The company released its 2021 annual report and 2022 quarterly report. It achieved operating revenue of about 7.7 billion yuan for the full year of last year, an increase of 2.99% over the previous year, and achieved net profit of 836 million yuan, a year-on-year decrease of 8.41%, after deducting net profit of 858 million yuan from the previous year, a decrease of 5% over the previous year, lower than previous expectations. In the first quarter of this year, the company achieved revenue of 1,833 million yuan, a year-on-year decline of 6.49%, a year-on-year net profit of 193 million yuan, a year-on-year decline of 13.63%, and net profit of 193 million yuan after deducting non-return mother's net profit was 193 million yuan, a year-on-year decrease of 13.84%.
IDC's business is growing steadily, and the SaaS business has been hit hard. By business, the company's IDC business developed steadily in 2021, and the number of cabinets put into production in core regions continued to rise. By the end of 2021, the company had put in production more than 43,000 cabinets, with a listing rate of over 70%, driving the company's IDC-related business revenue to 2,029 billion yuan, an increase of 9.82% over the previous year. Revenue from the cloud computing business was 5.591 billion yuan, an increase of 0.85% over the previous year. Among them, the AWS business operated by the company operated was stable. As the company's infrastructure layout expanded, the business also had more room and possibility for development; the SaaS service business of subsidiary Mushuang Technology was affected by the “double decline” and the impact of the epidemic on education, tourism, lifestyle services and other industries, and revenue and profit declined to varying degrees compared to the previous year. Entering 2022, the COVID-19 epidemic recurred in many places in the first quarter. The construction and commissioning progress of the company's IDC projects in Shanghai, Tianjin, Yanjiao and Changsha were all affected by epidemic control policies to varying degrees. The listing progress and project delivery time of some projects were delayed, leading to a 6.49% year-on-year decline in the company's revenue.
Gross margin fluctuated slightly, and IDC's business remained at a high level. The company's consolidated gross margin in 2021 was 20.42%, down 0.46pct from the previous year, and remained stable. By business, the gross margin of IDC and its value-added services business was 53.62%, down 1.23pct from the previous year. We think it was affected by market competition and electricity price fluctuations in relevant regions. The company's gross margin for cloud computing and related services was 9.59%, down 1.22pct from the previous year. We think it was affected by the “double reduction” and the disruption of the company's downstream customer business by the pandemic.
There are many profit disruptors, and 2022Q1 has improved month-on-month. The company's net profit fell 8.41% year-on-year in 2021, mainly affected by the following factors: 1) the commissioning and consolidation of the newly built IDC, which led to an increase in fixed costs such as depreciation and amortization; 2) the company continued to explore the fields of IDC technology innovation and energy efficiency optimization, while increasing R&D investment in cloud computing business; 3) Cloud computing customer revenue in related industries declined due to the impact of the COVID-19 pandemic, the “double reduction” of the education industry, and real estate regulation policies; 4) The expected loss of accounting increased due to delays in the business payment process of already listed customers. In the first quarter of this year, with the increase in the company's cloud computing business, the increase in the listing rate of new IDCs, and the further dilution of fixed costs such as depreciation and amortization, the company's net profit to the mother increased 27.04% month-on-month, showing a significant improvement trend.
IDC resources in the core region have been further increased, and construction and reserve projects are plentiful. The company launched the first phase of the Tianjin Baodi Cloud Computing Base Project and the Hangzhou Digital Economy Science and Technology Innovation Center project in 2021 to further increase core regional data center resource reserves in first-tier and surrounding regions. The company's data center business has formed a national business layout centered around Beijing, the Yangtze River Delta with Shanghai as the center, and Changsha as the starting point to promote business development in central and western China. Currently, there are 12 data centers that can provide services, and more than 43,000 cabinets have been put into operation in the Beijing-Tianjin-Hebei and Yangtze River Delta regions. The company expects that construction and storage projects will have an operating scale of more than 100,000 cabinets nationwide after delivery, laying the foundation for the continued growth of IDC's business.
[Investment advice]
Considering the impact of the company's epidemic and the “double carbon” policy, compared with the previous forecast, we lowered the company's 2022-2023 revenue and gross margin forecast, and added the 2024 performance forecast. The estimated 2022-2024 company revenue is 8.339 billion yuan, 9.131 billion yuan, 10.117 billion yuan, and the net profit of the mother is 931 million yuan, 1,030 million yuan, 1,138 million yuan, EPS is 0.52 yuan, 0.57 yuan, 0.63 yuan, corresponding PE is 2.1 times 19 times, 19 times Double, 17 times, we are cautiously optimistic about the company's future performance and maintain the “increase in holdings” rating.
[Risk Reminder]
The progress of the new IDC project fell short of expectations;
The company's cabinet listing rate fell short of expectations;
Competition in the market intensified.