Event: the company publishes its semi-annual report 2023. In the first half of 2023, the company realized revenue of 3.37 billion yuan, + 48.8% compared with the same period last year, and net profit of 580 million yuan, + 807.6%, and 480 million yuan of non-return net profit, + 1350.8% of the same period last year. The increase in performance is due to the improvement of the airport and hotel business since the beginning of this year, as well as increased sales of real estate business, carrying forward income from the Haoting Nanyuan C14 project, which is due to a substantial increase in real estate revenue compared with the same period last year.
The strong recovery of the civil aviation industry led to a rebound in airport business revenue. With the increase of population mobility and the continued popularity of the tourism market, especially in Hainan, in the first half of 2023, the company's holding and management exported a total of 88900 aircraft takeoffs and landings at 9 airports, with a passenger throughput of 13.106 million, compared with the same period in 2019. + 68.3% shock 109.5%, 9.9% compared with the same period in 2019 The recovery of the company's passenger traffic is better than the national average (only 88.2% in the same period in 2019).
Tax exemption and commercial business are booming. The opportunities for population mobility increased in the first half of 2023, and the number of customers of the physical duty-free shops at Haikou Meilan Airport, Riyue Square and Sanya Phoenix Airport under the offline transaction model surged, and the revenue from duty-free and commercial business was 140 million yuan, a year-on-year decline of 98 million yuan. According to the 2022 caliber, this business includes island business investment income. Calculating the rental income of island commerce, Phoenix airport and the duty-free pick-up point of Phoenix airport, the revenue is + 22.5% compared with the same period last year.
The free trade port is about to close the customs, and the expansion of the business scale continues. Hainan Free Trade Port is expected to be closed in 2025, and the company's duty-free business is gradually expanding through policy dividends. 5000 square meters of new duty-free leasing area has been added to the second phase of the Phoenix Airport duty-free shop project. The work of warrants, investment promotion and decoration has been completed. After opening, the total duty-free leasing area of Phoenix Airport will reach 6800 square meters.
The macro recovery of real estate will accelerate the elimination of real estate and accelerate the transformation of real estate business. In the first half of 2023, the income of the real estate business reached 1.522 billion yuan, + 141% compared with the same period last year, and the net profit reversed the loss compared with the same period last year. In the follow-up, the "de-real estate" work will continue to be carried out to promote the development of air-facing industry projects and the diversification of supporting projects.
Profit forecast and investment suggestion: with the recovery of civil aviation demand and the release of Hainan free trade port construction dividend, the future performance of the company is more uncertain. It is estimated that the company's annual return net profit in 2023-24-25 is 11.3,14.4 and 1.72 billion yuan respectively, EPS is 0.10,0.13,0.15 yuan respectively, corresponding PE is 41x, 32x, 27x respectively. Relying on location and operational advantages, the company will maintain medium-and high-speed growth and maintain a "buy" rating.
Risk hints: the risk of macroeconomic fluctuations, tax-free sales or less than expected, residents' willingness to travel less than expected, uncertain policies related to the construction of a free trade port, etc.