2019Q1 realized revenue / operating profit / homing net profit of 253.24 million yuan, 2.73 million yuan, respectively, compared with the same period last year.-11.81% Universe 1008.22% Meli 1.33%, operating cash flow 149.71 million yuan, a substantial improvement over the same period last year. The previous bid-winning Ping an Science and Technology 2.6 billion IDC project has now signed a contract to enhance the certainty of IDC business expansion. Maintain 2019, 2020, EPS forecast 0.32, 0.47, 0.58 yuan, 2019, 2020, and 2021, EBITDA forecast 3.9, 5.1, 5.8 million, and maintain the "buy" rating.
The decline in net profit was lower than revenue, and operating cash flow improved significantly. 2019Q1's revenue decline slowed down, and gross profit margin returned to 28.94% (month-on-month + 24.76pcts year-on-year-2.62pcts); internal control first appeared to achieve a slight reduction in the overall expense rate of 0.83pct compared with the same period last year on the premise of declining revenue. Due to 2019Q1 government subsidy of 126.35 million yuan, other income increased 148.97% compared with the same period last year. Combined with the low base of 2018Q1 operating profit, 2019Q1 operating profit grew faster. Also due to the significant reduction in non-operating income of 2019Q1 (2018Q1 received engineering compensation), net profit decreased slightly, but the decline was still lower than revenue. In addition, the company continued business transformation and strengthened risk control, reduced raw material procurement expenditure, increased cash flow, slightly increased receivables / prepayments by 2.56% compared with the end of 2018, while payables / prepayments increased by 17.06% compared with the end of 2018. Operating cash flow has been greatly improved.
Signed a 2.6 billion IDC contract with Ping an Technology to enhance the certainty of business expansion. On March 21, 2019, the company announced the winning bid for Ping an Science and Technology computer room project in 2019, involving about 2620 racks with a 10-year lease (gradually put on the shelves in the first three years and full operation in the next seven years). On April 30, the company announced that the contract for IDC basic Business Services has been signed, with an estimated contract value of 2.6 billion yuan. Tender conversion contract is rapid, the company rack expansion and shelf rate increase certainty, IDC business expansion is expected to lead to a rebound in revenue and a higher gross profit margin. Previously, based on the company's 2016 IDC revenue in 2017 and nearly one year's contract, we estimated that the operator / Internet / financial customer single cabinet income was about RMB 100000 in 5-6-8. The increase in the proportion of financial customers will lead to an increase in single cabinet revenue, which is expected to drive the company's gross profit margin to rise further.
The leading position of IDC in Guangdong, Hong Kong and Macao is solid, and the transformation of financial technology is worthy of attention. 2018 and 2019 are the key years for the company's strategic transformation and industrial upgrading. In the future, the company will focus on financial technology and IDC/ cloud computing. At present, the company has a deep layout of 15,000 cabinets, Guangdong-Hong Kong-Macau Greater Bay Area, and the leading position of IDC is stable. The signing of a long-term large contract with Ping an Technology may bring more opportunities for cooperation in the field of financial science and technology in the future, which is worthy of continuous attention.
Risk factors: the expansion of IDC cabinets and the increase in shelving rate are not as expected.
Investment advice: optimistic about the rapid growth of the company's IDC business in the next three years, it is suggested to pay attention to the progress of the company's financial technology transformation. Maintain 2019, 2020, EPS forecast 0.32, 0.47, 0.58 yuan, 2019, 2020, and 2021, EBITDA forecast 3.9, 5.1, 5.8 million, and maintain the "buy" rating.
