During the reporting period, the company achieved total operating income of 22,468848 million yuan, an increase of 5.21% over the same period of the previous year, and achieved operating profit of 44.911,700 yuan, a decrease of 42.43% over the same period last year; realized a total profit of 47.0935 million yuan, down 47.01% from the same period last year; and realized net profit attributable to shareholders of listed companies of 398.888 million yuan, a decrease of 46.12% over the same period last year.
Key points of investment:
The company's operating income increased slightly compared to the previous year, but profits declined. The main reasons are: (1) Compared with the same period of the previous year, the company's non-current asset disposal revenue during the reporting period decreased by 307.76 million yuan, mainly due to the fact that the company confirmed asset disposal revenue from the relocation of the old factory of 303.461 million yuan in the same period last year; (2) the company increased the development of new products, and the increase in R&D projects and R&D personnel led to an increase of 8.813,800 yuan in R&D expenses; (3) government subsidies, which include current profit and loss, decreased by 3,582,800 yuan over the same period last year.
The company's military products business is currently stable due to production capacity, and its profitability is expected to continue to increase in the future. In 2019, the company's military goods business remained stable due to production capacity. The company is expanding production capacity for military products. The current pyrotechnics power expansion project is actively cooperating with government departments, and the finalization of local construction projects has been completed. On the basis of the pyrotechnics capacity expansion project, capacity building for pyrotechnics testing and appraisal will be added to enhance the company's position in the pyrotechnics industry. Research and development of new products and market development efforts have been continuously stepped up, and a total of 79 military research projects have been carried out. Fifteen design finalization (or certification) projects have been completed, major breakthroughs have been achieved in the military goods business, and profitability is expected to increase.
Production expansion projects are progressing steadily, meteorological support projects have achieved new developments, civilian product performance continues to grow, and profitability is expected to increase. Revenue from the civilian goods business mainly comes from the country's financial expenditure on people. The company has a stable customer base, and business revenue has basically maintained a steady growth trend in recent years. During the reporting period, the company's human imaging equipment production expansion project progressed steadily, and at the same time, it was committed to developing a series of major new weather protection products. A total of 30 research projects on civilian products have been carried out, and 5 design finalization (or certification) have been completed. The focus is on developing various new types of portrait detonation equipment, new types of portrait operation equipment, and meteorological environment monitoring equipment. A certain type of meteorological sounding rocket that the company cooperated with a military enterprise also received an order mission from the military.
New product development has added momentum to the company's development. The civilian goods business is expected to maintain its growth trend, and profitability is expected to continue to increase.
Profit forecasting and investment ratings: In the context of growing defense spending, increasing rigid demand for military practical training, and the role of man-made influence on weather in disaster prevention and mitigation, ecological environment protection and construction, and the guarantee of major social activities, etc., in conjunction with the company's implementation of a continuous innovation-driven strategy to continuously increase research and development of new technologies and new products, as well as the business strategy and competitive awareness of actively expanding production and capacity in the military and civilian goods sector, we expect the company's EPS to be 0.394 yuan in 2020-2022. 0.456 yuan, 0.524 yuan. The corresponding PE is 55.64 times, 48.06 times, 41.83 times. It is recommended to hold it.
Risk warning: market change risks, safety risks, and COVID-19 fluctuations, etc.