Recently, Dahua released its third-quarter report and conducted a Q&A with investors.
In the first three quarters, Dahua achieved a total revenue of 21.172 billion yuan, a year-on-year decrease of 1.46%, and a non-returnable net profit of 1.584 billion yuan, a year-on-year decrease of 25.91%.
In the third quarter alone, the profit base was relatively small. At the same time, during the reporting period, equity incentive expenses and loss from changes in fair value increased year-on-year, dragging down profit performance. In terms of gross profit margin, the gross profit margin in the first three quarters was 37.53%, a year-on-year decrease of 3.04%, including the impact of the freight adjustment to the cost item of 1.76%.
The following is the important content of the full text of the investigation, which Leifeng.com has made without changing the original meaning:
1. Recently, the domestic macroeconomic pressure is relatively high. How does the company view and look forward to the development of several major business sectors?
This year, the company’s operation has been greatly affected by the general environment. In the third quarter, the company’s B-end business achieved a growth of nearly 10%. At present, the main problem is still in the G-end and distribution business.
On the government side, some integrated projects have a relatively high risk of bad debts. Therefore, the company has adhered to the concept of high-quality development since last year. Since this year, it has not done many integration projects. At the same time, the number of large projects has decreased under the current macro background, which has caused the government business to experience a painful period. We believe that the government is expected to have new policies and measures in the future. With the continuous introduction of relevant policies, the business needs of the government can be gradually released.
In terms of small and medium-sized enterprises, there were more negative growth in the third quarter, which is a part that we need to constantly reflect on. On the one hand, there is indeed the impact of declining demand, but frankly speaking, the company’s customer coverage and coverage quality do have a certain gap compared with that of its friends. Therefore, we are also summarizing our experience and making changes. We will continue to increase our targeted investment in key areas and cooperate with partners. We hope that there will be a better change next year.
The business of the enterprise is slightly better, and it can also be driven by investment, including the recently introduced policies such as discount loans for hospitals and schools. It is hoped that the enterprise side will have better development next year.
At present, it is expected that the domestic business performance in the fourth quarter is slightly better than that in the third quarter. For example, some delayed demand in the domestic market may be released by the end of the year. Looking ahead to next year, overall cautious optimism.
2. The overseas sector, including Europe, America and Russia, has been affected by various factors including war and inflation recently. How does the company look forward to the development of next year?
The performance gap in Russia and Ukraine has brought certain pressure to overseas market revenue. In Europe and the United States, inflation is high and demand is relatively weak. We will continue to observe new opportunities. Other countries, such as Brazil, India, and Southeast Asia, have relatively active demand. At present, the fourth quarter is expected to be better than the third quarter. Looking forward to next year, there will be structural differentiation overseas. We remain cautiously optimistic.
3. In the past two years, the company has been in the staffing period. Faced with the current environment, how does the company anticipate the rhythm of staffing and cost investment in the future?
Up to now, the number of employees is about 24,000. In the past two years, the company has invested more in human resources. Last year, it recruited 2,000 fresh graduates, and the corresponding expenses were fully reflected in the third quarter of this year. However, while resources have been invested heavily, due to the impact of the epidemic, macro environment, etc., the income performance is average, resulting in a decline in data such as per capita income and per capita profit. In particular, the domestic gap is relatively large. Taking Shanghai as an example, the company’s peak sales in Shanghai in 2019 and 20 can reach 1.3 billion. However, due to the impact of the epidemic this year, a high-quality market like Shanghai has only about 4 to 5 billion, a decline a lot of. In the case of relatively difficult open source, the company achieves effective cost control by throttling and adjusting the structure. In the future, or at least next year, the company will maintain overall stability in terms of personnel. In addition to maintaining the regular elimination of the bottom, it also welcomes the addition of outstanding talents. At the same time, the internal structure will be adjusted in a timely and dynamic manner according to the business, such as adjustment to the main grain-producing department to increase internal flow. In addition, under the background of the company’s special emphasis on high-quality development, the next step will focus on the improvement of per capita benefits.
4. The company attaches great importance to the development of software business. Can you briefly introduce the progress of software business?
