沧州明珠(002108)

2017 preliminary result slightly missed DBe due to subpar separator yield

CZMZ announced its 2017 preliminary result with headline numbers on 23 Jan2018. The company delivered RMB3.5bn revenue and RMB544mn NPAT in 2017,or 27.5% and 11.6% increase on a year-over-year basis. The preliminary NPATwas c.8% below DBe, or c.9% lower than A-share consensus due to subpar yieldof wet processed separator capacity expansion commenced in 3Q17, given stablebusiness performance of the company's other 2 business units - traditional plasticpipes and BOPA film. In the mid-term, we believe the wet processed separatorproduction lines with designed capacity of 105mn sqm should be able to ramp upand provide margin support for the company. CZMZ is scheduled to release thefinal 2017 results on 23 Mar 2018, and we look forward to having more detailsthen. Maintain Buy.