Main points of investment
The performance is basically in line with expectations: the company's performance is basically in line with expectations, and under the influence of C2 factors, revenue has increased by 66.55%. The substantial increase in financial expenses had a greater impact on the performance of the current period: in the first half of the year, financial expenses increased by 123.2% to 3.719 billion compared with the same period last year, of which interest expenditure was 3.572 billion, up 96.8% from the same period last year, and the net exchange loss was 245 million, compared with 16 million in the same period last year. In addition, the management fee was 1.008 billion, an increase of 54.65% over the same period last year, mainly due to the impact of C2 consolidation, as well as one-time recognition of M & A-related fees (220 million).
The acquisition of C2 was completed and aircraft leasing ranked third in the world: in April 2017, the company acquired the commercial aircraft leasing business (C2) of the CIT Group through Avolon, and completed the equity transfer of the underlying asset C2. By the end of half a year, the company's own, managed and ordered aircraft totaled 950, making it the third largest aircraft leasing company in the world. In the first half of the year, the company's aircraft leasing business achieved an operating income of 7.332 billion, an increase of 117.99% over the same period last year, and its gross profit margin increased by 4.95% over the same period last year.
Container leasing ranks second in the world: by the end of half a year, the total number of containers owned and managed by Seaco and Cronos has exceeded 3.98 million CEU, making it the second largest container leasing company in the world, with an average occupancy rate of 93.7%. Since the beginning of this year, the international shipping market has warmed up, and the container rental rate has increased to a certain extent. In the first half of the year, the company's container leasing business achieved operating income of 2.069 billion, down 2.98% from the same period last year. Due to the 11.79% increase in operating costs, the gross profit margin fell 7.21% compared with the same period last year.
Bohai Leasing has a registered capital of 22.1 billion, making it the largest leasing company in China: the company's domestic financial leasing business mainly takes Bohai Leasing, Wanjiang Financial Leasing and Hengqin Leasing as business platforms. Bohai Leasing currently has a registered capital of 22.1 billion yuan, becoming the largest leasing company with registered capital in China. In the first half of the year, the company's revenue from infrastructure, roads, bridges and rail transit leases reached 1.318 billion yuan, an increase of 18.99 percent over the same period last year, and the gross profit margin increased by 2.04 percent over the same period last year. With the fixed increase of funds in place, the scale and performance of financial leasing business is expected to meet sustained growth.
Termination of the acquisition of Hua an property Insurance and HKAC minority shares, proposed to issue 8 billion preferred shares: the company announced the termination of the acquisition of Hua an property Insurance and HKAC minority interests. In addition, the company intends to issue no more than 80 million preferred shares and raise no more than 8 billion shares to supplement the operating funds of the company's leasing business.
Profit forecast: we expect the company's net profit from 2017 to 2018 to be 2.889 billion yuan and 3.739 billion yuan respectively, corresponding to 0.47 yuan and 0.60 yuan EPS respectively.
Risk tips: exchange rate risk; global macroeconomic volatility risk; leasing business lower-than-expected risk; financial control platform integration is not as expected risk.
