The company released its 2024 three-quarter report. 24Q1-Q3 achieved revenue of 0.448 billion yuan/yoy +21%, net profit of 0.136 billion yuan/yoy +227%, net profit of non-return to mother of -0.162 billion yuan, year-on-year increase of loss; single 24Q3 achieved revenue of 0.147 billion yuan/yoy +16%, net profit due to mother 0.182 billion yuan/yoy +505%, net profit of non-return to mother of -0.112 billion yuan, net profit of non-return to mother of 0.112 billion yuan, Losses increased year over year. The company's net profit to mother increased high in the first three quarters of 24, mainly due to the return of Jiangnan Garden's estimated liabilities and confirmation of non-operating income. 24Q3's net non-operating income reached 0.291 billion yuan.

In the first three quarters of 24, the company's gross profit margin was 3.58% /yoy-9.2pct, mainly due to the company's tourism and culture technology sector confirming project revenue and carry-over project costs during the period, leading to a 34% year-on-year increase in operating costs.

In the same period, the company actively carried out cost control to reduce sales-related labor costs and other sales-related expenses. In the first three quarters of 24, the company's sales expense ratio decreased by 2.9 pct to 2.86% year on year, and the management expense ratio decreased by 0.5 pct to 24.47% year on year.

The company has advantages such as resources, industrial chain and brand, and long-term development can be expected. 1) Competitive advantages in the entire cultural tourism technology project industry chain, with the ability to manage full-process consulting services such as cultural tourism project market research, project planning, planning and design, operation consulting, etc.; 2) Advanced and comprehensive technology at the manufacturing level of high-tech amusement facilities; 2) Scarce tourism resource advantages. Its subsidiary Dinosaur Valley Company has a world-class dinosaur fossil site site and is the largest dinosaur fossil site area in China, supporting the company to create derivative dinosaur-themed products; 3) Brand advantage, accumulated over many years to create Kunming World Expo Park, World Dinosaur Valley, Planet Carle, Cloud Travel Auto Represented by leasing, etc. Travel brands.

Profit forecast and investment advice: The company is expected to achieve revenue of 0.797/0.877/0.964 billion yuan in 2024-2026, yoy +11%/+10%, net profit to mother 0.12/-0.17/-0.157 billion yuan, yoy +128%/-242%/+8%. The current stock price corresponds to the 24-year PE of 48X. It is covered for the first time, and there is no rating yet.

Risk warning: risk of macroeconomic fluctuations, risk of spending power falling short of expectations, risk of natural weather changes.