Incidents:
In the first half of 2021, the company's revenue is expected to be 160,000 yuan to 180,000 yuan, an increase of 101.32% to 126.48% over the same period last year; payments exceeded 1 billion yuan, an increase of about 40% over the same period last year; net profit is expected to be 20 million yuan to 30 million yuan, turning a loss into a profit.
Commentary:
The company is committed to improving management efficiency, and has achieved remarkable results in contract management, cost control, investment management, etc.
In terms of contracts, the company introduced project management work rules, established a hierarchical management mechanism for project implementation, sorted out historical stock contracts, set targeted follow-up management and assessment plans, established “red, yellow, and green” project operation monitoring indicators, and improved operational efficiency. In terms of expenses, pay close attention to financial cost control. Financial expenses fell by about 10% year-on-year in the first half of 2021. Although the loan scale in the first half of the year was the same as the same period last year, the amount of undertakings for projects under construction doubled compared to the same period last year, and the efficiency of capital use improved markedly. On the post-investment side, the company strengthened the management of the invested enterprises and increased its business expansion efforts. The amount of non-recurring profit and loss in the first half of the year was about 14 million yuan.
The company efficiently expanded its market, saw a sharp increase in revenue, and turned net profit into profit. On the market side, the company is guided by budget targets and optimizes a multi-dimensional, differentiated performance evaluation system to stimulate the enthusiasm of sales staff.
In the first half of '21, the amount of new contracts signed by the company reached 1.36 billion yuan, an increase of 32% over the same period last year; the gross profit of the contracts signed increased by about 41% over the same period last year. In terms of revenue, in the first half of 2021, the company's revenue is expected to be 160,000 yuan to 180,000 yuan, an increase of 101.32% to 126.48% over the same period last year; the amount paid exceeded 1 billion yuan, an increase of about 40% over the same period last year. In terms of net profit, the company's net profit for the first half of the year is expected to be 20 million yuan to 30 million yuan, turning a loss into a profit.
The company pays attention to R&D investment, and business transformation and upgrading are progressing smoothly. In terms of R&D, the company strengthens R&D innovation and enhances R&D capabilities through various forms such as technology contests. The company has received a number of international and domestic awards. The company's smart epidemic prevention “Three Pieces” received the “Top Ten Innovative Initiatives of the 4th Shanghai Medical Reform” and is the only enterprise recommended unit. In terms of transformation, on the one hand, the company continues to deeply cultivate traditional advantageous business fields such as healthcare, government affairs, and ICT, and steadily promotes commercialization, cloud-based, and SAAS transformation. All core indicators have maintained double-digit growth. On the other hand, it continues to make efforts in the fields of Internet medical care and smart cities. In the first half of the year, the company released Manniu Health 2.0's ecological product “Manniu Xiaojing” (digital home health care platform); Smart City Citizen Cloud continued urban expansion, with more than 89 million registered users in the first half of the year, of which about 18 million new users were added in the first half of the year, strengthening the exploration of value-added models of data elements and enhancing long-term operation capabilities; Health Cloud registered more than 40 million users, of which about 14 million were added in the first half of the year.
Company profit forecast and investment rating: We expect the company's net profit attributable to the parent for 2021-2023 to be 0.41, 0.87 and 225 million yuan respectively, and the corresponding EPS is 0.03, 0.07 and 0.19 yuan respectively. The current stock price corresponds to the 2021-2023 PE value of 397.57, 185.43, and 71.56 times, respectively. It is expected that the company will move forward along the “steady-expansion-transformation” trilogy. Currently, the company has achieved remarkable results in solving management issues left over from history and low margin contract issues. Traditional medical and government IT businesses have improved markedly, and transformation businesses such as Internet healthcare are developing smoothly, so it maintains the “recommended” rating.
Risk warning: The progress of historical order processing fell short of expectations, the growth of traditional medical and government informatization businesses is slowing down, and competition for developing new business markets is fierce.
