Recently, Tongcang Optical Fiber and Cable Co., Ltd. (hereinafter referred to as “Tongcable Optical Fiber”) announced the company’s annual results as of 2021. In 2021, the international epidemic is still severe, and the pressure on the limit price in the domestic market has not yet eased. Facing the market opportunities and challenges, the company has successfully consolidated its global leading position in the optical fiber and cable industry, achieved new breakthroughs in international business, and improved its diversified business layout, overcoming the pressure of industry cycles to achieve revenue and profit growth. During the reporting period, the company’s operating income was approximately RMB 9.536 billion, an increase of approximately 16% over 2020; gross profit was approximately RMB 1.872 billion, an increase of approximately 13.6% over 2020; net profit attributable to shareholders of the parent company was approximately RMB 710 million , an increase of approximately 30.3% over 2020, with basic earnings per share of RMB 0.94.
The main business of optical fiber and cable is consolidated, and innovative breakthroughs strongly support “East Numbers and West Calculations”
In 2021, Tongcang Optical Fiber will continue to improve the production process of preforms, optical fibers and optical cables, improve the level of intelligent manufacturing, optimize production efficiency and cost structure, expand the application scenarios of new products, and continue to improve production efficiency, successfully consolidating the main business of optical fibers and cables. A leading market position in the world. Tongcang Optical Fiber was awarded the top ten smart benchmark factories in Wuhan in November 2021. In May 2021, the full-process digital supply chain of the cable optical fiber was selected as the first batch of national supply chain innovation and application demonstration cities and demonstration enterprises released by the Ministry of Commerce, fully demonstrating that the cable optical fiber supply chain system is leading the industry in response speed and stability level.
In terms of technological innovation, based on the successful realization of the complete independence of the optical fiber industry chain, the cable optical fiber has increased the research and development of new optical fibers for 5G. Global leader in mode fiber. At the same time, the ultra-low attenuation and large effective area optical fiber developed by Tongcang has helped China Mobile Research Institute to complete the research and testing of the world’s longest 800G long-distance transmission technology, laying the foundation for the large-scale commercial use of 5G networks. Strong support for the national “dual carbon” strategy and the network interconnection in the “East and West” project. With the official launch of the “East Digital and Western Calculation” project, the company, as a representative of new infrastructure, has a long data center industry chain, wide coverage, and strong driving effect. Annual gross profit margin and profit improvement.
In addition, the high-end multimode optical fiber of the cable-through optical fiber is widely used in the construction of large-scale data centers by domestic and foreign customers. In the field of special optical fibers, the active three-clad optical fibers developed by the company have achieved technological breakthroughs, broke the overseas monopoly, and solved the technical problem of “stuck neck”.
Continuous improvement of diversified layout and breakthroughs in multiple fields to enhance core competitiveness
While ensuring the core advantages of the main business, the company has continued to accelerate the pace of diversification in recent years and achieved breakthroughs in many fields. The company has further improved its layout in the fields of optical modules and optical devices, communication network engineering, data center wiring, AOC consumer electronics, etc., and has made new progress in optical modules, semiconductor quartz materials, submarine cables and other fields. Among them, in the field of optical modules and optical devices, the company seizes the development opportunities of the data center market and the communication market, and achieves continuous growth in operating income in 2021. Changxinsheng, a subsidiary of the company engaged in optoelectronic chips, modules, AOC, integrated wiring and other related businesses, has made continuous breakthroughs in ultra-high-definition video, virtual reality, medical systems, machine vision, data centers and other application fields, and its products have entered many overseas well-known large-scale customer supply chain.
In addition, the company’s optical fiber and intelligent industrial control solutions and other related products and services have been applied in the State Grid project. Among them, the State Grid Shaanbei-Hubei ±800kV UHV DC project adopts the company’s G.654.E optical fiber to achieve a single span A breakthrough of 467 kilometers of unrelayed long-distance transmission.
In March 2022, the company acquired Wuhu Tus Semiconductor Co., Ltd. and Wuhu Terahertz Engineering Center Co., Ltd., and entered the third-generation semiconductor industry. The acquisition will help enhance the company’s core competitiveness.
