Event: the company released its annual report in 2019, showing that the company achieved an annual operating income of 1.291 billion yuan, an increase of 28.87% over the same period last year, a net profit of about 155 million yuan, an increase of 18.63%, and a deduction of non-net profit of 146 million yuan, an increase of 27.25% over the same period last year. Basic earnings per share is 0.22 yuan.
Three-dimensional parking equipment business maintains rapid growth: in recent years, through the acquisition of Shenzhen Weichuang, Shandong Tianchen and other companies, the company has successfully created an intelligent parking business pattern of "South Weichuang, North Tianchen" and improved the layout of the domestic parking equipment market. The company's intelligent parking equipment has significant technical advantages, covering many high-quality customers. In 2019, the company's three-dimensional parking equipment business continued to maintain rapid growth, with an annual income of 817 million yuan, a growth rate of 31.50%, accounting for 63.28% of the company's total revenue. Gross profit margin remained stable, reaching 31.50% in 2019, down 1.06 percentage points from the previous year.
Intelligent parking industry is expected to achieve rapid development: with the continuous growth of car ownership in China, the gap of parking spaces in the city expands accordingly, and the increasing shortage of urban land resources restricts the construction of parking lots. In this context, the policy continues to promote the development of three-dimensional parking system. The company's three-dimensional parking equipment business development, led by the government public demand, is expected to fully enjoy the policy dividend in the future.
Make every effort to build the integrated development of investment, construction and operation: in the dominant position of equipment business, the company locates its strategic development as "intelligent construction + parking resources + Internet". With the acquisition of parking resources as the key point for the development of business, the integrated layout of the company's parking industry began to take shape in 2019. The company realizes the rapid expansion of parking resources through maintenance, rights and interests and alliance. In addition, in 2019, the company's holding company Yusheng Industrial Fund acquired Changan parking, which successfully built the Wuyang parking investment and operation plate.
After laying the groundwork for nearly a year, we are optimistic that the company's parking investment and operation is expected to achieve rapid growth in the next three years.
Profit forecast and investment advice: affected by the epidemic situation and the postponement of downstream customer bidding, we reduced the company's net profit in 2020 and 2021 to 1.80 and 223 million yuan, and increased the net profit by 282 million yuan in 2022. The corresponding EPS from 2020 to 2022 is 0.25,0.31,0.39 yuan. By relying on the advantages of equipment manufacturing, through joint ventures with the government, BOT, EPC, etc., and vigorously expand the integrated business of investment, construction and operation of the parking industry, we believe that the company has more room for growth in the future, so it maintains a "buy" rating.
Risk hint: parking operation project progress is not as expected risk; merger and acquisition integration is not as expected, and bring goodwill impairment risk; risk of accounts receivable provision.
