Avic Hi-Tech(SH:600862) Xin Lang Cai Jing·2025-08-26 00:25Core Viewpoint - The company reported a stable performance in H1 2025, with revenue and net profit showing modest growth, indicating a solid operational foundation and alignment with annual targets [1][2]. Financial Performance - In H1 2025, the company achieved revenue of 2.747 billion yuan, a year-on-year increase of 7.87%, and a net profit attributable to shareholders of 605 million yuan, up 0.24% year-on-year [1]. - Q2 2025 revenue was 1.346 billion yuan, reflecting a year-on-year increase of 9.47% but a quarter-on-quarter decrease of 3.95%. Net profit for Q2 was 247 million yuan, down 2.12% year-on-year and 30.91% quarter-on-quarter, primarily due to a decline in gross margin [1]. Cost Control and R&D Investment - The company maintained a gross margin of 37.8% in H1 2025, up 0.5 percentage points year-on-year, while Q2 gross margin was 34.2%, an increase of 1.2 percentage points year-on-year. The period expense ratio was 9.5%, up 1.0 percentage points year-on-year, mainly due to an increase in R&D expense ratio [2]. Business Segment Performance - The aerospace new materials segment generated revenue of 2.717 billion yuan, a year-on-year increase of 7.89%, with a net profit of 644 million yuan, up 1.75% year-on-year. The company successfully completed high-quality tasks for AVIC composite models, supporting the development and timely delivery of civil aircraft and engines [3]. - The advanced manufacturing segment is undergoing adjustments, with revenue of 29 million yuan, a year-on-year increase of 60.5%, and a net profit of -7 million yuan, indicating a reduction in losses [3]. Order and Inventory Management - Accounts receivable and bills amounted to 4.24 billion yuan, a 15.5% increase from the beginning of the period, while inventory was 1.28 billion yuan, only up 0.3%. The increase in raw materials and work-in-progress suggests preparation for downstream demand [4]. - The company is actively expanding production capacity with several ongoing projects, including the advanced aerospace prepreg project, which has entered trial operation, and the carbon materials production line, which has completed project acceptance [4]. Share Buyback and Employee Incentives - The company announced a plan to use 100 to 200 million yuan for share buybacks, with 1.9258 million shares repurchased by July 31, 2025, using approximately 49.958 million yuan, indicating a progress of about 25-50% [5]. - The upcoming employee stock incentive plan is expected to enhance the motivation of core staff and support sustained growth [5]. Investment Outlook - As the only specialized unit in China's aerospace industry engaged in composite materials R&D and engineering, the company holds a significant competitive advantage. The expected net profits for 2025-2027 are projected to be 1.305 billion, 1.517 billion, and 1.777 billion yuan, respectively, with corresponding EPS of 0.94, 1.09, and 1.28 yuan [5].