lu'an EED(SH:601699)2024-05-07 01:32Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook on its investment potential [4]. Core Views - The company has reported its 2023 annual results and 2024 Q1 results, which are generally in line with market expectations. The 2023 revenue was 43.137 billion yuan, a year-on-year decrease of 20.55%, and the net profit attributable to shareholders was 7.922 billion yuan, down 44.11% year-on-year. For Q1 2024, revenue was 8.659 billion yuan, a decline of 27.19% year-on-year, with a net profit of 1.288 billion yuan, down 61.9% year-on-year [4][7]. Summary by Sections Financial Performance - In 2023, the company achieved a coal production of 60.46 million tons, an increase of 6.3% year-on-year, and coal sales of 54.98 million tons, up 3.9% year-on-year. The average coal price was 727.6 yuan/ton, down 21.8% year-on-year, with a gross profit margin of 52.2%, a decrease of 9.2 percentage points [4][5]. - For Q1 2024, coal production was 13.24 million tons, a decrease of 9.9% year-on-year, and coal sales were 11.81 million tons, down 7.1% year-on-year. The average coal price was 689.4 yuan/ton, down 20.7% year-on-year, with a gross profit margin of 45.2%, a decline of 14.4 percentage points [4][5]. Cost Management - The company's total expenses for 2023 were 5.318 billion yuan, a decrease of 7.2% year-on-year. Management expenses increased by 11.59% to 3.61 billion yuan, while financial expenses saw a significant drop of 103.53% to -0.26 billion yuan due to reduced borrowings and interest expenses [5]. Dividend Policy - The company plans to distribute a cash dividend of 1.589 yuan per share, resulting in a high dividend yield of approximately 7.5% based on the closing price on April 30, 2023 [5]. Profit Forecast - The profit forecast for 2024 has been revised down from 15.125 billion yuan to 8.099 billion yuan, with additional forecasts for 2025 and 2026 at 8.241 billion yuan and 8.411 billion yuan, respectively. The current market capitalization corresponds to a PE ratio of 7.8X for 2024, indicating a 22% valuation discount compared to comparable companies in the industry [4][5].