Main points of investment
The performance grew steadily and profit margins declined slightly. In the first half of 2022, the company achieved revenue of 897 million yuan, an increase of 17.36% over the same period last year, and a net profit of 90 million yuan, an increase of 6.73% over the same period last year. Among them, property basic services, owner value-added services, non-owner value-added services and asset management services respectively achieved revenue of 7.71 billion yuan. The company's gross profit margin and net profit margin in the first half of 2022 were 23.06% and 10.60%, respectively, falling by 0.63pct and 1.1pct respectively compared with the same period last year. The decline in profit margin has the impact of the epidemic and the subject of new mergers and acquisitions. The profit margin of the newly merged Pratt & Whitney property and Zhongda property is relatively low, but with the normalization of the epidemic and the promotion of post-investment management, the company's profitability will remain robust.
The signing scale continues to grow, and the Yangtze River Delta is basically stable. In the first half of 2022, the company signed 61 new projects, covering an area of 7.813 million square meters. By the end of the first half of 2022, the company had signed a total of 696 projects, with a total signed area of 83.069 million square meters, an increase of 15.12% over the same period last year. The company's project density in the Yangtze River Delta region has further increased, and the cumulative signed area in the Yangtze River Delta region accounts for 85%, an increase of 3pct compared with 2021.
Multi-format comprehensive layout, a new breakthrough in the field of urban services. In the first half of the year, the company signed a number of new projects in various formats. At the end of the first half of the year, housing accounted for 67%, commercial writing accounted for 23%, and urban services accounted for 10%. Of the newly signed area, residential accounted for 40%, commercial writing accounted for 21%, and urban services accounted for 39%. The company has made a great breakthrough in the field of urban services, and won the new strategic cooperation project in Wuzhen, Zhejiang Province on the basis of the original sanitation and river management business, with a total service area of 125 million square meters and an annual contract value of more than 6000 million yuan. In addition, since 2022, the company has successively signed strategic cooperation agreements with Tiejian Chengfa and Chunze Huahan, which is expected to continue to import resources in the future.
Platform value-added services and asset management services continue to improve. 1) the rapid development of value-added services: the gross profit margin of the company's property value-added services in the first half of the year is 53.11%, which is + 6.81pct compared with the same period last year. Through the "Yuejiajia" platform, the company sold more than 100000 products in the first half of the year, and the sales of the Dragon Boat Festival increased by 60% compared with the same period last year. Meiju business successfully undertook two outbound projects; home service, intermediary rental and community space operation plate also improved. 2) reducing losses in asset management business: the company withdrew from the loss-making long-rent apartment project, and Xixi Islands Hotel maintained its income as an epidemic isolation hotel. At the same time, the property developer operation plate took on Wuzhen assets business, and the profitability of asset management services was greatly improved. The gross profit margin of asset management business in the first half of the year was 3.01%, which was + 37.77pct compared with the same period last year.
Investment advice: the company's multi-format comprehensive layout has led to steady growth, and the results of regional expansion have been gradually realized. We maintain the company's EPS of 1.04 yuan and 1.23 yuan in 22 and 23 years, respectively. According to the closing price on September 8, 2022, the corresponding PE is 12.8 times and 10.8 times, respectively, maintaining the "prudent overweight" rating.
Risk tips: the market expansion is not as expected, the labor cost is rising too fast, and the project gross profit margin is falling.