Snow Diron (002658) 2018 Annual Report Comments: Expenses drag performance, industrial-end monitoring demand is picking up

Snow Diron (002658) 2018 Annual Report Comments: Expenses drag performance, industrial-end monitoring demand is picking up
Realized revenue of 12 in 18 years.89 trillion, ten years +18.9%, realized net profit attributable1.79 thousand yuan, at least -16.54%.Affected by the macro economy, 杭州桑拿 the demand for monitoring at the industrial end has decreased, while the company’s main business is mainly at the industrial end, and last year it voluntarily gave up some industrial customers with low repayment quality, resulting in slightly lower revenue growth than in the same industry.The negative growth in net profit is primarily due to the increase in the company’s expense growth rate and the extension of sales expenses by +33.6%, sales expense ratio increased by 1.5 points to 14.0%; total budget expenditure +26 each time.0%, R & D expenses of 90.07 million yuan, +30 in the same period.3%; period expense ratio increased by 2.6pct to 29.5%. Reinforcement of receivables has obvious effects, stable operation, redundant cash, and rapid increase in asset-liability ratio. The company strengthened the collection of receivables last year. The total amount of receivables did not increase, and the turnover rate of receivables increased by zero.52 to 2.74. Inventory turnover increased by 0.15 to 2.03, showing that the collection effect is obvious.Cash in hand at the end of the company11.9 trillion, +99 for ten years.5%.Due to the issuance of convertible bonds, the company’s asset-liability ratio was 13 in 2017.7% increased to 26 at the end of 18.6%, but still at the highest level in the industry. Water quality monitoring and non-electrical atmospheric monitoring began to gradually increase in volume, and the gross profit margin declined. Last year, the gas analyzer and spare parts business achieved revenue2.200 million, a rapid growth of +67 over the past ten years.3% was due to the increase in sales of mainframes due to the ultra-low emission transformation needs of enterprises.Industrial process analysis system revenue is 0.9.5 billion, an increase of 15 over the same period.95%, mainly due to the growth in sales of cement and air separation.And the environmental monitoring system (6.8 billion, +6.1%) and operation and maintenance services (2.100 million, -0.02%) Budget operations have remained stable.Water quality monitoring has achieved approximately 100 million revenues, which is growing rapidly, indicating that the water quality monitoring market is gradually increasing.Overall gross profit margin fell by 4.8pct to 43.5%, the first is that market competition has intensified, and water quality monitoring has just started to compete with foreign brands for the market. Atmospheric non-electricity monitoring owners have stricter cost requirements and lower short-term gross profit margins.The company’s newly signed monitoring equipment orders in 2018 exceeded 1.5 billion yuan, more than + 20% per year. Earnings forecast and rating: optimistic about the demand from the industrial side This year, the heavy monitoring industry has achieved high growth for 18 years due to the acceleration of government demand. This year, monitoring sites have fallen, water quality monitoring has been rolled out, and demand for monitoring equipment in the non-electric field has increased.After environmental protection kills “one size fits all”, there is a strong demand for monitoring in industrial enterprises. It is optimistic that the company’s focus on industrial monitoring will pick up.The company’s operations are stable, and it is planned to use free funds to buy back company shares of no more than 200 million US dollars to encourage and show development confidence.It is expected that the company’s net profit for the years 19-21 will be 2.60/3.26/4.00 million, corresponding to the current estimate of about 20/16/13 times, give a buy rating. Risk reminder policy advances less than expected, poor project repayment