16/8/2018-8

The profit rate is regressing.

Mobile phone equipment blue chip Haoyu (02382) earned only 2% to 1.18 billion yuan in the first half of the year (RMB, the same below), far below the market forecast of 1.57 billion yuan, mainly affected by the core business profit margins regressed and recorded 2 100 million yuan exchange losses, no interim dividends.

Haoyu announced its results last night, and its share price fell 4.2% to close at 121.1 yuan.

As of the end of June this year, the Group’s consolidated revenue recorded 11.98 billion yuan, an increase of 19% year-on-year. Among them, the optical component business with the largest contribution to profit increased by 40% to 2.656 billion yuan, but the profit margin of the business was 40%, which was more than 44% in the second half of last year. As for the optoelectronic products with the highest revenue contribution, the profit margin dropped to 4.7%, far less than the 9.8% in the second half of last year.

In terms of gross profit, the gross profit margin of Haoyu fell to 19.4% in the first half of the year, down 1.2 percentage points year-on-year. It was also worse than the 22.2% in the second half of last year, mainly due to the year-on-year decline in the gross profit margin of mobile phone camera modules.

Competition in the mobile phone industry is intensifying

Another mobile phone device giant, Hon Hai (Taiwan: 2317), also had a worse-than-expected quarterly net profit. Its largest customer, Apple’s smartphone iPhone, began to experience complex assembly and tight parts supply, which undermined Hon Hai’s profitability performance.

According to the analysis, the profit margins of the two major businesses have reversed. On the one hand, the price war of mobile phone equipment has already suppressed the average selling price of products; on the other hand, the competition facing the industry has been transformed into a large-scale and small and medium-sized enterprise. Melee. Although Huawei’s main customer, Huawei, will release its new flagship mobile phone in the fourth quarter, the industry structure seems to continue to plague Haoyu’s profit level.

The core business growth of Haoyu has been in the face of the neck, and the fluctuation of the foreign exchange market has directly dragged down the performance of net profit. The company issued $600 million in bonds in January this year, but since then the exchange rate of the yuan against the US dollar has fluctuated drastically, dragging the company to record a foreign exchange loss of 201 million yuan, compared with a foreign exchange gain of 1.55 million yuan in the same period last year.

The brokerage Deutsche Bank lowered its target price of 7% to 158 yuan before the release of the list, maintaining the “Buy” rating.

According to the bank, the price of orders for mobile phones from the mobile phone camera module was under pressure. The two customers Oppo and Vivo cut orders at the beginning of the year, resulting in a lack of room for upgrades. The key to the second half of the year is the new high-end smartphones, which can increase the market share of Sanyu’s three-lens and 3D sensing components and the average selling price of products, thus reversing the market’s pessimistic expectations.