Software is an important indicator in the transformation process of a company from a product to a solution, and it is also the core capability of the company. In the third quarter, the software scale was still relatively small, with an increase of 18%, and the cumulative increase in the first three quarters was 12%. The company is now continuing to increase resource investment in the software business, strengthening the capabilities of basic software and technical software and upper-level customization, and looking for more ecological partners to promote it together. Let our software adapt to the system with lower requirements, better openness and better ecological environment. Software, as the company’s strategic business, helps the company achieve an important transformation from complete hardware to a combination of software and hardware. It is difficult to achieve in the environment, but we still hope to achieve it through unremitting efforts.
5. How do you view the current industry competition situation? And the company’s product pricing strategy in the future?
In the past two years, the competition in all walks of life has become more intense than before, but for our industry, it is still dominated by two giants, and both need to maintain a certain amount of profit, so the overall competition is unlikely to be vicious. Of course, reasonable positive competition can also promote the healthy development of the industry, and everyone will pay more attention to and improve services and other aspects. In this process, the company has paid more attention to the management and control of receivables and the quality of business development in the past two years.
There are both homogeneity and differentiation in products and solutions, which are the most important points for companies to improve prices and gross profit margins. In the G-end business, the company has 200 solutions and 5,000 small scenarios. In the B-end company, there are 300 solutions and 3,000 small scenarios. Through the changes of such sub-scenarios, we can make some differentiated competition points and achieve their own The price strategy is generally in a relatively stable state.
6. Can you introduce the overall situation of the current innovative business?
The overall base of the innovation industry is not high, but the growth rate is relatively fast. It is still in the cultivation stage, and it is basically cultivated from 0. Huacheng, Huarui, and Huaruijie are relatively large.
7. Who are the main customers in the company’s automotive electronics business, and what role does Leapmotor play in it?
The company’s automotive electronics business has a certain advantage in the initial stage because of the customer, but the whole is carried out under the premise of fair competition. In addition to Leaprun, Huaruijie is also actively developing non-zero run customers. There are more and more applications of vision in automobiles. In the future, assisted driving and automatic driving need to rely on visual perception such as sensors and camera systems. It is hoped that we will continue to accumulate products on the perception side, strengthen existing technical advantages, and then continue to expand powerful ones. client.
8. Introduce the relevant background of Huachuang Video’s termination of spin-off listing and sale of equity, and whether there will be some changes in future operation ideas?
This is a decision made by the company after fully considering the internal and external environment, maintaining consistent operational flexibility, integrating resources and optimizing the structure. The Huachuang Video for sale this time is a conference video system, equipment and other related assets with audio and video as the core. The operating income of this part in 21 years is more than 200 million yuan, and the profit is more than 10 million yuan. The overall volume is not large. Considering that the company hopes to optimize the overall business structure and concentrate its advantageous resources on the main business operation, it decides to sell part of its equity to promote its independent operation.
9. Leaprun has been successfully listed, what changes will it have on the company’s financials?
The company only invested 90 million in Leaprun, which currently accounts for about 7% of Leaprun’s equity, and the return on investment is still considerable. From a financial point of view, the loss of Leaprun’s performance is calculated according to the equity method and included in the company’s profit. Up to now, more than 1 billion has been accrued, and a total of 332 million has been accrued in the first three quarters of this year. In the future, Leaprun’s losses will decrease, or Selling equity will reduce apparent pressure on the company’s financial statements.
10. How does the company view the impact of upstream supplier inventory on the company’s stocking?
The supply chain was tight across the board last year, but at the current point in this year, a large number of suppliers have relatively high inventories, creating favorable conditions for this stocking.
11. What are the new developments in China Mobile’s fixed increase matters? Has the company considered any moves to boost its share price?
At present, the stock price is upside down. On the one hand, affected by the general environment, the company’s own performance is not very satisfactory, and at the same time, the general environment of the capital market is not very good. In this regard, we will continue to actively explore and seek effective solutions. The core of boosting the stock price still needs to improve performance. In addition to the weak environment, the company is still in the throes of strategic adjustment to high-quality development. The company will continue to adhere to high-quality development and strive to maintain stable operations. . Since the company is in the period of non-public offering, according to the relevant laws and regulations of the China Securities Regulatory Commission, the repurchase cannot be implemented. Leifeng Network Leifeng Network Leifeng Network
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