The “trinity” layout is progressing steadily, and the recovery in downstream demand is driving performance improvement. Haite Hi-Tech is a three-in-one high-tech enterprise whose main business is high-end core equipment development and support, high-performance second-generation/third-generation integrated circuit design and manufacturing, and aeronautical engineering technology and service. It is the first private aviation equipment development and technical service company in China. It is currently the only domestic civil aviation engineering technology service enterprise that also has licenses such as CAAC, EASA, and pilot training for transport aircraft, business jets, and FA. In the field of high-performance integrated circuit design and manufacturing, the company undertook many major national scientific research projects, and has the first 6-inch compound semiconductor production line in China established by the National Development and Reform Commission. The company's R&D strength and chip manufacturing capabilities are in a first-class position in the industry. In recent years, due to the recovery of the civil aviation industry, the downstream maintenance market and increased demand for passenger conversion, companies in the field of superposition low-altitude economy have developed close strategic cooperation with EVTOL's main engine manufacturers, and the company's performance is expected to grow rapidly in the future.
The company's revenue achieved steady growth. In 2023, the company achieved a total revenue of 1,053 billion yuan, an increase of 15.81% over the previous year; achieved net profit of 47 million yuan, a sharp increase of 263.21% over the previous year, mainly due to a sharp increase in aviation seat delivery settlement volume, delivery of major training system equipment projects, and the recovery of the civil aviation industry, which led to the continuous improvement of aviation maintenance business growth, operational efficiency and cost control capabilities. On the cost side, the cost rate for the 2023 period was 28.03%. Specifically, the sales expense ratio in 2023 was 1.49%, up 0.09 pct year on year, R&D expenses were 40 million yuan, down 28.20% year on year, mainly due to the capitalization conditions of some of the company's R&D projects and capitalization of R&D investment; the management expense ratio was 14.90%, down 3.50 pct year on year, mainly due to a decrease of 1.07 million yuan in equity incentives this year; the financial expense ratio was 7.87%, down 0.58 pct year on year. On the asset side, the 2023 contract debt was 123 million yuan, an increase of 56.80% over the previous year. With the delivery of products included in the contract, it will have a positive impact on the company's performance.
The recovery of the civil aviation industry is driving demand in the field of aviation engineering. The company seized the opportunity to actively explore the market. The comprehensive revenue of aviation engineering technology and service business reached 756 million yuan in 2023, an increase of 12.91% over the previous year, accounting for 71.80% of total revenue. The gross margin was 38.93%, an increase of 0.12 pct over the previous year. In terms of aviation department accessories, the company achieved a year-on-year increase in revenue and profit, forming new profit growth points for new aircraft development, construction and maintenance capabilities, adding new maintenance production lines, expanding production scale, and achieving new breakthroughs in business; in terms of flight training, the company continued to increase market growth and consolidate the leading position in domestic third-party flight training; in terms of civil aviation engineering technology and services, the company officially signed an Airbus freighter modification agreement, becoming the world's first third-party modification company for the EFW A321 aircraft, linking the advantages of the company's upstream and downstream industry chains to form aviation The complete industrial chain of aircraft leasing, aircraft maintenance, and passenger aircraft to freighter is under construction, and is expected to be put into use in 2025. In terms of business jet aviation engineering technology and services, we will continue to maintain efficient and high-quality operation management, continue to establish parts maintenance capabilities and interior maintenance capabilities, form new business growth points, and continue to maintain the position of the business jet MRO with the strongest maintenance capacity, the largest maintenance volume, and the best maintenance quality in Greater China.
The field of high-end core equipment is developing rapidly, and the field of low-altitude economic simulation can be expected to generate comprehensive revenue of 239 million yuan in 2023, an increase of 25.65% over the previous year, accounting for 22.72% of total revenue. In terms of R&D and manufacturing, the company continues to carry out serialization and profiling work, which spawns more than 40 pre-research, research and batch production projects from aero engine control, rescue electric winches, oxygen systems, auxiliary power units, heading indicators, simulation equipment development and drone support engines. Electric rescue winches are actively developing civil aviation and general aviation customers; cabin oxygen systems have been delivered to customers for a long time and have completed airworthiness forensic testing; Ansheng has carried out strategic cooperation with many leading eVTOL companies to customize simulator R&D and manufacturing business, and in 2023, the D-class full-motion flight simulator custom-developed for customers was successfully delivered and successfully passed the bureau's D-class certification. In terms of production and scientific research support, the whole machine testing and parts research and development tasks for certain key models were promoted to pre-set nodes; support capabilities for certain types of engines were built and batch delivery was achieved.
A number of special chips have made major breakthroughs, expanding the civilian product strategy and expanding the premium track company. Huaxin Technology, a participating company, insisted on “high-quality development” as the guide and continued to thoroughly implement the strategy of “expanding civilian products and strengthening technology equipment”. During the reporting period, revenue increased dramatically over the same period last year. Huaxin Technology closely follows market trends and actively lays out high-quality racetrack products such as new energy, automotive electronics, optoelectronic sensing, 5G mobile communications, and high-performance technology chips.
First, the key scientific equipment projects undertaken were completed on time and were highly praised by customers. Second, it has officially obtained the IATF16949 automotive industry quality management system certification, marking that the company's compound semiconductor chip has successfully obtained a green pass to enter the automotive field, further consolidating the foundation for product promotion and application, and providing a strong guarantee for the company to participate in the automotive industry market competition. Third, major breakthroughs have been made in the development of a variety of widely used special chips.
Fourth, in terms of marketing, we have received continuous customer orders in the fields of new energy charging pile chips, fast charging chips, photoelectric sensing chips, and RF modules. Fifth, the company has undertaken or participated in key R&D projects for many national, provincial and scientific equipment customers, and its technical capabilities and R&D capabilities have been highly recognized by customers.
Research and development continues to advance in various fields, laying the foundation for future development performance. The company currently has many research projects, and continuous investment in various fields lays the foundation for new future performance growth. Among them, the passenger oxygen system for a certain type of domestic aircraft has completed all tests; test flight verification of a certain type of helicopter pilot oxygen supply device is in progress; a certain type of helicopter rescue electric winch product has been delivered to users for test flight verification and has entered the verification test stage; in addition, the company is already developing electronic controllers, signal converters, and parts for certain types of aircraft engines as expected. The project is already underway, and it is expected to take advantage of the rapid development of the low-altitude economy and become the second growth curve for the company's performance.
Investment advice and profit forecasting
As a high-tech company with a “trinity” layout, Haite Hi-Tech is a high-tech company with a “trinity” layout. With the recovery of the civil aviation industry and the rapid development of the low-altitude economy, the company is expected to maintain rapid growth in future performance. The company is expected to achieve net profit of 78 million yuan, 119 million yuan, and 174 million yuan in 2024-2026, corresponding EPS of 0.11, 0.16, and 0.23 yuan/share, respectively. Corresponding to the current PE stock price, which is 90 times, 59 times, and 41 times, respectively, an investment rating of “increase in holdings” is given.
Risk warning
Downstream demand falls short of expectations; construction progress of expansion projects falls short of expectations; risks such as failure to win bids for key projects;