The company's performance is in line with expectations and gross profit margin remains stable
The company's operating income in 2019 was 5.62 billion, an increase of 7.5% over the same period last year, and its net profit was 480 million, an increase of 0.2% over the same period last year. The gross profit margin reached 19.2%, unchanged from the same period last year. The company's income does not increase profits, mainly due to the relatively large increase in expenses during the period, especially the expansion of tire channels has brought about an increase in pre-market costs and an increase in R & D investment brought about by new product research and development.
Sales volume continues to grow, and the unit price of the product has decreased.
In 2019, the company's sales of all-steel tire, semi-steel tire and skew tire reached 525.6, 635.6 and 722000 respectively, an increase of 12.4%, 6.6% and 59.7% respectively over the same period last year. According to the channel, the number of dealers, mainframe factories and stickers reached 917.4, 204.6 and 1.113 million respectively, an increase of 22%, 0.2% and-26.9% respectively over the same period last year.
In terms of sales volume, the company has achieved a substantial improvement in distribution channels, mainframe factory supporting has maintained a stable, while OEM has dropped sharply due to the impact of trade frictions in the United States.
In terms of price, the unit price of all-steel tire, semi-steel tire and skew tire was 808, 177 and 301 yuan per bar, down 41, 7 and 17 yuan per bar compared with the same period last year. According to the sales channels, the unit prices of dealers, mainframe factories and OEM reached 431, 597 and 368 yuan respectively, with year-on-year changes of-15, + 13 and-62 yuan. On the one hand, the reduction in the company's selling price was affected by the downturn in the automobile market. Sales in the passenger car and commercial vehicle markets fell 9% and 1% respectively in 2019 compared with the same period last year. On the other hand, it is also related to the decline in the price of raw materials, natural rubber-9.6%, synthetic rubber-4.8%, carbon black-6.9%, steel-4.5%.
The Thai factory is about to start production, and the supplier system has broken through again.
The Thai plant is expected to start production in the second quarter of 2020, and the first phase will increase the production capacity of 800000 all-steel tyres and 4 million and a half steel tires. After completion, the production efficiency will be increased by 20%, the production cycle will be shortened by 20%, the work efficiency will be increased by 40%, the waste of raw materials will be reduced by 80%, and the company's external sales scale will be greatly increased.
At present, the company has become the mainstream supplier of more than 30 large domestic automobile manufacturers, and has successfully become the supplier of BAIC Daimler, Dongfeng Suizai, Great Wall Motor and other automobile manufacturers in 19 years. So far, the top ten commercial vehicle mainframe factories in China have all entered the supporting system. The company is the supporting manufacturer of the world's first "5G + smart driving" project of SAIC Iveco Hongyan Automobile, which marks a new breakthrough in the research and application of tire intelligence.
Taking into account the impact of the epidemic, we lowered our 20-year performance from 584 million to 528 million, maintained 626 million in 21, expected net profit for 22 years to 634 million, EPS reached 0.83 yuan per share, respectively, and the corresponding share price PE was twice as high as 8-7-7, maintaining the "overweight" rating.
Risk tips: Sino-US trade frictions affect tire exports, raw material prices fluctuate, and the epidemic leads to the risk of postponement of projects under construction.
