Event: the company released its semi-annual report for 2020. During the reporting period, the company realized operating income of 212 million yuan, year-on-year + 24.49%; net profit of 31 million yuan, + 1721.80%; deduction of non-net profit of 32 million yuan, + 3342.43%; net operating cash flow turned negative, to-31 million yuan. Earnings per share (EPS) was 0.1224 yuan per share, an increase of 1,726.87 percent over 0.0067 yuan per share in the same period last year.
The substantial growth of airborne equipment business led to the company's overall performance in the first half of the year. During the reporting period, the operating income of the airborne equipment development business, which was mainly composed of cabin equipment such as aviation seats and kitchen and bathroom interiors, protective armor and radio navigation equipment, was 150.5491 million yuan, an increase of 61.28% over the same period last year. Affected by the epidemic, the company's aviation maintenance business achieved revenue of 55.6565 million yuan, down 0.70% from the same period last year; revenue from measurement and control equipment development business reached 163800 yuan, down 98.04% from the same period last year The operating income of information technology services and other businesses was 5.9202 million yuan, down 53.63% from the same period last year. Despite the impact of the epidemic in the first half of the year, the company's performance maintained bright growth due to the substantial growth in airborne equipment business.
The four fees remained stable, and the VAT rebate increased and thickened profits. During the reporting period, the company's sales expenses were 10.396 million yuan, management expenses were 45.1771 million yuan, R & D expenses were 28.7803 million yuan, and financial expenses were 2.9188 million yuan. The overall volume was the same as last year, and the increase in financial expenses was due to the increase in interest on short-term loans. At the same time, the VAT rebate income of products during the reporting period was 23.8985 million yuan, an increase of 19.2029 million yuan over the same period last year, further thickening the company's profits.
Airborne equipment segment market leader, the core benefits from China's land and aviation construction and mechanization process. The company is positioned as a high-tech enterprise focusing on aerospace and defense, and its main business includes airborne equipment and intelligent measurement and control. Among them, the airborne business plate is mainly engaged in military and civil aviation seats, navigation equipment, and China's helicopter protective armor and transport aircraft kitchen and bathroom interior products, which has a high market share in China's rotor equipment market. Combined with the recent geopolitical changes around China and China's goal of "realizing mechanization in 2020", China's sustained investment and vigorous development in the field of land and aviation and medium-and long-distance transport equipment will not change. The company is expected to benefit from this trend at its core.
Profit forecast. The company is expected to make a net profit of 0.93, 1.18 / 143 million yuan in 2022, corresponding to PE 49.0, 38.6, and 31.8 times the "highly recommended" rating.
Risk Tip: the company's orders are lower than expected, the industrial payback is slower than expected, and the plate valuation falls.