Downstream demand outbreaks supply exceeds demand, and the rising price of power devices is on the rise. Demand broke out in the downstream photovoltaic field of power devices, new energy vehicles, frequency conversion home appliances, military products and other market areas. Upstream wafers are in short supply, supply is tight, and power devices continue to be out of stock. Manufacturers have raised prices several times, but delivery time continues to be extended. At present, power devices and MLCC are the two most scarce components in the market, and it is expected that the price trend of power devices will copy the MLCC path.
Under the background of rising product prices, Huawei Electronics ranked first in revenue of the top 10 power semiconductors in 2017, and its profits have been greatly improved. In 2017, the company's revenue was 1.635 billion yuan, an increase of 17.12% over the same period last year, and its net profit was 94.8538 million yuan, an increase of 133.52% over the same period last year. Revenue in the first quarter of 2018 was 396 million yuan, an increase of 12.53% over the same period last year. The net profit returned to the mother was 21.7016 million yuan, an increase of 72.07% over the same period last year, and non-net profit increased by 98.26% over the same period last year.
Huawei has accumulated profound electronic technology and will shine in the military field. Huawei Electronics went public as early as 2001, obtained capital support, and has deep technology reserves in MOSFET and IGBT, leading domestic competitors. The company has a number of 4-inch, 5-inch and 6-inch power semiconductor wafer production lines, with a total production capacity of 3.3 million wafers per year and packaging resources of 2.4 billion wafers per year by the end of 2017.
The company's 5-inch and 6-inch production lines produce medium and high-end power semiconductors such as Schottky, MOS and IGBT respectively, among which the 6-inch line produces new mid-and high-end power devices (MOS, IGBT) with greater market demand, higher technical level and higher added value. In 2017, the company's 5-inch production capacity was 1.56 million / year, and 6-inch production capacity was expanded to 750000 / year, basically full production, capacity utilization and production and sales rate are more than 96%. In addition, the company's 8-inch line is also under construction and is expected to be put into production in the second half of 2019, when the company will expand high-end MOS and IGBT production capacity and accelerate to catch up with overseas giants.
In 2017, the company got all the four military industrial certificates and got the key card to enter the military market. Originally, imported semiconductor chips were used in military products, but due to the warning of the ZTE incident, the state will vigorously use domestic power devices instead. The company has developed anti-radiation MOSFET products that meet the requirements of the military market, and the performance indicators of the products have been certified by customers. The company's military revenue exceeded 10 million in 2017 and is expected to reach 20 million in 2018.
Depreciation and amortization of equipment has expired one after another, and the profit level has improved significantly. Huawei Electronics added 106 million, 98 million and 235 million special equipment in 2008, 2009 and 2010, respectively. The depreciation period of special equipment is ten years, which means that the amortization of this batch of special equipment will be completed in the next three years, which can reduce depreciation and amortization by tens of millions every year, and the company's profits will be greatly increased.
The per capita output value of the company increased from 542800 in 2015 to 763600 yuan in 2017, and the production efficiency has been improved, ranking in the forefront of power semiconductor enterprises. The net interest rate on sales rose from 2.63% in 2015 to 5.46% in 2017, with a substantial increase in profits and increasing profitability.
The company's comprehensive gross profit margin increased by 1.11 percentage points in 2017. The company's management of period expenses has been improved, and sales expenses and financial expenses have increased with the scale of the business, but the management expenses have decreased compared with the same period last year, resulting in a reduction in the rate of period expenses. The profit level of the company has improved significantly compared with the same period last year, and the return on total assets and the return on net assets have increased significantly, reflecting the enhancement of the company's profitability. The company's turnover of accounts receivable is also more smooth. The number of days of receivables fell from 110 days at the beginning of 2016 to 84 days in 2017.
In 2017, the company invested 97.3231 million yuan in R & D, an increase of 15.11% over the same period last year, accounting for 5.95% of operating income. At the end of the year, there were 644 R & D personnel, accounting for 31% of the total number of employees. The company focuses on promoting the R & D and manufacturing of the third generation of new material devices in order to realize the large-scale application of middle and high-end technology products in order to maintain a continuous market leading position.
We will further promote the adjustment of the management of the business department and enhance the enthusiasm of equity incentives. In 2017, the company continued to adjust its organizational structure and deeply implement the operation of the business department. The company fully delegates power to the business department, speeds up the response speed of the business department to the market demand, responds to the changes of the market demand with a keen sense of smell, and then mobilizes the initiative consciousness and enthusiasm of the front-line team to speed up the operation and development of the company. improve the overall operational efficiency of the company. Improve operational efficiency to enhance market competitiveness.
The company launched an equity incentive program in November 2017, granting 2.43% restricted stock to 30 executives and core employees. Combine the interests of employees with the interests of the company, and further mobilize the enthusiasm and fighting spirit of the core staff, which is conducive to the realization of the company's long-term strategic goals.
Profit forecast and investment rating. From 2018 to 2020, we estimate that the company's operating income for 2018-2020 will be 1.909.10 RMB 2.288 billion, and its net profit will be 1.53 Belgian RMB, corresponding to a PE of 34.3 Belgian 20.6, giving it a "buy" rating.
Risk hint. Demand for power semiconductors is lower than expected; company operation is lower than expected