The company released 2021 annual report: 1) 2021: revenue of 4.739 billion yuan / YoY+67.5% (at the top of the previous performance forecast range), net profit of 102 million yuan /-44.33%, mainly due to the contract adjustment of a major customer of the company in the second half of 2021. 2) Cash flow: net cash flow of operating activities-089 million yuan / YoY-157.8%, is mainly due to the increase in the balance of trade receivables due to the credit period granted by some newly signed comprehensive flexible employment strategy customers, as well as the implementation of the employee home purchase loan plan in June 2021.
The income of psychic workers continued to increase, and the gross profit margin decreased due to the events of major customers, but the continuous optimization of the system platform led to the continuous improvement of the efficiency of psychic management. 1) flexible employment business (accounting for total revenue 97.50%/+1.10pct) realized revenue of 4.622 billion yuan / YoY+97.5%. The turnover rate of flexible employees decreased by about 7.4% by 1.6pct to 2021, and the per capita management of comprehensive flexible employment increased by 14% to 265. Thanks to the company's continuous optimization of the system platform and data analysis, the standardization of professional recruitment and comprehensive flexible employment project management process has been strengthened. By the end of 21, the company had 50447 flexible employees / YoY+30.6%; with a gross profit margin of 4.5%/-3.4pct, mainly due to the adjustment of key customer contracts, and the impact of policy adjustment on the online education industry in the second half of 2021 had a significant impact on customer employment demand and service premium in this industry. 2) the professional recruitment business (accounting for the total revenue 1.9%/-0.5pct) achieved a gross profit margin of 90 million yuan / YoY+29.9%, for 28.3%/-11.3pct, which significantly affected customers in the major online education industry and increased recruitment costs caused by the establishment of new service locations and recruitment delivery centers. 3) other human resources solutions (as a percentage of total revenue 0.6%/-0.6pct) achieve a gross profit margin of 0.27 million yuan / YoY-20.6%;, which is mainly due to the service fees charged to customers by some newly signed labor dispatch contracts in 2021, including the welfare fees of dispatched employees.
The impact of demand contraction in industries such as major customer contract adjustment and online education has put short-term pressure on profitability.
1) overall gross profit margin: 5.3%/-4.3pct, mainly due to the impact of major customer contract adjustment and policies on the online education industry, as well as a significant reduction in demand in the Internet industry; 2) expense rate: sales expense rate 1.4%/-0.5pct, the increase in sales expenses is mainly due to investment in the talent pool; R & D expense rate 0.38%/-0.11pct, management expense rate 2.1%/-0.5pct. 3) net interest rate: 2.16%/-4.3pct.
Looking forward to 2021: 1) at the industry level, the prospect of the digital outsourcing market is good: according to the Bright Consulting report, the information technology and digital service outsourcing market is huge and is expected to break through the market size of 1 trillion yuan by 2025. China's information technology and digital service outsourcing industry is expected to have a combined annual growth rate of about 13.4% from 2021 to 2026, with broad prospects for development. 2) at the company level, build a digital human resources ecological chain: in 2021, the company has successively reached cooperation with Xunteng Group, Kumao Robotics and China's science and education, and continues to explore ways to establish a talent ecological chain based on the integration of industry and education. Next, we also plan to cooperate with industry-education integration enterprises, colleges and universities or vocational training institutions in information technology, Internet of things and other fields through strategic cooperation or investment. Further build the ecological chain of human resources.
Investment advice: buy-An investment rating with a 6-month target price of HK $9.0. It is estimated that the overall income in 2022-23 is 47.42 yuan and 6.079 billion yuan respectively, with a corresponding growth rate of + 0.06%, 28.19%, and net profit of 1.25 yuan and 162 million yuan, respectively, with a growth rate of + 22.8% and 29.7%. Give a Buy-An investment rating.
Risk tips: COVID-19 influence, intensified competition in the industry, rising labor costs, macroeconomic fluctuations and so on.