AVIC Mechanical (002013) 2019 Interim Report Review: Steady Growth in Aviation Business and R & D Expansion in Non-aviation Business
On August 26, the company released its 2019 Interim Report, reporting that the two companies achieved operating income53.
3.9 billion, a decline of 2 every year.
02%; net profit attributable to mother 3.
25 ppm, an increase of 12 in ten years.
Brief comment on the company’s small revenue.
On August 26, the company released its 2019 Interim Report, reporting that the two companies achieved operating income of 53.
3.9 billion, a decline of 2 every year.
02%; realized operating profit 3.
79 ppm, a decrease of 2 per year.
02%; net profit attributable to listed companies3.
2.5 billion, an annual increase of 12.
The company’s overall gross profit margin 22.
99%, increasing by 0 every year.
The decrease in the company’s revenue was mainly due to the segmentation of non-aeronautical products. The increase in net profit attributable to the parent was mainly due to the reduction in the minority shareholders’ equity deducted by the 北京夜生活网 company.
Revenue from the aviation business grew steadily, while revenue from the automotive business declined.
In terms of products, the company’s aviation products achieved revenue of 35 in the reporting period.
30 ppm, an increase of 9 in ten years.
68%; non-aeronautical products achieved revenue of 17.
64 ppm, a decrease of 16 per year.
91%; modern service industry and others achieved zero revenue.
46 ‰, a previous decline of 57.
In view of different industries, the company’s aircraft manufacturing segment achieved revenue of 35.
30 ppm, an increase of 9 in ten years.
68%; the automotive industry segment achieved revenue9.
26 ppm, a decrease of 28 per year.
94%; revenue from other manufacturing sectors8.
38 ppm, a 10-year increase2.
22%; trade and other sectors achieved zero revenue.
46 trillion, down 57 every year.
The 杭州桑拿洗浴会所 subsidiary Seiki Technology is in the transition period, and its R & D expansion breakthrough has led to the penetration of the automotive manufacturing sector.
Finance and R & D expenses increase every year.
In terms of expenses, the company’s overall period expense ratio increased by 0.
95 averages to 15.98%.
Specifically, sales expenses have dropped by 22 per year.
92%, the management cost drops 4 every year.
92%, financial expenses increased by 53 in ten years.
07%, R & D expenses increased by 32.
The decrease in sales expenses was mainly affected by the decline in revenue of the non-aeronautical sector. The increase in financial expenses was mainly due to interest expenses on convertible bonds, and the increase in research and development expenses was due to the company’s penetrating R & D in the automotive parts segment and the continued R & D expenditure in the aviation segment.
Optimized cash flow.
Net cash flow from operating activities of the company during the reporting period -3.
39 trillion, an increase of 45 each year.
98%, mainly because the company’s sales receipts are better than the same period last year; the net cash flow from investment activities is -4.
40,000 yuan, an increase of 19 every year.
84%; net cash flow from financing activities4.
03%, mainly because the company received more than 5% in cash from borrowings; the net increase in cash and cash equivalents was -3.
The business growth of the aviation sector subsidiaries was better.
From the perspective of its subsidiaries, Guihang Electric, Sichuan Hydraulics, Sichuan Fanhua Instrumentation, Yibin Sanjiang Machinery, and Singapore Airlines Group have seen higher growth, reflecting the continued good growth of the company’s aviation business.
Qing’an’s revenue and net profit span decreased, mainly due to the replacement of its air-conditioning compressor business; Jingji Technology’s revenue and net profit were replaced, mainly due to the replacement of its automotive supporting business.
The electromechanical system has ushered in a period of rapid growth. The company will give full play to its comparative advantages and will continue to set the military aircraft market space at USD 150 billion for the next ten years. The average annual market space for electromechanical systems is approximately 22.
$ 500 million.
It is estimated that in the next ten years, the number of new fighter aircraft is expected to be about 1500, and the market space is about $ 100 billion.
About 200 new large transport aircraft and special combat aircraft, about 400 new training aircraft and other models, about 2,000 military helicopters, and total military aircraft market space of about $ 150 billion, accounting for 15% of the value of electromechanical systemsAccording to calculations, the average annual market space for mechanical and electrical systems in military aircraft is about 22.
$ 500 million.
If the electromechanical system is integrated and integrated, and the proportion of electromechanical systems is increased to 20%, the market space will further expand.
It is estimated that the domestic civil aircraft market will exceed US $ 1 trillion in the next two decades, and the average annual market space for electromechanical systems will exceed US $ 8 billion.
At present, China has become the world’s second largest civil aircraft market after the United States. In 2017, the number of domestic civil passenger aircraft was approximately 3,118, which increased by approximately 808 in 2013, with a combined annual total of approximately 7.
According to COMAC and Boeing’s predictions for the Chinese civil aircraft market in the next two decades, China will need a total of more than 7,000 civilian passenger aircraft in 2017-2036, with a total value of more than $ 1 trillion.
Aviation electromechanical systems are the foundation and necessary conditions to ensure the functioning of civil aircraft. The expansion of the civil aviation market will drive the growth of electrical system business. According to the 15% value of electromechanical systems, the average annual market space for electromechanical systems will be$ 8 billion.
AVIC’s relative monopoly share in the military aviation electromechanical market.
AVIC makes full use of the advantages of relying on the actual control of the aviation industry and forms long-term close cooperation with supporting OEMs to achieve unique competitive advantages such as first-step communication, rapid development, and full-process tracking. In the current military aviation mechanical and electrical products market, AVICMechatronics has a relatively proprietary budget and is expected to maintain a relatively proprietary advantage in the future.
Due to the lack of experience in the production of civil aircraft airborne systems, the core suppliers of domestic large aircraft C919 airborne systems are still foreign companies, and the company participates in the C919 electromechanical system supporting as a sub-supplier.
Benchmarking foreign airborne leading companies, the company’s civil aviation market is of great value.
In the future, the company will further focus on the main aviation mechanical and electrical industry and actively expand its downstream maintenance business.
Strengthen, AVIC Mechanical and Electrical Holding Company, the controlling shareholder of AVIC, plans to integrate with Avionics to strengthen the synergy of the aviation sector.
At the same time, actively expand the downstream maintenance market and expand the company’s growth space.
The Group’s electromechanical system is listed on the platform, and a large number of high-quality assets are injected into the expected adjustment of the scope of custody, and provided by Nanjing Central Research Institute.
In accordance with the principles of business synergy and higher requirements for performance, the company recently adjusted the scope of custody, reducing 7 custody companies and adding 1 Nanjing center.
Through this adjustment, Nanjing Research Center (609) and China Aviation Research Institute (610) related to the airborne system replaced the listed company’s custody.
At least after hosting, it can further improve the level of business collaboration and is expected to be replaced in the company.
In the past 4 years, the company has acquired 4 custodian companies. As the only capital operation platform for the aviation mechanical and electrical industry, related companies will still inject expectations in the future.
Earnings forecast and investment rating: The leader in mechanical and electrical systems, there is clear room for future penetration improvement. We maintain the buy rating. We believe that the company is a leader in military mechanical and electrical systems, and the rapid transformation of military aircraft volume performance in the future is expected.
The company actively expands the civilian and maintenance support market, widening the space for continued growth in performance.
It is expected that the company’s net profit attributable to its parent from 2019 to 2021 will be 9 respectively.
2.1 billion, 10.
5.1 billion, 12.
07 yuan, the annual growth is 10.
80%, the corresponding 19 to 21 years EPS are 0.
29,033 yuan, corresponding to the current maximum PE is 26.
49 times, 23.
21 times, 20.
21x, maintain BUY rating.