Event description:
The company released its annual report in 2018, with revenue of 1.87 billion yuan, an increase of 2.11% over the same period last year, net profit of 46.28 million yuan, an increase of 47.31% over the same period last year, and earnings per share of 0.05 yuan per share.
Event comments:
The performance of the parent company is stable, and the loss of the Aoketai project is reduced. During the reporting period, the parent company realized operating income of 1.86 billion yuan, an increase of 2.19% over the same period last year; operating profit of 207 million yuan, down 6.23% from the same period last year; and net profit of 179 million yuan, down 3.87% from the same period last year. The overall profit level of the parent company is relatively stable. The subsidiary Ganzhou Aoketai realized operating income of 127 million yuan, an increase of 42.82% over the same period last year. Of this total, the sales revenue of coated blades was 74.4 million yuan, an increase of 75.10% over the same period last year, and that of extruded bars was 27.45 million yuan, an increase of 65.73% over the same period last year. Net profit-133 million yuan, a loss of 16.05 million yuan and 10.76% less than the same period last year. Aoketai project has always been the main cause of the company's performance loss, excluding the impact of impairment factors, Aoketai project in the case of increased revenue, the loss has decreased, indicating that the gross profit margin of Aotek products has improved.
The overall cost of the three items was stable, while the financial cost increased slightly. In 2018, the company's sales expenses and management expenses were 3202 yuan and 99.52 million yuan respectively, down 2.94% and 1.49% from the same period last year, while the financial expenses were 74.9 million yuan, an increase of 25.55% over the same period last year, mainly due to the increase in borrowing scale and interest rates.
Aoketai project has become the biggest key point of the company's performance reversal. Aoketai lost money because its scale production fell short of expectations. In recent years, the company has continued to expand its R & D investment, with R & D expenditure of 43.29 million yuan in 2018, an increase of 81% over the same period last year. In 2018, Aoketai completed the production of 110 milling cutters, 32 drilling cutters, 4 turning cutters and 13 slotting cutters. With the increase in production, Aoketai is expected to break even, leading to a reversal of the company's performance.
Profit forecast and investment suggestion: it is estimated that the return net profit of the company from 2019 to 2021 is 0.89,1.32 and 169 million yuan respectively, and the EPS is 0.1,0.14,0.18 yuan respectively.
Risk hint: Aoketai project continues to suffer heavy losses; mine safety and environmental protection issues