Starnet Ruijie (002396) 2019 Interim Report Review: Revenue Growth Slightly Lower Than Expected Overseas 4G Business Impact
Event: The company released its 2019 Interim Report, with operating income of US $ 3.3 billion in the first half of the year, which was gradually decreasing5.
4%, slightly lower than expected; profit maximization1.
USD 500 million, a year-on-year decrease of 18%; net profit attributable to shareholders of listed companies.
5.7 billion, an increase of 34% in a year, in line with expectations.
Profit growth declined, the impact of changes in earnings on the net profit attributable to the mother in the first half of the year, the company’s revenue and profit growth declined, the return rate changed from positive to negative, and finally the net profit attributable to the mother realized growth.
Generally 南京桑拿网 speaking, the performance in the first half of the year is relatively small (generally less than 20%), and the expected performance is still to be verified.
Network terminals have grown rapidly, and communications products have declined. Revenue from enterprise-level network equipment in the main industry15.
US $ 700 million, an annual increase of 20%, and gross margin growth has remained stable; benefiting from the growth of network terminal products in the financial industry, network terminal business income5.
7 ‰, an increase of 47% in ten years, and gross profit margin increased by 3.
45pct; Affected by the decline in sales revenue of smart home gateway products and 4G products in the United States, communications products revenue6.
4 ‰, a year-on-year decrease of 34%, and gross profit margin increased by 6.
28pct; video information application income 8.
7 ‰, a 5% increase over ten years, and a 12% increase in gross profit margin.
24 points; other business income 4.
400 million, a year-on-year decrease of 41%.
Ruijie Networks / Shengteng / ViewEase grew steadily, and Ruijie Networks, a smart technology / Deming revenue that replaced the main enterprise-class network equipment, maintained steady growth, with revenue growth of 16%, which can be narrowed interchangeably; main cloud desktops and smart terminalsShengteng Information, revenue increased by 16%, net profit increased by 65%; Starnet, the main video information application business, developed steadily, revenue increased by 6%, net profit increased by 111%, K-meter users exceeded 85 million; smart technologyRevenue has improved, revenue has fallen by 25%, and net profit has increased by 115%. Due to the impact of trade frictions, the performance of Deming Communications, which is mainly engaged in overseas 4G products, has declined, and the revenue decline is estimated to be about 40%.
The network demand in the 5G era is expected to continue to increase. The company’s major product lines are expected to benefit from the 5G era expansion. Enterprise network equipment and terminals are expected to usher in a new round of upgrades. At the same time, the improvement of network performance is expected to develop smart communications, smart communities, and video information.And other relevant application scenarios in new business areas.
The company is expected to benefit from the demand for network equipment terminals and applications in the 5G era and maintain growth.
Downgrade to “Overweight” rating. Considering the impact of trade friction on overseas 4G business, downgrade 19?
The 21-year net profit forecast is from 7.
5 to 6.
70,000 yuan, corresponding to EPS 1.
83 yuan, corresponding to PE23X / 18X / 15X, considering the improvement in the previous period, it is lowered to the “overweight” level.
Risk Warning: Trade Frictions Affect Overseas Business, Data Center Products Impact on Lower Gross Margin