Xiamen clenergy technology IPO: financial data deteriorated net profit and gross margins of triple drop

Polaris solar PV net news: recently, the SFC website disclosure of Qingyuan technology (Xiamen) company limited (hereinafter: Qingyuan technology) of the prospectus, the company proposed public offering of no more than 37 million shares and raised $ 428 million dollars.

In recent years, Xiamen clenergy technology continued deterioration in key financial data, in 2011-2013, its net profit attributable to the parent company for 80.426 million Yuan Yuan and 40.0561 million Yuan respectively, declined. While gross margins were steep falls, its consolidated gross profit margin during the reporting period, and 51.84%, and 35.08%, respectively.

Key financial indicators falling to be listed companies, always attracted investors ‘ questions and discussion.

Decline in the gross margin

Xiamen clenergy technology as solar photovoltaic power generation equipment and services, mainly the production of PV mounting systems, PV inverters, photovoltaic power plant engineering services and other products. Mounting system is the company’s leading product.

Figures show 2011-2013 mounting revenue share of company revenues that year were 75.4%, 80.03% and 88.96% in 2013 and the product gross profit margin contribution of 32.55%, other product gross profit margin contributed 2.53% only.

Therefore, company revenues and profits on mounting products rely heavily on.

However, as the company’s products, PV mounting PV industry chain increasingly irrelevant in recent years, according to industry sources, the PV mounting systems may be the least technical content of products across the entire system, and most tenders are basically Institute or EPC provides a mounting solution manufacturers only simple processing according to the drawings. Barriers to entry are low, and can do simple cottage, who is specific to the project to make it depends on business skills.

In the same production of listed companies Icahn solar PV mounting systems products limited (hereinafter “Eicon Technology”) operating conditions, for example, can also be a horizon.

Eicon Technology Qingyuan technology is mounting one of the product’s main rival, a few days ago, the company announced the annual report of 2014.5, photovoltaic industry turnaround, coupled with policy guidance and market-driven factors, revenues 1.001 billion yuan in the first half, rose 40.48% and net profits of 36.2576 million Yuan, an increase of 700.16%. For the great performance of “explosion” Eicon Technology is concerned, its many revenues grow, even growth in electricity sales by a factor of more than 4 times, but the mounting bracket product revenues only 118 million dollars, has declined by more than 10%.

Eicon Technology explained: “photovoltaic mounting bracket lower revenue largely due to the company’s customer credit accounts and orders the margin level requirements more stringent. ”

In fact, 2013 Eicon Technology mounting brackets and other metal products has achieved relatively rapid growth, sales revenue rose more than 60%, but the company said: “amid fierce competition, the products, prices and margins declined. ”

Whether for price protection or to avoid margin decline, Eicon Technology stent products is already facing the plight of weak revenue growth and margin, falling prices, but for Eicon Technology, less than 20% of the business accounts for growth does not appear to have affected its performance.

However, concern is mounting for the “fist” products of Xiamen clenergy technology, which also faces a decline in gross margins and rapid growth of receivables in Exchange for slight growth in operating income of quagmire.

2012 and 2013, Qingyuan technology accounts receivable respectively increased by 35.6% and 63.2%, operating revenue increased 1.9% and 14.09%, respectively. 2013 accounts receivable amount up to 175 million dollars to 38.61% per cent operating income for the current period. That same year, consolidated gross margin only 35.08% 2011 almost half.

In addition, Xiamen clenergy technology products also declined.

According to the prospectus, PV mounting systems products unit price has been dropped from 1.04 Yuan per watt 2011 2013 0.56 Yuan per watt.

Competitive market

Sacrifice profit to price claimed city of effect is passable, data displayed, Qingyuan technology in each market of sales also now struggling state, company PV bracket products in Asia, and Australia, and European and the Americas are has market, however four a market in the Australia and Americas has appeared sales income declined, 2013 respectively drop 45.25% and 72.47%; Asia and European still keep growth, but growth is appeared obviously fell, 2012 and 2013, Asia market sales income respectively growth 351.7%, and 120.72%, respectively 173.67% and 58.35% on the European market, the growth rate slowed markedly.

In the case of traditional marketing Australia sales decline, Qingyuan technology shift to the domestic market and Japan markets preempted, but these two markets are not a blue ocean.

Industry sources said on condition of anonymity: “the fierce competition at the low price in the domestic market, low gross margins and prevailing in the domestic market accounts, many companies have given up the domestic market. International gross profit rate is relatively high, but overseas customers on support requirements are high, this requires that companies must maintain a high level of quality assurance. ”

May be based on overseas markets seriously, Qingyuan in prospectus shows that attention to investment in research and development of science and technology, and by the end of 2013, the company has made 66 patents and technical developers in the company and affiliated company staff structure, 100 people, second only to 125 the number of people the production staff, the total number of staff as much as 27.4%.

However, puzzling, is that research staff and research spending does not match, 2011-2013, the company developed into Yuan, 1.2298 million Yuan and 14.9776 million Yuan respectively, accounting for revenues in the current period, and 3.11% and 3.3%. Effort and investment is clearly disproportionate.

In addition, these 66 patents, of which domestic 58 for utility model and design patents, no patents for inventions. 8 outside were innovation patents and design patents.

Original title: Xiamen clenergy technology IPO: financial data deteriorated net profit and gross margins of triple drop

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