Department's business and investment income both weighed on the first half of the year
In the first half of the year, the company's main business income was 1.29 billion yuan, a year-on-year decrease of 26.6%. Its main business profit was 323 million yuan, a year-on-year decrease of 11.7%, net profit of 79.69 million yuan, a year-on-year decrease of 47.7%, EPS 0.14 yuan, far below. market expectation. The sharp decline in performance was mainly due to two factors: The sales of the company’s profitable products, PW2000 and PS7100, suffered serious declines in sales. This was mainly due to the fact that the heavy truck market was still recovering in the first half of the year. The major customers of the company’s products were the needs of Sinotruk and Dongfeng Group. Decline; Second, the company's high hopes for Bosch Steam Turbine due to concentrated consumption and sales market has not yet opened up, the first half of the year up to 100 million yuan loss, a direct impact on the company's net profit of 31.55 million yuan.
Various costs have grown too fast and there are motives and possibilities for adjusting profits
It is worth noting that the company's growth in the three expenses is clearly too fast. Although the drop in raw material prices caused the gross profit margin of the company to increase from 21% in the same period of last year to 25.7%, the apparent increase in the expense ratio has affected earnings growth. The administrative expense ratio rose from 6.26% in the same period of last year to 9.31%, the financial expense ratio increased from 1.81% to 2.83%, the operating expense ratio increased from 3.44% to 4.36%, and the three expense ratios increased from 11.51% to 16.50%. Nearly 5 percentage points. In connection with Bosch Gas & Diesel's significant concentration of accruals in the second and third quarters and the equity incentive plan the company is currently preparing, we do not rule out the possibility of profit adjustment. Of course, from another perspective, if equity incentives are completed during the year, it will help speed up the achievement of performance improvement.
Another investment income company: the new growth of the department comes from the matching and export
In 2004, the company reached a cooperation agreement with Bosch. The company's headquarters mainly produces mechanical pumps PW2000 and PS7100 that meet Euro II emission standards, while the company’s RBCD, which holds 30% of its shares, is fully produced to meet Euro III and Euro IV standards. Electronically controlled common rail system. Under the increasingly stringent state emission standards, after 2008, the company's domestic product market may gradually shrink, and then turn into investment income-generating enterprises. Considering Bosch's commitment to abandon domestic and foreign competition in mechanical pumps, we believe that the export of spare parts and mechanical pumps for Bosch Diesel Engine may become the direction for the development of the company's headquarters. Of course, since the implementation of emission standards for large commercial vehicles and construction machinery lags behind that of light vehicles, the company’s business development and development in this area will also bring about several years of profit growth.
Bosch Diesel: The car diesel process will not be as optimistic as it sounds, and profit growth after the transformation can also be expected
After Bosch Diesel has suffered a huge loss for two consecutive years, its pre-training, research and development and other expenses have been basically completed, only to be market development and sales. The main product of Bosch Diesel Engine's electronically controlled common-rail fuel system is technically a product of upgrading mechanical pumps. At the beginning of the construction, it intends to enter the dairy diesel market, but from the perspective of oil quality and urban restrictions, we still Not optimistic about the development prospects of diesel cars. On the contrary, we believe that light commercial vehicles such as light trucks and light passengers, mainly urban-rural ones, may be new discoveries in the joint venture market. Given that emission standards may not be strictly enforced on a nationwide basis, we carefully predict that Bosch Diesel's sales revenue in 2006-08 will be 450 million yuan, 700 million yuan and 1.2 billion yuan respectively. In 2008, it achieved a substantial increase in revenue while in 2009 it achieved a substantial increase in profits.
In 2006, it will be the lowest profit point of the company. In the next three years, the EPS will be 0.17 yuan, 0.30 yuan and 0.41 yuan respectively. Given the company's profit turning point and strong competitiveness, it will give 25 times PE and maintain its neutral rating.
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