| 作者： | Tommy WONG,Eric SIU |
| 时间： | 2020年08月21日 |
| 重要性： | 一般报告 |
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| 阅读权限： | 该文章钻石卡、金卡、银卡客户可阅读全文 |
| 摘要： | Report title:ENN ENERGY (2688 HK) - Taking advantage of LNG import Analyst:Tommy WONG,Eric SIU Report type:Company Date:20200821 [Summary] ■ 1H20 core profit +14% yoy, in-line; Gas sales: GPM expansion overcame the fall in ASP ■ Latest gas sales vol. growth reassures recovery trend; LNG import will continue to benefit procurement cost in 2H20 ■ Softer 1H20 not a surprise, BUY on pullback, DCF-TP at HKD103 Results boosted by expansion in gas sales GPM ENN’s revenue declined 11% yoy in 1H20 from 1) lower gas sales ASP leading to a fall in gas sales revenue in retail (-11% yoy) and wholesale (-15% yoy) segments, which accounted for 83% of the total revenue; and 2) slid in gas connection fee revenue (-26% yoy) from fewer connected new households (connected 1mn in 1H20 vs. 1.3mn in 1H19). However, with the increase in LNG import, it reduced its overall procurement cost and resulted in retail gas sales GPM expansion (GPM: 16.7% in 1H20 vs. GPM: 13.6% in 1H19). After adjusting for one-off items (i.e. other gains and losses), its core profit grew 14% yoy to RMB2.9bn. FY20E citygas sale vol. guidance at +10% yoy Its citygas sales vol. grew 4% yoy in 1H20, and mgmt. indicates the recovery path is intact (monthly gas sales yoy growth: June +15%; Jul: mid to high teens). However, mgmt. suggests headwind from its transportation gas sales vol. (-30% yoy in 1H20) takes time to ease. As a result, it cuts its FY20E citygas sales vol. growth guidance to +10% yoy (previous: +12% to 15% yoy), in which the previous year’s M&A projects will contribute c.400-500mn cu m incremental gas sales vol. growth (i.e. +2% to 3% yoy on its full year’s growth). Procurement cost will see further downward trend in 2H20 Mgmt. expects to import another c.1mn tonnes of LNG in 2H20, which will see more cost saving than 1H, as the import price of its long-term LNG contracts are pegged with the moving average of oil price (i.e. July import price is pegged with the oil price between Mar and May). Overall, it guides 2020 gas dollar margin at RMB0.61/cu m (vs. RMB0.59/cu m in 2019). Maintain BUY; Recovery trend remains intact We slightly edge up our FY20E-FY22E core profit as we expect improvement in gas dollar margin with more LNG import. Company’s recovery trend remains intact, maintain BUY and TP at HKD103. Its shares trade at 13.3x FY21E P/E with an FY20E-FY22E EPS CAGR of 15%, valuation looks undemanding. |
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