Battery net learned from the recent investor telephone communication meeting held by Hengdian East Magnetic (002056) that in the first quarter of 2021, Hengdian East Magnetic achieved operating income of 2.558 billion yuan, an increase of 90.99% over the same period last year, and the net profit belonging to shareholders of listed companies reached 258 million yuan, an increase of 193.26% over the same period last year. At present, the company's orders are in good condition, continuing the prosperity of the first quarter in April. In terms of inventory, the company's inventory data in the first quarter increased compared with 2020, mainly due to (1) the company's capacity expansion and the addition of some reasonable stock; (2) in order to cope with the rise in the price of upstream raw materials, the company prepares a certain amount of stock.
According to official data, Hengdian East Magnetic was founded in 1980 and has expanded the industry from a single magnetic material to photovoltaic, lithium and devices through the combination of industry and finance since it was listed in 2006. Among them, the company's photovoltaic products mainly include monocrystalline silicon wafers, batteries and modules, which are mainly used in the construction of ground power stations and distributed power stations. Lithium battery products mainly include cylindrical lithium batteries and small power systems, which are mainly used in electric bicycles, power tools, portable energy storage, floor sweeping robots, vacuum cleaners and other fields.
In terms of performance, under the influence of the novel coronavirus epidemic, Hengdian East Magnetic still achieved relatively rapid growth last year, with a completed income of 8.106 billion yuan, an increase of 23.5% over the same period last year, and a net profit of 1.014 billion yuan belonging to shareholders of listed companies, an increase of 46.67% over the same period last year. Among them, the photovoltaic industry has an income of 3.468 billion yuan and a gross profit margin of more than 20%; the lithium power industry has turned from losses to profits, with an income of 466 million yuan and a gross profit margin of about 25%. The company said that as the company's layout changed from big power to small power in the past two years, the adjustment of the market and customers was getting better and better, and gradually achieved full production and full sales, making the operating performance of the lithium power industry turn from deficit to profit.
In terms of production capacity, the current Hengdian East Magnetic Photovoltaic industry can produce 600MW silicon wafers, 4GW batteries and 1.5GW components. Lithium battery can produce 1GW ternary cylindrical 18650 battery annually. In addition, the company's major projects this year are 4GW high-efficiency large-size single crystal project, 2GW high-efficiency component project, 148 million lithium batteries and magnetic materials and devices related projects, after completion and production, can gradually increase revenue and profits.
Hengdian Dongji said that the solar photovoltaic industry will continue to increase its share in the energy structure in the future, coupled with the promotion of the goal of carbon neutralization, growth is expected. Lithium electricity is widely used in power and energy storage markets, and there is a lot of room for growth. To sum up, the company plans to achieve sales revenue of 10.982 billion yuan in 2021, an increase of 35.48% over the same period last year, and a net profit of 1.229 billion yuan belonging to the shareholders of the parent company, an increase of 21.25% over the same period last year.
The following is a question-and-answer session of the investor telephone communication session:
Q: where does the driving force of the company's growth come from?
A: on the one hand, the research institute of the company has many new projects in research and development, and the introduction of R & D results into mass production will become the growth driving force of the company. Secondly, the company has a large capital development this year, and the large investment projects include 4GW high-efficiency large-size single crystal project, 2GW high-efficiency component project, 148 million lithium batteries and magnetic materials and devices related projects, completed and put into production, which can gradually increase revenue and profit.
Q: what are the criteria for overseas location as the company expands its production capacity, and what is the rate of return?
A: the company will expand its production capacity according to market demand. At present, the overseas Indian factory site has been landed, mainly in order to more efficiently cooperate with customers who have already built factories in India. The internal rate of return of different projects is different, you can pay attention to the content of the company announcement.
Q: in the face of the rising price of raw materials, how does the company deal with it? Can it all be transferred downstream?
A: price transfer has a certain lag, and the competitiveness of different products is different, so it may not be completely transferred to the lower reaches. At present, the company has a strong ability to transfer.
Q: what is the reason why the photovoltaic industry can still maintain a high gross margin in the fourth quarter of 2020?
A: the main reason is that the investment time of the company is well controlled, the specific relative advantage of unit investment cost, and the conversion efficiency and capacity utilization are high; Second, the company has been pursuing steady development in previous years, and did not expand its scale until last year, so that the production capacity of large-size battery chips is relatively high. third, the company's internal cost control ability is strong, and the company's customer structure is of high quality. the company will provide customers with customized products, relative to product gross margins will be better.
Q: what is the concentration of photovoltaic customers in the company?
In 2020, the top five customers of the company accounted for 11% of the sales revenue, and the degree of concentration was not high. The main customers of the photovoltaic industry are abroad, and about 70% are sold abroad.
Q: what are the types of photovoltaic cells produced by the company?
A: the company is currently P-type PERC high efficiency single crystal battery, there is room for upgrading N-type TOPCON.
Q: what is the size of the 4GW battery chip in the expansion project? What was the size of the 1.6GW project last year?
A: the company is currently expanding the size of the 4GW battery to 182, compared with the size of the 1.6GW last year.
Q: which industry will the company grow more in 2021?
A: the growth rate of the photovoltaic + lithium power industry will be relatively large, mainly because the photovoltaic + lithium power industry will be gradually put into production in the second half of the year if the expansion project is smooth, and the magnetic materials + device industry will also maintain double-digit growth.
Q: how much will the company spend on capital in 2021?
A: there are probably more than 2 billion.
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