（2）分季度看，2024Q1/Q2 营收4.40/2.00 亿元（YOY-16.10%/-38.40%）；归母净利润0.06/-1.44 亿元（2023Q1/Q2 为-1.08/-1.57亿元）；扣非归母净利润-0.14/-1.34 亿元（2023Q1/Q2 为-1.77/-2.64亿元）。Key points of investment:
2024H1 performance under pressure in the short term:
(1) 2024H1 revenue of 0.64 billion yuan (YOY -24.64%), net profit of 0.139 billion yuan, net profit of non-return to mother of 0.148 billion yuan, all reduced year-on-year losses, mainly due to slightly poor year-on-year box office performance and participation; 2024H1 investment income of 95.63 million yuan (YOY +113%), and credit impairment losses of -70.68 million yuan. 2024H1 gross profit margin 18.17% (+4.29pct year over year), net profit margin -22.10% (2023H1 is -31.26%), and the period expense ratio is 37.39% (-19.68pct year over year).
(2) By quarter, 2024Q1/Q2 revenue was 0.44/0.2 billion yuan (YOY -16.10%/-38.40%); net profit to mother 0.006/-0.144 billion yuan (2023Q1/Q2 was -0.108/-0.157 billion yuan); net profit after deducting non-attributable net profit of -0.014/-0.134 billion yuan (2023Q1/Q2 was -0.177/-0.264 billion yuan).
The film focuses on commercial blockbusters, and the series strengthens development:
[Film] The 2024H1 film business achieved revenue of 0.156 billion yuan (YOY -50.21%), including film investment revenue of 0.148 billion yuan (YOY +646.04%), gross profit margin of 57.41%, and film distribution revenue of 0.008 billion yuan (YOY -97.13%). 2024H1's participation in the “Flying Spur Life 2” and “Dog Battle” totaled more than 3.3 billion yuan at the box office (2023H1 released 4, mainly invested in 2 main control+ 2 participated in the total box office of 1.9 billion yuan). The main investment+distribution “Legend” and the participant+distribution “Red Mansion Dream: Golden Jade Love” will be screened in the 2024 summer program. The main project “Operation Jiaolong” is in post-production and is expected to be screened during the Spring Festival in 2025; “Princess Kashmir” is in early preparations and is expected to be launched within 2024.
[Series] In terms of skits, in July 2024, the first domestic AIGC-generated sci-fi short series “Sanxingdui: Future Apocalypse”, produced by the company, was launched on Douyin, ranking second in the most popular Douyin skits list; in terms of long dramas, “Shangganling” is expected to be broadcast in 2024, and “Hunting Time” (“Under the Sun” and “Unexpected” created by the original crew) is expected to launch within 2024. In addition, “What Time May May” “Minister Qin Lin Chu” Dramas such as “Zexu” are in preparation.
Continuous optimization and adjustment, refined operation of cinemas:
Affected by the weakness of the movie market, the company's cinema business was under pressure in the short term. 2024H1's cinema business revenue was 0.491 billion yuan (YOY -16.41%), with a gross profit margin of 5.18% (-8.79pct year-on-year).
As of the end of 2024H1, the number of theaters/screens directly managed by the company was 107 houses/888 blocks, a decrease of 1 house/4 blocks from the end of 2023. According to Cat Eye, 2024H1's direct-run cinemas achieved box office (excluding service fees) of 0.392 billion yuan (YOY -28.2%) and a market share of 1.81% (-0.48pct year over year).
The company's cinemas continued to carry out refined operation, and from 2020 to the end of 2024H1, a total rent reduction of nearly 0.47 billion yuan was achieved.
Profit forecast and investment rating: We forecast the company's 2024-2026 revenue of 1.488/2.768/3.062 billion yuan, net profit to mother of -0.103/0.375/0.493 billion yuan, corresponding to 2025/2026 PE 15/11X. As the film projection industry gradually clears up and the company expands steadily, the market share is expected to continue to increase, and investment in film and television content production is developing rapidly, and there are plenty of reserves for blockbuster films. Based on this, the first coverage was given a “buy” rating.
Risk warning: Risks such as stricter policy supervision, box office recovery falling short of expectations, risk of falling short of expectations in film production costs/project development process/revenue recognition, inventory impairment, loss of core talent, impairment of accounts receivable, industry competition, declining valuation centers, and market style changes.