\u3000\u3 Guocheng Mining Co.Ltd(000688) 586 Hefei Jianghang Aircraft Equipment Co.Ltd(688586) )
The net sales interest rate reached a record high of 24.25%, and the scale effect was gradually reflected
The company released the annual report of 2021: in 2021, the company’s operating revenue reached 953 million yuan, with a year-on-year increase of + 14.72%, realizing a net profit attributable to the parent of 231 million yuan, with a year-on-year increase of + 19.23%, and deducting a net profit not attributable to the parent of 200 million yuan, with a year-on-year increase of + 27.70%. By sector, the revenue of aviation business was 59900 yuan, a year-on-year increase of + 18.92%, accounting for 62.85% of the revenue; The revenue of special refrigeration business was 232 million yuan, a year-on-year increase of + 11.37%, accounting for 24.30%.
Profit side: in 2021, the company achieved a gross profit margin of 43.61%, a year-on-year increase of + 2.1pcts, reaching a record high; In terms of period expenses, during the period, the company incurred sales expenses of 24 million yuan (YoY + 3.13%), management expenses of 135 million yuan (YoY + 20.44%, mainly due to the cancellation of social security exemption and the increase of personnel expenses), financial expenses of – 18 million yuan (mainly due to the increase of interest income), R & D expenses of 51 million yuan (YoY + 0.01%), and the overall cost rate during the sales period was 20.09%, a year-on-year low of -2.14 PCTs, The company’s net profit margin on sales reached 24.25%, a year-on-year increase of + 0.92pcts, reaching a record high.
We believe that the company, as a supplier of system finished products, is expected to usher in new models. The value and penetration of single machine products are expected to increase at the same time. After adding the scale effect of new products, the marginal cost decreases (including the reduction of fixed cost allocation and the decrease of variable cost caused by manufacturing upgrading). The profitability may enter the track of continuous improvement on the basis of large-scale production.
Inventory + 68.89%, contract liabilities + 190858%, product delivery speed may increase
Inventory side: at the end of the period, the company’s inventory reached 685 million yuan, an increase of 68.89% over the end of the previous year, of which the book balance of raw materials reached 218 million yuan, an increase of 89.47% over the end of the previous year; The book balance of inventory commodities reached 170 million yuan, an increase of 59.77% over the end of the previous year; The book balance of goods issued was 215 million yuan, an increase of 91.81% over the end of the previous year, indicating that the company is in the stage of active preparation for production and goods, and is optimistic about the continuous improvement of product delivery speed.
Contract liabilities: at the end of the period, the company’s contract liabilities reached 379 million yuan, up + 190858% from the end of the previous year, and the prepayment reached 91 million yuan, up + 436.70% from the end of the previous year. The main reason is that the company received more prepayments from customers and increased prepayments to upstream suppliers. We believe that Party A’s large advance payment may have begun to be transmitted to the downstream, and the company may further improve its management level and operation quality by relying on abundant cash flow.
China’s only professional development platform for aviation oxygen system and airborne fuel tank inerting protection system
The company is the only professional R & D and manufacturing base of aviation oxygen system and airborne fuel tank inerting protection system in China. It is also the largest aircraft auxiliary fuel tank in China and China’s leading manufacturer of special refrigeration equipment. The company’s products cover aviation oxygen system, airborne fuel tank inerting protection system, aircraft auxiliary fuel tank and other supporting supplies for all military aircraft under research and in service and some civil aircraft with equipment needs in China; Military special refrigeration equipment has been covered by the air force, army, Navy, rocket army and other military types.
The first batch of pilot mixed reform of military enterprises took the lead in implementing the shareholding of core personnel
The company is one of the first batch of pilot projects for the mixed reform of military enterprises. As the vanguard of the mixed reform of state-owned enterprises of AVIC, the company takes the lead in implementing the shareholding of core personnel within the group. In 2018, there were 146 core personnel in the two batches, all of whom were paid in, holding a total of 5% of the shares of aviation industry Jianghang. We believe that as a long-term incentive mechanism, core personnel shareholding will contribute to the cultivation of core talents and the long-term development of the company, and will have a significant effect on the performance of the company.
Profit forecast and rating: with the increase in the number of military aircraft during China’s 14th Five Year Plan period and the accelerated loading of advanced fighters represented by the fourth generation aircraft, the product quantity and unit value of aviation oxygen system and airborne fuel tank inerting protection system will also increase rapidly, the increase of training will promote the significant growth of maintenance demand, and the company’s core business will continue to benefit; In terms of civil aircraft, the company’s products are expected to realize the localization and replacement of key civil aircraft models and enter the accelerated production scheduling period. Considering the uncertain rhythm of delivery confirmation, we adjusted the net profit attributable to the parent company from 406 / 578 million yuan to 337 / 456 million yuan from 2022 to 2023, and the net profit attributable to the parent company in 2024 was 617 million yuan, corresponding to PE of 28.78/21.23/15.69x
Risk tips: the risk of military orders, the risk of supporting supply, the risk of uncertainty in the pricing time of military review, the risk of uncertainty in the batch production rhythm of new models, etc.
