Event: according to the company's annual report for 2018, from January to December 2018, the company achieved operating income of 5.706 billion yuan, an increase of 4.26% over the same period last year; net profit belonging to shareholders of listed companies was 276 million yuan, up 3.78% over the same period last year; and earnings per share was 0.44 yuan, an increase of 3.78% over the same period last year.
The issuance of convertible bonds will consolidate the main business, and major projects will be carried out in an orderly manner. In 2018, the company successfully issued convertible bonds to raise 419.4 million yuan, further improving the layout of the three major industries of optical fiber and cable, intelligent access and military informatization. During the reporting period, the company signed a joint venture and cooperation agreement with Changfei Optical Fiber and Cable Co., Ltd. to jointly invest in the establishment of a light rod company; the plant construction of the optical fiber capacity expansion project of Dongguan Laobu Industrial Park has passed the completion acceptance and fire control acceptance; the construction and acceptance of the optical network science and technology bright new area industrial park construction and expansion project have been completed and have reached the serviceable state; the ERP project has completed the integration and upgrading of the fiber cable plate and has been launched one after another. The equipment networking of 149production lines has been completed in the second phase of MES, the renovation of the new leased factory building of the special Dongzhi expansion and intelligent manufacturing project has been completed, 8 chip production lines have been installed, and major projects have been carried out in an orderly manner.
The acquisition of 70% stake in Beijing Shenzhou Airlines has broad prospects for military informatization. In 2018, the company acquired a 70% stake in Beijing Shenzhou Airlines to further expand the business territory of military information technology.
Beijing Shenzhou Airlines is a high-tech enterprise specializing in the development, sales and service of military computers, military bus test and simulation equipment, signal processing and navigation, and industrial automation data acquisition and testing platform. it has a rich product line in the fields of industrial computer and platform, communication interface, data acquisition, embedded system, signal processing, flight control, reinforced computer and so on. The equipment products of Beijing Shenzhou Airlines and the supporting products of Chengdu Fourier military products are highly consistent and complementary in product form, product function, R & D and implementation, etc., through the mutual matching of products and services, to share technological development achievements and technological advantage resources in many fields to promote the systematic development of the company's military information industry.
Profit forecast and investment rating: the company's net profit from 2019 to 2021 is expected to be 389 million yuan, 528 million yuan, 630 million yuan, EPS is 0.62,0.84,1.00 yuan, corresponding to PE is 23 times, 17 times, 14 times, given a "buy" rating.
Risk hint: the prosperity of the optical communication industry is declining; the military business expansion is not as expected.