Chenming Paper (000488) released its semi annual report. In the first half of the year, it achieved a revenue of 16.676 billion yuan, a year-on-year decrease of 2.89%, and a net profit of 230 million yuan, a year-on-year decrease of 88.61%. During the reporting period, Chenming paper produced 2.58 million tons of machine-made paper and sold 2.69 million tons of paper. In addition, the company's financial expenses and financial leasing business scale further contracted.
In the first half of the year, the paper industry continued to be depressed, and the industry experienced a relatively difficult first half. According to the performance disclosure of listed paper enterprises, the performance of many large leading enterprises showed negative growth in varying degrees. According to insiders, it is not easy for large paper enterprises to remain profitable against the background of low industry prosperity.
According to the data of the National Bureau of statistics, in the first half of the year, enterprises above Designated Size in the paper industry achieved a revenue of 737.46 billion yuan, an increase of 2.5% year-on-year; The total profit was 25.99 billion yuan, a year-on-year decrease of 46.2%. As for the reasons for the sluggish performance of the paper industry as a whole, some people in the industry believe that the rising prices of raw materials, the insufficient performance of price increase benefits, and the epidemic hindering the smooth flow of logistics are the main factors causing the sluggish sales and tight profits of the paper industry in the first half of the year.
Since 2022, affected by multiple factors such as the macroeconomic environment and repeated epidemics, the prices of energy, chemical raw materials, wood chips, logistics and so on have remained high, and the operating cost pressure of the paper industry has increased, while the downward transmission of costs is insufficient, and the profit space of the paper industry has been squeezed.
However, compared with small and medium-sized paper-making enterprises, the scale advantage of large-scale paper-making enterprises enables them to obtain a larger scale of income when the industry is prosperous, and maintain profits by relying on competitive marginal costs when the industry is depressed. In addition, when the industry is difficult, it is often the time when the concentration of the industry is rising rapidly. In the long run, it helps the leading enterprises to expand new market space and gain greater voice.
Everbright Securities analysis points out that during the period of rising pulp prices, the leading enterprises have price advantages, capacity utilization advantages and pulp reserve advantages over small and medium-sized enterprises, and the leading companies often have export capabilities and can obtain higher profits by exporting to Europe.
In terms of exports, in the first half of 2022, Chenming Paper's overseas sales revenue was 3.8 billion yuan, a year-on-year increase of more than 120%, becoming a new growth point for the company.
Chenming paper said that under the circumstances of fluctuations in the bulk commodity market and poor stability of the global supply chain, the company's layout of the whole industrial chain has provided great help for enterprises to control production costs and cultivate core competitiveness. The wood pulp production capacity of 4.3 million tons / year has created significant advantages for the company, and pulp paper integration is also one of the main focuses of the company's future development.
Although the industry as a whole fell into a downturn in the first half of the year, there are also views that the industry as a whole has stabilized. It is understood that recently, Arauco and other large pulp enterprises in Chile announced plans to expand production and put into production. The tight supply of wood pulp is expected to be eased. In addition, the global monetary policy is tightened, inflation is down, and raw material prices are expected to fall. At the same time, with the improvement of domestic epidemic control and the implementation of the national policy of stable growth, the improvement of domestic demand is driven, and the prosperity of the paper industry is expected to gradually recover, and the industry's profits can be recovered.
Everbright Securities pointed out that on the cost side, the short-term pulp price will remain high and volatile, and it is expected that there will be an inflection point in the fourth quarter; On the demand side, the overseas economy is recovering, the demand is strong, and the domestic demand is expected to improve. With the arrival of the stage of concentrated paper use in the second half of the year, the paper industry will gradually return to the prosperity channel.
