Event: in 2019, the company achieved sales revenue of 734 million yuan, an increase of 19.74% over the same period last year, an operating profit of 262 million yuan, an increase of 25.54% over the same period last year, and a net profit of 230 million yuan belonging to the owner of the parent company, an increase of 27.28% over the same period last year, equivalent to 3.63 yuan of EPS. Net profit excluding non-recurring profit and loss was 216 million yuan, an increase of 22.82% over the same period last year. In 2019, the company plans to increase 10 shares for every 10 shares and distribute a cash dividend of 5 yuan (including tax).
Operating services drive rapid revenue growth in 2019. The company is an advanced manufacturer of environmental monitoring instruments, with independent research and production of environmental monitoring instruments as the core to provide customers with automatic and intelligent environmental monitoring systems and operational services.
The company's main products include water quality monitoring system, air / smoke monitoring system and environmental monitoring information management system, and provide customers with environmental monitoring system operation services.
Benefiting from the implementation of China's environmental protection policy and the standardization and improvement of technical standards, the company's revenue has maintained a rapid growth rate. Thanks to the seven national component service centers and the operation and maintenance services of the national surface water automatic monitoring station, the company's 2019 operating services achieved sales revenue of 204 million yuan, an increase of 54.13% over the same period last year, which is the main factor for the company's rapid revenue growth; the company's largest business environment monitoring system achieved sales revenue of 457 million yuan, an increase of 2.64% over the same period last year, achieving steady growth.
The company's comprehensive gross profit margin declined and its expenses were well controlled during the period. In 2019, the company's comprehensive gross profit margin was 51.75%, down 2.58 percentage points from the same period last year. This is mainly due to the sharp decline in revenue in North China, which lowers the company's overall gross profit margin. In 2019, the company's expense rate during the period was 19.70%, down 1.86% from the same period last year, mainly due to a 1.26% drop in sales expense rate.
After the outbreak of COVID-19, the company urgently produced related products. At the beginning of 2020, when the COVID-19 epidemic broke out, the Ministry of Ecology and Environment asked to strengthen emergency monitoring during the epidemic, strengthen the monitoring and supervision of drinking water sources and hospital wastewater, and carry out intensive monitoring of special parameters such as residual chlorine, fecal Escherichia coli, biological toxicity and so on. few domestic enterprises have independent production capacity of this kind of instruments, and the company responds quickly and accelerates production. It has been put into use in the on-line monitoring of river cross-section and drinking water sources, the inspection of emergency monitoring vehicles and automatic laboratory analysis equipment.
Profit forecast: from 2020 to 2022, we forecast that the company's net profit attributable to the owner of the parent company will be 263 million yuan, 310 million yuan and 361 million yuan respectively, equivalent to 3.29,3.87 yuan and 4.51 yuan respectively for EPS. According to the closing price of 77.64 yuan per share in the last trading day, the price-to-earnings ratio is 24 times, 20 times and 17 times respectively.
Risk tips: 1) the epidemic continues to lead to a decline in demand; 2) competition intensifies.
