Main points of investment:
The company turned from loss to profit in 19 years, and its operation was restrained for a short time in the first quarter.
The company recently released its annual report for 2019 and quarterly report for the first quarter of 2020. The company's operating income in 2019 was 1.245 billion yuan, an increase of 37.0% over the same period last year. The net profit belonging to the parent company was 11.0705 million yuan, compared with a net loss of 280 million yuan in the same period last year. In the first quarter of 2020, due to the impact of the epidemic, the company's operating income was 95.77 million yuan, down 42.52% from the same period last year; the net profit attributable to the parent company was 44.45 million yuan, compared with a net loss of 18.39 million yuan in the same period last year. The company's performance in 2019 is in line with expectations, and the quarterly operation is greatly affected by the epidemic, resulting in a large loss, but with the smooth progress of the resumption of work, the company's operation has been normalized, and the future performance is expected to quickly reverse losses and enter a period of steady development.
Relying on the profound technical background, the company has made great efforts to develop the three major electronic fields.
As a professional and technical company that has been deeply cultivated in the field of power products for 25 years, it has formed the advantage of sustainable development in terms of technology platform, product development and R & D team. technology platforms with full topology structure and full power coverage and more than 100 kinds of products have been developed, which are widely used in three major fields: data communications, smart energy and new energy vehicles: communications. The company's communication power supply module, IDC power supply system and distributed power supply are used in base stations and data centers. In the field of smart energy, the company's backup power supply, photovoltaic inverter and battery management system BMS are mainly used for energy storage, new energy and industrial energy-saving services; in the field of new energy vehicles, the company's charging piles, on-board power supplies, hydrogen fuel cell converters and vehicle augmenters are mainly used for new energy vehicles and integrated optical storage charging and discharge systems. For a long time, the company focuses on independent research and development and manufacturing, continuously improves product quality through technological innovation, and provides customers with stable and reliable products and overall solutions. related technologies and products have formed competitive advantages in terms of power efficiency, power density and high reliability. The company's product sales are mainly direct sales, some products are sold by direct sales + agents to meet the needs of market differentiation, and its products enjoy a high reputation among the majority of customers.
Continue to increase investment in R & D and continuously enhance the competitiveness of independent research and development
Independent research and development is the foundation of the company, the company has been increasing investment in research and development. Since last year, the company has established a Power Research Institute to strengthen the technology platform and product research and development capabilities, and built a reliability verification laboratory in line with international standards. continue to meet the speed of the company's product development and global sales of higher product quality requirements. The company's supply chain management system is driven by customer demand, realizes the coordination of the end-to-end industrial chain and the controllability of cost, and introduces intelligent manufacturing equipment at the production end to complete the upgrade of "intelligent factory" and realize the standardization of production management. improve efficiency and reduce costs at the same time to maximize business benefits. As the core supplier of the world's major telecom operators and tower companies, the company's independent research and development of communication power supply, EPS products, module power supply has been in the industry leading position, the newly launched DC-DC power supply for hydrogen fuel cell, high-speed motor controller and fully sealed liquid-cooled charging module quickly become industry star products. At present, the company has a stable team of experts covering 178 items of intellectual property rights, which can quickly provide comprehensive solutions to the various needs of customers.
Optimize the business structure, reduce fees and improve efficiency to help turn losses into profits
In 2019, under the background of the decline of the overall prosperity of the global economy, the transformation and upgrading of domestic industries was accelerated, and the switching between new and old momentum was accelerated. In the face of complex economic environment and the pressure of high-quality development, the company actively responded to market changes, subtracted in business structure, shut down and dealt with marginal industries, and focused the company's resources on three strategic business directions: data communications, smart energy and new energy vehicles. With the launch of 5G construction, the addition of 5G base stations brought a significant increase in power demand, and the company seized on the new addition, expansion and transformation needs of domestic operators for communication power supply, and made major breakthroughs in the overseas communication power supply market, thus achieving rapid and restorative growth in the current year's performance. At the same time, the company has also achieved breakthroughs in data center business, standby power supply and intelligent evacuation system, and distributed photovoltaic business, which will provide further impetus for future performance growth in many directions. In addition, with the help of the domestic policy of speeding up the development of new energy vehicles, the company has made great progress in product development, market expansion and system construction, and related products have entered a number of domestic and foreign automobile manufacturers. this will also lead to the exponential growth of the company's business performance. Therefore, in 2019, with the joint efforts of business layout optimization, core business restorative growth and new business breakthroughs, the company successfully achieved endogenous performance turnaround, which is a solid foundation for growth.
However, since the first quarter of this year, in the context of the sharp economic decline caused by the impact of the epidemic, although it is the off-season of sales, the sharp decline in revenue and the rigid effect of expenses have led to a loss in the company's performance in the first quarter. However, with the rapid launch of new infrastructure led by 5G construction, communication power products have entered the seller's market, the company's communication power products are in short supply, and the rapid growth of core business in the future is expected to be temporary. in the future, as operators accelerate 5G construction and the recovery of the new energy vehicle industry, the company's business is expected to embark on a steady development channel.
Profit forecast
Based on the strategic transformation of the company from "traditional communication power product manufacturer" to "communication infrastructure integrator" and "network energy solution provider", we are optimistic that the company's future product and service diversification trend can perfectly cater to the ongoing large-scale 5G construction, and make effective breakthroughs in new energy and other new fields, and the company is expected to grow steadily in the future. Taking into account the long-term impact of the current epidemic, we have appropriately lowered our previous profit forecast for the company. It is estimated that the company's revenue in the next three years will be 1.3 billion yuan, 1.561 billion yuan and 1.873 billion yuan, and the corresponding return net profit will be 70.24 million yuan, 112 million yuan and 157 million yuan. Maintain the company's "overweight" rating.
Risk hint: operator collection orders are not as expected, and new energy vehicle business is not as expected.