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Guoxing Optoelectronics (002449) 2018 Annual Report Comments: Performance slightly exceeds expectations

Guoxing Optoelectronics (002449) 2018 Annual Report Comments: Performance slightly exceeds expectations

18-year revenue increased by 4%, and net profit attributable to mothers increased by 24%, slightly lower than the market’s expected 18-year revenue of 36.

2.7 billion, an annual increase of 4%, net profit attributable to mothers4.

46 ppm, a year-on-year growth of 24%, slightly lower than market expectations, mainly due to lower than expected profit in the fourth quarter, Q4 revenue of 8.

310,000 yuan, -18% MoM, net profit attributable to mother 0.

6.2 billion, -61% MoM.

The poor operating conditions of Q4 were mainly affected by the macroeconomic environment in the fourth quarter, and the price drop caused by the expansion of small-pitch LED lamp beads manufacturers decreased the competition in the industry.

Therefore, the average gross profit margin and net profit margin were affected, and the gross profit margin for the fourth quarter was 22.

19%, -3.

56 points, net sales margin 7.

11%, MoM -7.

95pct, in addition to the main reason for the decline in gross profit margin, the company’s fourth-quarter management expense ratio and research and development expense ratio rose, leading to an increase in net profit margin.

The company’s RGB business segment has grown significantly. From the perspective of better division of labor in downstream display demand, ① the revenue of the SMDLED business segment in 2018 reached 89.

61%, revenue of 32 in 18 years.

500 million US dollars, an annual increase of 5.

97%, gross margin 26.

84%, ten years +1.

86pct, of which the company’s small-pitch LED products continue to grow steadily, helping the company’s RGB business unit achieve revenue of more than 2 billion, a growth rate of over 30%.

② Revenue from lighting application business for 18 years1.

4.8 billion, ten years -29.

18%, gross profit margin 2.

18%, six years -6.

87pct③Epitaxial chip business realized revenue 1.

3.6 billion, at least -16.

56%, gross profit margin -2.

21% a year -8.

48 points.

The company’s small-scale products have outstanding competitiveness and are driven by better downstream demand to achieve rapid growth.

However, the company’s lighting applications and chip business are subject to increased market competition, and the average value will definitely decrease.

Consolidate the leading position of the high-end LED display market, the company invests another 1 billion layouts in the next generation of LED packaging companies. The independent high-end brand “REESTAR” is based on the high-end LED display market.Highly recognized, in order to further consolidate the scale of the high-end display market, the company announced in January 19 that it plans to invest 1 billion U.S. dollars in plans to increase efforts to build small-pitch / MiniLED and other new-generation LED packaging devices and chip expansion projects, and the company plans to expand productionThe scale exceeds 2000kk / month, and it will be gradually released in the next 6-12 months.

Upcoming 20% growth in Q1?
50%, give “buy” rating company to forecast 0 profit range for the first quarter.

960,000 yuan?
1.

21 ‰, one year + 20% -50%, median 1.

09 million yuan, through the demand 成都桑拿网 upgrade, downstream demand for LED displays and small spacing continues to emerge.

What do we expect the company 2019?
Net profit attributable to mothers in 2020 is 5.

50/6.
780,000 yuan, a year-on-year growth rate of 23%, corresponding to 16 times PE in 2019, and maintain a “buy” rating.

Risk warning LED display industry demand is less than expected