Accounts receivable as high as 2 billion, a five-year high, can Changying precision break through in auto track

Shenzhen Changying Precision Technology Co., Ltd. (hereinafter referred to as Changying precision, 300115. SZ) has made a bet on the field of new energy vehicles, achieving the goal proposed two years ago. According to the financial report of the third quarter of this year, in the first three quarters of this year, the revenue of Changying precision was 6.746 billion yuan, with a year-on-year growth of 9.07%; the net profit was 413 million yuan, with a year-on-year increase of 119.32%; the annual net profit attributable to the parent company is expected to be 530-650 million yuan, with a year-on-year increase of 532% – 675%. As for the huge growth of the company’s net profit during the reporting period, Changying precision explained that due to the effect of product structure adjustment, wearable products, tablet products, and laptops had a greater growth, which had a positive impact on the benefits. < / P > < p > it is worth noting that in 2018, Changying precision began to focus on the development of non mobile phone business, and proposed to achieve more than 50% of revenue from non smartphone business within three years, and try to transform into new energy vehicles, intelligent robots and other fields. < / P > < p > data shows that in the first half of the year, the proportion of non mobile phone business of the company has increased to about 50%, which means that the target proposed in 2018 has been achieved this year. However, despite the gratifying growth of net profit, investor.com noted that the accounts receivable of Changying precision in the third quarter reached 2.069 billion yuan, up about 28% from 1.618 billion yuan in the same period of last year, which reached a five-year high. Among them, the credit impairment loss in the current period was – 38.7 million yuan, compared with 13.9 million yuan in the same period last year. Changying precision explained in the financial report that this was mainly due to the increase in the provision for bad debts of accounts receivable and other receivables compared with the same period last year. During the reporting period, the inventory of Changying precision was 3.141 billion yuan, accounting for 27% of the total assets of 11.571 billion yuan. The inventory turnover days were 150 days, and the inventory turnover rate was 1.79 times / week, slightly slower than that of 2.10 times / week in the same period of last year. In response, the company said that the inventory increased by 835 million yuan, or 36.23%, compared with the beginning of the year, mainly due to the expansion of the company’s sales scale, resulting in the increase of goods issued. < / P > < p > in fact, the problem of high inventory of the company is a continuation of the operation phenomenon in 2019. According to the financial report in 2019, its inventory reached 2.306 billion yuan last year, the highest level in the past five years; in 2019, the company’s accounts receivable amounted to 1.654 billion yuan, the highest value in five years, and this figure was renewed in the first three quarters of this year. Changying precision said in its annual report that the company and its subsidiaries conducted impairment test according to the lower of inventory cost and net realizable value, and made provision for inventory falling price of about 208 million yuan during the reporting period. Compared with its peers, its main business is the leading manufacturing industry of consumer electronics and precision components, and its inventory in the third quarter of this year was about 17 billion yuan, accounting for 25.83% of the total assets of 65.776 billion yuan. In the first half of the year, the inventory turnover rate of Lixun precision was 3.63 times / week, which was significantly higher than 1.79 times / week of Changying precision. Therefore, for Changying precision, how to improve the collection speed of accounts receivable to avoid bad debts, and how to speed up the inventory turnover and improve the operation efficiency have become the key to optimize the financial structure of subsequent companies. In view of the ways Changying precision will speed up the payment collection and improve the operation efficiency in the future, investor.com wrote to Hu Yulong, Secretary of the board of directors, and Chen xiaoshuo, general manager of the company, by email, but no response was received. Since its establishment in 2001, Changying precision has focused on precision components manufacturing. Its main customers include oppo, vivo, Huawei, Samsung, North America and other famous 3C manufacturers. In recent years, with the popularity of smart phones, the mobile terminal market has entered the adjustment period before 5g. The competition in the mobile phone component industry chain is also increasing, and the shipment volume has declined to varying degrees. < / P > < p > in order to avoid the risk brought by the single dependence on the smart phone business, Changying precision actively arranges new energy vehicles, smart wear and other subdivision tracks. On September 27, Changying precision announced that the company’s fixed increase plan of 1.9 billion yuan was approved by the CSRC. The number of shares issued to specific objects does not exceed 20% of the total share capital of the company before the issuance, that is, about 182 million shares. The funds raised will be mainly used for Shanghai Lingang New energy vehicle components (phase I) and 5g intelligent terminal module projects. However, as far as Changying precision is concerned, whether it will take a long time to enter the automobile field and what problems it will face in terms of technology, sun Yanbiao, President of the first mobile phone Research Institute, told investor.com that in terms of precision structural parts, Changying precision technology is very strong, which belongs to the top level in China. For example, Changying precision, a metal structure with the highest precision and difficulty, such as mobile phone hinge, can be produced in large quantities. Therefore, cross industry to do auto parts, for Changying precision is just a dimension reduction blow. Sun added that in addition, some mobile phone suppliers have cross-border layout in the automotive field, and will also aim at the central control of the manufacturing and production of automobiles. Because the car central control is like an enlarged version of the mobile phone, for the mobile phone supplier, it just changes a carrier, and does not need too many update iterations on the technical level, which belongs to the technical translation. It is no coincidence that < / P > < p >. Auto industry commentator Zhang Xiang also told investor.com that for Changying precision, it is not difficult to turn to the automotive industry. As long as the company pays attention to the R & D cost and personnel investment, and insists on exploring, it is not difficult to achieve stable development. With the change and development of market demand, Changying precision has been on the road of continuous transformation. At the beginning, it focused on the production of mould Changying precision, and began to make electronic shielding parts in 2004, which laid the foundation for becoming a mobile phone supplier such as Huawei. In 2005, the product was positioned as mobile phone connector, and began to enter the field of smart terminal connector, and became one of the domestic mobile phone board end connector suppliers. < p > < p > in 2009, Changying precision made a secondary transformation, and its products changed from mobile phone connector to mobile phone slide rail composite shielding parts. In 2012, the products were transferred to smart terminal metal appearance parts. In 2016, the fourth transformation started to focus on robots, intelligent equipment and intelligent vehicles. However, for the transformation two years ago, it was actually more about product restructuring. In this year’s semi annual report, Changying precision positioned it as double adjustment, that is, product structure adjustment and customer structure adjustment. In terms of product structure, the company continued to increase the development of non mobile phone business, and launched tablet computers, notebook computers, smart home products, etc. In the middle and low-end assembly manufacturing already occupies a large number of market Changying precision, began to move towards high-end and intelligent, adjust the structure of products and customers. < p > < p > according to the financial report data, in the first half of the year, the revenue of intelligent wearable products of Changying precision increased by more than 25%, the revenue of tablet computer products increased by more than 3 times, the revenue of new smcled bracket business increased more than 3 times, and the company’s revenue to Tesla increased by 31.42% year-on-year. Although the company’s product orientation and positioning are inclined to high-end intelligent robots, smart home and automobile fields, it is still full of challenges whether Changying precision can make greater breakthroughs in the future, achieve substantial growth in performance, and open the gap with peers. < / P > < p > Disclaimer: the purpose of this article reprinted by china.com finance and economics is to convey more information and does not represent the views and positions of the website. The content of this paper is for reference only and does not constitute investment advice. Investors operate accordingly and bear their own risks. < p > < p > Chinanet is a national key news website under the leadership of the Information Office of the State Council and managed by China foreign language publishing and Distribution Bureau. Through 11 versions in 10 languages, the website releases information 24 hours a day, which is an important window for China to carry out international communication and information exchange.