Events:
The company announced its quarterly report of 2019, with revenue of 126 million and net profit of 13.07 million, respectively, 11.53% and-8.63% respectively over the same period last year. Non-net profit increased by 2.41% over the same period last year, with earnings per share of 0.05 yuan.
Comments:
19Q1 revenue increased as scheduled, while profits declined slightly under the influence of marketing activities-equity incentives-R & D investment. The company's 19Q1 revenue increased by 11.53% compared with the same period last year, of which piano sales increased by 8.43%, and the proportion of mid-and high-end model sales increased. The comprehensive gross profit margin of 19Q1 is 28.37%, which is lower than that of 18Q1 by 0.38pct. During the period, the expense rate increased by 1.56 pct compared with the same period last year, resulting in a slight decline in profit growth, mainly due to:
1) sales expenses increased by 20.4% over the same period last year: in addition to concerts, master classes, piano competitions and other activities, the company also actively participated in activities such as the 2019 online Spring Festival Gala cooperated by CCTV. 19Q1 brand promotion expenses increased by 134.8% compared with the same period last year
2) Management fees increased by 36.09% compared with the same period last year; equity incentive fees increased; 2. Research and development expenses increased, including 6 new research and development projects for 19Q1, 1 New year project for intelligent electric steel, 4 new vertical piano projects and 1 grand piano project, with total R & D expenses accounting for 4.16% of revenue.
The company's art education business is advancing steadily: 1) the company officially launched the intelligent piano classroom in 2017, which combines the APP course of Walt Disney Company animation intelligent piano, the teaching method of Vienna University of Music and Performing Arts, and Helen's intelligent piano as teaching aids to enlighten children's way to learn piano. 2) since 2014, the company has been operating by signing cooperation agreements with local training institutions, and the art education and training course system is defined as art enlightenment, music education, art education and dance education. 3) the Vienna EMP Music Enlightenment Project, following the European idea of music enlightenment education, began to be piloted in Ningbo in 17 years.
Maintain the "highly recommended-A" rating. The company continues to improve its R & D capability, enrich its product models, improve product quality, enhance brand promotion, and actively open up domestic and foreign markets; at the same time, actively promote intelligent piano and art education and training projects, 19 years of new business is expected to join the development. From 2019 to 2021, the EPS were 0.27,0.32 and 0.38 yuan respectively, compared with the same period last year: 27%, 19% and 17% respectively, maintaining the "highly recommended-A" rating.
Risk hint: the progress of art education and training is lower than expected.