Chujiang New Materials (002171): Military materials and copper conductors with performance in line with expectations help the company’s growth
Event: The company released three quarterly reports, and achieved profit attributable to mothers in the first three quarters3.
56 ppm, an increase of 14 in ten years.
48%, of which the return to the mother’s profit in the third quarter1.
36 ppm, an increase of 37 in ten years.
The growth rate of profit growth was consolidated by Tianniao High-tech and the newly-added holding subsidiary Xinhai High-Tech Leader.
From the report of 2019H1, we can see that the company’s gross profit of copper sheet, copper rod, copper rod wire, steel tube, carbon fiber composite material and equipment manufacturing business increased by -0.
400 million, 0.
800 million, 0.
1 trillion, 0 trillion, 0.
600 million and 0.
At 100 million US dollars, the growth rates are obviously carbon fiber composite materials and copper rods, and the two block businesses are related to the company’s new consolidated items in 2019.
Based on the extrapolation of gross profit growth in the second quarter, and combined with the overall macroeconomic environment this year, the probability of profit growth in traditional businesses such as copper plates and strips is not high. Therefore, we judge that the company’s third-quarter performance growth may still change.Consolidation of Gaoxin and newly-added holding subsidiary Xinhai Gaodao.
Many factors caused the company’s three fees to increase significantly.
The company’s three fees for the first three quarters totaled 4 from the same period last year.
62 billion percent increased 39% to 6.
$ 4.1 billion, of which management expenses increased by 49% per year, due to 1) optimization of the salary incentive mechanism and increase in management personnel expenditures; 南京桑拿网 2) the amortization of share payment expenses for the third phase of the employee shareholding plan increased;After Xinhai, the company’s scale increased; R & D expenses increased by 33% each year, which stemmed from the company’s increased R & D investment in advanced copper-based materials industry and high-end thermal equipment and new materials industries; the company’s financial expenses further increased by 1584%,It originated from 1) the increase in the company’s operating scale brought about an increase in liquidity demand and an increase in interest income; 2) the raised funds were gradually invested in project construction, and the financing income from the raised funds decreased;
The National Fund supports the development of Skybird.
During the year, the company completed the merger and reorganization project of Sky Bird High-tech7.
The company issued 47.5 billion US dollars in supporting funds and successfully completed the National Military-civilian Integration Industry Investment Fund, holding 91,240,875 shares of the company, accounting for 6 of the company’s shares.
The participation of the national military-civilian integration fund in the company will increase and it will be listed in the list of the top ten shareholders of listed companies, indicating that the company’s military composite products and related technical capabilities are recognized. The company is expected to participate in national defense security construction projects in the future.
Profit forecast and rating.
Maintain the company’s “overweight” rating, and we expect the company’s EPS for 2019-2021 to be 0.
35 yuan, 0.
42 yuan and 0.
49 yuan, corresponding to the current sustainable PE is 17 respectively.
9 times, 14.
8 times and 12.
Risk reminder: The new project’s commissioning schedule and profitability are lower than expected, the three fees are higher than expected, and the macro economy is gradually leading to the replacement of copper processing fees.