1. Event
In 2016, the company's revenue was 230 million yuan, an increase of 39.56% over the same period last year, and the net profit was 30 million yuan, an increase of 27.86% over the same period last year, deducting non-net profit of 31 million yuan, an increase of + 971.17% compared with the same period last year. The profit distribution plan of the company is 1.00 yuan for every 10 shares.
two。 Our analysis and judgment
(1) the performance growth is in line with expectations, and the company has achieved a magnificent transformation.
The company achieved double-digit growth in revenue and profit in 2016, which is basically in line with expectations. The growth in this period is mainly due to the consolidation of Shikai Technology in the fourth quarter, the recovery of the coal industry and the rapid growth of rail transit business. At this point, the company's business has also changed from a single coal mine safety to the military industry, information and coal mine "troika" side-by-side, realizing the magnificent transformation. From a sub-business point of view, in the field of military industry, the subsidiary Shikai's scientific and technological business performance grew steadily, realizing 61.0302 million deduction of non-net profit and exceeding the performance commitment; in the field of information business, Fuhua Yuqi made great progress in the transformation of rail transit informatization and system integration big data business, with sales revenue increasing by 48.35%, deducting non-net profit of 38.0674 million for the whole year, and exceeding the performance commitment. The income of traditional coal mine safety business has achieved positive growth for the first time in recent years, and the operating performance has improved under the background of industry recovery.
(2) military business will become the new growth pole of the company.
The company's military business is mainly responsible for Shikai Technology and its subsidiary Ji Heng Optics, and its main products are missile guidance systems and precision optical systems. Many models of Shikai Science and Technology have been formally installed and equipped in batches, and many types of guidance systems actually in production belong to exclusive production, and a stable military procurement system ensures smooth performance. Shikai Science and Technology has promised to deduct non-net profits of not less than 73 million yuan and 86 million yuan in 2017 and 2018. We believe that with mature technology and rich military resources, new products are expected to continue to land, and military business will become the company's new growth pole in the future.
(3) the establishment of M & A funds and the sustainable period of extension development
The company and Luxin Venture Capital and Xi'an Government guidance Fund jointly set up Xi'an military-civilian Integration Industry Fund, which was completed for the record in February 2017. at present, the first batch of funds has been in place and entered the implementation stage. We believe that this move will help the company to take advantage of the professional advantages of Luxin Venture Capital, combined with the direction of the company's transformation, through mergers and acquisitions and other ways to deepen the field of military industry and information technology.
3. Investment suggestion
It is estimated that the return net profit of the company in 2017 and 2018 is 130 million and 160 million respectively, the EPS is 0.20 and 0.24 yuan, and the current stock price is 49x and 41x corresponding to PE. At present, the company has a small market capitalization, large space for the development of military industry and information business, and maintains a "recommended" rating.
Risk hint: the growth of civilian products is not as expected.