Gree Electric (000651): Q2 operation exceeds expectations

Gree Electric (000651): Q2 operation exceeds expectations

The report’s reading company disclosed the 2019 Interim Report: the first half of the total revenue was 983.

41 ppm, a six-year increase of 6.

9%, net profit attributable to mother 137.

50 ppm, a ten-year increase of 7.

4%; of which Q2 total revenue was 573.

35 ppm, an increase of 10 in ten years.

3%, net profit attributable to mother 80.

78 ppm, an increase of 11 years.


Investment points Q2 revenue performance exceeded expectations, the second half of the year is expected to maintain stable growth and combined with third-party monitoring and retail monitoring data, it is expected that the company’s Q2 revenue may be roughly flat, but the actual growth of 10%, which may be due to the company’s product upgradeThe ex-factory unit price rose faster than expected. In the first half of the year, Zhongyikang statistics showed that Gree’s 杭州桑拿网 offline retail price averaged + 4% per year. Therefore, Jinghong promoted the growth of consumer electronics revenue by 63%.

6% (US $ 1 billion), which also supports the overall main business; advance receipts increased by 49% at the end of the reporting period, but Q2 is the off-season, and Q3 advance receipts performed more fully, taking into account the weaker terminal demand and improvedThe decline in channel inventory is relatively benign. It is expected that the company will ensure payment recovery and promote liquidity through an active opening policy. We are optimistic about the company’s share rebound and stable revenue growth in the second half of the year.

Expenses increased and profitability remained flat every year. In the first half of the year, the company’s gross profit margin exceeded +0.

9 points, mainly due to the decrease in the cost of bulk raw materials such as copper and steel, but in the context of opponents’ price reduction promotions, the company’s expense has also strengthened, and the sales expense ratio increased by +1 in the first half.

9pct; Combined exchange and financial management, profit and loss financial expenses + investment income + income from changes in fair value increase the total performance.

7 trillion, the company’s net profit at the end of the first half of the company 14.

0%, ten years +0.

06 points.

Operating cash flow continued to increase, with cash assets exceeding $ 120 billion. In the first half of the year, the company’s net operating cash flow was 16.5 billion, an increase of 84%, of which Q2 increased by 261%. In addition, the company’s cash assets exceeded 120 billion at the end of the reporting period, and other current liabilities were 63.7 billion.This shows that the company has a solid foundation and abundant food.

Steady growth in performance and expected growth. Buy rating is based on the company’s aggressive opening policy to promote the expansion of expectations. It is expected that the second half performance will maintain steady growth. In the long run, the company’s core brand power barriers remain, and manufacturing cost advantages are prominent.The channel reform through the gradual approach will continue to continue to lead the development of the advantages; the company’s dividends are also expected to increase through the merger and reform, and drive the valuation repair; the company’s 2019-2021 performance is expected to increase 9%, 10%, 10%, correspondingPE12, 11, 10 times, maintaining the buying level.

Risk reminder: industry competition intensifies beyond expectations, raw material cost growth exceeds expectations


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