Orders increased sharply, docking Xiongan New area to seek development
In the third quarter of 2017, the company signed 666 million yuan in newly signed orders, an increase of 33.04%. In the first three quarters, newly signed orders totaled 874 million yuan, accounting for 105.81% of last year's revenue. Sufficient orders are good for the company's future business performance.
Recently, as one of the consortia, the company has won the bid for the first section of the EPC general contract project of the afforestation project in the first area of Xiongan New District 9, with a winning bid of 27.75 million yuan. As the first tender announcement of Xiongan, the company is mainly responsible for the construction of the project. The company is actively expanding the field of ecological and environmental protection, which echoes the principle of ecological priority and green development in the construction of Xiongan New area. We believe that the company will combine the comprehensive advantages in landscape ecological engineering design, construction and maintenance and seedling planting to fully grasp the historic opportunity of ecological construction in Xiongan New area.
Revenue is growing rapidly, and municipal gardens are expected to promote steady growth.
The company achieved revenue of 149 million yuan in the third quarter of 2017, an increase of 33.04%, with a relatively rapid growth rate, resulting in a 13.11% increase in revenue in the first three quarters to 535 million yuan. The company's business covers design and construction. In terms of breakdown, the proportion of municipal gardens in landscape engineering revenue has increased from 44.7% in 2013 to 88.7% in 2016.
The company's overall gross profit margin in the first three quarters was 30.25%, up 2.84% from the same period last year. Among them, the gross profit margin of municipal garden business has exceeded 30% in recent years, with its proportion increasing, and the gross profit margin of landscape design has always been high, which has exceeded 55% in recent years, the company's profitability is expected to be further improved.
During the period, the expense rate was basically stable, and the return net profit increased at a high speed.
The company's expense rate during the first three quarters was 16.56%, an increase of 0.34 percentage points over the same period last year. Among them, the sales expense rate increased by 0.05% to 2.07%; the management expense rate increased by 10.86%, up 1.8%, mainly due to a large increase in the salary of managers; and the financial expense rate increased by 3.63%, down by 1.5%. The main reason is that the interest income increases due to the substantial increase in cash on hand after listing. Non-operating income was 2.157 million yuan, an increase of 75%, mainly due to more government subsidies in the third quarter. Taken together, the company's net profit increased by 62% to 49.6148 million yuan.
The payback is under pressure, and the operating cash flow is significantly deteriorating.
The company's payback was poor in the first three quarters, mainly due to a decrease in business receipts and an increase in payments to suppliers.
The ratio of receipt and cash decreased by 41.29% to 79.53% compared with the same period last year; cash payment increased by 9.73% to 138.73% compared with the same period last year; the combination of the two resulted in a net operating cash flow of-202 million yuan, which was worse than that of-51 million yuan in the same period last year.
The advantage of cross-regional operation is obvious, and the R & D technology is in the lead.
The company has set up three major design centers in Beijing and Guangzhou, and set up subsidiaries in many places, with strong cross-regional operation and management capabilities, laying a solid foundation for subsequent continuous expansion. By continuously increasing R & D investment, introducing technical personnel and carrying out R & D cooperation, the company has formed and accumulated leading ecological restoration technology and engineering management experience in the fields of comprehensive management of ecological environment of rivers and lakes, saline-alkali land management in northwest China, ecological wetlands and soil and water conservation, and further improved the company's competitive advantage in the field of ecological gardens.
Investment suggestion: as the leader of comprehensive garden enterprises, the company always maintains competitive advantages in design and construction integration, cross-regional operation and technical research and development, and has sufficient orders on hand; actively embraces new opportunities for the construction of Xiongan New area and vigorously promotes the PPP model; and has a strong ability of continuous expansion. Cover for the first time, giving the company a "buy" rating. It is estimated that the company's EPS will be 1.07,1.58,2.09 yuan per share from 2017 to 2019, and the corresponding PE will be 30,21,16 times.
Risk tips: the growth rate of investment in fixed assets continues to decline; the risk of project payback
