Weixing New Materials (002372) Interim Report Comments: Revenue Growth Segmentation Improves Profit Quality
Key Investment Events: On August 7, 2019, the company released its semi-annual report for 2019, and the company achieved operating income of 21 in the reporting period.
50,000 yuan, an increase of 11 in ten years.
58%; net profit attributable to shareholders of the listed company is 4.
43 trillion, an increase of 14 over the same period last year.
91%; budget benefit 0.
Opinion: PPR pipes have achieved counter-trend growth, but Q2 growth has improved.
In terms of products, PPR pipe fittings, PE pipe fittings, PVC pipe fittings, and other products achieved revenue 11 in the first half of 19, respectively.
1 and 0.
800 million, an increase of 10 each year.
63% and 90%.
25%, the growth of PPR products against the trend shows the company’s strength in the retail end; the PE pipe revenue of engineering products is mainly due to the company’s adjustment to the municipal business in accordance with the market environment; the growth of the PVC business is mainly due to its increase in PVCThe sales of line pipes and various types of home-made pipe systems have played an important role in channel sales. The major gains in other products are mainly due to the rapid growth of new businesses such as waterproofing and water purification.
By quarter, Q1 achieved revenue of 7.
810,000 yuan, an increase of 17 in ten years.
89%, net profit attributable to mothers1.
3 billion yuan, an annual increase of 21.
Q2 realized revenue 13.
2.3 billion, an increase of 8 years.
09%, achieving net profit attributable to mother 3.
14 ppm, an increase of 12 in ten years.
Q2 income growth forecast We judge that it may still be due to the increasing trend of the proportion of fertilized and decorated houses.
In terms of income growth, the Northeast and Western regions are faster. In the first half of the year, Northeast China, North China, East China, South China, Central China, and the Western Region each experienced an increase of 32.
60% and 20.
53%, of which the Northeast region has increased, mainly due to the company’s expansion of the market expansion rate in the region; PE tube gross profit margin increased significantly, driving the company’s comprehensive gross profit margin to increase in the first half of the company’s comprehensive gross profit margin of 46.
36%, rising by 0 every year.
In terms of products, the gross profit margins of PPR, PE and PVC pipe fittings were 58.
19%, 35.39% and 26.
94%, gross margin is relatively constant 0.
53% and 0.
The gross profit margin of PPR and PVC pipe fittings products is basically stable, and the gross profit margin of PE pipe fittings products has increased significantly. We judge that it is due to the optimization of the product structure at the engineering end and the decline in raw material prices.
The period expense ratio decreased, and the net profit ratio continued to increase during the reporting period.
88%, a decrease of 0 compared with the same period last year.
2 single, of which sales, management (including research and development) and financial expense ratio are 13 respectively.
5% and 南京夜网 -0.
57%, which decreases by 0 each year.
25 and -0.
03 units; the expense rate control during the period is better, the company’s net profit margin was 21 in the first half of the year.
11%, an increase of 0 compared with the same period last year.
63 averages, quarterly, QI and Q2 net profit margins are 16.
67% and 23.
74%, rising by 0 each year.
46 and 0.
At 95 levels, the quality of municipal business transformation has been improved, and the proportion of accounts receivable has fallen. In the first half of the year, the engineering business adhered to the concepts of “striving for stability while keeping risk control first” and “doing better and stronger”.The operating quality has been steadily improved; construction projects actively seize development opportunities, focus on core projects, and achieve rapid and healthy development.
Accounts receivable in the first half accounted for 12.
35%, down 4 from the end of 18 years.
94%, the quality of receivables improved significantly.
Increase R & D investment and continuously improve the company’s core competitiveness The company’s R & D investment in the first half of the year was 64.48 million yuan, an annual increase of 27.
During the reporting period, the company had more than 50 research projects, including 7 provincial-level new product projects and 3 appraisals; 68 patent applications were filed, of which 14 were invention patents; the company formed a research and development “conversion reserve, ongoing research reserve, and reserve funds”Plan for various industries, and continue to develop R & D investment to enhance core competitiveness. We give the company an “overweight” rating. We estimate that the company’s operating income will be 50% in 2019-2021.
900 million, 56.
700 million, 62.
USD 600 million, an increase of 11 each year.
3%; net profit attributable to mothers is 11.
05 billion, 12.
1.6 billion, 13.
29 trillion, an increase of 12 each year.
It is expected that the EPS for 2019-2021 will be 0.
7 yuan / share, 0.
77 yuan / share and 0.
84 yuan / share, corresponding PE is 22/20 / 18x.
The company is warped in the field of pipe retailing. It may face the impact of the improvement of the penetration rate of decoration houses in the short term. However, the company’s channel, internal control and other advantages are at the leading level in the industry, and it is given an “overweight” rating.
Risks prompt macroeconomic risks; the risk of rising raw material prices; the risk of increased competition in the industry.