The company released three quarterly results for 2021: 21Q3 achieved revenue of 203 million yuan, down 12.16%; net profit of 17.99 million yuan, down 67.98%; net profit of 17.83 million yuan, down 67.97%, down 67.97%, 0.0606 yuan per share, and 69.07%, 1.85%, 4.47%, respectively.
Affected by the double reduction and the impact of upstream raw material prices, profits have declined. The net profit of 21Q3 decreased by 67.98%, of which: 1) under the influence of the double reduction policy, the net profit of K12 extracurricular training business of 21Q3 decreased by 138%. In order to focus on the core strategy of vocational education, the company plans to follow up with the K12 compulsory education training business. 2) 21Q3 is affected by the rise in the price of upstream raw materials, and the net profit of the company's ink business has dropped by 108%.
At present, the company has responded to the impact of rising raw material prices by raising product prices and adjusting product structure.
21Q3's gross profit margin was 33.8%, with a decrease of 16.2%, mainly due to the double reduction policy and the increase in the price of upstream raw materials in the ink business. The rates of sales, management, R & D and financial expenses were 10.3%, 8.8%, 3.6% and-0.1% respectively, with year-on-year changes of-0.5,4.0,1.1 and-1.8% respectively. The increase in the management expense rate was mainly due to the low base of the management expense rate affected by COVID-19 's epidemic in the same period last year; affected by the decline in gross profit margin, 21Q3's net profit margin was 8.5%, with a decrease of 16.4%.
In October 2021, the Central Office and the State Office issued the opinions on promoting the High-quality Development of Modern Vocational Education. With the introduction of vocational education encouragement policies, the school-running level of secondary vocational-higher vocational-vocational universities will be continuously improved. The matching path of higher vocational education and college entrance examination will also be opened up one after another. As the supply of students at the bottom of vocational education, relying on the national goal of 1:1, the scale of secondary vocational schools is expected to expand. Relying on the development model of "extension M & A + endogenous growth", the company continues to explore the vocational education market, broaden the service margin, and promote the integration strategy of vocational and general education in an orderly manner.
Profit forecast: the company has many years of word-of-mouth and customer accumulation in Shaanxi, and the integration strategy of remote employment and general education continues to advance. It is estimated that the company's net profit from 2021 to 2022 will be 1.18,12.8 yuan, corresponding to 20.1 and 12.8 times of PE.
Risk hint: COVID-19 epidemic situation is repeated, remote expansion is not as expected, goodwill impairment risk.
