SMM News: recently, Hengdian East Magnetic Company said in a survey of investors that the company will have varying degrees of investment in the permanent magnet and soft magnetic industry, and the proportion of investment in the soft magnetic industry is larger than that in the permanent magnet industry. The company will actively cooperate with major customers to develop new products and materials while maintaining its original advantages, so as to further become bigger and stronger and consolidate the company's position in the magnetic materials industry. The details are as follows:
1. How does the company view the difference between ferrite permanent magnets and rare earth permanent magnets?
Answer: permanent magnet material system can be divided into ferrite, rare earth, new material system and so on. The company is mainly based on ferrite material system. Ferrite and rare earth permanent magnets are different in raw materials, processing technology and cost, so their respective application fields are also different. Permanent ferrites are mainly used in household appliances (air conditioners, washing machines, refrigerators, audio, microwave ovens, etc.) and automobile motors (wipers, seats, window rocking, oil pumps, ABS, etc.). Rare earth permanent magnets are mainly used in wind power, new energy vehicle drive motors, elevators and so on. Although there is a small part of the application market (such as frequency conversion air conditioning) overlap between the two materials, it can not be completely replaced by magnetic properties, high temperature resistance coefficient, price gap and other factors. The market application of the two materials will increase in the future, and the annual growth rate of the permanent magnet ferrite industry will be less than that of rare earth permanent magnets. The company will maintain the continuous growth of ferrite permanent magnet business by increasing its market share.
2. How much space does the company think for the future development of ferrite permanent magnets?
A: if there is electricity, there will be magnetism, and there will always be room for demand for magnetic materials. The company believes that in the future, with the progress and development of science and technology, the performance of ferrite permanent magnet will continue to improve, the advantage of performance-to-price ratio will be more and more prominent, and its application field will be more and more extensive.
3. What are the barriers to the company's magnetic materials industry?
A: the company has the advantages of technology, equipment, scale, market and management. In terms of technology, the company has a world-class R & D platform and strong R & D force. At the same time, the company has obvious basic advantages in materials, the company has the largest pre-fired production base in the world, 70% of its materials are supplied internally and 30% are sold externally; in terms of equipment, the company has advantages in high-precision mold manufacturing and automation equipment manufacturing capacity; in terms of scale, the company has an annual production capacity of 130000 tons of permanent magnet ferrite and 30,000 tons of soft magnetic ferrite. In terms of market, the company's core customers are mainly the world's top 500 or leading enterprises in the industry; in terms of management, the company also has obvious advantages in lean manufacturing management and cost control.
4. What is the pricing basis of the company's products?
Answer: although the market share of the company's magnetic materials is relatively high, the pricing of the company's products is mainly based on market supply and demand and the level of technology. if some products are unique in the market, their pricing power is strong. if some products are in a state of full competition, their pricing power is weak. over the years, the company's magnetic materials industry has maintained a gross profit margin of about 30%, far better than the average level of the industry.
5. How does the company plan its future capital expenditure in the magnetic materials industry?
A: the company will have varying degrees of investment in the permanent magnet and soft magnetic industries, and the proportion of investment in the soft magnetic industry is larger than that in the permanent magnet industry. The company will actively cooperate with major customers to develop new products and materials while maintaining its original advantages, so as to further become bigger and stronger and consolidate the company's position in the magnetic materials industry.
6. The leading position of solar photovoltaic industry is relatively high. What level does Dongmei want to achieve in this industry, how to compete with its peers, and where is its competitive advantage?
A: the solar energy industry is the company's potential industry. the company began to intervene in the solar photovoltaic industry in 2010. over the past 10 years, the company has also experienced continuous updates and changes in industry equipment and technical routes. the company has been promoting the development of the industry at a steady pace, so the scale and income of the company's solar photovoltaic industry have not entered the first echelon in the industry. However, the company's solar energy industry technology has been in the first echelon of the industry, the company's battery conversion rate has reached 23%, mass production conversion rate has also exceeded 22.8%. The company's market layout is mainly export, and the company's export proportion has been in the first echelon in the industry in previous years. Based on the above, by 2019, we believe that the entire market-oriented competition and the industry have stabilized, the iterative speed of technological renewal has also begun to slow down, and the company has timely increased its capacity expansion, from hundreds of MW of previous individual projects to GW-level investment, to the new investment in the battery chip production line with an annual production capacity of 1.6GW, which has achieved the release of excess capacity and increased the production capacity of 700MW components. The follow-up company will continue to increase the production scale of battery chips and components according to the market development at home and abroad.
The company's competitive advantage mainly lies in the previous steady development and laying the industrial foundation, as well as the timing advantage brought by the equipment and technology iteration of the solar energy industry. at the same time, it is also reflected in the company's technological advantage, the cost advantage of intelligent manufacturing and the market advantage of foreign customers.
7. What are the main customers of the company's solar photovoltaic industry?
A: the company's solar energy industry exports a high proportion, mainly to Europe, Japan, South Korea, Brazil, South America and so on. The follow-up company will increase the strength of the domestic market.
Introduction to the basic situation of the company
The company's main business is "magnetic materials + devices" and new energy.
In the "Magnetic Materials + Devices" plate, the company is the world's largest manufacturer of ferrite magnetic materials, with the largest output of permanent magnet ferrites and soft magnetic ferrites in the world. in the future, with the growth of demand in application fields such as 5G base stations, big data center, cloud computing and wireless charging, the company's magnetic materials industry will continue to develop. Vibrating devices are leading in scale and have a global market share of more than 20%. The growth of new ringers / isolators and inductors is expected in the future.
In the new energy sector, the solar photovoltaic industry has a solid foundation and steady development. At present, it has the annual production capacity of 600MW wafers, 4GW batteries and 1.5GW modules. After the strategic shift of the new energy lithium battery industry to small power, the operation has been greatly improved, and the gap between supply and demand is gradually obvious. at present, it has an annual production capacity of 100 million lithium batteries and is in a state of full production and full sale. at present, it has invested and expanded the project of annual production of 148 million lithium batteries. it is expected to be completed and put into production in June and July 2021, when it is expected to become a new performance growth point of the company.
To sum up, with the release of various business modules, the company has achieved relatively rapid growth this year. The company's revenue and profits in the first three quarters grew faster than the previous quarter; in particular, the company realized sales revenue of 2.326 billion in the third quarter, an increase of 36.84% over the same period last year, and realized a net profit of 316 million yuan for shareholders of listed companies, an increase of 78.29% over the same period last year. At the same time, thanks to the effective integration of production capacity and the market, the growth ratio of net profit greatly exceeded the growth rate of sales revenue.
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