Event: the company announced its three-quarter report in 2019, with operating income of 1.952 billion yuan in the first three quarters, down 0.75% from the same period last year, and net profit of 218 million yuan, an increase of 9.74% over the same period last year, corresponding to 0.55 yuan per share.
Comments:
(1) the company's operating income in the first three quarters decreased by 0.75% compared with the same period last year, mainly due to the fact that the company's traditional main business was motor stator and rotor business, which was greatly affected by the continued malaise of downstream car sales. Of this total, Q3 reached 731 million yuan, an increase of 15.83% over the same period last year, indicating that the company's overall revenue has improved rapidly in the short term. (2) the company's net profit in the first three quarters increased by 9.74% compared with the same period last year, of which Q3 reached 85 million yuan, a substantial increase of 34.66% over the same period last year. The main reasons why the growth rate of homed net profit exceeds the growth rate of revenue include: the company's financial expenses decreased by 31.20% during the ① reporting period, mainly due to the increase in interest income in the current period; and other income increased by 105.46% during the ② reporting period, mainly due to social security subsidy funds. During the ③ reporting period, the gross profit margin increased by 2 percentage points compared with the same period last year, of which Q3 increased by 1.2 percentage points compared with the same period last year, which is related to the decrease in the cost of non-oriented silicon steel for motor raw materials in the core business. (3) the sales and management expenses of the company in the first three quarters increased by 19.15% and 16.56% respectively compared with the same period last year. Among them, Q3 sales and management expenses increased by 14.89% and 33.49% respectively compared with the same period last year. (4) in terms of assets and liabilities, the advance payment of the company at the end of the period increased by 84.98% compared with the beginning of the period, which was due to the increase in the prepaid steel payment of the current period and the increase of Tianyu Changying prepaid UAV materials, indicating that the company's orders were sufficient. Projects under construction increased by 154.5% compared with the beginning of the period, due to the increase in investment in intelligent factories.
The motor stator and rotor business continues to be stable, and the new energy vehicle business is expanding steadily. In the traditional motor stator and rotor business, relying on high technical level and service quality, the company has a long-term and stable service relationship with the global mainstream motor and electrical manufacturers, and is the world's largest supplier of automotive generator stator cores. the position of the industry continues to be stable. In terms of motor business of new energy vehicles, the company has jointly developed flat wire stator assembly technology with ES in Germany, which has higher energy density and higher motor efficiency, which is in line with the development trend of new energy vehicle motor and industrial motor technology in the future, and is expected to further enhance the company's competitiveness and provide new growth points for the company.
Drones maintain rapid growth and enrich the main business pattern for dual-use military and civilian use. The company's drone business takes the military as the core, while expanding domestic and foreign civilian markets. In the military field, the company's 005 series military helicopters have been in service for many years. According to the company announcement on August 2, the holding subsidiary Tianyu Changying added 780 million yuan in drone orders, accounting for 29.65% of the company's recent annual revenue. And customers are willing to purchase later; in the civil field, the company cooperates with Cainiao Alliance in the "hump" plan to meet the growing market demand in the field of unmanned logistics.
The completion of the share increase plan demonstrates the company's confidence in the development of the company. The company announced on February 12, 2018 that Mr. Yin Wei, the chairman of the company, Mr. Yu Deyun, the director, and Mr. Chen long, the other shareholders of the company, planned to increase their shareholdings in the company. As of February 12, 2019, all the increasing parties have completed the plan to increase their holdings, demonstrating their confidence in the sustainable development of the company.
Investment suggestion: considering that the company's drone business has sufficient orders and is expected to continue to grow in the future, while the company's traditional motor parts business area tends to be stable, we predict that the company's annual EPS in 2019-20-21 will be 0.68x0.84x1.16 yuan respectively, corresponding to the PE of 21-17-12, covering the company for the first time and giving the company an "overweight" rating.
Risk hint: drone business is lower than expected, flat line motor project research and development progress is not as expected, new energy vehicle industry policy changes.
