Sany will not be able to maintain a ten - year profit record   

For the north, the winter comes early this year, the construction machinery industry is the winter as everyone knows, many small businesses have been unable to bear the cold collapse, while large enterprises rely on brand awareness and brand effect had better, now as a leader in the industry, Sany enterprise or will not be able to maintain for ten consecutive years of earnings the record, that is to say, it can not carry out fast.

In November 24th, according to relevant information, Sany's operating profit may fall by more than 90% this year, and may even be a loss. In the past ten years, the construction machinery leading enterprise has maintained a continuous profit, and the net profit of last year reached 709 million yuan.

In May this year, Sany's application to issue 4 billion 500 million yuan of convertible bonds was approved by the SFC. But at the end of October, as well as the domestic engineering machinery company, it will produce a dismal three quarterly report. In 1-9 months of this year, the company's net profit was 38 million 468 thousand yuan, down 97.58% from the same period last year.

On the 24 day, the company received the notification letter issued by the China Securities Regulatory Commission on the issue of Sany's public offering of convertible bonds after the event, and asked for information on the sharp decline in its performance in the first 9 months of this year, and whether the business situation is stable or not.

Sany will not be able to maintain a ten - year profit record

In reply to the China Securities Regulatory Commission's announcement, Sany gave a more detailed explanation of its performance decline in the first 9 months. It has only introduced three seasons' time to announce its business situation. For net profit fell by 97.58% over the same period, Sany will attribute the most important reason to fixed asset investment, especially the slow slowdown in real estate investment, resulting in the decline in sales of construction machinery products.

The data provided by the company showed that the sales of its main construction machinery products all showed a sharp decline this year. In the first three quarters, 9915 concrete machines were sold, the number of them dropped by about 17%, and the sales volume of excavating machinery was 8684, which also decreased by 18.67%.

Concrete machinery and excavating machinery are two products that Sany most relied on. In 2013-2014 years, its sales volume has decreased by more than 30% and 20% respectively. This also led to Sany's sales of about $18 billion 500 million in 1-9 months of this year, up to 30% from a year earlier.

At the same time, the prices of major products caused by the intensification of market competition have led to a decline in Sany's gross interest rate. In the first three quarters, the gross profit margin of Sany was 25.58%, which was only slightly lower than that of 25.77% last year, but it is far behind that of the 31.75% figure when it was at its peak in 2012.

In addition, the construction machinery giant was also affected by the reform of the RMB exchange rate intermediate price mechanism. In the first three quarters of this year, it suffered 401 million yuan of exchange losses, compared with a loss of 73 million yuan in the same period last year.

Sany said, "with The Belt and Road" planning and the introduction of the future domestic investment demand has stabilized, in the construction machinery industry in the upper reaches of the long term will have development space. However, it also recognizes that the profitability of the construction machinery's main business is still under pressure.

And the most unfavorable result, no more than the annual report of a loss this year, and Sany may not be a solitary example. Previously, a number of leading construction machinery industry to produce three quarterly reports just passable: the first 9 months of this year, ZOOMLION (000157.SZ) loss of 520 million yuan; Xugong (000425.SZ) only profit 12 million 350 thousand yuan, down 99%; affected by factors such as Chinese drag on the market, Caterpillar's sales may also have four consecutive years of decline.

Thus, the construction machinery industry downturn trend is very obvious in China, of course, have a look at a saying: after a storm, in the national policy support, perhaps the industry will soon improve, we should maintain an optimistic attitude, not to be pessimistic.