A number of wind power listed companies concentrated on the release of the 2011 first quarter report. While the net profit showed a negative growth compared with the same period of last year, the cash flow generated by the company's operating activities was greatly reduced, and the inventory increased significantly year-on-year. The industry believes that the “profit-making era†of wind power equipment manufacturing industry is about to close, and under the fierce competition, large-scale integration of the industry will be inevitable.
The decline in performance
Huarui Wind Power (601558) released a quarterly report on April 27th. The company achieved a net profit of 438 million yuan in the first quarter, a slight increase of 1.02% year-on-year; while another wind power machine manufacturing giant Goldwind's first quarter net profit was compared with the same period last year. It fell by 16.99% to 206 million yuan. The net profit of Sinoma Technology, one of the leading companies in the field of wind turbine blades, decreased by 28.37% year-on-year to 26.31 million yuan.
Judging from the cash flow generated by operating activities, several companies have shown a "money tight". Sinovel's first quarter cash flow was 1.9 billion yuan, Goldwind Technology was -3.9 billion yuan, and Sinoma Technology was -195 million yuan.
Insiders pointed out that the wind power equipment company's first-quarter performance decline was not an accident, but in recent years, the wind power equipment manufacturing industry's "overcapacity" undercurrents of the "sinking" of the beginning of fermentation. If this momentum continues, it will accelerate the process of industrial integration that has gradually begun.
In recent years, the domestic manufacturers engaged in wind power machine manufacturing have expanded rapidly. The blind expansion of the market once sounded the alarm of overcapacity. Under the fierce competition situation, many domestic manufacturers have cut prices, and the whole machine cost has dropped from 6,500 yuan/kW in 2008. In 2009, it was 5,400 yuan / kW, until the end of last year was less than 4,000 yuan / kW.
The consequences of such a situation, on the one hand, make wind power "affordable Internet access" close at hand, but the bigger problem is that relatively low cost attracts all kinds of funds into the equipment manufacturing field. Under fierce competition, the profit margins of various manufacturers' products are constantly being squeezed. Huarui Wind Power's 2010 annual report pointed out that the current gross profit margin of the company's megawatt wind turbines was 20.61%, down 0.14% year-on-year; Goldwind's gross profit margin of major products also dropped significantly last year.
An analyst from Great Wall Securities said that the decline in product gross margins has caused manufacturers to lower their thresholds to ensure that orders are continuously drawn from wind farms, in pursuit of economies of scale to compensate for the shrinking profits caused by the decline in unit prices. “When you pull the order crazy, you can only get the advance payment that is less than half of the sales price of the whole machine, and you must continue to purchase products from the upstream parts suppliers. This will inevitably lead to corporate coping and receivable. Both the money has surged and the cash flow continues to be tight."
The person said that if this situation continues, the risk of breakage in the corporate capital chain will be inevitable. “Because wind power equipment manufacturers are just listed, their funds will be sufficient to maintain normal operations for a certain period of time. However, if the cash flow of enterprises will still be lost next year, it is estimated that many companies will not be able to stop.â€
Industrial capital retreats
Perhaps it is to see that the wind power equipment manufacturing industry is about to end the "profiteering era", and some capitals that want to enter the wind power industry have begun to retreat. Ha Air Conditioning (600202) previously announced that the company's board of directors deliberately considered, decided to terminate the wind power research and development activities, and concentrate on making the main business bigger. China CNR (601299) recently announced that it is trying to enter the top five domestic wind power equipment manufacturers in the next five years, but the company’s executives told China Securities Journal that the specific actions to implement this strategy will depend on the domestic wind power industry. Development space depends.
The above analysts pointed out that in the future, large-scale integration in the field of wind power equipment manufacturing will be inevitable, but he believes that the merger and reorganization between the manufacturers in the same chain of the industry chain may have limited contribution to the expansion of the company's performance. It should focus on the upstream and downstream business expansion of the industry chain to control product costs in a wider range; at the same time, strengthen technological innovation and enhance enterprise competitiveness with new products.
The decline in performance
Huarui Wind Power (601558) released a quarterly report on April 27th. The company achieved a net profit of 438 million yuan in the first quarter, a slight increase of 1.02% year-on-year; while another wind power machine manufacturing giant Goldwind's first quarter net profit was compared with the same period last year. It fell by 16.99% to 206 million yuan. The net profit of Sinoma Technology, one of the leading companies in the field of wind turbine blades, decreased by 28.37% year-on-year to 26.31 million yuan.
Judging from the cash flow generated by operating activities, several companies have shown a "money tight". Sinovel's first quarter cash flow was 1.9 billion yuan, Goldwind Technology was -3.9 billion yuan, and Sinoma Technology was -195 million yuan.
Insiders pointed out that the wind power equipment company's first-quarter performance decline was not an accident, but in recent years, the wind power equipment manufacturing industry's "overcapacity" undercurrents of the "sinking" of the beginning of fermentation. If this momentum continues, it will accelerate the process of industrial integration that has gradually begun.
In recent years, the domestic manufacturers engaged in wind power machine manufacturing have expanded rapidly. The blind expansion of the market once sounded the alarm of overcapacity. Under the fierce competition situation, many domestic manufacturers have cut prices, and the whole machine cost has dropped from 6,500 yuan/kW in 2008. In 2009, it was 5,400 yuan / kW, until the end of last year was less than 4,000 yuan / kW.
The consequences of such a situation, on the one hand, make wind power "affordable Internet access" close at hand, but the bigger problem is that relatively low cost attracts all kinds of funds into the equipment manufacturing field. Under fierce competition, the profit margins of various manufacturers' products are constantly being squeezed. Huarui Wind Power's 2010 annual report pointed out that the current gross profit margin of the company's megawatt wind turbines was 20.61%, down 0.14% year-on-year; Goldwind's gross profit margin of major products also dropped significantly last year.
An analyst from Great Wall Securities said that the decline in product gross margins has caused manufacturers to lower their thresholds to ensure that orders are continuously drawn from wind farms, in pursuit of economies of scale to compensate for the shrinking profits caused by the decline in unit prices. “When you pull the order crazy, you can only get the advance payment that is less than half of the sales price of the whole machine, and you must continue to purchase products from the upstream parts suppliers. This will inevitably lead to corporate coping and receivable. Both the money has surged and the cash flow continues to be tight."
The person said that if this situation continues, the risk of breakage in the corporate capital chain will be inevitable. “Because wind power equipment manufacturers are just listed, their funds will be sufficient to maintain normal operations for a certain period of time. However, if the cash flow of enterprises will still be lost next year, it is estimated that many companies will not be able to stop.â€
Industrial capital retreats
Perhaps it is to see that the wind power equipment manufacturing industry is about to end the "profiteering era", and some capitals that want to enter the wind power industry have begun to retreat. Ha Air Conditioning (600202) previously announced that the company's board of directors deliberately considered, decided to terminate the wind power research and development activities, and concentrate on making the main business bigger. China CNR (601299) recently announced that it is trying to enter the top five domestic wind power equipment manufacturers in the next five years, but the company’s executives told China Securities Journal that the specific actions to implement this strategy will depend on the domestic wind power industry. Development space depends.
The above analysts pointed out that in the future, large-scale integration in the field of wind power equipment manufacturing will be inevitable, but he believes that the merger and reorganization between the manufacturers in the same chain of the industry chain may have limited contribution to the expansion of the company's performance. It should focus on the upstream and downstream business expansion of the industry chain to control product costs in a wider range; at the same time, strengthen technological innovation and enhance enterprise competitiveness with new products.
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