I. Overview of events
According to the 2018 annual report released by New Hualian, the company achieved an operating income of 14 billion yuan in 2018, an increase of 88.2% over the same period last year. The net profit of shareholders belonging to listed companies was 1.186 billion yuan, up 40% from the same period last year.
II. Analysis and judgment
The performance is beautiful and the real estate business is making steady progress.
In 2018, the company achieved an operating income of 14 billion yuan, an increase of 88.2% over the same period last year, and a net profit of 1.186 billion yuan, an increase of 40% over the same period last year. The higher growth rate of revenue and net profit is mainly due to: 1) the company strictly controls the efficiency of the project, and the settlement amount for the whole year reached 11.35 billion yuan, an increase of 84.9% over the same period last year. 2) the sales amount reached 10.7 billion yuan, with a steady growth rate. During the reporting period, the company's gross profit margin on sales and return on net assets were 33.5% and 15.26%, an increase of 1.7 and 1.93 percentage points respectively over the previous year, and profitability continued to improve, laying a solid foundation for the company's later development.
Strengthen the strategy of literature and tourism, and the projects are blooming one after another.
In 2018, the Tongguanyao ancient town in Changsha opened grandly, and the project included dozens of large-scale cultural and tourism projects in dozens of formats, which successfully realized the opening and operation as scheduled; Wuhu Xinhua Lianjiuzi ancient town completed all the monomers in the reporting period and planned to close the park as a whole in July 2019; Xining Xinhua Liantong Dream Park project was fully launched in various formats and planned to start operation in July 2019. The South Korean Xinhua Union Fairview Villa project was approved by the local Taoist Council and obtained the development license in March 2019. Taking Wenliu as the core strategy will help the company to fully integrate internal and external resources, disperse operational risks, continuously obtain stable cash flow, and promote the rapid development of the company.
Strengthen brand building and promote project development
At the same time of strategic transformation, the company has comprehensively strengthened brand building, and has won many honors such as "China's excellent literature and travel enterprises in 2018", "China's top ten green responsible enterprises" and "China's top 30 real estate comprehensive strength". The promotion of brand influence will effectively promote the expansion of the company's projects and product sales, and improve comprehensive efficiency.
III. Investment suggestions
The performance and sales of Xinhua Union have increased steadily, the transformation of literature and tourism has been strengthened, the project has been promoted rapidly, and the brand influence has been significantly enhanced. It is estimated that the company's EPS in 19-21 will be 0.74,0.84,0.95 yuan, corresponding to PE 6.0pm 5.1amp 4.5 times, and the company's highest, lowest and median PE in the past three years will be 58.8pm 7.3max 20.8 times respectively, maintaining the company's "recommended" rating.
Fourth, risk tips:
The policy of the real estate industry has been tightened, sales are not as expected, and the progress of the cultural travel project is not as expected.