Event: The company released its 2024 three-quarter report. The company achieved total operating income of 0.405 billion yuan in the first three quarters of 2024, a year-on-year decrease of 14.77%; net profit attributable to shareholders of listed companies was 0.085 billion yuan, a year-on-year decrease of 28.84%.

The core of the decline in third-quarter results was weather disturbances, and the core focus was on the construction of the Animal Kingdom project. Continued high temperatures and frequent extreme weather in Jiangsu, Zhejiang and Shanghai during the summer (July-August) affected the company's business development. On August 15, Liyang City held a commencement ceremony for the Tianmu Lake Animal Kingdom Cultural Tourism Complex project. The Tianmu Lake Animal Kingdom Cultural Tourism Complex project plans to invest 3.55 billion yuan, covering an area of about 120 hectares, and is located in the Tianmu Lake Tourist Resort. With the theme of “animals+amusement”, the project introduces advanced amusement equipment and various cultural and creative performances and reality shows, aiming to create a comprehensive tourist destination integrating viewing, entertainment, interaction and leisure.

The project has been included in the list of key cultural and tourism industry projects in Jiangsu Province, the list of key service industry projects in Jiangsu Province, and the database of major industrial construction projects in Changzhou.

Driven by event planning and product innovation, market linkage favors sales conversion rates. Guided by the market and user needs, the company continues to carry out event planning and product line research and development innovation. The focus is on spring markets, summer markets, holiday markets, etc., using elements such as “pandas,” “digging for bamboo shoots,” “going to the stream,” and “stars,” to plan relevant events and topics to create trending news topics and notebook content. In addition, the company's three major centers are linked with Jingjiu to promote customer sharing. Focus on playing the role of a one-stop service center hub, dig deeper into the potential of complex products and diversified markets, achieve mutual collaboration in product traffic, and enhance destination sales conversion rates.

Investment advice: The company is expected to achieve revenue of 0.562/0.723/0.848 billion yuan in 2024-2026 and achieve net profit to mother of 0.115/0.153/0.183 billion yuan, corresponding to 27.3/20.5/17.1 times PE, and maintain the “gain” rating.

Risk warning: Extreme weather affects passenger flow, construction of new projects falls short of expectations, and industry competition intensifies.