Xinda Securities·2024-03-22 16:00Investment Rating - The investment rating for China Shenhua is "Buy" [1] Core Views - The report highlights that China Shenhua's integrated operations have shown stable performance, with an emphasis on increasing dividend levels to enhance shareholder returns [1][7] - The company reported a slight decline in revenue and net profit for 2023, but maintains a strong cash flow and low debt ratio, indicating financial stability [1][3][4] Financial Performance Summary - In 2023, China Shenhua achieved operating revenue of CNY 343.074 billion, a decrease of 0.4% year-on-year, and a net profit attributable to shareholders of CNY 59.694 billion, down 14.3% year-on-year [1][8] - The company's operating cash flow was CNY 89.687 billion, a decline of 18.27% year-on-year, with basic earnings per share at CNY 3.00, down 14.27% year-on-year [1][8] Coal Segment Summary - The coal production volume reached 324.5 million tons, an increase of 2.9% year-on-year, while coal sales rose by 7.7% to 450 million tons [3] - The average selling price of coal decreased by 9.3% to CNY 584 per ton, but the company managed to maintain stable profitability through a high proportion of long-term contracts [3] Power Segment Summary - The total power generation increased by 5.5% to 2,122.6 billion kWh, with total electricity sales rising by 11.1% to 1,997.5 billion kWh [4] - The average utilization hours for coal-fired power generation improved by 4.5%, and the segment's revenue grew by 9.3% to CNY 92.407 billion, with profit increasing by 34.1% [4] Transportation and Chemical Segment Summary - The railway segment saw a revenue increase of 1.8%, but profits declined by 11.9% due to rising costs [5] - The port segment's revenue grew by 4.8%, while the shipping segment faced a significant revenue drop of 20.1% due to falling average shipping prices [5] Resource Development and Integration - The company is actively advancing coal resource succession projects, with several mining licenses obtained and production capacity increases approved [6] - China Shenhua is enhancing its coal-electricity integration strategy, with ongoing investments in renewable energy projects [6] Dividend Policy and Future Outlook - The company announced a cash dividend of CNY 2.26 per share, representing 75.2% of the net profit attributable to shareholders for 2023, with a dividend yield of 6% based on the closing price [7] - The report forecasts net profits for 2024-2026 to be CNY 62.585 billion, CNY 64.293 billion, and CNY 66.121 billion respectively, with a maintained "Buy" rating [7][8]