Main points of investment
Events: 1) 2023H1, the company realized revenue, return net profit and deducted non-return net profit of 33.70,5.83 and 478 million yuan respectively, compared with the same period last year, + 48.81%, + 807.55% and + 1350.75% 2023Q2, respectively. The company realized revenue, return net profit and deducted non-return net profit of 21.11,3.50 and 281 million yuan respectively, + 96.23%, + 3331.54% and 824.65% respectively.
In terms of business, 2023H1:1) Airport business, the company's nine airports completed passenger throughput of 13.11 million passengers, returning to 110% of the same period in 2019, realizing revenue of 956 million yuan / year-on-year + 47.51% / position 2) tax-free and commercial business, revenue of 140 million yuan / year-on-year-40.99%, or mainly due to a decline in taxable commercial rental income. 3) real estate business, achieve revenue of 1.522 billion yuan / year-on-year + 140.68%, or mainly due to the company's increased sales and carry forward project revenue; 4) property management business, achieve revenue of 353 million yuan / year-on-year-14.04% X 5) other businesses achieve revenue of 399 million yuan / year-on-year + 18.91%.
With the separation of duty-free and commercial business, it is expected that tax-free-related income will increase compared with the same period last year, while commercial rental income has declined: 1) venue rental: island businesses achieve an income of 58 million yuan by providing duty-free shop venue rental. The tax-free venue rental income of Sanya Phoenix Airport is 84 million yuan, with a total venue rental income of 142 million yuan / + 16.39% compared with the same period last year. It is expected that the rental income of island commercial space will decline due to the adjustment of the new contract, while Sanya Airport will recover obviously from the same period last year. 2) pick-up point rent: Phoenix airport duty-free pick-up point income 36 million yuan / year-on-year + 12.50%, mainly due to the epidemic in high-line cities in March-June last year, Hainan passenger flow, sales base is low; 3) Investment income: subsidiary island commercial shares in Haikou Meilan Airport investment income reached 63 million yuan / year-on-year + 14.55%; participation in Sanya Phoenix Airport duty-free shop realized investment income of 15 million yuan.
The expense rate has been continuously optimized and the return on investment has changed from negative to positive. 1) profit side: 2023H1 gross margin 44.48% / year-on-year + 5.95pct, net profit rate 18.53% / year-on-year + 16.05pct; 2) expense side: 2023H1 company sales expense rate 2.32% / year-year-0.19pct, management expense rate 10.20% / year-2.82pct, financial expense rate 8.12% / year-3.54pct, mainly due to the substantial increase in revenue in the first half of the year, the expense rate has been optimized 3) Investment income: 2023H1 achieved an investment income of 122 million yuan, from negative to positive, and HNA, whose main business is aircraft maintenance, achieved an investment income of 6 million yuan, reducing losses compared with 2022.
There is still much room for growth in the airport + duty-free main business. In the short term, passenger flow in Hainan recovers quickly, and the whole year is expected to exceed the 2019 level, leading to the improvement of airport and duty-free business performance. At the same time, the new duty-free rental area of 5000 square meters in the second phase of Sanya Phoenix Airport will bring an increase. In the medium and long term, Sanya Phoenix Airport T3 needs to be expanded, and the growth potential of the airport is expected to be further released after the expansion of carrying capacity.
Profit forecast and rating: the company's assets are of high quality and its business model is flexible. We make adjustments to the company's profit forecast. It is estimated that the net profit from 2023 to 2025 will be 10.98, 15.59 and 0.14, respectively, and the PE corresponding to the closing price on August 22, 2023 will be 42.2, 29.8 and 27.0 times, respectively, maintaining the "overweight" rating.
Risk hints: macroeconomic downside risks, policy risks, increased competition risks, etc.