Introduction to the main contents of investor relations activities
I. Ms. Yang Jiedan, General Manager, introduced the basic situation of the company.
Founded in 1993, the company was listed on the Growth Enterprise Market of Shenzhen Stock Exchange in June 2012. Since its establishment, the company has been committed to precision die-casting of light alloys and new materials. Up to now, it has been precipitated by precision die-casting industry technology for more than 20 years. As a national high-tech enterprise specializing in research and development, design, production and sales of new materials, the company has a complete industrial chain integrating material research and development, precision mold development, precision die casting, numerical control finishing and surface treatment, which can provide customers with one-stop services and the best solutions. The focus of the company's development will be around three major businesses: large-scale precision die-casting, liquid metal and biodegradable high-purity magnesium medical implants.
II. Mr. Tang Guoping, Director of Operations, introduced the company's large-scale precision die-casting applications.
The company is one of the earliest enterprises in the world to lay out large-scale aluminum and magnesium alloy die-casting equipment. At present, the company and its holding subsidiary Chaohu Yi'an Yunhai have 4200T, 3500T and 2700T.
Large-scale vacuum die-casting equipment with different models such as 1600T can meet different specifications and large-scale
Production requirements of precision die-casting integrated products.
With the enhancement of people's awareness of ecological environment protection, vigorously implementing energy conservation and emission reduction and developing new energy have become the only way for the country's sustainable development. To achieve more endurance in the body weight loss of new energy vehicles, it is necessary to develop the overall integration of light alloys and mold traditional multiple parts through large-scale precision die-casting. At present, the company has realized the overall integrated application of new energy vehicle motors, electronic control, battery packs, dashboards, automotive doors and other products.
The company can provide customers with one-stop services from mold design and development, die-casting molding, finishing, surface treatment, testing, packaging and other processes on large-scale precision die-casting products. At present, the company has entered the supply chain of many well-known international and domestic customers such as Tesla, Ningde Times, BYD, Geely and so on.
III. Mr. Li Weirong, chairman of Magnesium Medical, a wholly-owned subsidiary, introduced the application of high-purity magnesium orthopedic implants
This paper introduces the medical application history of magnesium metal and the research and development process of the company's high-purity magnesium bone nails. Compared with magnesium alloy bone nails, the company's high-purity magnesium degradable bone nails have a single element, regardless of the multi-element toxicity effect. It has good biocompatibility, close mechanical properties to bone tissue, no stress blocking effect, and can be removed from secondary surgery. The product is mainly used in human fractures and bone mass fixation.
In January 2020, the company completed the first clinical trial case implantation of magnesium bone nails in China in Zhongnan Hospital of Wuhan University. Due to the outbreak of the novel coronavirus epidemic in China, the company's high-purity magnesium bone nail clinical trial process was affected to a certain extent. After the COVID-19 epidemic in China was effectively controlled, the company's project team has made every effort to promote the clinical process. At present, domestic clinical trials have been carried out in eight clinical hospitals. After ten years of accumulation, the company has built a super-first-class team, high technical barriers, strong partners and other core advantages in biodegradable medical magnesium alloy, which can promote clinical progress better and faster.
In May 2020, the company's high-purity magnesium medical bone nails obtained the EU CE certification of the world's first high-purity magnesium screws. In October, the company signed the Cooperation Agreement with the Clinical Hospital of the Republic of Batumi of Georgia and the International Innovative Medical Service Company of Georgia. Since then, the company has received an order for 1,500 medical magnesium bone nails from the Georgia International Innovative Medical Service Company. At present, the company is producing orders for high-purity magnesium bone nails in an orderly manner. Goods. It is also actively promoting the sales work of countries and regions that recognize EU certification. At the same time, the company is also promoting the certification of countries and alliances in important regions of the world, including the United States, Russia and other countries and alliances.
In addition to the application of high-purity magnesium bone nails, the company will also continue to develop the company's high-purity magnesium brackets and other related products, which are currently in the laboratory research and development stage.
IV. Mr. Gao Kuan, Chairman of Yihao Metal, a holding subsidiary, introduced the development and application of liquid metal products.
The performance and development process of liquid metals are introduced. Liquid metal, also known as amorphous alloy, is a new metal material with glass, metal, solid and liquid characteristics. Because there are no defects such as dislocation, lamination, grain boundary, etc., amorphous alloys show special mechanical characteristics. Its bending strength, tensile strength, elastic deformation, etc. are better than that of common materials (5 times stronger than conventional aluminum and magnesium alloys, 5 times that of 7 series aluminum, 3 times that of stainless steel, and 2 times that of titanium alloys). Because of the excellent physical and chemical properties of liquid metal materials and a wide range of technical applications, liquid metals have been widely used in consumer electronic products, new energy vehicle products, headphones, etc., and have begun to show broad application prospects in intelligent manufacturing, high-end sports equipment and aerospace.
The company's liquid metal products have been applied in batches on folding mobile phone hinges, mobile phone optical brackets, door locks, acoustics and other products. The company provides two liquid metal chain for the largest mobile terminal customers in China. The liquid metal FaceID brackets and camera modules produced by the company have been supplied to Xiaomi, OPPO and other well-known domestic mobile phone manufacturers in batches, and liquid metal locks are exclusively supplied to Tesla. The company is the only enterprise in the world that applies liquid metals to the automotive industry.
