Changshan Beiming (000158): Half Year Net Profit Loss Of RMB 50 Million To RMB 60 Million

Changshan Beiming (000158) released the semi annual performance forecast of 2021 on the evening of July 14. In the first half of 2021, it is estimated that the net profit attributable to the shareholders of the listed company will suffer a loss of 50-60 million yuan, which is 41.53% - 29.84% compared with the same period of last year. The basic loss per share was 0.0313 yuan per share – 0.0375 yuan per share.

Reasons for performance change:

1. Textile business: during the reporting period, domestic terminal consumption showed a recovery growth trend, some overseas orders returned to China due to the epidemic situation, and the industry prosperity was improved.

The company continued to make efforts in product development, increased the proportion of functional differentiated fiber fabrics and color textile products, and continuously enhanced the downstream order taking ability, and realized significant growth in sales revenue and profitability. The reduction of financing cost makes the financial expenses decrease compared with the same period, and also increases the net profit.

However, due to the fact that the textile business of the company is located in Shijiazhuang, affected by the epidemic situation of pneumonia, a shutdown loss of 30.37 million yuan (the loss belongs to non recurring profit and loss), and the current write off of receivables with full provision for bad debts in previous years decreased by nearly 10 million yuan, the net profit of textile sector in the current period is still negative.

2. Software business: during the reporting period, the company adhered to the established development strategy, grasped the industry development opportunities, continued to increase R & D investment, and constantly improved sales channels. All businesses continued to maintain a good development trend, and the contract amount increased by 40% compared with the same period last year, especially in smart city, financial technology and other businesses.

However, due to the need for a certain period of implementation of orders in hand, the project investment increased more than the same period last year in line with the order growth, and the project benefit was relatively lagging behind, which made the order performance not fully reflected in the current period. The operating revenue only increased by 5% compared with the same period last year, and the net profit was realized when the R & D expenses increased by 37.5 million yuan. The follow-up companies will speed up the implementation and acceptance of the signed contracts, so as to convert the orders in hand into revenue as soon as possible.