Zoomlion (000157) 2019 Interim Report comment: continuous growth in performance and continuous improvement in profitability

Zoomlion (000157) 2019 Interim Report comment: continuous growth in performance and continuous improvement in profitability

Event: Zoomlion released the 2019 semi-annual report, and the company achieved 南宁桑拿 operating income of 222 in the first half of the year.

62 ppm, an increase of 51 in ten years.

23%; net profit attributable to parent company is 25.

760,000 yuan, an increase of 198 in ten years.

11%; operating cash flow 35.

75 ppm, an increase of 124 in ten years.

19%.

Comments: Cranes and concrete machinery maintained high growth rates, and the company entered the period of performance release with full flexibility.

According to industry statistics, the sales of truck cranes in the first half of the year was 25,494 units, which was gradually extended by +53.

3%.

According to grassroots research, concrete machinery continued to grow at a high speed in the first half of the year, with pump trucks and tower cranes growing at a better rate.

Zoomlion, as a lifting machinery and “top-two” brand in concrete 合肥夜网 machinery, maintained its leading market share in the first half of the year, and its industry grew rapidly.

In terms of products, the company’s concrete machinery / lifting machinery / other machinery / agricultural machinery achieved revenues of 7.5 billion / 1.1 billion / 2.5 billion / 900 million in the first half of the year, respectively, exceeding the growth rate of 31.

15% / 94.

75% / 13.

06% /-2.

57%.

In terms of market share, construction hoisting machinery and long boom pump trucks continued to maintain the number one position in the industry. The domestic market share of truck cranes increased by 6 compared with 2018.

8 units.

The gross profit margin increased + the expense ratio decreased, and the company’s profitability continued to improve.

In the reporting period, the company’s comprehensive gross profit margin reached 30%, an increase of 4.
.

In terms of 41 units, the gross profit margins of concrete machinery / lifting machinery / other machinery products / agricultural machinery were 27.

37% / 32.

17% / 26.

15% / 10.

37%, an increase of 5.
.

21/3.

82 / -1 / 29/0.

17 units.

The average gross profit margin of concrete machinery and crane machinery with high revenue share increased, mainly due to (1) the clearing of used equipment, (2) the improvement of product structure, and the increase in the proportion of high-margin towers in construction cranes,.

0 Product applications increase product added value and increase gross profit.

During the reporting period, the company’s expense control results were remarkable, and its expenses during the period16.

92%, a decrease of 2.
.

4 units.

Cash flow from operating activities reached a new high during the same period, and operating quality improved significantly.
The company achieved a net cash flow of 35 in the first half of the year.

800 million, an increase of nearly 2 billion over the same period of the previous year, mainly due to (1) the boom in production and sales promoted the accelerated reorganization of production funds, (2) adhered to strict credit policies, and (3) the company gave different settlement methodsPrice policy, customers can replace different settlement methods according to the pace of their own cash flow, (4) supply chain management reduces costs, and (5) fees reduce the contribution to cash flow.

At the same time, the company’s turnover has improved significantly. The accounts receivable turnover days have been converted by 85 days from the previous year, and the inventory turnover days have been converted by 38 days from the same period of the previous year, which fully demonstrates the significant improvement in the company’s operating quality.
The growth of traditional products is expected to continue in the second half of the year, and new products are poised for growth.

Real estate investment remained high in the second half of the year. Infrastructure investment is expected to stabilize in the second half of the year. Overlapping environmental factors are driving the demand for renewal. It is expected that crane concrete machinery will continue to grow in the second half of the year.

In terms of new products: (1) The aerial work platform has made a good start and has shown initial results, and is expected to become the first echelon enterprise in the field of aerial work platforms; (2) Earthmoving machinery launches new products and completes the national provincial sales service network layout;Become the company’s future growth point.

Earnings forecast: Based on the two-year production and sales surpassing expectations in the first half of the year, we raised the company’s earnings forecast to 0-20 EPS in 2019-2021.

54/0.

64/0.

71 yuan (the original predictor variable is 0.

42/0.

48/0.

53 yuan), corresponding PE is 10/9/8 times, combined with comparable company evaluation and benchmarking international, give Zoomlion 12-13 times the estimated level in 2019, and adjust the target price range to 6.

48-7.

02 yuan, maintaining the “recommended” level.

Risk reminder: The prosperity of the construction machinery industry is declining, and downstream demand is less than expected.