The operation is stable, and the impairment provision increases and restricts the release of performance. The company's 2021Q1-3 achieved a revenue of 8.76 billion yuan, an increase of 26%; and a net profit of 250 million yuan, an increase of 4%, and the performance growth rate was significantly slower than the income. It is expected that the company's Q1-3 impairment is significantly higher than in previous years based on a prudent and objective attitude against the background of tight real estate regulation this year. (the cumulative amount of credit impairment is 82 million yuan, which is 41 million yuan more than that of the same period last year). From a quarterly point of view, Q1-3 achieved revenue of 1.93 billion yuan, an increase of 31%, 41%, 13%, and a net profit of 0.69 million, 0.30 million, respectively. Compared with the same period last year, Q1-3 achieved the highest single-quarter performance since 2016, with a year-on-year performance of-26%, 55%, 55%, 25%, respectively, the highest level since 2016. The company Q1-3 accumulated a total of 12.4 billion yuan in newly signed orders, an increase of 7.1%, of which public clothes / housing respectively accumulated 774.1 billion yuan, an increase of 6.2% and 6.5% respectively. This year's cumulative orders continued to maintain positive growth, indicating a certain degree of business resilience. By the end of Q3, the company has signed unfinished orders of 26.5 billion yuan, which is 2.5 times of the company's revenue in 2020. sufficient orders ensure the steady growth of the company's follow-up revenue performance.
Q3 the margin of gross profit margin improved, the expense rate decreased, and the increase of raw material reserves led to an increase in cash outflow. The company's 2021Q1-3 gross profit margin of 14.47%, basically unchanged from the same period last year, of which Q3 single-quarter gross profit margin of 16.54%, compared with last year Q3 increased 2.25 pct,Q3 single-quarter profitability marginal improvement. The expense rate during the period was 9.20%, a decrease of 0.35 pct compared with the same period last year, of which the sales / management / R & D / financial expense rate changed-0.40 pct respectively. The decline in sales expense rate is expected to be mainly due to stricter regulation and control of real estate, cautious business development and reduced marketing activities. The increase in R & D expenditure is mainly due to the continuous increase of R & D investment in the fields of materials, design, intelligence and informatization. The loss of asset impairment (including credit impairment) was 123 million yuan, an increase of about 82 million yuan over the same period last year. On the one hand, due to the implementation of new accounting standards, impairment losses on contract assets and other non-current assets were adjusted to "asset impairment losses"; on the other hand, due to the tightening of real estate financing, the company increased the provision for impairment of residential decoration business based on prudent principles. The net interest rate was 2.91%, a slight decrease of 0.63 pct compared with the same period last year.
The net operating cash outflow of 2021Q1-3 was 1.4 billion yuan, an increase of 4.80 yuan over the same period last year, mainly due to the preparation of materials in advance when the price of raw materials rose (the final inventory of Q3 increased by 720 million yuan compared with the end of last year). The cash-to-cash ratio is 97%, 87%, respectively, which is higher than that of the same period last year. The ratio of cash to cash is-4 pct.
Industrial interior business continues to expand and is expected to benefit from the development of green buildings. Since the beginning of this year, the domestic dual-carbon policy has been continuously deepened, and the prefabricated decoration has outstanding benefits in energy saving and emission reduction, which is one of the important means to achieve green construction.
The company is one of the earliest domestic prefabricated decoration enterprises, has provided more than 5 million square meters of industrial built-in products, the operation mode has gradually taken shape, and continues to optimize and improve the material end, production end, design end, construction end and other aspects to improve the profit margin of the project. Under the background of friendly policy environment and accelerated market development, we estimate that in the first three quarters, the company has signed and won the industrial interior order of 17-1.8 billion yuan, which is on a preliminary scale. With the accelerated development of green buildings and the release of the company's production capacity, the company expects that the scale of industrial interior business is expected to maintain a compound annual growth rate of 30% per cent and 50 per cent in the future, gradually becoming a new growth point.
Investment advice: we predict that the company's return net profit for 2021-2023 will be RMB 4.5x790 million, respectively, with an increase of 43%, 33% and 30%, respectively. The CAGR for 2020-2023 will be 57%, and the EPS for 2020-2023 will be RMB 0.34, respectively. The current stock price will be times higher than that of PE in 22-17-13, and the "Buy" rating will be maintained.
Risk tips: the risk of rising prices of raw materials, the promotion of industrial built-in business is not as expected, the risk of bad debts caused by accounts receivable, the risk of stricter real estate regulation, the risk of financial internal control and punishment, and so on.
