New natural gas (603393): financial costs dragged down growth in the first quarter, optimistic about the continuous rise in volume and price of coalbed methane

New natural gas (603393): financial costs dragged down growth in the first quarter, optimistic about the continuous rise in volume and price of coalbed methane

Event: The company released the 2019 first quarter report.

The company achieved operating income in the first quarter6.

95 yuan, an annual increase of 111%, net profit attributable to the mother is 77.23 million yuan, an annual increase of 4.

8%, lower than Shenwan Hongyuan’s expectations.

Investment Highlights: Due to the merger of Asian American Energy, operating income has increased significantly.

Increased gas price costs and financial expenses have dragged down performance growth.

Due to the merger of Asian American Energy at the end of 2018, the company achieved operating income in the first quarter of this year6.

950,000 yuan, a sharp increase of 111%.

Due to the increase in natural gas procurement costs during the heating season, the company’s operating costs in the first quarter3.

92 yuan, an annual increase of 62.

59%.

And because gas purchase costs have not been eliminated to downstream gas users, it has dragged down the company’s profitability of gas distribution business in Xinjiang.

The company added 1.5 billion bank loans in April 2018 for the acquisition of Asian American Energy. In the first quarter of this period, new interest expenses were added compared with the previous year.

Gas price cost and financial expenses affect the company’s net profit return to mother’s growth rate is lower than the growth rate of operating income.

79%.

Asian American Energy continued to supplement and develop gradually, and the scale of development continued to grow.

In 2018, 63 holes were drilled in the Panzhuang blockchain, an increase of 8 from 2017.

For historical reasons, the 34 wells originally operated by China United Coalbed Methane were officially transferred to Asia-American since November 2018, adding 60,000 cubic meters per day to Panzhuang.

In the initial period, Asian American Energy continued to increase drilling, and the scale of gas production continued to increase.

In October last year, the Development and Reform Commission approved the coalbed methane development plan for the southern region of the Mabi blockchain.

The latest NDRC policy has changed the development plan of coalbed methane foreign cooperation projects from the approval system to the record system, which will help the company develop new blockchains and increase its growth space in the long run.

Rising international oil prices support coalbed methane gas prices, which is expected to enhance the profitability of Asian and American energy.

Since December 2018, the price of Brent crude oil has continued to rise to about $ 74 per barrel, an increase of more than 45%.

Domestic coalbed methane prices are 厦门夜网 determined by market supply and demand, and have a certain degree of linkage with international energy prices.

The continuous rise in international crude oil prices can support coalbed methane gas prices and promote the improvement of Asian and American energy profitability.

Earnings forecast and estimation: With reference to the first quarter report, we lower our forecast for the company’s 2019-2021 performance to 4.

54 and 5.

59 and 6.

6 billion (5 before adjustment).

33, 6.

29 and 7.

4.4 billion).

Corresponding to the current expected PE is 14, 11 and 10 times.

Natural gas consumption continues to grow at a high rate, and the new policy of coalbed methane development is conducive to the company’s long-term expansion.

The company’s assessment is lower than the industry average and maintains a “Buy” rating.