From January to September 2009, the company achieved operating income of 154 million yuan, down 34.07% from the same period last year; operating profit loss of 2.765 million yuan, down 125.7% from the same period last year; net profit belonging to shareholders of listed companies was 1.411 million yuan, down 70.21% from the same period last year; and basic income per share was 0.0064 yuan, down 70% from the same period last year.
Business in the international market is in the doldrums, affecting the company's performance in the first three quarters. The company is mainly engaged in the production and sales of motorcycles, special vehicles and garden machinery, of which the international market business accounts for more than 30% of the company's business income. Since the beginning of this year, the company has been seriously affected by the financial crisis, and sales in the international market have been sluggish, resulting in a decrease in export orders and a drag on the company's performance in the first three quarters.
The reversal of asset impairment and non-operating income become the main sources of profit. In the first three quarters of 2009, due to the transfer of the corresponding provision for inventory decline and the reduction of bad debt provision for accounts receivable, the company returned a total asset impairment loss of 1.0256 million yuan. In addition, as a result of government demolition, the company made a non-operating income of 4.3302 million yuan after cleaning up related assets. Excluding the above two items, the company's net profit is about 4 million.
The asset-liability ratio is the lowest in the industry, and the proportion of monetary funds is the highest in the industry. The company's asset-liability ratio in 2008 and the first three quarters of 2009 was 6.46% and 10.1% respectively, the lowest among all listed companies in the Tianxiang machinery industry. Low financial leverage makes the company's ROE less sensitive to the boom in the industry. In terms of the composition of the company's assets, currency funds accounted for 57.84% and 56.58% of the total assets in the first three quarters of 2008 and 2009, the highest in the Tianxiang machinery industry. The interest income brought by a large number of bank deposits has become another component of the company's profits. The company's financial expense rates for the first three quarters of 2009 were-5.1%,-3.5% and-3.3%, respectively.
Earnings forecast and investment rating: the company is expected to earn 0.007 yuan per share in 2009 and-0.022 yuan in 2010. based on the closing price of 8.05 yuan on October 22nd, the dynamic price-to-earnings ratio in 2009 is 1226 times earnings, which does not have the valuation advantage.
We maintain the company's "neutral" rating.
Risk hints: (1) global economic instability reduces demand in overseas markets; (2) export uncertainty caused by exchange rate fluctuations.
