Nanyang shares (002212) 2018 annual report and 2019 first quarterly report comments: information security business performance eye-catching market and R & D expansion continued to grow

Nanyang shares (002212) 2018 annual report and 2019 first quarterly report comments: information security business performance eye-catching market and R & D expansion continued to grow

Event: The company released its 2018 annual report and realized revenue of USD 6.3 billion, an increase of 22 per year.

74%, achieving net profit attributable to the parent company4.

85 ppm, an increase of 14 in ten years.

16%, basically in line with expectations.

At the same time, the first quarter report of 2019 was released to achieve revenue of 10.

50,000 yuan, an increase of 7 in ten years.

16%, affected by the expansion of equity incentives and R & D expansion, 19Q1 net profit attributable to mothers decreased by 88.6 million yuan.

Information security business performance is eye-catching: 武汉夜生活网 18 years of steady revenue growth22.

From 74% to 630,000 yuan, in terms of business segments, the wire and cable business achieved revenue of 45.

5.7 billion, an increase of 14 in ten years.

85%; revenue from information security business17.

$ 30 trillion, a sharp increase of 49 previously.

40%, of which Tianrongxin, a wholly-owned subsidiary, realized revenue.

USD 4 billion, a year-on-year growth of 49%. The performance of the information security business is eye-catching for several reasons: 1. The company’s growth is in cloud security, data security, industrial control security, autonomous controllable and connected Internet security, Internet of things security, and terminal threatContinuing investment in protection, and successively launched related security products and solutions; 2. The company gradually vigorously developed information security integration business.

3. The traditional firewall business is progressing smoothly, with a market share of 20 in 2017.

3% to 22 in 2018.

4%, the market is further improved.

Tianrongxin achieved net profit in 18 years4.

97 ppm, a year-on-year growth of 21%. The lower profit growth rate is mainly due to the increase in the proportion of low-margin integration services.

The performance was in line with expectations, and the market and R & D investment continued to increase: The company’s overall gross profit margin and period expense ratio for 18 years remained basically stable, and its gross profit margin dropped slightly.

06 good to 24.

8%, during the period, the expense ratio also dropped slightly.

6 up to 16.

5%.

Benefiting from rapid revenue growth, the company’s net profit also grows by 14 per year.

16% to 4.

85 trillion, basically in line with expectations.

Although the overall expense ratio dropped slightly, the market and R & D expansion continued to grow. In 18 years, the company’s sales expenses and R & D expenses increased.

28% and 14.

36%, sales and research and development personnel increased by 28% and 34%, respectively, and continue to accelerate market expansion.

Investment suggestion: Considering the impact of equity incentive amortization on profits, the net profit attributable to the parent company for 19-20 years is reduced to 4, respectively.

18 ppm and 5.

6.5 billion, while forecasting a net profit of 7 attributable to the parent company in 21 years.

30,000 yuan.

We are optimistic that the company as a firewall leader will benefit from the overall rapid growth of the industry and the company’s layout in emerging areas such as cloud security, data security and industrial control security, maintaining the “overweight” level.

Risk warning: the pressure on shareholders to reduce their holdings; mergers and acquisitions integration is less than expected; innovative businesses such as cloud security are developing less than expected; overall market expectations are falling.