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米奥会展(300795)事件点评:拟回购配合股权激励彰显信心 静待后续订单放量

Miao Exhibition (300795) event review: Proposed repurchase in line with equity incentives shows confidence and waits for subsequent orders

民生證券 ·  Jul 1, 2024 11:06

Miao Exhibition announced plans to repurchase shares. On June 26, 2024, the company issued an announcement announcing that it plans to use no less than 50 million and no more than 0.1 billion yuan of its own funds to repurchase the company's shares (the specific amount is subject to actual use of capital) to implement employee stock ownership plans or equity incentives. The price of the shares to be repurchased is no more than RMB 25 per share (including capital). Based on 25 yuan/share and 50 million yuan of the minimum repurchase amount, the number of repurchases is about 2 million shares, accounting for about 0.87% of the company's total share capital; if the maximum repurchase amount is calculated, the number of shares to be repurchased is about 4 million shares, accounting for about 1.74% of the company's total share capital.

The first half of the year was affected by exhibition schedules, and performance was under pressure. On June 25, 2024, the company released a semi-annual performance forecast: 24H1 is expected to achieve net profit of 0.37 to 0.041 billion yuan, a year-on-year decrease of 51% to 46%, and a year-on-year net profit of 0.34 to 0.038 billion yuan after deduction, a year-on-year decrease of 54% to 48%. The decline in revenue in the first half of the year is expected to be mainly affected by the company's exhibition schedule. The company held 6 exhibitions on 24H1 and 9 exhibitions on 23H1 in the same period last year. The year-on-year decline in the number of exhibitions led to a decline in revenue and profit.

Repurchases are combined with equity incentives to avoid dilution of share capital and demonstrate confidence in development. On June 3, 2024, Mio Exhibition announced the 2024 Restricted Stock Incentive Plan (draft): The proposed grant of benefits does not exceed 1.54% of the company's total share capital at the time of the announcement of the plan. If the repurchase plan is successfully implemented, it will cover at least 56.5% (0.87%/1.54%) of the share capital required for equity incentives, which will greatly reduce the amount of additional share capital issued by the company (if the share repurchase capital fully covers the share incentive plan, there is no need to increase the share incentives), reducing or even avoiding share dilution. Furthermore, if there is no change in share capital before the company's repurchase is completed, the maximum price of the shares the company plans to repurchase and the corresponding market value of 25 yuan/share is 6.56 billion yuan (as of the close of June 28, the company's market value is 4 billion yuan), which fully demonstrates the management's confidence in the company's subsequent development.

Booths are waiting to be sold in the second half of the year to provide a guaranteed growth target. According to the company's exhibition plan for the year, Q3/Q4 will host 9 exhibitions in 9 countries: the United States/Mexico/Brazil/South Africa/Poland/Japan/Indonesia/UAE/India. After Q3, it will enter the peak exhibition season, and orders are expected to continue to increase. According to the equity incentive draft issued by the company, if the 80% guaranteed incentive target is achieved, revenue of 1.044 billion yuan, a year-on-year growth rate of 25.03%; or a net profit of 0.218 billion yuan without return to mother, a year-on-year growth rate of 20.00%; if the 100% incentive target is achieved, revenue of 1.305 billion yuan, a year-on-year growth rate of 56.29%, or 0.273 billion yuan of net profit without return to mother, a year-on-year growth rate of 50.00%. This time, 208 people were eligible for equity incentives, accounting for 21% of the company's employees. They are optimistic that driven by equity incentives, the company will achieve performance above the guaranteed incentive goals.

Investment advice: Miao Exhibition is a leading domestic and overseas self-hosted exhibition leader. Taking advantage of domestic companies going overseas, it has achieved high growth in the number of booths, and is also improving overall exhibition service capabilities through specialized exhibitions/digitalization; the same frequency increase in scale/service capability/brand is expected to further consolidate Mio's barriers as a leader in domestic and overseas self-hosted exhibitions. As China's inbound and outbound trade continues to flourish, the company's performance flexibility is expected to continue to unleash. Considering the cost of equity incentives, we lowered the company's performance expectations. We expect net profit to be 0.25/0.32/0.4 billion yuan in 2024-2026, respectively, and the corresponding PE is 16x/13x/10x, respectively, maintaining the “recommended” rating.

Risk warning: geopolitical risk, risk of order sales falling short of expectations

The translation is provided by third-party software.


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