Jiemei Technology (002859) company financial report comments: downstream destocking affects short-term performance and waits for demand to pick up in the second half of the year
[Key points of investment]The company achieved operating income in the first half of 20193.
8.2 billion, down 36 each year.
18%; net profit attributable to mother was 5,413.
670,000 yuan, a decrease of 48 per year.
Net cash flow from operating activities reached 2.
67 ppm, an increase of 1940 in ten years.
Downstream destocking led to a double decline in revenue and profits, and demand is expected to pick up in the second half of the year.
From the fourth quarter of 2018 to the end of June 19, the downstream industry has been in the inventory stage. Due to this, the company’s short-term performance has shifted.
Destocking pressure reduced. In the first three quarters of 2018, some downstream companies and distributors of electronic components continued to raise prices and stockpiles, which led to high stocks in downstream companies. The transition due to the transition from 4G to 5G led to a rapid decline in demand.
In the second half of the year, downstream and downstream customer inventories gradually returned to normal levels. The arrival of 5G brought about a rebound in demand, and the company’s crop utilization rate gradually improved.
The paper carrier tape product structure was further optimized, and the plastic carrier tape raw materials were switched smoothly.
Paper carrier business achieved revenue in the first half of the year2.
86 ‰, a decrease of 36 per year.
At the same time that revenue has grown significantly, the gross profit margin of this business has still reached zero.
27 outstanding improvements, thanks to the continuous optimization of its product structure.
In the first half of the year, the company’s share of cut paper tapes further decreased, and the percentage of shifts in punched paper tapes increased.
As for the plastic carrier tape, some customers have begun to switch from self-produced black PC particles, and some customers have realized batch use.
With the gradual release of plastic carrier tape production capacity, new customers are increasing, and the future development of the business’s profitability is gradually increasing.
Regarding the transfer of adhesive tape, it achieved revenue of 1567 in the first half of the year.
230,000 yuan, an annual increase of 209.
Despite the lack of short-term effects of MLCC destocking, sales of MLCC release films have increased, but the number of customers has steadily increased, and OCA release films for optical adhesives and release films for adhesive materials have also begun to sell.
Optimistic about the domestic substitution trend of transfer tapes, this business will contribute to the company’s long-term performance growth point.
The operating cash flow has improved significantly, and the repurchase of shares has shown the company’s confidence.
In this report, the net cash flow from operating activities of the first-tier companies reached 2.
67 ppm, an increase of 1940 in ten years.
55%, mainly due to the company’s customers with good credit, timely payment in accordance with the credit amount and appropriate control of procurement expenditures 佛山桑拿网 in the current period.
The company intends to repurchase shares for incentives, with a repurchase amount of 1 ppm-1.
5 trillion, the repurchase price does not exceed RMB 42 per share (inclusive).
The repurchase of shares further shows that the company is optimistic about the company’s development prospects.
[Investment suggestion]Considering that the company ‘s performance in the first half of the year was affected by industry destocking and exceeded its original expectations, the company ‘s profit forecast for 19/20/21 was lowered. As the destocking in the downstream industry has ended, the industry ‘s prosperity has ushered in transformation, so the company ‘s performance in the second half of the yearThere will be resistance to pick up.
Based on the above factors, the operating income for 19/20/21 is reduced to 11.
3.2 billion, down 19/20/21 net profit attributable to mother to 2.37/3.
97 ppm, corresponding to 0 EPS.
54, PE 35/26/21 times.
Maintain the “overweight” rating.
[Risk warning]The company’s new business development is less than expected; the industry’s economic reversal is less than expected.