Shanghai Port Group (600018): Performance was slightly higher than expected, revenue declined, but expense control and investment income led to profit growth

Shanghai Port Group (600018): Performance was slightly higher than expected, revenue declined, but expense control and investment income led to profit growth

The results of the first quarter of 2019 slightly exceeded expectations. The first quarter of 2019 results announced by Shanghai Port 北京夜网 Group: operating income 81.

USD 5.9 billion, a year-on-year decrease of 6%; net profit attributable to the parent company19.

22 ppm, an increase of 16% per year, corresponding to a profit of 0.

08 yuan, slightly more than we expected.

Tungsten still maintained rapid growth in the first quarter: According to the company’s website, the container throughput of the home port increased by 7% and the cargo increased by 2% in the first quarter.

Company revenue fell 5.

6%, operating costs fell by 5.

9%, but taxes and attachments decreased by 1.
.

400 million US dollars (tax split due to real estate income settlement last year), each 13 million yuan in gross profit increase, but net profit increased by 2.

$ 7.1 billion, mainly due to cost control (administrative expenses are reduced by 1.
).

400 million US dollars and increase in investment income (increasing 65 million annually, mainly from the profits of affiliated joint ventures such as the Postal Savings Bank, Bank of Shanghai and other joint ventures), contributing 39% and 24% of the increase in profits, respectively.

Development Trend The growth rate of the port’s main business may slow down.

With the commissioning of the Yangshan Phase 4 automated terminal, efficiency and capacity have been improved, and the hub transfer function in the Yangshan Port area has been further developed: the water-to-water transfer ratio reached 46 in 2018.

8%.

However, considering the external demand, the manufacturing PMI shows the economic growth rate or growth rate of Europe and the United States, China’s PMI new export order index is weak, and it may still be affected by the rush of shipments caused by trade friction in the short term, so the container explosion growth rate or amplitude.

Bulk goods may be affected by domestic demand and import policies.

It is recommended to pay special attention to the situation of China-US trade negotiations and external demand.

Financial real estate and other businesses increased diversified income.

Finance: In 2018, from Shanghai Bank, the investment income of PBC accounted for 11% and 20% of net profit.

Real estate: The company still has the Long Beach project (estimated investment of 18.5 billion US dollars) and the military industry road project (estimated total investment of 82).

700 million), is expected to continue to contribute profits to the company in the 深圳桑拿网 future.

Earnings Forecast We maintain our 2019 / 20e earnings forecast of 96.

10/98.

7.7 billion is unchanged.

Estimates and recommendations Companies currently sustainably correspond to 19/20 years 19.

1/18.

6 times P / E.

Maintain recommended level and target price 9.

12 yuan, corresponding to 19 times 22 times price-earnings ratio, compared with current expectations of 15%.

The risk exceeded expectations, the cost control exceeded expectations, and the actual settlement progress was slower than expected.