Fire Electronics (000561) 2018 Annual Report Comments: Steady Growth in Performance and Supply and Demand Outlook Continue to Improve
The company achieved EPS 0 in 2018.
The reported company’s income and gross profit margin remained stable, bad debt losses decreased, other income increased, and performance grew steadily.
Taking into account the steady advancement of our army’s informatization construction and the development prospects of the company’s communications and electro-acoustic business, we maintain the EPS forecast for 2019/20 of 0.
21 yuan, giving the company 2021 EPS forecast 0.
Taking into account the company’s market in the short-wave communications field and future asset injection expectations, it maintains an “overweight” rating with a target price of 9 yuan.
The performance is in line with expectations and is expected to continue to improve.
The company realized revenue in 201812.
24 ppm (decade +0.
58%), net profit attributable to mother 0.
RMB 870,000 (+24 for the whole year.
10%) to achieve EPS 0.
The reported amount of the company’s revenue is stable, and the gross profit margin rose by 0.
From 19% to 44%, the provision for bad debts in this period was reduced. The provincial military-to-civilian support fund of 3.5 million yuan was received, and the military-to-civilian integration construction compensation was 5 million yuan. The performance growth rate was faster than the revenue growth rate.
It is expected that through the gradual recovery of military and civilian products orders, the company’s performance is expected to continue to improve.
The main business of communication decreased slightly, and the prospect of supply and demand steadily improved.
In 2018, the company’s communications and supporting businesses achieved revenue10.
9.4 billion (-2.
06%), gross margin of 43.
7%, increase by 0 every year.
As the core enterprise of short-term short-wave communication equipment research and production, the company’s four-generation short-wave communication equipment developed for our army represents the highest level in the industry, thus providing full-power series airborne short-wave products.
The reported company’s air and naval aviation spare parts achieved growth. 20W short wave radio entered the military market for the first time, and made good progress in digital generation, low-altitude prevention, railway leveling and other business areas, but affected by the military reform and the extension of foreign trade market contracts,Shaanxi Tongtong’s revenue fell 41 a year.
With the advancement of our army’s informatization construction and the restoration of orders after the effects of the military reform are gradually eliminated, the performance of Shaanxi Tongtong Company is improving.
In addition, the company’s production capacity construction has been progressing steadily, the ZW project has been completed as a whole, the construction of the 2X project comprehensive test center has been completed, the first phase of the Chang’an Communication Industrial Park has entered the interior decoration stage, and the new plant No. 9 has completed the preliminary scheme design.
The market for electro-acoustic services is gradually opening up, and noise reduction business is expected to become a growth point of performance.
Report information, the company’s electroacoustic device business income1.
08 thousand yuan (+39.
4%), gross margin increased by 15 in the short term.
2 to 39.
4%, significantly improved profitability.
The reported company’s market development is progressing rapidly. The in-car audio integrated management system has opened up new channels in the Marine Corps; the in-car audio integrated management system has achieved the installation 杭州桑拿网 of a certain type of trainer for the first time; the space noise reduction system has been installed and verified; the Army IntelligenceQualifications for the development and production of anti-noise headphones and other projects.
Hongsheng Technology, a subsidiary of the Company, continued to optimize its business structure, continuously promoted product and technology innovation and customer expansion, and its revenue in 2018 increased by 24.
6%.In the future, the noise reduction business is expected to become the next growth point, driving the company’s performance to further improve.
Increased shareholder holdings demonstrate confidence in future development, and subsequent asset injections are worth looking forward to.
Shaanxi Electronic Information Industry Investment Management Co., Ltd., the controlling shareholder of the company, increased its holding of 1.5 million shares in the company in June 2018 (0.
25%), showing confidence in the company’s future development prospects.
Shaanxi Province proposed to increase the domestic asset securitization rate, and Shaanxi Electronic Information Group also clearly stated that the target of the group’s asset securitization rate at the end of the “Thirteenth Five-Year Plan” period should be more than 40%. As the only listed company within the group, the company’s subsequent asset injection potential is expected.
Group assets and revenue are several times larger than the company. If asset injection is steadily advanced in the future, efforts will be made to significantly increase the company’s performance.
Risk factors: Asset injection is less than expected, and new product launch forces are less than expected.
Investment suggestion: Considering the steady advancement of our army’s informatization construction and the development prospects of the company’s communications and electro-acoustic business, maintain the company’s EPS forecast for 2019/20 to 0.
21 yuan, giving 0 EPS forecast for 2021.
The current price is 7.
88 yuan, corresponding to 45/38/32 times of PE in 2019/20/21 respectively.
Taking into account the company’s market in the short-wave communications field and future asset injection expectations, it maintains an “overweight” rating with a target price of 9 yuan (corresponding to 51 times PE error in 2019).