In 2019, the company's revenue increased by 5.91%, and the return net profit increased by 70.92%. In 2019, the revenue reached 2.702 billion yuan, an increase of 5.91% over the same period last year; the net profit realized was 154 million yuan, equivalent to 0.37 yuan in fully diluted EPS, an increase of 70.92% over the same period last year; and the non-return net profit was deducted from 123 million yuan, an increase of 29.64% over the same period last year. The higher increase in net profit is mainly due to the reversal of dismissal benefits brought about by the return of some paid employees, as well as the improvement in profitability brought about by category adjustment. The company intends to pay a cash dividend of 0.8 yuan (including tax) to all shareholders for every 10 shares.
In a single quarter, 4Q2019 achieved operating income of 680 million yuan, an increase of 5.15% over the same period last year; net profit of 36 million yuan, equivalent to 0.09 yuan of fully diluted EPS, an increase of 27.45% over the same period last year; and net profit of 38 million yuan, an increase of 26.16% over the same period last year.
The comprehensive gross profit margin increased by 0.81 percentage points, and the expense rate decreased by 2.06 percentage points in 2019. The company's comprehensive gross profit margin was 19.91%, up 0.81 percentage points from the same period last year.
In 2019, the company's expense rate during the period was 11.25%, down 2.06% from the same period last year, of which the sales / management / financial expense rate was 1.93%, 9.80% and 0.48%, respectively, and the year-on-year change was-0.18%, 1.37% and 0.51% respectively.
Market-oriented operation brings long-term operation and management optimization.
During the reporting period, the company introduced Fangda Group as the controlling shareholder through mixed reform, which brought a sense of competition and market-oriented operation concept to the company. It is expected that the upgrading and transformation of ZTE headquarters will continue to be carried out in an orderly manner, and the marketing methods will be more diversified. The company launched horse racing mechanism to improve the degree of match between people and posts and reserve the strength of talents. It is expected that the market operation concept brought by Fangda Group will bring long-term operation and management optimization of the company.
Downgrade profit forecast and maintain "overweight" rating
Taking into account the negative impact of the epidemic, we downgrade the company's EPS forecast for 2020-2021 to 0.26 / 0.30 yuan (previously 0.30 / 0.32 yuan), and add 0.32 yuan to 2022, maintaining the "overweight" rating.
Risk hint
The operation of the main store is not up to expectations, and the business improvement after the mixed reform is not up to expectations.