The company is mainly engaged in optical fiber and cable, optical communication equipment and supporting product research and development, manufacturing, sales and communication and information system software development, engineering design and import and export business.
The company is one of the top 10 optical cable manufacturers in China.
In the third quarter of 2011, the company achieved operating income of 310 million yuan, an increase of 27.57% over the same period last year; operating profit of 7.9129 million yuan, an increase of 511.56% over the same period last year; net profit belonging to the owner of the parent company was 8.2619 million yuan, an increase of 71.98% over the same period last year; and basic earnings per share was 0.0430 yuan per share.
During the reporting period, the company's operating income and operating profit increased significantly, mainly due to the triple play and the improvement of the external environment for smart grid construction, and the substantial increase in the sales of power and optical cables in Sichuan Huiyuan Optical Communication Co., Ltd. the operating income of optical fiber and optical cable business has increased significantly compared with the same period last year.
The consolidated gross profit margin has increased compared with the same period last year. In the third quarter of 2011, the company's comprehensive gross profit margin was 26.67%, up 3.05 percentage points from the same period last year. We believe that it is mainly due to the transfer of the company's optical cable sales to the relatively profitable power optical cable market during the reporting period.
During the reporting period, the company's period expense rate was basically the same as that of the previous year. In the first half of 2011, the company's period expense rate was 24.12%, up 0.09 percentage points from the same period last year. Among them, the sales expense rate was 16.94%, up 3.61% from the same period last year; the management expense rate was 5.28%, down 2.1% from the same period last year; and the financial expense rate was 1.90%, down 1.41% from the same period last year. The increase in the rate of sales expenses is due to the increase in sales expenses due to the company's increased investment in market development in the third quarter.
The optical fiber and cable industry continues to have a high demeanor during the 12th five-year Plan period. under the background of triple play and accelerated construction of optical fiber, the market demand is expected to increase steadily, but due to the fierce competition in the domestic optical fiber and cable market, the price has a downward trend. the company has no competitive advantage in optical fiber prefabricated rods and can turn to power optical cables and other markets with higher gross profit margins. On the other hand, increasing the business volume of communication engineering and system integration will also be another bright spot for the company to increase revenue.
We previously expected the company's earnings per share from 2011 to 2013 to be 0.12,0.13,0.14 yuan respectively. According to the closing price on October 21, 2011, the corresponding dynamic price-to-earnings ratio was 52 times, 48 times and 44 times respectively. Maintain a 'neutral' investment rating.
Risk hint. 1, the demand and price of ordinary optical fiber cable has declined; 2, the gross profit margin of power optical cable has dropped.
