Addison Precision (603638): Hydraulic Hammer Capacity Released in Accordance with Expectations

Addison Precision (603638): Hydraulic Hammer Capacity Released in Accordance with Expectations
Eddie Precision released the 19th half-year report and achieved revenue 7 in the first half of the year.430,000 yuan, an increase of 47 in ten years.6%, achieving net profit attributable to shareholders of listed companies1.81 ppm, an increase of 48 in ten years.9%, net of non-attributable shareholders’ net profit1.80,000 yuan, an increase of 47 in ten years.8%.Performance is in line with expectations, and in terms of revenue structure, Breaker 5.3.8 billion, hydraulic parts 2.3 trillion, the two divisions offset 3,000 trillion each other, the actual hydraulic parts income is about 2 trillion. Breaking the production capacity of the hydraulic hammer, the revenue increased significantly.In the first half of the year, the company’s hydraulic hammer revenue was 5.380,000 yuan, at least 3 in 2018.31 ppm increased by 63%, and the growth rate is high. The main hydraulic hammers, especially sledgehammers, are in hot demand and continue to be funded. At the same time, production capacity is also being released. At present, the monthly hydraulic hammer production capacity has reached more than 2,500.Sales will grow by about 50% in ten years.The source of the company’s subsequent increase in hydraulic hammer products is reduced. The expansion of overseas customers such as Volvo and the increase in penetration of well-known domestic customers will continue to increase the revenue of hydraulic hammers.In addition, the company also plans to establish branches in India, the United States and other regions to further develop overseas markets. In the first half of the year, the revenue of hydraulic components increased steadily, the proportion of front-loading increased, and new customers of main engines began to increase volume.In the first half of the year, the actual revenue of hydraulic components was about 2 trillion, and some hydraulic components business was merged into the parent company. Therefore, the hydraulic technology revenue of the subsidiaries changed with comparable caliber.The growth rate of hydraulic parts revenue is related to the sales of excavator mainframes and the adjustment of inventory policies of OEMs since the second quarter to achieve lean production. The growth rate of the domestic hydraulic parts industry has been replaced to varying degrees in the second quarter.The decline in profit margin was mainly due to the company’s development of new customers for OEMs and the after-market price fluctuations.Although the sales growth of excavators has gradually stabilized in the second half of the year, the company developed host customers such as Xugong Liugongshan Reconstruction Machine in 2019. The walking motors have been tested and verified in small and medium batches of the above customers. It is expected that the volume will soon be increased. Pump valvesThere are also some supplies. At present, the company’s hydraulic components are expected to account for more than 50% of the value of front-loading. Gross profit margin rose steadily.The overall gross profit margin in the first half of the year was 43.2%, slightly higher than before 2018, the second quarter gross profit margin of 43.2%, unchanged from the first quarter.We expect that although the hydraulic component’s gross profit margin has improved due to post-market price fluctuations 南宁桑拿 and other reasons, the increase in the proportion of pre-installation before re-conversion will quickly recover, while the hydraulic hammer produces scale effects and improved production efficiency, and the gross profit margin increases.obvious. Net cash flow from operations improved.In the first half of the year, net operating cash flow was 77.27 million yuan, an increase of 120% annually, especially the net operating cash flow in the second quarter of the year1.With a net profit of 2.8 billion US dollars, through the gradual stabilization of the proportion of OEM customers, it is expected that the cash flow will improve year-on-year. Performance forecast and investment advice.We estimate that Eddy’s precision hydraulic hammer revenue will exceed 1 billion, hydraulic components revenue will be about 500 million, and predicted 杭州桑拿 net profit3.19 trillion, corresponding to 30 times the current estimate, and the short-term estimate is reasonable.However, in the medium and long term, Eddie’s precision hammers and hydraulic parts will have very definite growth, and the subsequent growth space will break through. The impact of the new hammer sales on the breaker business is also small, and it is expected to grow steadily.Continue to highly recommend Eddie Precision. Risk Warning: Systematic transition of sales volume in the construction machinery industry, and the expansion of the field of hydraulic motors and other front parts is gradually expected.