Yongding shares strive to rebuild a "new Yongding" in 3 to 5 years"

In 1997, Yongding shares were listed on the main board of the Shanghai Stock Exchange, becoming the first private company in the optical cable industry to land in the capital market. After decades of development, the company has not only formed a strategic pattern of "photoelectric integration and coordinated development", but also continuously handed over profitable "transcripts". But in 2020, the company suffered its first loss since going public.

"Last year's outbreak affected several of our business segments to varying degrees, with the first loss since listing and pressure within the company." mo siming, chairman of the board of yongding shares, said,"only with great determination and great efforts can we turn the pressure into the driving force for the development of the company, and strive to rebuild a 'new Yongding' in three to five years '."

Cai Yuan, chairman and general manager of Yongding Group, the controlling shareholder of Yongding shares, said that the group will fully support Yongding's long-term strategic plan for innovative development, help the company seize the commanding heights of industrial competition, and accelerate the transformation to high-quality development.

First loss since listing

Walking into the Yongding headquarters park in Wujiang, Suzhou, the first thing you see is"Chasing the light and chasing the dream"Four characters, this is Yongding shares have been in the pursuit of business philosophy. Although the company's operating performance has fluctuated from time to time, Yongding shares have always maintained a profitable state after listing, and have adopted dividends for 17 years to share the company's operating dividends with shareholders.

In 2020, Yongding's record of sustained earnings was terminated.

Affected by the combination of the epidemic and the industry cycle, the company experienced its first loss since listing-to achieve operating income of 3.285 billion yuan in 2020 and net profit attributable to shareholders of the listed company -0.56 billion yuan. The company's optical fiber and cable business was affected by the decline in the order volume and bidding price of major customers, resulting in a decrease in gross profit of 29.3846 million yuan year-on-year, and a provision for inventory decline of 19.97 million yuan was made. In fact, this is only a microcosm of the current situation of "green and yellow" in the domestic optical fiber and cable market.

With the construction of FFTx (I. e., the general name of all kinds of fiber optic networks) and 4G approaching the end, 5G large-scale commercial gradually rise, the domestic fiber optic cable market in the past two years into the shock adjustment stage. The most direct manifestation of the market change is that the unit price of optical fiber has dropped from 100 yuan per core kilometer in 2012 to 65 yuan per core kilometer in 2018. In 2019, the unit price of China Mobile's 0.105 billion-core kilometer ordinary optical fiber collection will further drop to 30 yuan per core kilometer.

In addition, terminal sales, project cycle, annual cost reduction and other factors led to the company's automotive wiring harness business annual loss of 0.329 billion yuan.

The so-called annual drop is that at the end of each year, the main engine factory and parts enterprises negotiate to reduce the supply price for the second year. It is understood that the annual decline rate of the domestic automobile industry is generally 3% to 5%, the specific proportion is determined by the two sides through negotiation, but it is closely related to the stage of the supply project, and obtaining the fixed point of new projects often means better profit performance.

"Since the second half of last year, the auto industry has picked up significantly, and we have secured 16 new project designations, and GM's 3.3 billion yuan order will also be delivered this year. Progress has also been made in terms of new customers and new business."Mo Siming introduced.

How to recreate brilliance

In the first year of the "14th Five-Year Plan", Yongding shares were formulated to build"Strong Yongding, Efficient Yongding"Long-term strategic planning for the goal.

"Strong and Forever"It refers to the formation of a stable framework for long-term future development within the company, from the organizational framework to the talent team to the business collaboration. At the end of last year, the management team of Yongding shares carried out an overall iteration, and younger and more professional "new faces" entered the company's board of directors.

Mo Siming said that through team reorganization and process reengineering, the company's management can be stable for a long time.

At the same time, Yongding Co., Ltd. has also set up a new automotive electrical division by integrating the company's internal industry, human resources, research and development resources. The goal is to surpass the market definition of traditional Tier 1 supplier (Tier 1) and become a "Tier 0.5" that is deeply bound with car companies and provides services from collaborative innovation in the early stage to data sharing in the later stage ".

In fact, to become a "Tier 0.5", Yongding shares have enough "confidence". The company's Jinting wire harness is a well-known domestic automobile wire harness manufacturer. Its products cover regular low-voltage vehicle wire harnesses and new energy high-voltage wire harnesses. Its main customers include SAIC General Motors, SAIC Volkswagen, Volvo, Cummins, Yanfeng Andaotuo, Faurecia, etc. Another subsidiary, Yongding Zhiyuan, is one of the core suppliers of China Unicom and China Telecom in telecom big data.

Similar to this kind of integration of internal resources, the formation of efficient synergies, is."Efficient Yongding"of the target. The same "chemical reaction" also occurred in the company's optical communications business segment. In the face of the downstream market shock adjustment, Yongding shares take the initiative to choose"Go outside"and"Go up"Two responses.

"Go outside"It is to get rid of the dependence on the orders of the three major operators, open up new markets such as overseas projects and special fiber projects, and open up new performance growth space for the company."Go up"It is by virtue of the company's fiber optic cable business volume advantages, the business will be extended to upstream optical devices, optical modules, optical chips and other high value-added links.