Items:
The company released its semi-annual report for 2016, with operating income of 139605902.40 yuan during the reporting period, an increase of 46.28% over the same period last year. Net profit attributed to shareholders of listed companies was 22591871.08 yuan, compared with a loss of 2843794.75 yuan in the same period last year. In this regard, our comments are as follows.
Comments:
The revenue slightly exceeded the market expectations, and the profit situation improved significantly. The company's revenue increased by 46.28% over the same period last year, mainly due to the increased contribution of new business, which came from three aspects: 1. The business of virtual operators is growing steadily, and the traffic operation is beginning to achieve results; 2. Mobile game revenue rebounded, with a year-on-year increase of 30.55%. Nanjing North latitude International Center has been put into commercial use, and the occupancy rate has increased rapidly. The homing net profit increased by 894.43% compared with the same period last year, achieving a turnaround from losses to profits, on the one hand, incremental revenue contributed to profits, and on the other hand, business optimization was completed in the second half of 2015, and operating costs and expenses were greatly reduced.
Speed up the introduction of foreign boutique games. The company's game and video business has established a differentiated competitive strategy with strong liquidity, and profits are expected to stabilize and pick up from 2016. Mobile video deepens cooperation with CCTV International and China Mobile, benefiting from the dual catalysis of 4G popularity and live broadcast of events. Mobile game focus International IP as a boutique agent, has won EA, King, Rovio and other star game distribution rights, the number of agent games is expected to continue to increase.
Flow management is expected to become a new revenue growth pole. The company has strongly cut into the mobile Internet access business, and the A-share listed companies have exclusive and comprehensive coverage of WiFi and 3G/4G traffic operation. WiFi resale time accumulated more than 10 million hours, accounting for the largest share of third parties. The starting point of 3G/4G traffic operation is high, and the layout occupies the first-mover advantage, focusing on expanding Internet channels and customers in the financial industry, and it is expected that traffic operation will continue to bring incremental income contribution.
Set up a mobile Internet industry fund to expand the layout. The company signed an agreement with Ping an Caizhi, wonderful World and Ping an Wisdom to jointly set up a mobile Internet industry investment M & A fund with a total size of RMB 500 million, of which the company subscribed for 150 million yuan. By participating in the establishment of an industrial fund, the transformation of mobile Internet is expected to speed up. The investment direction of the fund covers communication solutions, intelligent hardware and mobile Internet services, such as video lottery cloud platform, mobile games and other areas, which is expected to form coordination with the company's business. it is conducive to the integration of industrial resources and channel capabilities, and promote the rapid development of existing business.
Risk factors: new business growth is not as expected, industrial fund investment risk.
Maintain the "overweight" rating: the company's business development inflection point has been verified, the transformation strategy is clear and accurate, traffic operation and aviation Internet are expected to lead to a reversal of performance, the establishment of a mobile Internet industry fund is expected to further enhance the development potential to accelerate the pace of transformation, maintaining the company's 2016-2018 EPS forecast of 0.21pm 0.34x0.43 yuan, maintaining the "overweight" rating.