Matters: the company achieved operating income of 1.749 billion yuan in 2016, an increase of 28.84% over the same period last year; net profit of 156 million yuan belonging to shareholders of listed companies, an increase of 28.27%, 35.30% after deduction; and EPS of 0.20 yuan, an increase of 17.65% over the same period last year. It is proposed to pay a cash dividend of 0.3 yuan per share (including tax).
The growth rate of revenue and net profit is relatively fast, and the contribution of garden business is outstanding: in 2016, the company achieved an increase of 28.84% in operating income and 28.27% in net profit belonging to shareholders of listed companies, respectively, with a rapid growth rate of performance. From a quarterly point of view, the company's 2016Q1-Q4 achieved year-on-year revenue growth of 42.83%, 7.8%, 50.93% and 25.12% respectively, and net profit belonging to shareholders of listed companies grew at a faster rate of 58.54%,-7.7%, 87.56% and 23.42% Q1 and Q3 respectively.
The company's operating cash flow in 2016 was-524 million yuan, a sharp drop of 83.84% compared with the same period last year, mainly due to the expansion of the revenue scale of the company's garden business and the increase in progress payments and deposits. From the perspective of business structure, landscaping, combined anti-counterfeiting bottle cap, aluminum anti-counterfeiting bottle cap and composite anti-counterfeiting printing aluminum plate increased by 49.33%, 13.80%,-1.86% and-5.09% respectively compared with the same period last year. The company's landscaping business has developed rapidly, mainly due to the company's efforts to promote ecological garden construction, comprehensive management of the ecological environment, increase the innovative application of PPP model, and achieve stable growth in the performance of the landscape business sector.
The leader of the packaging industry embraces "Internet +" in advance: the company is the largest manufacturer of aluminum plate composite anti-counterfeiting printing and anti-counterfeiting bottle caps in China. According to the 2016 annual report, the company produced about 2.184 billion anti-counterfeit bottle caps during the reporting period, with a business income of 472 million yuan, ranking first in the industry for more than a decade in a row. The company began to upgrade traditional bottle caps in 2015, implementing a QR code with one cap and one code. Bottle cap QR code uses "Internet +" and "Internet of things"
Technology, giving bottle cap digital form, can not only achieve the function of anti-counterfeiting, but also achieve deep cooperation with distributors, give priority to warehouse delivery, reduce circulation links, so as to reduce the cost of the winery. At present, the company has built the only QR code bottle cap production line in China, with a production capacity of 1 billion; and during the reporting period, the QR code case of cooperation between the company and Mitsui knife was completely landed, which is the first enterprise in the industry to realize the combination of internal and external codes. the project has also become a demonstration base for the company's QR code bottle cap. In addition, the company also holds a 38% stake in Shenzhen Care Media and plans to cooperate deeply with it, and it is expected that the wine network will be launched in 2017-2018.
Huayu Garden successfully completed its performance commitment and enhanced its ability to extend orders to environmental protection: Chongqing Huayu Garden's main business is mainly municipal engineering and ecological greening project construction, with a complete qualification system.
From 2014 to 2016, the performance commitment completion rate of Huayu Garden was 105. 5% respectively. 93%, 108. 62%, 100.08%, Huayu Garden has fully fulfilled its performance commitment for the year, and the net profit has shown a gradual upward trend. Since 2016, the total amount of newly signed orders for Huayu Garden has reached 3.874 billion yuan, of which the total amount of PPP orders is 1.924 billion yuan, accounting for 49.66%, and the order scale is gradually increasing and the quality is gradually improving. In March 2017, Huayu Garden won the bid for the comprehensive ecological restoration project in Xixiu District (Phase II), with a bid amount of 1.584 billion yuan. Huayu Garden extended the industrial chain to ecological and environmental protection, significantly enhanced its ability to take orders, and ensured the high growth of the company's garden business with sufficient orders on hand.
Investment advice: buy-An investment rating, 6-month target price of 8.4 yuan. The company is a leading manufacturer of anti-counterfeit bottle caps, with the layout of bottle caps "Internet +" in the forefront of the industry; the acquisition of Huayu Garden in 2014 to create a dual-main business model, Huayu Garden performance commitment in 2015-2016 is good, and the layout of PPP model, the performance of the garden sector is expected to increase significantly. We are optimistic about the company's future two-wheel drive performance growth. The company's revenue growth from 2017 to 2019 is expected to be 33.3%, 22.9% and 22.0%, respectively, and net profit growth is 37.8%, 23.3% and 23.5%, respectively. To maintain the Buy-An investment rating, the six-month target price is 8.4 yuan, which is equivalent to the dynamic price-to-earnings ratio of 35 in 2017.
Risk hint: QR code bottle cap promotion is not as expected, garden plate order landing is not as expected risk, and so on.