Tower Group: CITIC Securities investors investigated our company on April 17

According to Securities Star News, on April 17, 2024, Tower Group (002233) announced that Sun Linxiao of CITIC Securities investigated our company on April 17, 2024.

The details are as follows:

Q: What is the company's annual capital expenditure, and what are the main aspects?

A: Judging from the data of the past two years, the annual capital expenditure is about 200 million to 400 million yuan, of which the larger capital expenditure in 2023 is Huizhou Tower Mining Co., Ltd., a subsidiary of Huizhou Tower Cement Co., Ltd., a wholly-owned subsidiary, and paid nearly 200 million yuan for the auction to obtain mining rights. In the future, the company's capital expenditure will mainly be technological transformation projects such as ultra-low emission, cement kiln co-disposal of solid waste projects, smart factories, green mines and the construction of first-class safety standard enterprises, etc., aiming to promote the company's technological progress, environmental protection upgrading and safe production. Thank you!

Q: What is the company's view on the possibility of the cement industry being included in the national unified carbon emission trading market in the future, and what is the impact on the company?

A: The inclusion of the cement industry in the national unified carbon emission trading market will provide a fairer and more transparent carbon emission management platform for the cement industry, and at the same time, it also means that cement companies will face stricter carbon emission restrictions and supervision. In order to reduce carbon emissions, enterprises need to increase investment in energy conservation and emission reduction technologies to improve carbon emissions in the production process.

We note that the Ministry of Ecology and Environment recently issued a notice on publicly soliciting opinions on the "Guidelines for Greenhouse Gas Emission Accounting and Reporting for Enterprises for Cement Clinker Production" and the "Technical Guidelines for Verification of Greenhouse Gas Emissions for Enterprises on Cement Clinker Production", and we have calculated the company's carbon emission data for 2023 in accordance with the draft for comments, and the results show that the impact on us is not significant.

The company is still very confident that the cement industry will be included in the national unified carbon emission trading market in the future, and the company will continue to achieve carbon emission reduction in production process and production energy consumption through technological transformation and upgrading, photovoltaic power generation, and the use of alternative fuels on the basis of summarizing the beneficial experience of carbon emission management in the past, so as to achieve green and low-carbon transformation.

Q: The dividend plan disclosed in the company's annual report has a dividend ratio of up to 80% and a dividend yield of about 7%, how does the company consider it, and is such a high dividend ratio sustainable in the future?

Answer: The cash dividend ratio of the profit distribution plan in 2023 will hit a record high, the main reason is that the company did not purchase shares in 2023, mainly because the number of treasury shares was still large due to the purchase in previous years, and the amount of shares used by the company for share purchases in 2020-2022 is more than 200 million yuan every year, therefore, 2023 Second, the company's stock price has hovered at a low level in the past year, and small and medium-sized investors have strong demands for increasing the dividend ratio; third, it actively responds to the "Regulatory Guidelines for Listed Companies No. 3 - Cash Dividends of Listed Companies" Fourth, after years of development and accumulation, the company's capital reserves are abundant, which is enough to cope with the normal operation and development of the company, and at the same time, holding more cash is also facing the situation of declining financial returns due to declining interest rates, which makes the company have the conditions to increase the proportion of cash dividends. To sum up, in order to further enhance investors' sense of gain and enhance investors' confidence in the company, the company has increased the dividend ratio in 2023, hoping to enhance investors' reports by increasing the dividend ratio. In fact, the company has always attached great importance to the work of investors, and the company's annual cash dividend has maintained a high proportion in the past few years, basically around 60%. In the future, the company will continue to implement a sustainable, stable and predictable cash dividend policy based on comprehensive consideration, further enhance investors' reports, allow investors to share the company's operating results, and continuously improve the company's investment value.

Q: How is the company's concrete industry operation, and will it continue to develop the concrete industry on a large scale in the future?

Answer: The company vigorously developed the concrete batching plant around 2010, but after entering, it was found that the entry threshold of the batching plant was relatively low, the accounts receivable were more, the synergy effect on cement sales was not as expected, and the profitability of the enterprise was relatively poor.

