Fuyao Glass (600660) 2019 Interim Report Review: Q2 U.S. factory profit margins rebound, German SAM orderly integration

Fuyao Glass (600660) 2019 Interim Report Review: Q2 U.S. factory profit margins rebound, German SAM orderly integration
Interim profit was -20%, and performance was in line with expectations. Fuyao Glass achieved revenue of 102 in the first half of the year.870,000 yuan, an increase of 2% per year, and net profit attributable to the mother 15.0.6 billion, down 19 each year.43%, deducting 13.400 million, down 26 every year.75%, deducting SAM-22% from deducting foreign exchange.Revenue in the second quarter alone was 53.54 ppm, an increase of 0 per year.31%, net profit attributable to mother 9.0 billion, down 31 a year.12%, deducted 8.24 ppm, a decrease of 33 per year.27%.  In terms of sub-regions, we expect to reduce domestic flights by 14% (H1 domestic passenger car production will decrease by 14%) and overseas revenue + 27% (excluding SAM’s overseas glass business revenue + 14%).Taken together, Fuyao Glass’s interim report is in 厦门夜网 line with expectations. The performance expectations are only due to the pressure on the domestic auto market, SAM integration and increased float inventory.  Aluminum trim integration, the auto market downturn float pressure, gross profit margin of Q2 continued to decline in the first half of 2019 gross profit margin 37.53%, down 4 each year.43pct (Q1 gross profit margin fell by more than 2.84pct), the company’s gross profit margin reduction has two main aspects: 1) the early integration impact of aluminum trim project.18pct; 2) The poor market environment leads to an increase in float inventory, and the low gross profit from sales is 0.62 points.Net interest rate 14.64%, a decline of 3 per year.89 points.Report the statutory three fee ratio21.01%, increasing by 0 every year.92pct, of which sales and management rates are stable every year, and financial expenses are 0.70%, increasing by 0 every year.68 points.The exchange rate in 2019H1 was 31.13 million yuan, compared with 60.84 million yuan in the same period last year.  US Q2 profit margin rebounded significantly, German SAM orderly integrated 2019H1 Fuyao’s US factory revenue of 19 trillion (+13.7%), net profit 1.400 million (Q1 net profit is about 0.400 million), Q2 net margin improved significantly.The US automotive glass plant maintains steady growth, and the long-term US plant still maintains its output forecast of 3.9 million sets of automotive glass.The German SAM company acquired by Fuyao completed the settlement on March 1, and 2019H1 will contribute to the revenue of listed companies5.07 trillion, gross profit margin -12.6%, can accept 64 million yuan (consolidation period is a total of 4 months from March to June); SAMQ1 revenue 1.400 million, expected to be less than 20 million yuan.It is expected that the SAM integration time will be more than one year, and the subsequent additional investment of 100 million euros will basically continue the subsequent growth of the US plant.  Risk reminder: The profitability of US factories is not up to expectations, and the domestic auto market is leaning.  Wait for SAM to turn losses and maintain its overweight rating. Fuyao Interim Report is in line with expectations. Considering the short-term conversion of the newly acquired company SAM consolidation period, we lower our profit forecast and adjust the profit for 19/20/21 from 37/42/47 to34/36 / 400,000 yuan (assuming exchange income of 200 million yuan in 19 years), corresponding to EPS 1.35/1.44/1.6 yuan, corresponding to PE 17/16 / 14x, maintaining the overweight level.