Desay Battery Executives answer investors ask: take advantage of technology to face changes in business models

Yesterday morning, participate in the SSE "practicing the Chinese Dream" into the listed company series of activities of more than 40 small and medium-sized investors walked into the Shenzhen Science and Technology Park Desay Battery (market, interrogation) headquarters, with the company's financial controller Lin Jun, Dong Secretary Zhonghong carried out face-to-face communication, and around the Desay battery core advantages, The topic of development strategy has been hotly discussed. Investors: The company's main business income growth quickly, but the net profit is not high. Personally feel that this industry should be a high margin of the industry, so want to understand the company's costs and expenses. Lin Jun: To illustrate, we do not do the core of this business. The company's business is divided into two parts, one is the encapsulation business, the second is the power management system. Among them, the power management system is 2012 by the encapsulation business cultivation separate. At present, the company's two business, respectively, by two companies: Packaging business by Huizhou Battery, power management system is the blue microelectronics to undertake. In the past two years, with the refinement of smart phone batteries more and more high, the level of packaging and product consistency requirements are increasingly high. Each battery package of net income or packaging costs, including materials, labor, profit is not very high, so the package of this piece of profit is not as high as expected. Investor: Will the gross margin decline after the company becomes the official supplier of high-end customers? How to deal with the problem of falling gross margin? Lin Jun: Since the fourth quarter of last year, the company has become the official supplier of high-end customers, in fact, the company's business model has changed considerably. The previous model is the mobile phone assembly plant on the Dongguan new energy, Samsung, Sony and other manufacturers of electric core orders, and then these core manufacturers to the Desay battery orders. Desay battery business may include only the protection board and packaging costs this piece, may also include a small number of components or battery sales, but the amount is relatively small. But sales began to grow more in the fourth quarter of last year, as the company has become a formal supplier. According to forecasts, sales revenue this year will increase a lot, but the sales margin will be more reduced. Domestic High-tech Enterprises can only do more in manufacturing, efficiency and automation to do more to achieve substantial revenue growth, and to offset the decline in gross profit margin problem. In addition, the company is also playing its own technical advantages, to do relatively high value-added products, this is the company's "Blue sea" strategy. Investor: Will the company ever intervene in the core business? Lin Jun: At least 5 years of planning there is no involvement in the batteries. Mainly because the core is a high threshold of the industry, is a capital-intensive, talent-intensive, technology-intensive industries. Investor: Can you tell me about the company's power tools business, and what is the strategic goal of the business in the future? Lin Jun: 2013 ago, the company's power tools business is mainly the accumulation of technology, the company has nurtured the business for 5 years. This, but also by the treasure when the impact of product quality events, the final company and treasure when the reconciliation. Power Tools Business, the company's future goal is to occupy more than 10% of the market share, this business is the company's future growth, but the smartphone at least in these years is the company's main industryWorks。