At present, the company has 12 wholly-owned, holding and shareholding concrete enterprises, with an operating income of 177 million yuan in 2023. The company will strive to operate the existing batching plant well, and actively respond to the problems of declining demand for concrete and increasing difficulty in collecting payments caused by the deep adjustment of real estate.

In the future, the company will continue to pay attention to concrete development trends, changes and opportunities.

Q: Please introduce the company's photovoltaic power generation projects?

A: As of the end of 2023, the company's installed photovoltaic power generation capacity is about 36MW, and the photovoltaic power supply capacity in 2023 will be 36.66 million kW.h, accounting for nearly 4% of the company's annual electricity consumption.

At the end of 2023, the company will seize the opportunity of the rapid decline in the price of energy storage power station equipment to accelerate the construction of user-side energy storage power stations of various cement enterprises, continuously increase the proportion of clean energy use, and continuously reduce the electricity cost of enterprises.

Q: How can the company's newly established tower biotechnology company contribute?

Answer: Guangdong Tower Biotechnology Co., Ltd. established by the company is mainly to explore the research and development, production and sales of functional probiotic products. As a kind of microorganisms beneficial to the human body, functional probiotics have received extensive attention in the health industry in recent years, and the company is optimistic about the market prospects in this field, and plans to provide consumers with high-quality functional probiotic products through cooperation with competitive scientific research institutions in the industry. At present, we are building a team to do a good job in trial sales before the product is launched. If the project meets the disclosure requirements, the company will fulfill the information disclosure obligations in a timely manner and in accordance with the regulations.

At present, Tower Biotechnology Co., Ltd. is actively promoting the preliminary work, and there is no substantive and breakthrough progress, and it is expected that it will take a long time to form a certain amount of operating income contribution and profit.

Q: Does the company currently have the idea of merger and reorganization?

Answer: The company insists on strengthening and refining the main business of cement, and constantly consolidates the dominant position of the company's regional cement leading enterprises. In recent years, the demand for cement has been declining, and the efficiency of the industry has been declining, but from the relevant data, the number of mergers and acquisitions of cement enterprises is not large, and the mergers and acquisitions of the industry are not active. In the future, the company does not rule out mergers and acquisitions to further expand and strengthen the scale of the main cement business, we focus on the merger and acquisition target market supply and demand, resource endowment conditions, transaction prices, synergies and other factors, the company will comprehensively weigh the consideration, the specific announcement issued by the company shall prevail.

The main business of Tower Group (002233) is the production and sales of various types of Portland cement and ready-mixed concrete.

According to the 2023 annual report of Tower Group, the company's main revenue was 5.535 billion yuan, down 8.29% year-on-year, net profit attributable to the parent company was 742 million yuan, up 178.55% year-on-year, and non-net profit was 640 million yuan, up 100.56% year-on-year, of which in the fourth quarter of 2023, the company's single-quarter main revenue was 1.419 billion yuan, down 26.22% year-on-year, and net profit attributable to the parent company was 127 million yuan, down 21.35% year-on-year; The non-net profit deducted in a single quarter was 125 million yuan, an increase of 11.76% year-on-year, the debt ratio was 11.06%, the investment income was 169 million yuan, the financial expenses were -50.9087 million yuan, and the gross profit margin was 26.28%.

A total of 4 institutions have rated the stock in the last 90 days, 1 have given a buy rating and 3 have an overweight rating, with an average institutional price target of 9.92 over the last 90 days.

Here's the detailed earnings forecast information:

Margin data shows that the stock has a net financing inflow of 13,039,200 in the past three months, with an increase in the financing balance, and a net outflow of 910,900 with a decrease in the balance of securities borrowing and lending.

The above content is compiled by Securities Star based on public information, generated by an algorithm (Network Information Calculation No. 310104345710301240019), and has nothing to do with the position of this site, if there is a problem with the data, please contact us. This article is a compilation of data and does not constitute any investment advice for you, investment is risky, please make a cautious decision.