Fire Communication (600498): No pole Tailai single Q3 improved significantly

Fire Communication (600498): No pole Tailai single Q3 improved significantly

The incident describes the company’s third quarterly report for 2019.

On January 9, 2019, the company realized revenue of 177.

75 ppm, a ten-year increase2.

32%; net profit attributable to mother 6.

19 ppm, 10-year average1.

86%; single quarter revenue 57.

90 ‰, ten years ago 6.

28%, net profit attributable to mothers1.

92 ppm, an increase of 16 in ten years.


Incident review Optimized revenue structure, strengthened cost control, and performance began to improve: The company continued to optimize its revenue structure and proactively abandoned some low gross profit margin projects. Q3 gross margin improved significantly.

Gross profit margin for the first three quarters of 21.

93%, with a ten-year average of 1.

32 pct; but gross margin of 24 in the third quarter alone.

78%, an increase of 1 per year.

59 points, up 7 from the previous quarter.

06 points.

The company strengthened cost control. The company’s sales, management and financial expenses in the first three quarters decreased by 11 respectively.

20%, 11.

70%, 12.

75%, sales in the third quarter alone, management expenses fell by 11 respectively.

35%, 11.

76%, financial expenses increased by 154 in ten years.

16%, quality and efficiency were further strengthened.

Huodan’s 3Q results improved significantly, and the inflection point has now been reached.

5G transmission bidding is imminent, and Fibonacci sharing can be expected: China Mobile’s 5G transmission bidding plan was first released in November, with an estimated size of more than 20 billion U.S. dollars. Telecom and China Unicom follow closely behind, and the total scale plan is comparable to mobile.
Intermodal transport, China Mobile’s 2020 GPON equipment new collective procurement bidding, the use of 杭州夜网 flexible business strategies, beacon cover half of the share, warm up 5G in advance, and the company’s early 5G transmission test outstanding performance, we believe that the domestic 5G transmission equipment market pattern is expected to reshape,A total of fire can be expected.

The convertible bonds are about to be released, helping to set sail again: The company’s convertible bonds have been approved by the Securities Regulatory Commission on September 3, with a scale not exceeding 30.

US $ 8.8 billion, focusing on the main 5G optical communication and information security industry. With reference to historical conditions, the company is expected to release the “Convertible Bonds Prospectus” (locking transfer proposal) in the near future. Convertible bonds will be released to reduce funding pressure, consolidate 5G & security foundation, and helpThe flames set sail again.

Investment suggestion: Since this year, the company has continued to drop by 5%, fully reflecting the negative fundamentals. The third quarter net profit has improved, and it is expected to gain new attention in the market.

5G transmission tenders are about to start, and the industry’s high-boom cycle is about to start. As a leader in 5G transmission equipment, Beacon will be the first to benefit.

In the past 3 years, the company’s estimated range of 32-46 times, currently corresponding to 31 times the current estimate, is located at the bottom, and the allocation value is prominent.

We estimate the company’s net profit attributable to its parent to be 10 in 2019-2021.

09 billion, 12.

6.1 billion, 16.

3.9 billion, corresponding to PE 31 times, 25 times, 19 times.

Considering that the company will re-enter the rapid growth stage (transmission + overseas + ICT equipment) in the next 3 years, and at the same time the deployment of operator transmission equipment bidding and convertible bonds is expected to land soon, the company is highly deterministic and recommended.

Risk Warning: 1. 5G commercial construction is less than expected; 2.

Fiber optic cable industry cycle impact.