Key points of investment
The company released its report for the third quarter of 2017: the company achieved operating income of 507 million yuan in the first three quarters of 2017, an increase of 4.27% over the previous year; achieved net profit attributable to shareholders of listed companies of 130 million yuan, an increase of 495.13% over the previous year, corresponding to EPS of 0.26 yuan. The company achieved operating income of 230 million yuan in the third quarter of 2017, an increase of 68.99% over the previous year; net profit attributable to shareholders of listed companies was 31.1332 million yuan, an increase of 1038.87% over the previous year. Net profit attributable to shareholders of listed companies is expected to be 218-246 million yuan for the full year, an increase of 135.14%-165.13% over the previous year.
Revenue rose sharply in a single quarter, and asset disposal revenue of more than 150 million yuan increased significantly throughout the year. On a quarterly basis, the company's Q1, Q2, and Q3 achieved operating revenue of 1.11, 1.67, and 230 million yuan respectively, up -43.60%, 7.96%, and 68.99%, respectively. The company's single-quarter orders and revenue scale increased dramatically, leading to a tenfold increase in performance. The company's Q1, Q2, and Q3 gross margins were 18.66%, 18.96%, and 32.14%, respectively. We determine that this may be due to the increase in the share of products with high gross margins and the volume of orders placed, which also brought significant economies of scale. The company's net profit increased sharply in the first three quarters, mainly due to the transfer of assets from the old factory area, and confirmation of compensation related to the demolition in accordance with the demolition agreement.
Lay out the big 3D printing industry and build the company's core competitiveness. The company signed an agreement on the AP1000 pressure vessel with Dongfang Electric (Guangzhou) Heavy Machinery Co., Ltd. in July to further expand its voice in the field of nuclear power. Develop businesses derived from 3D printing, such as 3D printing coating repair and rapid repair, etc., and lay out the major 3D printing industry to further enhance the company's core competitiveness.
Profit forecast and rating: The company is a leader in the nuclear power HAVC industry. It has already obtained military qualifications for nuclear power. It has benefited from the integration of the military and the civilian integration, offshore floating nuclear power plants, and the restarting of nuclear power tenders. It is expected that the company will receive a large number of nuclear power orders in the future. The company's EPS for 17-19 is expected to be 0.43/0.32/0.47, respectively.
Risk warning: 3D industrialization falls short of expectations, and nuclear power tenders fall short of expectations.
