Joyson Electronics (600699): 3Q19 performance slightly exceeded expectations; expect improvement in profitability

Joyson Electronics (600699): 3Q19 performance slightly exceeded expectations; expect improvement in profitability

The 3Q19 results declined slightly. We expect the company to announce the 3Q19 results: revenue 149.

800 million, ten years -10.

8%, -2.

7%; net profit attributable to mother 1.

900 million, -20 per year.

4%, net of non-attributed net profit 2.

4 ppm, due to the general strike and Takata affected the order before and after the integration, the performance was slightly lower than our expectations.

  Development Trend 3Q19 revenue exceeded expectations; deducting non-attributed net profit multiple alternative stable.

In the third quarter of 19, the company realized revenue of 149.

800 million, ten years -10.

8%; single quarter gross profit margin 16.

4%, which is basically flat; 1 point for doping.

In terms of expenses, the sales, management and R & D expense rates are -1 per year.

5 / + 2.

2 / -0.

4 points.

Among the 3Q management expenses, the expenses related to restructuring reached 1.

0 million yuan, mainly due to the integration of staff resettlement costs.

Net profit attributable to mothers and net profit attributable to non-mothers in the third quarter of 19 were 1.

900 million and 2.

400 million yuan.

In terms of working capital, accounts receivable and bills in the third quarter of 19 were flat on a month-on-month basis; inventories increased by 厦门夜网 5 on a month-on-month basis.

800 million; bills payable and accounts payable increased by 2.

200 million yuan.

In the third quarter of 19, the company realized operating cash flow2.

500 million US dollars, an annual increase of 22.

3%.

Capital expenditure in the third quarter of 19 reached 9.

0 ppm, which is expected to be mainly used to update Takata’s automation equipment to achieve efficiency improvements.

The passive security scale fluctuated short-term, and new orders were in good condition.

We expect the 3Q revenue waiver is mainly due to the increase in revenue from the security business.

In the end, the general strike may have a certain impact on the company’s North American business; reorganization, the loss of some orders that may exist before and after the acquisition of Takata assets, and the conversion of orders to revenue generally takes about 2 years, and we expect that this impact will continue in the short term.
In 2018, Joyson Safety’s new orders reached US $ 8.2 billion, with a market share of more than 35%. We expect Joyson Safety’s business revenue to gradually pick up in the future.

The automotive electronics business layout is gradually improving, and it is expected that the profitability will gradually improve.

At present, the electronic business has formed a perfect layout of smart car linkage, human-computer interaction and E-mobility. New orders for electronic business in 1H19 exceeded RMB 17.3 billion, which will remain the main growth point in the medium and long term.

In terms of profitability, the average gross profit margins of smart car association and E-mobility businesses in 2018 were less than 20%, which translates into the advancement of localization. We expect the profitability of the automotive electronics business to improve.

  Earnings forecasts and estimates Due to the impact of security business expansion and restructuring costs, we have reduced our net profit for 2019/20 by 14% and 3% to 9, respectively.

500 million and 11.4.9 billion yuan.

The current consensus is 21/2019/2020.

5 times / 17.

7 times price-earnings ratio.

  Maintain Outperform rating and 20.

00 yuan target price, corresponding to 27.

4x 2019 P / E ratio and 22.

6 times 2020 price-earnings ratio, 27 more recently included.

5% upside.

  Improved risk profitability was lower than expected.