Events:
The company recently released its semi-annual report for 2010. during the reporting period, the company achieved operating income of 107 million yuan, down 14.3% from the same period last year; net profit belonging to the parent company was 21.5053 million yuan, down 39.8% from the same period last year; gross profit margin and net profit margin were 68.9% and 19.6% respectively, down 2.1% and 8.2pct respectively.
Main points of investment:
The epidemic disturbed the short-term performance, and the order situation gradually improved.
In the face of the global epidemic and complex international situation in the first half of the year, the company's short-term operation was hit to a certain extent, but the impact of the epidemic on the company gradually weakened, and the decline in revenue narrowed from 25.3% of Q1 to 5.3% of Q2. From a regional point of view, the company's domestic market achieved revenue of 59.7852 million yuan (YoY-21.5%) in the first half of the year, and the company's domestic orders recovered quickly after the epidemic was alleviated, and the revenue decline narrowed from 45.6% of Q1 to 1.5% of Q2; foreign markets achieved revenue of 48.7521 million yuan (YoY-3.1%), mainly affected by the spread of the overseas epidemic in the second quarter. After July, with the resumption of production in China and the unsealing around the world, orders in the main regions of the company are recovering rapidly.
According to the product line of building instrument management cloud platform, the company's digital pressure testing products achieved operating income of 87.905 million yuan (YoY-19.5%) in the first half of 2020, while temperature testing products achieved operating revenue of 19.1265 million yuan (YoY+22.0%). The proportion of revenue increased to 17.9%. The company's temperature detection products still achieve rapid growth under the influence of the epidemic, and are expected to become a new growth pole of the company's performance. Focusing on the instrument industry chain, the company continuously launches high value-added products around pressure and temperature calibration and testing, while extending the field of electrical testing and MEMS sensors to achieve the coordinated development of "internal growth + extension". In addition, the company's SaaS cloud platform will be launched in 2021, which is expected to further enhance the added value and competitiveness of the company's products.
R & D investment hit a new high, technological innovation to build core competitiveness in the first half of 2020, the company's total R & D investment of 28.88 million yuan (YoY+28.2%), accounting for 27% of business income. In the short term, a substantial increase in R & D investment has dragged down the company's net profit, but we believe that high R & D investment is the basis for the company's long-term sustainable growth. The company needs to enrich the product pedigree and expand downstream applications through R & D to continuously launch new products with more technical content, so as to increase market share and product added value, and build the company's core competitiveness.
Profit forecast and investment advice:
It is estimated that the company's net profit in 2020, 2021 and 2022 will be 75.43 million yuan, 114 million yuan and 135 million yuan respectively, maintaining the company's "overweight" rating.
Risk factors:
Risks such as lower-than-expected global epidemic control, slower-than-expected progress of production expansion projects, lower-than-expected progress of MEMS projects, lower-than-expected downstream demand, and increased trade frictions.
