Main points of investment
Event: the company released the 2020 annual report and the first quarterly report in 2021. The company achieved revenue of 1.413 billion yuan in 2020, an increase of 13.58% over the same period last year, a net profit of 138 million yuan, an increase of 21.01% over the same period last year, and a revenue of 374 million yuan in the first quarter, an increase of 12.53% over the same period last year. The net profit reached 33 million yuan, an increase of 8.62% over the same period last year.
Comments:
The performance is growing steadily and the profit level is relatively stable. In 2020, the company achieved a revenue of 1.413 billion yuan, an increase of 13.58% over the same period last year. The net profit returned to the home in 2020 reached 138 million yuan, an increase of 21.01% over the same period last year. In the first quarter, the company realized revenue of 374 million yuan, an increase of 12.53% over the same period last year, and the net profit was 33 million yuan, an increase of 8.62% over the same period last year. The performance maintained steady growth. From the perspective of profitability, the company's gross profit margin and net profit margin in 2020 were 21.58% and 9.75% respectively, and the net profit rate rose 0.6 percentage points from the same period last year, mainly due to the improvement in the rate of sales expenses, down 0.7 percentage points from the same period last year. In the first quarter, the company's gross profit margin was 25.33%, net profit margin was 9.41%, and profitability remained relatively stable.
The expansion of the territory has been accelerated, and the signed area has increased rapidly. The Yangtze River Delta is still the company's largest basic market, with revenue in Zhejiang Province accounting for 61% of the company's total revenue for the year. In 2020, the company stepped up the development of markets outside Zhejiang Province and expanded its business in Hebei Province. Revenue in Hubei Province and Jiangxi Province increased by 116.5% and 221.1% respectively. The expansion of the territory has been accelerated and the expansion has achieved results. By the end of the first quarter of 2021, the company had signed a total of 598 projects, with a total signed area of 70.6454 million square meters, an increase of 16.3% over the same period last year.
Continuous platform output to open up new waterways for urban services. The company has made great progress in the field of urban services, and has set up seven joint ventures since 2020 to seek business opportunities and space resources from the upper reaches of the industrial chain. to provide services for the old city transformation, intelligent community management and urban space operation in Jingdezhen, Xi'an, Zhejiang Jiaxing, Huzhou and other places. Up to now, more than ten projects of the cooperation platform have been landed. There is a broad space in the field of urban services, and the company's active layout in this blue ocean field may become a new growth point of performance in the future.
Investment suggestion: the company's multi-format comprehensive layout has created steady growth, the results of regional expansion have been gradually realized, and continue to open up new waterways for urban services. According to the 2020 annual report, we adjusted the company's EPS to 1.23 yuan and 1.50 yuan in 2021 and 2022 respectively. According to the closing price on April 27, 2021, the corresponding PE was 17 times and 14 times respectively, maintaining the "prudent overweight" rating.
Risk Tip: Labor costs are rising too fast