AVIC Optoelectronics (002179): Faster growth in the first three quarters benefited from high prosperity of military products and 5G civilian products
By: Date: 29/03/2020 Categories: MUwyryL

AVIC Optoelectronics (002179): Faster growth in the first three quarters benefited from high prosperity of military products and 5G civilian products

Event: The company announced the third quarter report of 2019, and achieved operating income of 68 in the first three quarters.

92 ppm, an increase of 19 years.

34%, realizing net profit attributable to mother 8.

31 ppm, an increase of 19 in ten years.

22%, the corresponding return is 0.

80 yuan.

Comments: (1) The company achieved operating income of 68 in the first three quarters.

92 ppm, an increase of 19 years.

34%, third quarter operating income22.

96 ppm, a ten-year increase4.

81%.

The first is the expansion of the company’s sales scale; (2) The company achieved net profit attributable to its mother in the first three quarters.

31 ppm, an increase of 19 in ten years.

22% (of which net profit attributable to the mother in the third quarter was 2.
.

58 ppm, an increase of 11 years.

At 37%, the net profit growth rate attributable to mothers will exceed the growth rate of revenue. The end point is that research and development will be concentrated in the third quarter in 2018, while financial expenses in 2019 will be concentrated in the first quarter, and the combined impact will lead to a breakthrough in growth).

The growth rate of the company’s net profit attributable to its mothers in the first three quarters was lower than the growth rate of revenues: a) The increase in sales expenses in the first three quarters.

85%, mainly due to the expansion of sales scale; management costs increased slightly by 3 each year.

83%, mainly due to the impact of the company’s revenue growth; financial expenses increased by 23.75 million yuan compared with the first three quarters of 2018, 18.25 million yuan, mainly due to the increase in interest expenses on convertible bonds; b) R & D expenses increased significantly
.

53%, mainly due to the company’s increase in product structure adjustment and R & D investment; c) the increase in investment income decreased significantly37.

63%, mainly due to the decline in profits of the joint venture, China Shipping Hisense; (3) the company’s gross profit margin increased by 1 in the first three quarters.

58 up to 33.

64%, third quarter gross margin increased 5 quarterly.

08 averages to 34.

43%, mainly due to the improvement of the product structure caused by the increase in military products; (4) From the perspective of assets and liabilities: a) Accounts receivable increased by 45 from the beginning of the period.

82%, mainly due to the expansion of the company’s sales scale. The repayment cycle of customers in some market areas is cyclical and mostly concentrated in the fourth quarter, resulting in a larger account receivables during the period; b) the inventory increased by 10 from the beginning of the period.

71%, mainly due to the increase in stock preparation caused by the increase in military orders; (5) From the perspective of cash flow: the net cash flow generated by the company’s operating activities during the reporting period increased by 4 over the same period of the previous year.

22 ppm to 1.

50 ppm was mainly due to the expansion of the company’s sales scale and increased subsidies.

National defense informatization construction and 5G industrialization continue to advance, and military and civilian business strive to maintain growth.

As the “Thirteenth Five-Year Plan” enters the final stage, the informatization construction in the national defense field has further deepened, and more weapons and equipment are installed and replaced to drive the demand for high-end connectors.

The company is expanding and leading in the field of military connectors and has a high market share. It is expected that the military products business will maintain rapid growth. In terms of civilian products, the company’s orders in the communications field will grow rapidly, mainly benefiting from 5G construction.

On October 22, the Ministry of Industry and Information Technology reported at the antique press conference of the Information Office of the State Council that the development of the information and communications industry was stable in the first three quarters of this year, and 5G commercial use started well. As of the end of September, three basic telecommunications companies had opened 5G base stations across the country. 8More than ten thousand.

The company’s communications business segment is expected to continue to grow as 5G continues to advance.

Independent innovation and technological breakthroughs, product structure upgrade to high-end, and enhance profitability.

The company plans comprehensive and major scientific research projects, and has made technological breakthroughs in a number of product directions, such as fluid connectors, high-speed backplane connectors, fiber optic connectors, and deep-water sealed connectors.
In addition, the company has initially built a long-term mechanism for core process capability construction, passed multiple process capability breakthroughs, continued to advance automation, and the integration of 淡水桑拿网 information technology has further enhanced core manufacturing capabilities.

The company focuses on high-speed connectors, optical interconnect boards and other high-end products to carry out product research and development, and follows up on the demand for connectors in the next-generation communication technology represented by 5G, which has been dispatched.
In the field of new energy vehicles, we cooperate with domestic and foreign vehicle companies to provide high-voltage and high-current connector products.

The company actively expands the high-end product market and is expected to upgrade its product structure and gradually increase its profitability.

Investment suggestion: We predict that the company’s EPS in 2019/20/21 will be 1.

08/1.

35/1.

69 yuan, corresponding to 35 for PE.

62/28.

42/22.

77 times,武汉夜网论坛 of which the company’s 2019 profit forecast exceeds the market forecast range, and is covered for the first time, giving the company an “overweight” rating.

Risk warning: military orders are less than expected, and 5G construction is slower than expected.