Yangpu high temperature resistant material Co., Ltd. (hereinafter referred to as "punai Co., Ltd") is one of the main domestic production enterprises of functional refractory materials, and also the main supplier and service provider of refractory products for steel industry.
Since its establishment in 1988, the company has experienced 32 years, during which it was listed on the Shenzhen Stock Exchange in 2008. After years of development, it has formed a group operation mode. At present, it has 12 wholly-owned subsidiaries, two branches, four holding subsidiaries and three joint-stock companies. The main business of the company is to develop, produce and sell the stereotyped refractory materials, functional refractory materials and supporting institutions, and undertake the overall contracting business of the design, installation and construction services of various thermal equipment refractory materials. At present, it has provided nearly 70 of the world's top 100 iron and steel enterprises with high-quality products and perfect overall contracting services.
On March 25, the company passed China Fund News? Opportunity treasure platform held an online institutional exchange meeting. Liu baikuan, chairman of the board, and Cao Yang, President of the board attended and interacted with participants to answer the topics of concern to investors.
The performance has been growing steadily. According to the introduction, Pu Nai's current business is mainly divided into three parts. The first plate is the raw material plate. The company has a mine in Tibet, Xinjiang and Haicheng respectively. The main products of the raw material plate are magnesia products and plate corundum products. The second plate is the refractory products used in the steel industry, which are mainly divided into three categories: shaped, amorphous and functional refractories. The third plate is the refractories used in the non steel industry.
In 2019, the total assets of punai reached 5.724 billion yuan, an increase of 8.17% compared with 2018. Operating revenue reached 4.14 billion yuan, an increase of 6.48% over 2018; net profit attributable to shareholders of listed companies reached 252 million yuan, an increase of 13.88% over 2018.
The company said that in 2019, for the refractory industry, the overall operation is relatively stable, but during the operation process, due to overcapacity, low industrial concentration, low level of intelligent manufacturing and insufficient innovation capacity, there are still problems. In view of these situations, Pu Nai Co., Ltd. has grown into a leading enterprise in refractory industry in China from the perspective of system solutions.
In 2019, the state adjusted some policies of refractory industry. In order to actively respond to the adjustment of these industrial policies, Pu Nai Co., Ltd. carried out automatic upgrading and eliminated some equipment and production capacity that did not meet the relevant laws and regulations. At the same time, the strength of the process technology that needs to be eliminated in terms of operation improvement and environmental protection is gradually increasing. Especially in the special work of vigorously developing relevant process improvement equipment upgrading, a holistic work plan has been formed and is being implemented gradually.
In addition, in 2019, based on the market situation, punai realized the optimization of production and operation by setting production capacity products, coordinating production capacity, and allocating production capacity. At the same time, we deepened the energy supply and energy management system, and achieved good results in comprehensive operation.
Through the above major work and efforts, in 2019, punai shares responded to some risks from the market, achieving double growth of income and net profit. In 2019, the tax paid by the whole Pu Nai shares was 271 million yuan, an increase of nearly 17 million yuan compared with 2018.
In the next five years, the company will realize the development strategy of 10 billion scale revenue related to punai. The company said that the development strategy of the next five years has been completed in the last year, which is to achieve more than 10 billion business revenue of punai by 2023 and enter the top three in the world through the efforts of three major sectors.
In addition, the company's development strategy for each of the three segments has also been prepared.
First of all, for the steel sector, it is necessary to achieve 7 billion yuan of business revenue by 2023. By adhering to the strategy of key customers, technology driven strategy, industrial M & a strategy, following the development trend of smelting technology, and opening up new market space, from the current 3.5 billion yuan to 7 billion yuan.
Next is the raw material sector. After nearly 10 years of efforts, especially in 2019, the main projects of each production base have been accelerated. At present, 70% of the projects have been invested. The company will start to make efforts this year. It is expected that by 2023, the annual revenue of raw materials will be 3.5 billion yuan.
Finally, the environmental protection refractory plate. The company will develop the recycling of waste refractory materials, put into production through the scale of high-purity magnesia raw materials, develop the cement kiln without falling, coordinate the treatment of urban garbage through the cement kiln, and fully develop the high-end raw materials, and put the advantageous products and characteristic products on the market, striving to achieve a revenue of 1 billion yuan for the environmental protection refractory plate in 2023 At 570 million yuan, it basically doubled.
Targeting the performance growth target in 2020 in advance for the business target in 2020, the company responded that the budget launched at the end of last year, after the review and approval of the board of directors, is planned to generate 4.979 billion yuan of sales revenue in 2020, which will increase by 20.27% compared with 2019 if it can be achieved; the net profit plan attributable to shareholders of Listed Companies in 2020 is 376 million yuan, which will increase compared with 2019 if it can be achieved The length was 49.21%.
