Sanhua Intelligent Control (002050) 2019 Third Quarterly Report Review: The Competitiveness of Refrigeration Components Highlights the Continuous Development of New Energy Business
The company’s net profit for the first three quarters of 2019 was 10.
56 trillion, ten years +4.
3%, net profit attributable to the mother in the third and third quarters3.
63 ppm, +4 for ten years.
9%, in line with expectations.
As the leader of refrigeration control components, the company’s main refrigeration industry has developed steadily. New energy vehicle thermal management has continued to obtain orders from many world-renowned electric vehicle companies. The industry layout is clear, and the company’s growth is highly certain.
Event: On October 24th, the company released the third quarter report of 2019, and the revenue for the first three quarters of 2019 was 86.
200 million, +4 a year.
3%; net profit attributable to mother 10.
56 trillion, +3 for ten years.
2%, net of non-attributed net profit of 10.
51 ppm, +2 for ten years.
9%, we comment as follows: Q3 2019 single quarter deducted non-attributed net profit4.
Ten percent of 09, +17.
9%, in line with expectations.
The company achieved revenue of 86 in the first three quarters of 2019.
20,000 yuan (ten years +4.
3%), net profit attributable to mother 10.
5.6 billion (+3.
2%) and a net profit of 12.
1pcts), deducting non-attributed net profit of 10.
5.1 billion (+2.
Among them, 2019 single Q3 income of 27.
900 million (+4.
3%), net profit attributable to mother 3.
6.3 billion (+4.
9%), deducting non-attributed net profit4.
09 thousand yuan (+17.
2019Q3 operating net cash flow +11.
3 trillion, +5 compared with the same period last year.
The improvement of US $ 600 million was obvious, and the growth of inventory and accounts receivable continued to be well controlled.
Single Q3 is about 0.
The non-recurring loss of USD 46 million is mainly due to hedging (forward settlement) of the USD exchange rate risk loss in a single quarter.
69 ppm, but the corresponding USD position gain directly increased the gross margin and was hedged.
The profitability of the main refrigeration industry has been trending better, and new energy support has driven zero growth in steam.In terms of business, the company’s refrigeration and air-conditioning electrical components business (former refrigeration, Yaweike, micro-channel and other business mergers) and auto zero business 2019Q3 revenue were 23 respectively.
4 trillion, +1 a year.
5% / + about 20%.
Among them, the refrigeration business segments are as follows: 1) Refrigeration: the growth rate of commercial air-conditioning in the first three quarters of 2019 exceeded 20%, while the growth rate of domestic air-conditioning business followed the downstream. According to industry online data, air-conditioning production in the first three quarters of 20191.
2 billion units (-1.
0%), where Q1 / Q2 / Q3 +1.
3%, it is expected that in the fourth quarter, air-conditioning production is expected to achieve single-digit growth on the basis of a low base in the same period.
2) Yaweike: 2019 is expected to be the same as 2018 (net profit replaced by 283.5 billion yuan in 2018).
3) Micro-channel: In the single quarter of 2019, the increase in revenue was flat, and the gross profit margin increased by about 3pcts, driving the net profit to about + 11% per year.
Auto zero business in the first three quarters of 2019 net profit2.
40,000 yuan (close to the expected performance commitment 2).
450,000 yuan); the company’s overall net profit for the first three quarters of 2019 is 10.
6 million, if it is necessary to reach the target of the core employee stock appreciation right incentive assessment in 2019 (estimated about 1.4 billion US dollars), it is expected that the net profit attributable to the mother in Q4 needs to reach 3.
The profitability of the initial profit rate is significant, and the costs have steadily decreased during the period.
The company’s 2019 single Q3 gross profit margin is 29.
6% for one year.
0pcts, the obvious improvement, is mainly due to (1) the income side: commercial refrigeration with higher profitability, the new energy auto zero supporting business increased proportion, and reflected the appreciation of the dollar; (2) the cost side: the purchase of copper prices stabilized.
In terms of expenses, the expense ratio during the 2019Q3 was 12.
5%, flat for one year.
The sales rate is 3.
8% (year -1.
4pcts), mainly due to the repayment of quality deductions in the early period and the switching of some business accounting calibers, with a management fee rate of 5.
2% (one year-0.
2pcts, -0 per second after excluding caliber switching.
7pcts), the company’s “Jingbingqiangjiang” plan to improve personnel efficiency brings cost savings; financial rate -1.
5% (decade +0.
Energy efficiency standards promote ensuring the long-term growth of refrigeration, and new energy thermal management continues to grow globally.
On June 14, 2019, the “Minimal Action Plan for Green and Efficient Refrigeration” of the seven ministries and commissions proposed that by 2022, the energy efficiency level of multi-connected home air conditioners will be increased by more than 30%.
With the improvement of environmental protection standards, the company’s electronic expansion valve refrigeration products (Sanhua Intelligent Control’s global share of about 50%) is expected to continue to increase its penetration rate, and by 2020, it will promote the acquisition of more than 50% of high growth.
On the basis of supporting the well-known U.S. electric vehicle companies in the early stage, the new energy thermal management will continue to break through leading European and American leading car companies such as Volkswagen, Mercedes-Benz, BMW, Volvo, and General Motors in 2019.Significant contributions are expected from 2020.
Risk factors: New energy vehicle sales are less than expected, the air-conditioning industry is weaker than expected, and new energy vehicle policies are volatile.
Investment suggestion: Considering the negative growth impact of the air-conditioning industry in the second and third quarters of this year, slightly lower the company’s 2019/20/21 return to its net profit forecast to 14.
6 ppm (previous forecast for 2019/2020/2021 was 14.8/16.
200 million), corresponding to 2019/20/21 EPS is 0.
67 yuan (originally forecasted as 0 for 2019/20/20.
70 yuan), currently expected 14.
15 yuan, corresponding to 28/24/21 times PE in 2019/20/21.
As a leader in thermal management, the appliance appliance refrigeration business and the new energy vehicle thermal management business have extremely strong global competition. In the short-term downstream air-conditioning industry, the demand for fuel vehicles is high, but the company’s industry layout is highly certain.The high growth of the energy vehicle industry maintains a “Buy” rating.