\u3000\u3 Guocheng Mining Co.Ltd(000688) 333 Xi’An Bright Laser Technologies Co.Ltd(688333) )
Performance summary: in 2021, the company achieved an operating revenue of 550 million yuan (+ 33.9%), a net profit attributable to the parent company of -53.306 million yuan (- 161.5%), and a corresponding EPS of -0.67 yuan. Excluding the equity incentive fee of 170 million yuan, the net profit attributable to the parent company will be 120 million yuan in 2021;
Metal additive manufacturing experts with deep industrial chain: the company is a leading provider of a full set of solutions for industrial grade metal additive manufacturing (3D printing) technology in China. It has deep layout of the industrial chain and has the whole process capability of “powder manufacturing – printing equipment – Printing Service – software support”. The main products are used in aerospace, rail transit, automobile, medical and other fields. In the field of aerospace, the company has deeply participated in major model development projects such as “bomb, arrow, satellite and aircraft”, and its main customers include well-known manufacturers in this field outside China;
In terms of main business sectors, the aerospace sector is still the main source of the company’s performance and continues to cultivate deeply, with a revenue of 320 million yuan (+ 45.8%), accounting for 57% of the total revenue and a gross profit margin of 53.5% (- 6.4pcts), mainly due to the increase in employee compensation, asset depreciation and material costs; The revenue of industrial machinery was 180 million yuan (+ 53.9%), accounting for 32% of the total revenue, and the gross profit margin was 38.2%, which was basically the same as that of the previous year. In terms of business products, printing services accounted for 50.4% and self-developed printing equipment accounted for 39.5%. The two businesses increased by 29.6% and 44.4% respectively year-on-year, of which the gross profit margin of 3D printing services was 48.9% (- 11.3pcts), mainly because the phase II project was still in the stage of capacity climbing, and the cost increased rapidly. The net profit attributable to the parent company is RMB -53 million, which is mainly due to the drag of equity incentive. Without considering the impact of equity incentive, the net profit attributable to the parent company will be RMB 120 million in 2021;
Financial data: during the reporting period, the company’s sales expenses increased by 51.5% year-on-year, mainly due to the increase in the number of sales personnel, salary and investment in external publicity and bidding; Management expenses increased by 306.6% year-on-year, mainly due to the withdrawal of share based payment expenses in 2021; Financial expenses increased by 30.9% year-on-year, mainly due to the expansion of the company’s scale and the increase of bank loans; R & D expenses increased by 67.4% year-on-year, mainly due to the increase in the number of R & D personnel and their salaries and the increase in R & D projects; The operating cash flow decreased by 69.8% year-on-year, mainly due to the increase in the company’s purchase of equipment, raw materials and employee compensation;
Continue to increase R & D investment and bind the core team with equity incentive: the company attaches importance to R & D investment. In 2021, the R & D investment was 110 million yuan, with a year-on-year increase of 67.4%, accounting for 20.7% of operating revenue, an increase of 4.1pcts compared with the same period of the previous year. In recent years, the company has continuously increased the expenditure of R & D expenses, and the number of R & D personnel has increased from 197 in 2020 to 267. The company’s equity incentive plan covers the chairman, deputy general manager and core technical backbone personnel, granting a total of 4 million shares, accounting for 5% of the total share capital at that time. Through equity incentive, bind the core technical team, enhance cohesion in the high-speed growth period of the industry, and the company will maintain its competitive advantage;
Speed up the production capacity layout and boost the rapid growth of performance: the company’s IPO raised investment project has been put into use in November 2021. In addition, in July 2021, the company announced the phase III production expansion plan, which plans to use the self raised fund of 2 billion to invest in the construction of 190000 square meters of various plants. After the project is completed, the annual production scale of 200 sets of metal 3D printing commercial equipment and 50000 sets (pieces) of metal 3D printing customized products can be achieved, Reflect the company’s confidence in the industry. With the transformation of the company’s projects under construction into fixed assets, the production capacity continues to climb, and the performance will be released faster;
Investment suggestion: as a leading enterprise in the metal 3D printing industry, in recent years, with the rapid development of downstream applications, the company has made in-depth layout in the aerospace field and continued high-intensity research and development. With the landing of pre research models and the gradual release of planned production capacity, the company’s performance will achieve leapfrog development. It is estimated that the operating revenue of the company from 2022 to 2024 will be RMB 900 / 12.6 / 1.75 billion respectively, with a year-on-year increase of 63.0% / 40.4% / 38.6%, and the net profit attributable to the parent company will be RMB 24 / 218 / 399 million respectively (it is estimated that the equity incentive will affect the annual profit of RMB 169 / 42 / 09 million), with a year-on-year increase of 146% / 792% / 83%, corresponding to pe472x / 53x / 29x. Give a “buy” rating.
Risk warning: the price fluctuation risk of raw materials, the downstream demand is less than expected, and the production progress of new projects is less than expected.
