Events:
The company announced that in the first quarter of 2021, Q1 achieved operating income of 760 million, an increase of 14.7% over the same period last year, and a net profit of 87 million, an increase of 0.14% over the same period last year.
Comments:
The expense end rose slightly, and the performance was the same as the revenue side under the preferential decline of the epidemic. Supported by the continuous billing, the company's 2021Q1 revenue increased by 14.7% year on year, which was slower than the 28.9% growth rate for the whole of 2020. On the gross margin side, 2021Q1 gross profit margin increased by 2 percentage points year on year, or due to changes in management model and improvement of project operation capacity. On the expense side, during the first quarter, the expense rate rose 3 percentage points to 14.2% compared with the same period last year, and the increase in sales and management expenses was the direct cause. The rapid business expansion led to a 1.0% increase in the sales expense rate compared with the same period last year. The management expense rate also increased by 1.3 percentage points driven by model changes and business development. On the whole, on the one hand, it is affected by the rise in fees, on the other hand, the performance of preferential policies for the same period of 20 years has increased by about 30 million. At a high base, the net interest rate of return to home has dropped 1.6 percentage points year on year to 13.1%, corresponding to the scale of net profit of 87 million, which is basically the same as the same period last
The bill keeps growing at a fast pace, and the project is extended horizontally to increase speed.
The expansion of the company's sanitation projects accelerated in 2020, with an increase of about 20.7 billion in winning bids and an annual increase of more than 1 billion yuan. Among them, large single occurrence, including more than 3.3 billion Duyun project (annualized about 130 million), 6 billion Baoshan project (annualized about 240 million) and so on. On the one hand, it reflects the strong ability to take orders, on the other hand, it also reflects the horizontal extension and acceleration of the project under the strategy of "city butler". Since 2021, the company has maintained the momentum of taking orders rapidly, and it is estimated that the total amount of winning bids has exceeded 8 billion, ranking first in the industry, including the Hohhot sanitation integration project with a total value of more than 1.4 billion and an annualized rate of nearly 100 million.
The "city butler" strategy has been established, and on December 22, 2020, the company held a press conference to announce that the company's name had been changed to "overseas Chinese Silver City Management Co., Ltd." at the same time, the "city butler" strategy was officially released, that is, the overall market-oriented management service of public space from horizontally broadening the industrial chain by taking urban sanitation and cleaning as the carrier. The traditional urban management system adopts the mode of decentralized management of departments, which has some disadvantages, such as overlapping functions, blank management, weakening responsibility mechanism and so on. The integration of the urban management system in the future is the general trend. The company adjusts its strategy in time to comply with the general trend of integrated and integrated sanitation. It is expected to continue to empower the company to take orders and enrich the content of project operations at the same time.
Profit forecast and valuation
From 2021 to 2023, the company is expected to achieve operating income of 38.3,46.7 and 5.63 billion, and net profit of 3.8,4.7 and 590 million, corresponding to PE of 19.7,15.9 and 12.8 times, to maintain "buy".
Rating.
Risk tips: intensified market competition, lower-than-expected operation of terminal disposal projects, and higher labor costs.
