The performance of raycus laser will hit a new high, and the laser source market demand is strong

Thanks to the strong overall demand in the laser market, Raycus laser achieved rapid growth in operating performance.

In 2021, Raycus is expected to achieve a net profit of 460 million-490 million RMB attributable to shareholders of listed companies, a year-on-year increase of 55.36%-65.49%; net profit attributable to shareholders of listed companies after deducting non-recurring gains and losses is 405 million RMB -430 million RMB, a year-on-year increase of 62.32% -72.34%.

With the leading market share and strong demand in the laser market, Raycus laser is vigorously expanding production. Previously, the company announced that it plans to invest 5 billion RMB to build a laser intelligent manufacturing base project, which is expected to be completed in two phases within seven years.

The performance is expected to hit a new high.

Affected by the overall strong demand in the laser source market, Raycus' profitability in 2021 may reach a new high.

According to the performance forecast, in 2021, Raycus Laser is expected to achieve revenue of 3.3 billion RMB to 3.5 billion RMB, an increase of 42.45%-51.08% compared with 2.317 billion RMB in the same period of the previous year; it is expected to achieve a net profit of 460 million RMB to 490 million RMB, an increase of 55.36%-65.49% compared with 296 million RMB in the same period of the previous year; it is expected to achieve a non-net profit of 405 million RMB to 430 million RMB, an increase of 62.32%-72.34% compared with 250 million RMB in the same period of the previous year.

The operating performance of Raycus Laser in the first three quarters of last year has laid the foundation for high growth. Especially in the first quarter of last year, the company's performance achieved explosive growth.

In the first three quarters of 2021, Raycus achieved operating income of 2.507 billion, a year-on-year increase of 74.98%; net profit attributable to the parent was 401 million, a year-on-year increase of 123.21%; deducted non-net profit of 382 million, a year-on-year increase of 136.82%. Among them, the company achieved a net profit of 110 million in the first quarter, a year-on-year increase of 902.37%; deducted non-net profit reached 107 million, a year-on-year increase of 2039.41%.

The financial report shows that since the net profit reached a peak of 433 million in 2018, the company has experienced a decline in net profit in the following two years. In 2019 and 2020, the company's net profit achieved 325 million and 296 million respectively, a year-on-year decrease of 24.81% and 8.95%.

However, during the period, Raycus continued to increase R&D investment. From 2018 to 2020, the company's R&D expenses reached 86.54 million, 118 million, and 173 million, up 69.09%, 36.44%, and 46.58% year-on-year. In the first three quarters of 2021, the company's research and development expenses reached 146 million, a year-on-year increase of 59.35%.

It is planned to invest 5 billion to build a new base to expand production.

Raycus Laser was established in 2007. The actual controller is Aerospace Science and Industry Group. The company focuses on laser light source technology. After more than ten years of deep cultivation in the industry, it has developed into a process solution provider based on core light sources for various manufacturing companies. In 2020, Raycus' domestic market share reached 24.4%, ranking the domestic leader and the second in the world.

Continuous fiber laser sources are the company's main source of revenue, and the revenue share has increased from 50.22% in 2015 to 75.78% in 2020. In the first half of 2021, the company's continuous fiber laser source revenue reached 1.317 billion RMB, accounting for 81.84%.

Regarding the high performance growth in 2021, Raycus explained that during the reporting period, the overall demand for the laser market was strong. As a leading fiber laser company in China, Raycus laser continued to make efforts in high-end applications and successfully launched a number of new products to the market, resulting in a steady increase in laser sales and operating income, and a sustained increase in net profit. In addition, through technological breakthroughs, the subsidiary has further improved the upstream industrial chain and expanded the company's product line. Special optical fibers, ultrafast lasers and other sectors have provided certain profit support for the company.

It is understood that Wuhan Ruixin Special Optical Fiber Co., Ltd. (referred to as "Wuhan Ruixin"), a subsidiary of Raycus, achieved outstanding operating performance in the first half of 2021, achieving operating income of 168 million and net profit of 103 million. The industrial-grade high-power ultrafast laser polarization-maintaining gain core technology research and application project led by Wuhan Ruixin was selected as the 2020 Hubei Provincial Key R&D Plan (the second batch).

It is worth mentioning that Raycus once said, "From the perspective of production capacity, according to past experience, the production capacity basically doubles every year to support the company's revenue growth." Therefore, the company is currently aggressively expanding production.

On December 9, 2021, Raycus Laser announced that the company intends to sign a project investment with Huangshi Economic and Technological Development Zone Management Committee to invest in the "Laser Intelligent Manufacturing Base Project". The company invests and constructs through self-raised funds. The total investment of the project is 5 billion RMB, of which 3 billion RMB is invested in fixed assets. It is planned to be completed in two phases within seven years, and the first phase of the project will be put into operation before June 30, 2022.