For this year's major work ideas, the company will continue to provide customers with better quality products and services, adhere to the concept of win-win, and strive to become a high-quality listed company with outstanding core competitiveness, leading brand and technology, strong profitability and anti risk ability, good return from shareholders, continuous improvement of employee benefits and more social responsibilities.
In 2020, the company will focus on its own efforts through three major business divisions, endogenesis and extension simultaneously, adhere to technological innovation and other measures, and strive for a substantial increase in revenue and profit on the basis of 2019. Specifically, there are seven major tasks:
The first is to refine the strategic development plan and improve the strategic management ability; the second is to deepen the group management and control mode and improve the efficiency of collaborative operation. The third is to strengthen the operation of the business division and ensure the realization of the business objectives; the fourth is to quantify the reconstruction of the core competitiveness and improve the comprehensive development strength of the enterprise; the fifth is to solidify the working mode of the key project and strengthen the foundation of the business operation; the sixth is to optimize the incremental expansion mode and accelerate the realization of the strategic objectives; the seventh is to activate the team building and the construction of the corporate culture to enhance the development of the enterprise Guarantee.
Finally, Liu baikuan, chairman of the company, also said that in the future, some mergers and acquisitions will be considered, including domestic and overseas ones. In addition, another R & D center will be set up in Shanghai to increase investment in scientific research.
The following are questions on the spot of the exchange meeting: 1. The main raw materials of the company include alumina, aluminum based raw materials, magnesium based raw materials, bauxite and bauxite grade raw materials. What is the cost proportion of upstream raw materials of the company, the supply of raw materials and the purchase mode of our raw materials?
President Cao: there are mainly three small items here. The first one is about the proportion of upstream raw material cost. In 2019, the company also made a retrospective statistics. In 2019, alumina based raw materials accounted for 16% of the cost of raw materials, and magnesium based raw materials accounted for 32% of the cost of raw materials. Bauxite and bauxite based raw materials account for 15% of the cost. That is to say, the three major raw materials account for 16%, 32% and 15% respectively.
At present, the supply of raw materials mainly comes from two sources: one is the use of self-produced raw materials, the other is foreign procurement. There are four types of raw material procurement modes. The first is centralized procurement of bulk raw materials, which is also to give full play to the group's advantages in centralized procurement and coordinate the corresponding resources. The second mode is non bulk raw materials. According to the size of purchasing radius, each branch company selects suppliers nearby and purchases them in a decentralized way. The third mode is to purchase individual raw materials and auxiliary materials on the corresponding e-procurement platform. The fourth mode is to use just in time procurement mode for close suppliers.
2. What will affect the price trend of upstream raw materials? What is the change range of upstream raw materials in recent years? How will the change of raw materials affect the profitability of the company? What other related work has been done to realize the cost control of raw materials?
Mr. Cao: in terms of Pu Nai, the price trend of upstream raw materials is mainly affected by the following aspects: the first is the management of the local government on the mine, the second is the control of the ore mining volume, the third is the control of the ore sales channel, the fourth is the impact of the change in the supply and demand relationship brought by the production and supply of magnesia and other raw material products companies, and the fifth is the impact of the change in the supply and demand relationship The implementation of local environmental protection policies and environmental inspection policies. At present, it is mainly affected by these five aspects.
Second, what is the range of change in recent years. Since March 2017, the main raw materials have been affected by the factors I just mentioned. To this year, we should say 17, 18, 19 and 20 years, which is exactly four years, three years or so. We have experienced a big rise and fall, and now we have a steady decline.
Third, how does the fluctuation of raw material price affect the profitability of products. Objectively speaking, the cost of raw materials accounts for 79% of the product manufacturing cost of our company.
That is to say, the fluctuation of raw material price will have a great impact on the profit space of refractory products. But at the same time, for punai, due to the accelerated construction investment of our raw material sector, it will give punai the risk of future response to the fluctuation of raw material prices and the impact on profitability. In addition, we will form a linkage mechanism with the main upstream and downstream customers, especially our downstream customers, such as some steel enterprises we serve, we will establish a linkage mechanism. Then the fluctuation of raw materials will effectively control the profitability of punai.
The fourth question is how to control the raw materials and cost. There are mainly three links. The first one is procurement. We control it through centralized procurement and strategic cooperation with upstream raw material suppliers. In addition, in the production process, through technological breakthroughs, we are looking for alternative or comprehensive resource recovery technologies. In addition, through the lean control of the production process, we can control the cost in the production process. The third link is the use link, because now we are doing the general contracting. These products are to be sold through construction services. Then in the construction process, with the help of punai's powerful technology integration ability, we can realize the optimization of product configuration and raw material saving in the use process, so as to reduce the cost. In addition, we also realize cost saving and control through on-site recycling technology.
3. What are the assumptions for the company to set such a high target of 20.27% revenue growth and 49.21% net profit growth in 2020?
President Cao: let me give you a brief introduction on this issue. In 2020, our income will increase by 20%. Just now, I also introduced to all investors that the current business entity of punai Co., Ltd. is based on business