Sunlord Electronics (002138): Performance Exceeds Expectations, Long-term Growth Trend of Inductor Leaders Is Clear

Sunlord Electronics (002138): Performance Exceeds Expectations, Long-term Growth Trend of Inductor Leaders Is Clear
Matters: Sunlord Electronic Announcement: The company released the first half of the year’s results for the first half of the year.In the first half of 19, total revenue was 12.1.7 billion, +7 a year.77%, net profit attributable to mother 1.9.5 billion a year -13.98%, net of non-attributed net profit1.810,000 yuan, at least -5.16%.  Comment: In the first half of the year, the first half of the year’s performance was slightly lower than expected, and the company’s expenses and costs increased in the first half of the year.1.7 billion, +7 a year.77%, net profit attributable to mother 1.95 ppm, at least -13.98%, net of non-attributed net profit1.8.1 billion, -5 per year.16%, slightly lower than market expectations.19Q2 single quarter revenue 6.73 ppm, a five-year increase of 5.5%, an increase of 23 from the previous month.52%.Realized gross profit in the first half of 1929 trillion, ten years +9.51%, gross margin 35.26%, an annual increase of 0.56 units.  From the perspective of expenses, the selling expenses in the first half of 19 were zero.33 trillion, ten years +6.61%, management costs 0.63 trillion, ten years +10.97%, R & D expenses are 0.8.4 billion, +39 per year.14%, financial expenses 3.96 million yuan, financial expenses for the same period last year was -1.8重庆耍耍网2 million yuan.The exchange gain was -6.64 million yuan, the exchange gain was -5.35 million yuan in the same period last year, and the investment income was -1.16 million yuan.  We believe that the increase in expenses, loss in exchange rate, and decrease in distribution income are the main factors that caused the company’s performance to be lower than expected.The company’s single-quarter gross profit margin was 35 in 19Q2.65%, which is basically the same as the gross profit margin in the single quarter of 18Q2, which is an increase of 0 from the previous quarter.87 single, profitability of core products remained stable.However, due to the overall exchange rate fluctuations in the first half of the year, profits were reduced by 1,199 due to exchange rate changes each year.550,000 yuan.Excluding the impact of equity transfer gains and the decrease in earnings caused by exchange rate changes, profits in the first half of 2019 were basically the same as last year.  In addition, the increase in expenses is also one of the reasons for the pressure on the company’s performance. The company’s R & D expenditure in the first half of 19, 8,425.160,000 yuan, compared with 6,055 in the first half of 2018.300,000 yuan, expenditure increased by 2,369.RMB 860,000; 20,882 labor expenses in the first half of 2019.520,000 yuan, compared with 16,520 labor expenses in the first half of 2018.40,000 yuan, an increase of 4,362.480,000 yuan.The growth in expenses is reflected in the company’s continued development strategy.The company’s continued growth in the fields of automotive electronics, filters, magnetic materials, sensors, high-end precision inductors, precision ceramics and other industrial-specific products has contributed to the company’s sustainable growth.The foundation has been established, while increasing short-term cost pressures.  New products and customers have developed smoothly, and high growth is still expected in the future. In the first half of 2019, automotive electronics sales revenue increased by 429 compared with the same period last year.97%, automotive electronics achieved large-scale and stable delivery, which injected a strong source of power for Sunlord’s continuous and continuous growth!After more than ten years of hard work, the company has become an official supplier of automotive electronics companies with many global and domestic reputations such as BOSCH, VALEO, Denso, Tesla, CATL, Koboda, etc. CATL and Koboda are the second quarter of 2019New and rich customers.The company’s reversing radar transformers, BMS transformers for electric vehicles, and third-generation power inductors have been used by world-renowned automotive electronics companies.Auto electronics orders continue to grow, which is expected to become one of the important sources of revenue growth of the company.  The 5G business will lay the foundation for the company’s continuous expansion in the field of communications. Both communication base stations and terminal services will benefit from 5G business drivers.The company ‘s microwave devices specifically developed for 5G base stations have been recognized by major international manufacturers and gradually transformed into sales; the second half of the year will continue to expand the development and marketing of new products in the 5G market.At the same time, driven by 5G services, the demand for high-end precision inductors in mobile phone terminals will also increase significantly.The company continues to cultivate on the mobile phone side and new customers continue to expand. The penetration rate of the communication terminal market has continued to increase. Combined with the mobile phone terminal ‘s significant increase in the use of high-end precision inductors, the company has fully benefited from the 5G inductor volume and price trend. The communication terminal business aims toMaintain sustained and stable growth.  In addition, the company’s other businesses such as ceramics, military electronics, PCB and other businesses continue to develop steadily. While the company is actively researching and promoting new product development, it focuses on strengthening management team training and continuously improving management efficiency.Through the implementation of training for managers in management culture projects, the continuous progress of IPD work and the establishment of a new research and development assessment mechanism, the market for research results has been actively promoted; through the quantification and refinement of business management, overall operational efficiency has been improved and the company’s operating efficiency has been increased.  The company’s short-term performance is under pressure, and its long-term growth trend is obvious. The company maintaining the “buy” rating suffered from factors such as expense growth, exchange loss, and reduction in distribution income. The first half performance was slightly lower than market expectations.However, with the volume of automotive electronics products, the inductance business benefits from the 5G business driver, filters, ceramics, magnetic materials and other businesses usher in a period of rapid growth. The company’s high replacement in the past will transform the company’s growth momentum, and the company’s long-term growth is obvious.We lowered the company’s performance from the original 5 of 19/20/21.80/7.89/10.29 trillion, down to 5.08/6.51/8.1.8 billion, a ten-year growth rate of 6.2% / 28.1% / 25.7%.Earnings per share are 0.63/0.81/1.01, currently corresponding to 19/20/21 PE is 32.9/25.69/20.4 times.  Maintain “Buy” rating.  Risk reminders: First, the growth rate of traditional businesses and the progress of new businesses are not up to expectations.  Second, the company’s product development progress in new areas and new customers fell short of expectations.  Third, the cost of upstream raw material prices has risen, and the expense has grown rapidly.