Main points of investment
Event: Phoenix shares issued the 2017 semi-annual performance pre-loss announcement on July 19, which is expected to lose operating results in 2017, and the net profit attributed to shareholders of listed companies is expected to be about-71 million yuan. In the same period last year, the net profit belonging to shareholders of listed companies was 5.918 million yuan, a year-on-year loss.
During the reporting period, the company's main business income decreased significantly compared with the same period last year and the cost of major items on sale was on the high side, resulting in a significant decrease in gross sales margin in the current period compared with the same period last year, resulting in a significant decrease in net profit.
The operating income in the first half of 2017 was about 444 million yuan, a decrease of 44.64 percent compared with 802 million yuan in the same period last year. In addition, the cost of the main items on sale in this period is on the high side. In the first half of 2017, the company's sales mainly came from Nantong project and Taixing project. Because the overall sales situation in Nantong area at the beginning of the year was not good, and the inventory of Nantong project was not very good, such as late market and floor orientation, the company adopted the method of price reduction in the first half of 2017 in order to withdraw funds from inventory as soon as possible. Taixing project due to government price control and other factors, the opening price is lower, the cost is relatively high. As a result, Nantong project and Taixing project lost money.
The company no longer makes up for the previous year's losses, resulting in a substantial increase in income tax compared with last year, driving down the return to home net profit. The return net profit fell sharply compared with the same period last year, due to the fact that the 2016 company subsidiaries and Sun Company made up for the previous year's losses and the deferred income tax generated by confirming compensable losses, resulting in a much lower income tax expense in 2016 than in the first quarter of this year. Finally, the return net profit plunged sharply.
Profit forecast and risk rating: while developing the real estate business, the company creates a boutique pension community, hoping to create new profit growth points through the "institution-community-family" trinity pension model. The company's first Phoenix Yiranju project located in Yixing will be officially sold to the public this year. The original main business of real estate development will develop steadily, and it is expected to increase the land reserve in Nanjing, Hefei and other second-tier cities in 2017, laying the foundation for long-term development. It is estimated that the company's EPS from 2017 to 2018 will be 0.15 EPS 0.17 yuan respectively, and the corresponding PE will be 33 Universe 29 times, maintaining the "overweight" rating.
Risk hint: the real estate is in the doldrums and the pension project is not as good as expected.