Event

In the first three quarters, the company achieved operating income of 1.01 billion yuan, an increase of 15.1% over the same period last year; net profit of 140 million yuan, an increase of 12.4% over the same period last year; deducting 130 million yuan of non-net profit, an increase of 10.8% over the same period last year, the company achieved income of 360 million yuan in a single quarter, an increase of 12.4% over the same period last year; the net profit of return to the mother was 40 million yuan, an increase of 12.4% over the same period last year.

Main points of investment

The results of the three quarterly reports were in line with expectations, and the year-on-year growth rate of net profit was the same as that of the China report. In the first three quarters, the company achieved a year-on-year increase of 15.1% in revenue and 12.4% in net profit, which was basically the same as that of the China report. The company's Q3 single-quarter revenue and net profit decreased compared with Q2 this year, mainly due to the concentrated confirmation of some parking equipment orders including delayed construction and installation after the first quarter of the epidemic in the second quarter, and a gradual return to the normal delivery pace in the third quarter. It is expected that the fourth quarter will usher in the peak season of equipment installation confirmation and a small peak in payback. As of the end of the third quarter, the company's monetary funds were 270 million yuan, an increase of 117% over the same period last year. The funds raised significantly optimized the company's cash flow this year.

The company is full of orders on hand, and the gross profit margin is expected to recover.

The amount of accounts received in advance in the first three quarters of the company exceeded that of the whole of last year, and the sales volume of the main garage and installation services increased year by year, with full orders on hand. The company's Q3 gross profit margin was 33.4%, slightly lower than the same period last year, and 34.6% in the first three quarters, slightly lower than the same period last year, mainly due to the impact of the epidemic on downstream construction and equipment production capacity. After the company's projects in Dongguan and Xuzhou are fully put into production, economies of scale will further strengthen profitability and the level of gross profit margin is expected to be restored. The expense rate of the company during the Q3 period was 20.7%, an increase of 5.4% month-on-month, and sales expenses and R & D expenses rebounded.

Since the beginning of this year, various provinces have issued intelligent parking support policies; in the first three quarters, a total of eight parking special bonds have been issued nationwide, while a large number of special bonds of infrastructure and park infrastructure have been invested in the construction of parking projects, and leading equipment manufacturers have benefited obviously. In September this year, the company's board of directors passed a motion agreeing that the company should invest 210 million yuan to jointly set up Wuyang Wisdom (Chengdu) with Sichuan Bozhong, with the company holding 70% of the shares, mainly in Chengdu and related areas to lay out the investment and operation of smart parking projects, further ploughing and expanding the southwest market, and taking the lead in launching a comprehensive layout in the intelligent parking industry chain. The three-dimensional garage charging technology of new energy vehicles developed by the company can meet the adaptation needs of new energy vehicles to three-dimensional garages. with the improvement of the permeability of new energy vehicles, the market potential of rechargeable three-dimensional garages is unlimited.

Profit forecast

It is estimated that from 2020 to 2022, the company will achieve a net profit of 1.9 million yuan, an increase of 21%, 27%, 29%, and an EPS of 0.26, 0.33, 0.43, and PE times that of 30-23-18. Maintain the company's "buy" rating.

Risk hint

Investment in infrastructure real estate fell short of expectations; raw materials fluctuated sharply; the impact of the epidemic exceeded expectations.