Sun Paper (002078): Q2 net profit exceeds expected cultural paper leading value bottom

Event On August 28, 2019, Sun Paper published its 2019 Interim Report, and the company achieved total operating income of 107 in 19H1.

76 ppm, a ten-year increase2.

9%; net profit attributable to mother 8.

8.7 billion yuan, -27 per year.

8%; net profit after deducting non-return to mother 8.

64 ppm, -28 per year.


The decrease in profit was mainly due to the decline in the prices of major products and the rise in the cost of purchasing raw materials.

By quarter, the company’s 19Q1 / Q2 single-quarter revenue was 54.

51, 53.

2.5 billion, change by +8 each year.

1%, -2.

0%; net profit attributable to mothers is 3.

80, 5.

0.6 billion, changing -38 each year.

3%, -17.

2%, the decline in net profit attributable to mothers in 19Q2 narrowed significantly, exceeding market expectations.

Our analysis and judgment of the revenue-end pulp and paper products business has grown rapidly.

In terms of products, the income of the pulp and paper products business of the company in 19H1 increased steadily, every +2.

93%, the revenue of electricity and steam business fell steadily and slightly, -2 per year.

19% to 3.

7.5 billion.

Of which: non-replacement cultural paper income is -4 per year.

6% to 36.

12 ppm; dissolving pulp has grown rapidly in ten years26.

4% to 18.

2.6 billion.

By region: Mainland China sales revenue increased by +2.

4% to 105.

8.9 billion yuan, accounting for 98% of total operating income.

3%; overseas sales income +41 for ten years.

7% to 1.

8.7 billion, accounting for total revenue1.


The margin has increased, but earnings are expected to gradually pick up.

19H1 company’s gross profit margin decreased by 7.

21 points to 19.

71%.Among them, the gross profit margin of pulp and paper products business is ten years -7.

43 points to 19.

62%; gross profit margin of electricity and steam business decreased by -4.

02pct to 21.

44%; gross profit margin of other businesses +9 for ten years.

35pct to 24.


The decrease in gross profit margin was mainly due to the decline in the prices of major products and the rise in the cost of purchasing raw materials.

Since 2019, the price of wood pulp has continued to decline from about 5,500 yuan23.

6% to about 4,200 yuan; the price of double-adhesive paper fell steadily and decreased by 3383 from 6383.

3% to 6175 yuan; the price of double copper paper fell from 6033.

3% to 5833 yuan.

In the short term, the off-season of the paper industry has passed, accompanied by the demand for a large number of cultural papers from the preparation of spring textbooks for students in September-December and the promotion and promotion of the year before, and the demand for packaging paper that was promoted at the end of the double eleven and double twelve.It is expected that the price of pulp and paper products will rise, thereby increasing the level of profitability.

In the long run, the company’s capacity release guarantees an increase in revenue: (1) The company’s 10 input to the wood chip pulp production line and the 40-ton semi-chemical pulp production line will enter a stable production period in 2019. The 20-year investment in natural high-yield biomass fiber projects is expected toPut into operation in the fourth quarter of 2019; (2) The Laos 120 papermaking and papermaking project is advancing steadily as planned. The 40 to recycled fiber pulp board production line in the project has been trial-produced in June 2019, and two of the subsequent projects have an annual output of top 40The high-end packaging paper production line is expected to gradually enter the trial production stage every half a year in the first half of 2021; (3) The company plans to implement an annual output of 45 characteristic cultural paper projects with a total investment of RMB 20.

USD 1.6 billion to increase the company’s high-end cultural paper production capacity.

The expense ratio increased slightly during the period, and net operating cash flow rose steadily.

The sales expense ratio, management expense ratio, R & D expense ratio and financial expense ratio are +0 respectively.

77pct / + 0.

45pct / + 0.

31pct / -0.

24pct to 20.

56%, 7.

44%, 4.

74%, -0.


Net interest rate fell by 4.

55pct to 8.


19H1 The company achieved net operating cash flow22.

16 trillion, compared with 20 in the same period last year.

8 billion yuan, an increase of 6 over 杭州夜网论坛 the same period last year.


Investment suggestion: We expect the company’s operating income from 2019 to 2020 to be 232.

26 ppm and 251.

08 thousand yuan, at least +6 respectively.

7% and +8.

1%; net profit attributable to mothers is 20 respectively.

39 ppm and 22.

49 trillion, a year of -8.

9% and +10.3%; corresponding P / E is 7.

9x and 8.

7x, maintain “Buy” rating.

Risk factors: The price of raw materials fluctuates, the project progress falls short of expectations, and the price of paper changes.