This report is read as follows:
The original animation clothing and service platform revenue maintained good growth, the acquisition of NT new toy business, enhance performance growth.
In the future, we will continue to obtain high-quality IP, in-depth development of design, and maintain prudent ratings.
Main points of investment:
Maintain cautious overrating: taking into account the negative impact of the epidemic, the EPS in 2020-2022 will be lowered to 0.04 (- 0.09) / 0.04 (- 0.14) / 0.05. with reference to comparable companies in the media industry, it will be given about 135 times PE in 2020, maintaining the target price of 5.38 yuan.
NEW TIME consolidation, business expansion, rapid growth of revenue and profit. The company's 2019 revenue of 1.38 billion, an increase of 65.09%, net profit of 37.56 million (yoy+116.06%), the performance is in line with expectations. The high growth in revenue and profit is mainly due to the company's acquisition of NEW TIME,IP derivatives, a toy and gift manufacturer, to broaden its product line and increase its variety. In 2019, the subsidiary NEW TIME realized a net profit of 71.04 million yuan, exceeding the performance promise.
Animation clothing revenue to maintain a high growth, during the expense rate improved. Sub-business sector, animation clothing business revenue of 436 million, year-on-year growth of 33.92%, gross profit margin reached 31.97%, basically the same as the previous year. Revenue from the service platform rose 16.87 per cent year-on-year to 450 million, while gross profit margin decreased by 13.41pct to 24.91 per cent. The new toy business revenue in 2019 was 405 million, with a gross profit margin of 31.08%. The company's annual gross profit margin was 30.09%, down 2.48 from the same period last year, mainly due to the decline in the gross profit margin of the service platform, which pulled down the overall gross profit margin. During the period of the company, the expense rate improved significantly, and the sales, management and financial expense rate decreased by 1.11/2.05/1.76pct compared with the same period last year.
Based on IP derivation, find access to high-quality IP, in-depth development of design. In order to obtain more high-quality IP, on the one hand, the company will dig and set up excellent creative teams to create original content, and create high-quality original IP with its own characteristics, on the other hand, it will deepen cooperation with top IP. Deeply explore the value of IP, expand the scope of development, from clothing, toys to more related products.
Risk tips: the negative impact of the epidemic, the development of cultural and creative industry is not as expected, goodwill impairment risk.