The company has entered in-depth research and development of robot gear washer fasteners, smart watches, golf heads and other series of products. At present, the liquid metal washer for couplings has provided corresponding products according to customer size and design requirements. The customer is conducting detailed testing and continuing to optimize the design according to the test results. Flexible Gear Company has jointly developed with customers and has provided liquid metal flexible gear billets according to customer requirements. The customer is optimizing and testing it. Liquid metals have also been supplied to customers in small quantities on medical devices.
V. Interactive communication
(I) The current and future customer situation of the company?
A: The company has disclosed the cooperating customers in its periodic report. In terms of new energy vehicle products, the company has cooperated with many well-known customers such as Tesla, Ningde Times, BYD, Geely, TKP and so on. In terms of liquid metals, the company has cooperated with Tesla, Xiaomi, Huawei, OPPO, Lansi Technology, etc. In the future, in addition to strengthening the cooperation between existing customers and projects, the company will also continue to dig deep into new customers and projects to provide customers with better products and better services.
(II) What is the synergy between LQMT and the company in the development of liquid metals?
Answer: As we all know the strength and influence of the American Liquid Metal Company (LQMT) in patent research and development, the Hong Kong Liquid Metal Company, which was funded by Mr. Li Yangde, the chairman of the company, controlled LQMT. As a related party of the company, we have signed a parallel license agreement with the company in terms of patents. As a manufacturer of liquid metals, we can participate in customer research and development in the early stage with the help of LQMT platform and customer groups, and provide customers with material solutions and applicable liquid metal products. At present, the company and LQMT have projects in cooperation.
(3) The competitors and profit margins of liquid metals?
Answer: At present, the liquid metal market has not formed a complete competition pattern, and very few enterprises can achieve industrial production, which is why the company has been constantly looking for and cultivating partners. It is difficult for only one supplier to enter the supply chain of well-known enterprises. We hope to find and support partners to expand the liquid metal market. The profit margin is also different for different products, but with the maturity of the production process and the increase of the good product rate, even if the customer's price is adjusted, a better profit can still be maintained.
(IV) The company is currently diversified and developing, and the three key industries span a large extent. How does the company view this problem?
Answer: The company's three key developments revolve around the application of new materials. For the company, the principle is the same. Liquid metals, magnesium alloys and aluminum alloys are only the differences in materials, and the production process and skills are common.
(5) The layout of the company's magnesium nail sales in the future?
Answer: The company's high-purity magnesium bone nail has been clinically carried out in 8 hospitals in China. In the first half of the year, the clinical impact of the epidemic, and the clinical process and follow-up of patients after implantation in various hospitals in the second half of the year still met expectations. After clinical completion, the company will register the product before it is listed for sale. On the one hand, the company has established its own sales team, on the other hand, it will also cooperate with channel providers and large medical institutions. After obtaining EU CE certification abroad, the company has signed a Cooperation Agreement with the Clinical Hospital of the Batumi Republic of Georgia and the International Innovative Medical Service Company of Georgia, and has received 1,500 orders from the International Innovative Medical Service Company of Georgia. The smooth promotion and sales of the company's high-purity magnesium bone nails in Georgia and the rapid realization of sales are the first step for the company's high-purity magnesium bone nail products to enter the EU national market. At the same time, the company is also promoting the certification of countries and alliances such as the United States and Russia.
(VI) Will magnesium nails go to the United States for clinical practice? How many now? What is the gross profit margin?
A: The company is already preparing for FDA registration certification in the United States. The price belongs to the company's trade secret, which is currently clinically in China and has not yet been listed for sale. The price and gross profit margin have not been determined yet.
(VII) The reason why Chaohu Yi'an Yunhai has lost so far?
Answer: Yi'an Yunhai needs to carry out system certification and customer product sample confirmation in the early stage. The product needs a long certification period from sample delivery confirmation to mass production, and it is also affected by the large fixed cost, production capacity, epidemic and other factors in the early stage, and has not achieved profitability. Chaohu Yi'an Yunhai is also constantly enhancing its core competitiveness and vigorously developing products that meet the needs of the market. At present, two large-scale die-casting machine equipment, two 4200T, one 3,500T, two 2700T and one 1600T have been put into production, which can meet the production needs of customers' different products. The first phase of the plant has been put into production, and the second phase of the plant has been built 34,590 square meters. At present, the main project has been completed and is undergoing internal and external decoration. There are many target customer groups in the Yangtze River Delta, and we are optimistic about the future development potential.
(8) The current progress of the company and Sanxiang New Materials, Ningde Times and Wanshun Group's magnesium alloy materials projects?
Answer: The investment framework cooperation agreement signed in the early stage has been announced, and there is no latest progress at present. If there is any further progress in the future, it will be announced in time.
(IX) What are the advantages of the company's overall integration of light alloys in automobile products compared with the production of many scattered components?
Answer: The company's overall integration of new energy vehicle products will form multiple parts through large-scale precision die-casting as a whole. The product will be lighter and meet the requirements of weight loss and increase range of new energy vehicles. Product performance and quality can also better meet customer needs. The company's overall integration has been applied in new energy vehicle motors, electronic control, battery packs, dashboards, car doors and other products through different large-scale die-casting equipment such as 4200T and 3500T.
The overall integration will also be the future development trend of automobiles. It integrates traditional automotive structural parts, takes integrated molding, and requires more refined materials, equipment, molds and processes. Based on the company's more than 20 years of experience in the precision die-casting industry and the precipitation of technology, the company will also combine market development and the actual needs of customer products. Jointly with equipment manufacturers, we jointly develop 6000T and above tonnage die-casting integrated molding equipment, integrate new energy vehicle parts, and achieve wider application in large-scale automobile die-casting products.
List of annexes (if any)
None
Date
December 16, 2020
