Changyuan Donggu 2020 Semiannual Report: Sales revenue hits a record high, and performance growth ranks among the top in the industry
Release time:
2020-08-11
On August 10, 2020, Changyuan Donggu announced its 2020 semi-annual report. According to the report, the company's operating revenue was 753 million yuan, an increase of 32.56% year-on-year; the net profit attributable to shareholders of the listed company was 154 million yuan, an increase of 70.49% year-on-year; and the net cash flow from operating activities was 193 million yuan, an increase of 72.06% year-on-year. The company achieved all-around growth in its performance and passed a profit distribution plan to distribute a cash dividend of 12 yuan per 10 shares to all shareholders.
On August 10, 2020, Changyuan Donggu released its 2020 semi-annual report. According to the report, the company's operating revenue reached 753 million yuan, a year-on-year increase of 32.56%; the net profit attributable to shareholders of the listed company was 154 million yuan, a year-on-year increase of 70.49%; and the net cash flow from operating activities was 193 million yuan, a year-on-year increase of 72.06%. The company achieved all-around growth in its performance and passed a profit distribution plan to distribute a cash dividend of 12 yuan per 10 shares to all shareholders.
Changyuan Donggu, listed on the A-share market on May 26 this year, is a high-tech enterprise integrating the research, development, production, and sales of core components for automobile engines. According to the Shenwan secondary industry classification, it belongs to the automotive parts industry. Among the companies in the same industry that have disclosed their semi-annual reports, Changyuan Donggu's performance growth is among the top in the industry in terms of revenue, net profit attributable to the parent company, and operating cash flow.
The significant growth in performance this time is partly due to the overall improvement of the commercial vehicle market driven by national policies and demand; and partly due to the company's proper strategic layout. The company's long-term accumulation in technology and product quality, as well as its industry reputation and status, have further opened up the demand from downstream customers. According to the semi-annual report, major customers such as Foton Cummins, Dongfeng Cummins, and Dongfeng Commercial Vehicle have strong order demands for Changyuan Donggu. Meanwhile, new customers such as Guangxi Yuchai, Shangfei Hong, and China National Heavy Duty Truck, developed in recent years, have also shown a rapid increase in their demand for the company's products. The company's overall sales volume increased significantly in the first half of the year, and sales revenue reached a historical high.
Statistics show that as of August 10, 2020, 13 listed companies have launched mid-term distribution plans. In terms of the amount of cash dividends, Changyuan Donggu's dividend is the most generous.
According to the performance report, the company's net profit attributable to shareholders of the listed company in the first half of the year was 154 million yuan, while the total cash dividend distributed this time was 278 million yuan, far exceeding the company's net profit in the first half of the year. Where did the excess come from? By carefully studying the company's data, you will find that as of December 31, 2019, the company's consolidated financial statements showed undistributed profits as high as 580 million yuan! Compared to other companies that distribute almost all dividends before listing, Changyuan Donggu's choice to distribute dividends suddenly after listing is quite unique. Changyuan Donggu's original shareholders shared the 580 million yuan in undistributed profits with the new shareholders after listing, demonstrating their sincerity and generosity.
Located in a trillion-yuan market, industry tailwinds support the company's development, and the rapid growth of commercial vehicles creates vast opportunities.
Over the past decade or so, China's automotive industry has experienced rapid development and has become a crucial part of the national economy. From 2005 to 2016, the proportion of China's automotive industry added value in the national GDP increased from 1.18% in 2005 to 1.53% in 2016, becoming one of the leading industries supporting and driving China's sustained and rapid economic growth. Due to the long industrial chain, wide coverage, and numerous upstream and downstream related industries in the automotive industry, the booming development of China's automotive industry has also significantly driven the development of upstream and downstream related industries. According to statistics from the China Association of Automobile Manufacturers, as of 2018, the market size of China's automotive parts industry has exceeded 4 trillion yuan, with huge room for industry development.
Although the automotive market in the first half of 2020 was impacted by the epidemic, driven by various favorable macroeconomic policies, infrastructure investment policies, emission standard switching, overload control, and highway axle-based toll collection, the production and sales volume of commercial vehicles in the first half of the year both increased year-on-year. The overall improvement of the commercial vehicle industry has provided important support for the growth of Changyuan Donggu's performance.
In fact, in recent years, under the influence of sustained high growth in infrastructure investment, the growth in industrial, wholesale, and retail scales driving trade volume growth and related companies' logistics needs, and the stimulus of the new national standard GB1589-2016 and the joint crackdown on overloading by the Ministry of Transport and other relevant ministries nationwide, China's commercial vehicle market has maintained a certain growth rate. According to industry forecasts, the commercial vehicle market still has significant room for growth in the future, and its growth rate may far exceed the overall growth rate of the automotive industry. Therefore, as a supplier to large engine manufacturers such as Foton Cummins and Dongfeng Cummins, and large vehicle manufacturers such as Dongfeng Commercial Vehicle, Changyuan Donggu's own development will inevitably benefit from the rapid growth of the commercial vehicle market in the future and the steady progress of new projects such as Guangxi Yuchai, Shangfei Hong, and China National Heavy Duty Truck.
Proper strategic layout and product reputation drive rapid performance growth.
Regarding the company's development strategy, Changyuan Donggu clearly stated that the company adheres to establishing a brand image and gradually highlighting its brand characteristics and advantages, focusing on the development of engine cylinder blocks, cylinder heads, connecting rods, and other products, manufacturing high-quality products, building a corporate brand image, and using quality as the cornerstone, promoting scientific innovation and scientific management to provide customers with industry-competitive products.
It is understood that the company has many years of experience in the field of engine components and enjoys a good reputation in the industry. In terms of technology, through long-term technological innovation and accumulation, Changyuan Donggu has independently developed multiple complete core technology systems and successfully applied them to large-scale production. Currently, it has formed a flexible engine component production technology with independent intellectual property rights. In terms of products, the company has multiple professional processing production lines for major products such as cylinder blocks, cylinder heads, connecting rods, flywheel housings, and exhaust pipes, efficiently providing customers with large-scale production operations, and strictly controlling product quality while maintaining high supply capacity. Relying on the good reputation built through products and technology, the company has won full recognition from mainstream vehicle manufacturers and engine manufacturers, establishing long-term and stable cooperative relationships with high-quality customers, and steadily improving its market share. This has led to a rapid increase in the company's performance and laid a solid foundation for the company's long-term development.
At the beginning of 2020, the novel coronavirus raged across the country, and Hubei Province was the hardest-hit area. During the epidemic, under the guidance of the local government, the company implemented comprehensive and regular disinfection and prevention work, and there were zero infections throughout the company. Through the joint efforts of upstream and downstream partners and the hard work of all staff, the company quickly resumed production operations, completed various orders on schedule, and submitted its first report card since its listing. Next, the company will continue to consolidate and deepen cooperation with existing customers, actively expand new customers and projects, continuously improve its market share, enhance its large-scale production advantages, and create even better performance to reward investors and society.
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