Item: the company publishes its 2016 annual report
During the reporting period, the company realized operating income of 355 million yuan, an increase of 13.20% over the same period last year, and the net profit belonging to shareholders of listed companies was 32.67 million yuan, an increase of 11.48% over the same period last year. It is proposed to distribute a cash dividend of 0.5 yuan (including tax) for every 10 shares to all shareholders.
Peace viewpoint:
Main business orders pick up, performance rebound: the company is the leading enterprise of domestic thin film equipment. Affected by the macroeconomic boom, the company's net profit declined in 2015. There is a strong correlation between the sales of thin film equipment and the increase in film production. Previously, we judged that the increase in film production in China in 2016 would increase compared with the same period last year, and predicted that the company's performance would pick up in 2016. The company's annual report performance is in line with our previous expectations. Looking forward to 2017, the macroeconomic boom will gradually pick up, which will still support the company's thin film equipment business.
Enter the high-end film market and open up a new situation: (1) the film products produced by Jinjia New Materials, a subsidiary, have successfully opened the civil, medical and military markets, with a business income of 24.01 million in 2016. In addition, Jinjia new material has successfully launched worldwide multiple batches of product proofing, samples and other work, has been recognized by customers at home and abroad, the future sales of related film products are expected to grow rapidly; (2) the transformation of the original BOPP/BOPET biaxial stretching film production technology of the subsidiary far East Light Chemical has been basically completed and entered the trial production stage. The smooth progress of this technical transformation will provide a technical basis for the company to look to the fields of high-end optical film, electronic film, lithium battery separator, photovoltaic film and new energy film in the future.
The fixed increase project has passed for a while, and will contribute 170 million net profit each year after reaching production in the future: the company's fixed increase project has passed in December 2016, with plans to issue no more than 50 million shares and raise no more than 506 million yuan. To build a special multi-functional film factory, agricultural ecological film intelligent equipment and five-end big data intelligent service platform and other three major projects to build Jinming intelligent ecosystem. It is estimated that when these three projects reach production, they will contribute a total net profit of more than 170 million per year. In this order increase, Ma Jiazhen, the son of the actual controller and general manager, subscribed for no less than 100 million yuan, showing great confidence in the transformation and upgrading of the company.
In December 2016, the company formally signed the contract for the industrialization Technology Development (entrustment) of Neural Rehabilitation Robot with Tsinghua University, which put the industrialization of neural rehabilitation robot project on the agenda. There are a large number of disabled people in China, and the aging rate continues to rise, but at present, domestic rehabilitation departments and rehabilitation hospitals are short of resources. in the next few years, the demand for new rehabilitation equipment for the construction of rehabilitation departments in general hospitals will reach 10 billion-20 billion yuan. Jinming Seiki cooperates with Tsinghua University to lay out rehabilitation robots in advance, which has occupied the first-mover advantage.
Investment advice: the company's performance rebounded in line with our previous expectations. Be optimistic about the positive effect of the company's fixed growth projects on the future development of the company, and the broad development space of the company's great health strategy in the future; the company relies on its own advantages to enter the high-end film market, which is expected to significantly improve the company's profitability; we judge that 2017 will be an important turning point for the company. It is estimated that the company's EPS from 2017 to 2019 will be 0.34 yuan, 0.44 yuan and 0.58 yuan respectively, and the price-to-earnings ratio of the previous share price will be 50 times, 38 times and 29 times respectively, maintaining the "recommended" rating. Previously predicted that the company's 2017-2018 EPS of 0.31 yuan, 0.42 yuan, this time to adjust the performance forecast, mainly to the company's high-end film sales in the next two years to give a more optimistic expectation.
Risk tips: (1) macroeconomic recession, insufficient downstream demand; (2) the promotion of the big health strategy is not as expected; (3) the sales of high-end functional films are not as expected.