Company announcement: 1) achieve revenue of 59.8 billion yuan / + 12.92% (year-on-year, the same below) in 2020, return to the mother net profit of 186 million yuan / + 267.14%, deduct the non-return net profit of 0.08 billion yuan /-95.46%. Among them, Q4 single-quarter revenue of 16.2 billion yuan / + 3.76%, return to the mother net profit of 100 million yuan / + 396.75%, deducting the non-return net profit of 108 million yuan /-21.64%. 2) 2021Q1's revenue is 19.963 billion yuan / + 38.84%, the net profit returned to the mother is 0.1 billion yuan /-85.32%, and the non-return net profit is 3 million yuan / + 103.09%.
The decline of gross profit margin affects profits, and the overall effect of fee control is good. Under the impact of the epidemic, the company's revenue growth rate still reached 12.92% in 2020, due to the steady growth of mobile phone distribution business, especially the substantial growth of JD.com platform. However, the epidemic situation and business structure adjustment affected the company's gross profit margin, and the gross profit margin of communication product sales & maintenance and lottery business all declined, resulting in a sharp decline in non-return net profit by 95.46%. In addition, the overall cost control effect of the company is good. In 2020, the sales rate is 1.58% Universe 0.07pct, the management rate is 0.64% Universe 0.07pct, the financial rate is 0.34% Universe 0.11pct, and the R & D rate is 0.10% Universe 0.04pct, which reduces the overall 0.15pct for the period.
From the perspective of sub-business: 1) Mobile phone distribution business: revenue 55.3 billion yuan / + 22.09%, accounting for 92.45% of total revenue; gross profit margin 2.03%/-0.39pct decreased, presumably due to the increase in the proportion of JD.com 's own channel with lower gross profit margin; 2) Mobile phone maintenance business: revenue of 202 million yuan / + 73.01% increased significantly, gross profit 32.68%/-11.63pct decreased 3) Retail e-commerce business: the sharp decline in revenue of 3.784 billion yuan /-41.41% is due to the impact of the epidemic, while the increase in gross profit margin (6.74%/+2.81pct) is due to the improvement of operating efficiency. 4) Lottery business: it is greatly affected by the epidemic, with a revenue of 303 million yuan /-22.90% and a gross profit margin of 52.88% and 15.17%.
Try the new business of e-cigarette to increase the profit point. After Tianyin Communication, a wholly owned subsidiary of the company, added e-cigarette related business in August 2019, the company continued to lay out on the e-cigarette track. According to 36 Krypton report, the new army of e-cigarette brand Platte Technology has reached a cooperation with the company, and the two sides will carry out in-depth strategic cooperation in offline retail scenes. The joint efforts of the two sides will greatly promote the development of joining and further expanding business channels.
21Q1 revenue continued high growth, deducting non-return net profit to reverse losses. 21Q1's revenue of 19.963 billion yuan / + 38.84% continues its high growth, which is presumed to be due to the continued volume of JD.com 's platform online distribution business; gross profit margin 2.72%/+0.15pct slightly increased; overall period rates dropped significantly, of which the sales rate 1.58% Universe 0.15pct, the management rate 0.64% Universe 0.19pct, the financial rate 0.34% Lure 0.30pct, and the R & D rate 0.10% remained stable.
Profit forecast and investment rating: the company's mobile phone distribution business has maintained rapid growth in the past 20 years, and the overall fee control effect is good, but rising costs erode profits. 21Q1 income continues to grow at a high level, and the reduction of cost and control fees continues to help. The strategic layout of the company has gradually become clear, the 5G replacement trend and the expansion of JD.com platform will promote the sustained and rapid growth of mobile phone distribution business, and the "going global" strategy will open up the development space of lottery business and participate in the acquisition of glorious and continuously overcoded e-cigarette business. the future development is worth looking forward to. The profit forecast is lowered, and it is estimated that the EPS for 21-23 years will be 0.14 pounds 0.24 yuan 0.34 yuan respectively, and the closing price on April 30 corresponding to PE will be times that of 50-29-20, maintaining the "prudent overweight" rating.
Risk tips: overseas demand is lower than expected, exchange rate risk, business expansion is not as expected, etc.