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Yasha shares released the 2021 mid-term report: the company's 2021H1 achieved revenue of 5.308 billion, year-on-year + 36.77%; return to the mother net profit of 99 million, year-on-year-18.39%.
Comments:
Revenue remains high and performance is under short-term pressure: the company's 2021H1 achieved 5.308 billion in revenue, + 36.77% in the same period last year, and 99 million in net profit,-18.39% in the same period last year. We believe that the decline in performance is mainly due to the decline in gross profit margin and the substantial increase in credit impairment losses. From a quarterly point of view, the growth rate of Q1-Q2 income is + 30.62% and + 40.55% respectively, and the performance growth rate is + 25.62% and-54.67% respectively. Q2 alone accounts for 106 million of credit impairment losses and asset impairment losses, resulting in Q2 performance of only 30 million. According to the type of business, the revenue of the main building decoration was 3.149 billion, which was + 17.93% compared with the same period last year. Curtain wall decoration, intelligent system integration, decorative products and design contracts all increased by 92.96%, 59.57%, 56.07% and 39.73% respectively over the same period last year. From a regional point of view, the income of East China reached 2.71 billion yuan, + 5.11% compared with the same period last year, and the income of Central and South China, North China and Southwest China more than doubled compared with the same period last year. In terms of orders, the company signed 9.275 billion yuan in new orders in the first half of the year, + 18.90% compared with the same period last year, of which the order for public clothes increased rapidly, from + 24.21% to 5.9 billion yuan.
The profitability declined in the short term, and the rate continued to be optimized during the period: the company's 2021H1 gross profit margin was 13.13%, year-on-year-2.34pct, mainly due to the increase in material and labor costs; from a business point of view, the gross profit margins of architectural decoration and curtain wall decoration were-2.25pct and-2.26pct to 13.23% and 10.05% respectively. The period rate is from-1.37pct to 9.59%. Itemized, the sales rate, management rate, financial rate and R & D rate are 2.98%, 3.21%, 0.57% and 2.84% respectively, year-on-year-0.55pct,-0.67pct,-0.41pct, + 0.27pct. Affected by gross profit margin, 2021H1 net profit margin is 2.04%, year-on-year-1.19pct. Under the influence of real estate customers, the company's impairment losses increased significantly in the reporting period, and credit impairment losses increased by nearly 80 to 50 million compared with the same period last year. The net operating cash flow was-1.047 billion yuan, which was 13 million yuan less than the same period last year, and the net inflow of single Q2 was 32 million, which turned negative to positive compared with the same period last year. The asset-liability ratio is 60.97%, year-on-year + 1.45pct.
Firm industrialization core strategy, restructuring + foreign investment to consolidate the industry leading position: 1) industrialization priority, firm industrial reform: the company takes "architectural decoration industrialization" as the core strategy, the newly established prefabricated decoration department, the future will be EPC mode to send a large number of projects and overseas markets, and strive to through the 2018-2022 five-year efforts to stabilize the leading position in the industry. 2) restructuring + foreign investment to enhance competitiveness: reorganize the first-class qualification of Zhejiang Shunyi construction general contracting subsidiary to enhance EPC general contracting capacity; invest 80 million yuan to set up future construction science and technology with related companies to promote the development strategy of industrial assembly decoration industry. 3) increase R & D, empower long-term development: the company started the road of industrial decoration R & D in 2012, issued six enterprise standards in 2020, and continued to promote the secondary development of industrial software.
Profit forecast, valuation and investment rating: the company's performance has declined due to the epidemic and impairment losses in 2021, and it is expected that the main industry will continue to repair, and industrial decoration is expected to enter the volume stage. We estimate that the company's EPS in 2020-2023 is 0.40 yuan / 0.50 yuan / 0.63 yuan per share, and the corresponding PE is 16x, 13x, 10x respectively. Industrial decoration prosperity is high, the company is a leading enterprise in the industry, technology and brand advantages are far ahead, giving the company a valuation of 35 times in 2021, the target price of 14 yuan per share, maintaining a "strong push" rating.
Risk hints: industrial decoration is less than expected, real estate regulation is higher than expected, and the growth of bad debt losses is higher than expected.