Accelerating overseas deployment, the proportion of overseas business revenue exceeded 30% for the first time, setting a record
In 2021, Tongcang Optical Fiber will enhance its international competitiveness through four differentiated strategies of breakthrough, deep cultivation, integration and cultivation, and make full use of the opportunities of market growth. level, and rationally coordinated production capacity planning, and achieved rapid growth in overseas business income. In 2021, the company’s overseas business revenue will reach RMB 3.1 billion, a year-on-year increase of about 46.8%, and for the first time, it will reach more than 30% of the company’s annual revenue, achieving a phased breakthrough. Among them, the company’s overseas communication network engineering projects in Peru and the Philippines overcame the difficulties of the epidemic and completed the construction node target on schedule, which was highly recognized by local operators and customers, and received follow-up project orders.
In addition, during the year, Cable Optical also completed the acquisition of YOFC Poliron Indústria e Comércio de Cabos Especiais Ltda. (“Cable Poliron”) located in Brazil. Cables Polyron is a well-known brand in Brazil and Latin America. Brazil and Latin America are one of the company’s main overseas target markets. This acquisition is the company’s first production capacity layout in this region, which will help the company to further improve its international strategy.
At the same time, in response to the actual demand in Southeast Asia, Africa, Latin America and other places, Tongcang Optical Fiber is expanding its optical fiber and cable production capacity in Indonesia, and the construction of its optical cable production facilities in Poland is also progressing as scheduled. In the future, Tongcang Optical Fiber will further improve the localized production capacity layout covering international target markets and regions to cope with logistics and policy risks. Through the smooth implementation and delivery of the previous communication network engineering projects in the Philippines, Peru and other places, the company’s related business teams have grown rapidly, which will help the company to build overseas comprehensive service capabilities.
Enabling the digital transformation of 5G applications and building a 5G + Optical Cloud Industrial Internet Platform
Over the years, Tongcang Optical Fiber has insisted on the exploration and practice of intelligent manufacturing, and continuously improved the level of intelligent manufacturing. In the highly intelligent production workshop of Tongcang Optical Fiber, there are very few workers, and many tasks do not require manual operations. In November 2021, the China 5G + Industrial Internet Conference was held in Wuhan. Leaders and expert representatives from the national industry and information system visited the company’s digital production workshop and gave unanimous praise to the company’s intelligent manufacturing level.
During the “14th Five-Year Plan” period, the company will take “technological innovation and digital transformation” as an important strategic measure in the development stage of the 14th Five-Year Plan. Combined with the high-speed, large-bandwidth, low-latency, and high-reliability features of the all-optical network, it has broken through key technologies such as 5G+ all-optical network formation, equipment management and data acquisition, simulation, digital twin, and industrial big data, forming an industry-leading Leading “5G + Optical Cloud Industrial Internet Platform”.
Steady operation attracts capital financing, setting the highest financing record in the AOC field
The company’s operation is stable. During the year, it was awarded the long-term credit rating of AAA and the “stable outlook” by Lianhe Credit Rating Co., Ltd. and China Chengxin International Credit Rating Co., Ltd.
The company rationally uses capital market investment and financing channels to promote long-term sustainable development. In 2021, the fair value of the shares held by the company in Hangzhou Zhongxin Wafer Semiconductor Co., Ltd. will increase by approximately RMB 320 million. In 2021, the company’s subsidiary Xinsaikang Co., Ltd. (“Xinsaikang”) completed the A and B rounds of financing in 2021, with a cumulative financing amount of approximately RMB 600 million, setting the highest financing record in the field of AOC optical interconnection. . At the same time, the science and technology innovation fund established by the Cable Company has completed the investment in a number of enterprises, which strongly supports the development of the company’s strategy.
In 2022, the global macro economy will still face risks, the impact of the epidemic will continue, and the international situation will be complicated. Faced with opportunities and challenges, Tongcang Optical Fiber will make full use of the opportunity of improving supply and demand in the industry, consolidate its leading position in the world in its main business, and continue to implement various major strategic measures in depth. In terms of internationalization, Tongcian Optical Fiber will further improve its overseas production capacity layout and build localized supply and service capabilities; in terms of diversification, Tongcian Optical Fiber will enter the third-generation semiconductor material industry through acquisitions, while accelerating the construction of submarine cable construction capabilities and improving Diversified layout. With the recovery of industry demand and optimization of supply structure, we will achieve long-term sustainable development.