Main points of investment
The company released its three-quarter report for 2020, with revenue of 1.252 billion yuan /-54.52%, net profit of 156 million yuan /-35.11%, net profit of 137 million yuan /-44.91%, revenue of 453 million yuan /-49.12%, net profit of 0.04 billion yuan /-98.24%, and net profit of 0.01 billion yuan /-99.37%.
Commercial retail business has been weakened by the epidemic, and we are actively exploring new retail models such as buying in the same city. The company's 20Q3 commercial retail business income was 360 million yuan, down 48.57% from the same period last year, mainly due to the implementation of the new income criteria, and the income of the joint venture model was changed from the full method to the net method. The revenue of 20Q3 commercial retail business increased by 19.27% month-on-month, and the gross profit of 20Q3 of 148 million yuan was basically the same as that of the same period last year, and the impact of the epidemic was greatly weakened. The company's retail business actively consolidates its regional leading position by means of offline and online integration (the sales scale ranks first in Fuzhou department store market), and signed a strategic cooperation agreement with Tmall on October 21. Fuzhou Dongbai Center has become the first shopping mall in Fujian that Tmall buys in the same city.
The revenue of warehousing and logistics business is growing steadily, and we look forward to the gradual landing of a large number of reserve projects. The company's 20Q3 warehousing and logistics business income of 17 million yuan / + 6.40%, the growth rate has slowed down, is expected to be mainly affected by the company 20Q2 and Blackstone Group Inc Group completed the Lubao project withdrawal cooperation, the stock of independent operating area decreased. Affected by the epidemic, the progress of the company's new warehousing and logistics projects has lagged behind, and the pace of subsequent quarters is expected to accelerate significantly.
The expense rate of Q3 is significantly better than that of the first half of the year, and the exit time of the project affects the profit performance of the current period. The rate of 20Q3 sales, management and financial expenses is 17.73%, 10.51% and 8.25% respectively, which is better than that of 20H1. The company's 20Q3 net profit is 4 million yuan, down 98.24% from the same period last year, mainly because part of the company's profit comes from the investment income recognized in the withdrawal link of the warehousing and logistics project. the difference in the exit time of the project will lead to greater volatility in the company's short-term profits.
19Q3 realized the withdrawal of the Tianjin project, achieving an investment income of about 267 million yuan; 20Q3 did not withdraw the warehousing and logistics project.
Investment suggestion: the company's "commercial retail + warehousing logistics" two-wheel drive, retail business competitiveness, enterprising, performance is expected to continue to lead the industry; the steady expansion of logistics business scale, strong certainty of profit contribution, benefit from the REITs pilot. We have adjusted our profit forecast. From 2020 to 2022, the estimated EPS is 0.37,0.56 and 0.80 yuan respectively, and the corresponding PE is 12.6,8.4,5.9 times, respectively. We are optimistic about the development of the company and maintain the "prudent overweight" rating.
Risk hints: retail market demand has dropped sharply, logistics market demand has dropped sharply, logistics land supply has been substantially tightened, and property value has decreased.