Revenue decreased by 13.8% compared with the same period last year, with a full-year loss:
As of December 31, 2012, the company's total turnover for the whole year was about 688 million yuan, down 13.8% from the previous fiscal year. Revenue has declined for two consecutive years, but the rate of decline has slowed compared with the 23.4% decline in 2011. From a sub-business point of view, antenna system business grew 9.4% year-on-year, while base station radio subsystem business revenue continued to decline, down 39.7% from 2011. The coverage extension program business maintained a good growth trend, with revenue increasing by 69.4% compared with the same period in 2011. In addition, the company's 2G products accounted for about 36.3% of sales in 2012, while 3G and LTE accounted for about 28.5%, and multi-frequency and multi-system products accounted for 11.3%. The company achieved a gross profit of 116 million yuan for the whole year, down 45.5% from the same period last year, and the gross profit margin was 16.9%, down from 26.6% in 2011. The company believes that the decline in gross profit margin is mainly due to a significant reduction in demand for 2G radio frequency subsystem products from some equipment manufacturers, which makes the price competition very fierce. In addition, some 2G radio frequency subsystem products begin to enter the end of the life cycle. The company had to sell products at a discount in order to clear inventory, resulting in a drop in gross profit margin. For the whole year, the company's net profit is 39.47 million yuan, and there is no dividend for the whole year.
The demand for international equipment manufacturing is declining and is expected to recover in the future:
In 2012, sales to Chinese network operators rose 46% year-on-year, while sales to international equipment manufacturers fell 64%, according to company data. The decline in international equipment manufacturers was mainly due to a decline in procurement demand from Nokia Siemens Networks and Alcatel-Lucent, with sales falling by about 67.2% and 62.3%, respectively. The company's management believes that the products currently sold to international equipment manufacturers are mainly 2G radio frequency subsystem products, which significantly reduced the company's 2G radio frequency subsystem product sales revenue by about 60.5% in 2012 compared with 2011. Due to the increase of R & D investment in 2012, the company has now completed the development of 3G and LTE projects of the above-mentioned international equipment manufacturers. At the same time, the two major overseas customers, Nokia Siemens and Alcatel-Lucent, have basically completed the transition from 2G to LTE, so we expect the company's overseas orders to recover in 2013.
It is expected to recover in the future:
According to Bloomberg's comprehensive forecast, the company's earnings per share for fiscal years 2013 and 2014 are 0.11 yuan and 0.12 yuan respectively. We believe that in the future, with the acceleration of the popularization of global LTE technology in 2013, the growth of the demand for LTE and multi-frequency and multi-system products will benefit the upstream manufacturing enterprises of the communication equipment industry chain. At the same time, we know that the company's current order situation is good, and we believe that the company's performance will recover this year.