COSCO OCEAN ENERGY (600026): Improving after the trough

COSCO OCEAN ENERGY (600026): Improving after the trough

Key points of the report describe the first half of 2019, COSCO Hainan can achieve operating income71.

4 ‰, an increase of 39 per year.

2%, gross profit margin increased by 10 in ten years.

6 up to 20.

1%, net profit attributable to parent company increased by 6.

9 ppm to 4.

700 million, successfully turned losses into profits.

Event comment The freight rate improved significantly in the short term, and the profit was successfully turned into profit.

In 2019H, the company’s operating income increased by 39 in 杭州桑拿网 ten years.

2%, mainly due to: the annual revenue of foreign trade oil transportation business increased by 52.

4%, the average value of the industry VLCC-TCE in the first half of the year was $ 18,595 / day, an increase of 209 over the same period last year ($ 6001 / day).

9%.

On the cost side, the Group’s capacity increased by 11% per year in the first half of the year, and the increase in the speed of ships brought an increase in the fuel consumption of the fleet by 8%.

7%, resulting in a significant increase in fuel costs and depreciation (the average 380CST of marine fuel oil in the first half of the year can only increase by 2).

1%), operating costs increased by 23.
.

0%.

In the end, the company achieved a gross profit margin of 20.

1%, an increase of 10 per year.

6 units; attributable net profit is 4.

The profit improvement of 700 million yuan was mainly achieved by the gross profit of the foreign trade oil transportation business.

The gross profit of foreign trade oil transportation increased significantly in the short term, and domestic trade oil transportation and LNG business grew steadily.

In the first half of the year, foreign trade oil revenue increased by 52.

4%, gross profit margin increased by 27 in ten years.

5 up to 11.

1%, transportation gross profit increased by 203.

1% to 4.

400 million, which is the advantage of the company’s profit improvement in the first half of the year.

In terms of domestic trade oil transportation, operating income has increased by 29 per year.

2%, gross profit rate reduced by 7.

0 averages, gross body mass (5.

600 million) is roughly the same as last year.

In terms of LNG business, the first half of the LNG sector contributed profit before tax2.

90,000 yuan, an increase of 38 in ten years.

6%.

The profit improvement in the second quarter was less than the improvement in the first quarter.

In the second quarter alone, the company achieved zero attributable net profit.

4 ‰, increasing by 1 every year.
70,000 yuan, 4 for 2019Q1.
3 ‰, an increase of 5 per year.

100 million US dollars, profit has improved, the magnitude or decline is: in the second quarter, OPEC production cuts intensified, and the United States imposed sanctions on Iran, resulting in worsening oil tanker demand, VLCC-TCE second quarter average ($ 11565 / day) was earlierQ1 (25625) USD / day) significantly involved.

Maintain “Buy” rating.

We continue to be optimistic about the long-term improvement of supply and demand in the oil operation industry, and mentioned in the in-depth report “Oil Transport” potential energy theory “(4): New pattern, new journey”: the replacement of the US Gulf crude oil pipeline in the third quarter of 2019The demand for oil tankers has ushered in an inflection point in the medium and long term, and through the replacement of the 2020 sulfur limit order, the industry supply growth rate will accelerate downward.

The short-term freight rate in the short quarter of the third quarter is not short, and the peak season of the fourth quarter gradually comes. August to September is a better time for configuration.

The company’s EPS for 2019-2021 is expected to be 0.

33 yuan, 0.

44 yuan and 0.

58 yuan.

Risk Warning: 1.

The implementation of the 2020 sulfur limit order was less than expected; 2.

US crude oil pipeline breakthrough progress is lower than expected.