smoothly in new fiber raw materials. The 10-inch wood chip pulp production line and the 40-inch semi-chemical pulp production line have been completed and put into production in April and August 2018, respectively, which will effectively guarantee the company’s 160 raw material supply for packaging paper.
In 2018, the company’s new production capacity contributed more than 30% to the revenue, while the price of cultural paper fell by nearly 20% during the same period.
Therefore, we believe that new capacity is the core driver of the company’s revenue growth last year.
Q1 Paper and pulp prices rebounded slightly, and long-term growth was still driven by new capacity.
In the first quarter of this year, the prices of cultural paper and wood pulp rebounded slightly. Among them, the double adhesive paper rose by about 3%.
We expect the company’s gross profit margin to increase in the first quarter.
At the same time, this year, the company will accelerate the promotion of the 120mm papermaking project in Laos. With the continuous optimization and adjustment of new capacity in 2018, and continued cost reduction and efficiency, the company’s cost-side advantages will be further consolidated.
At the same time, the gradual release of new production capacity this year will continue to drive the company’s revenue to achieve steady growth.
Profit forecast and investment advice The company has outstanding comprehensive advantages and scale growth this 南京夜网论坛year. However, due to the trend of market paper price decline, we lowered the company’s EPS forecast to 0 in 2019/2020 after full dilution.
10 yuan (was 1).
45 yuan, down by 22.
2% / 24.
0%), predicting that the company’s EPS in 2021 will be 1.
28 yuan, CAGR of 14% in three years, corresponding PE is 8/7/6 times, maintaining the company’s “Buy” rating.
Risk factors Industrial policy risk; raw material price fluctuation risk; exchange rate risk; macroeconomic fluctuation risk.