Events:
In 2018, the company realized operating income of about 1.45 billion yuan, an increase of 33% over the same period last year; net profit of shareholders belonging to listed companies was 83.91 million yuan, an increase of 44% over the same period last year; net profit after deduction was 82.12 million yuan, an increase of 46% over the same period last year; and earnings per share reached 0.0994 yuan, an increase of 44.26% over the same period last year.
Main points of investment:
The emergence of the sports platform business model promotes the company's performance growth.
During the reporting period, the growth trend of the main business of the Chinese sports industry was obvious. The bright spot was that the revenue of the sports business was 560 million yuan, an increase of 30.57% over the same period last year, and the gross profit margin was 28.84%, which remained basically stable over the same period last year. From the performance point of view, the company's business model of "sports + multi-industry resources" has begun to release its performance, and the pulling effect produced by the sports industry has gradually emerged. It has been transformed from relatively independent sports services to cross-field and cross-industry platform services. through the construction of service platform, the effect on business linkage and resource integration is more obvious.
Sports business: the strength of the event matrix has greatly increased, and the brokerage business has an eye-catching performance.
The rapid operation of the company's sports business during the reporting period was mainly due to the substantial increase in revenue from event management, operation and brokerage, of which the revenue from the event business increased by 48.12% compared with the same period last year, and the revenue from the brokerage business increased by 82.72% over the same period last year.
In terms of event business, the company has added the Guangzhou Marathon project in the past 18 years, becoming one of the top three marathon operators in Beijing, four road bike races around China, around Qinling, Quanzhou Bay and Panzhihua, and cooperative projects such as sailing, aviation, intelligent sports and national fitness, which greatly increase the IP competitiveness and comprehensive strength of the company's events. We believe that China Sports Industry has become the most capable and potential sports event operator in China, and the sustainable development of this core business will continue to improve the company's operating ceiling and valuation level.
The company's sports brokerage business is mainly for the training Bureau of the General Administration of Sports, National diving team, synchronized Swimming team, short track Speed Skating team, Winter Center and other national teams, Wu Dajing, Liu Guoliang, Ye Shiwen and other well-known athletes to provide market development agency services, we believe that close to the 2020 Tokyo Olympic Games, the company's sports brokerage business also has the ability of sustainable development.
In terms of internationalization, the company is the absolute leader of "Belt and Road Initiative" in the sports industry, providing a business extension and international interface for the company's sports industry chain. During the reporting period, the company implemented sports technical assistance projects to assist Bolivia, Madagascar, Jamaica, Uruguay and Tonga in training, organizing competitions and performing "three combinations" in large-scale celebration activities; successfully implemented the technical assistance project for the group calisthenics performance at the opening and closing ceremony of the South American Games in Bolivia, and the traditional technical cooperation projects in Sierra Leone, Niger, Uganda and other stadiums. He also cooperated with the Ministry of Commerce to complete five sports workshops and undertook the exhibition work of China's first Import Expo sports service trade plate.
In addition, the company's major highlights in 19 years are the market development work of the Seventh CISM World Games, and the franchise retail business of the 2022 Winter Olympic and Paralympic Games franchise plan. We believe that the company's current resource advantages in the industry have continued to show, and the flow development of activities such as national fitness and Olympic Day has begun to start. its upstream event resources and downstream sports space content and operation business can form obvious synergy, so the huge commercial value of these resources will be gradually released, making the company become the best comprehensive operation platform of sports industry in China. At the same time, the performance can continue to grow.
The reorganization of sports lottery business is greatly undervalued by the market.
In the past 18 years, the company has launched a major asset restructuring work, and plans to inject shares related to two lottery companies and two certification companies under the State Administration of Sports. Among the underlying assets, the main business of Sports Lottery Science and Technology Company and China Sports Lottery Printing Company belongs to the upstream section of sports lottery service, and the main business of national sports certification company and Huaan certification company belongs to sports standardization service and certification and testing related industries, among which the important target sports lottery technology is the core system technology developer and operator of domestic sports lottery, and the domestic competition barriers and business advantages are very obvious. If the reorganization is successful, the company will fully cover the R & D operation-equipment-printing links upstream of the sports lottery and become the absolute leader in the sports lottery industry. We believe that the company's existing strength and development potential in the sports lottery business have been greatly underestimated by the market, and investors are advised to pay close attention to this.
Investment rating and profit forecast
We believe that the company's three-dimensional layout of the sports industry and the management mode of business platform are clear, and when the integration of internal business resources is in progress, the absolute advantages in sports event operation, sports brokerage, sports complex development and operation, sports lottery business are obvious, at the same time, resource advantages have begun to be released continuously, and the flow effect of covering users can be organically combined with information technology, big data and other scientific and technological means. With the continuous improvement of its business status, it is an absolute platform leading company in the domestic sports industry. Looking forward to 2019, the company's biggest focus is that the commercial value of the sports event matrix will continue to be released, at the same time, the sports lottery business is expected to gain stronger competitiveness and operating capacity through asset restructuring, and the sports foreign aid business will continue to contribute to the performance; in addition, the potential energy of the company's layout in sports space will appear in the medium and long term. Therefore, on the whole, the development potential of the company's business is great, and the performance has the ability of sustainable growth. We give the company an investment rating of "increasing holdings". Without considering the adoption of the company's restructuring, the company's EPS is expected to be 0.14,0.20 and 0.26 yuan per share respectively from 2019 to 2021. Investors are advised to keep paying attention.
Risk hint
Sports industry policy risks, the company's business development is not up to expectations, major changes have taken place in business, and the real estate industry remains in the doldrums.
