According to the company's 2022 annual report, the company achieved revenue of 1,035 million yuan, YOY -32.22%; net profit of the mother - 178 million yuan, YOY - 39.30%; after deducting net profit of the non-return mother - 242 million yuan, YOY -31.32%. The company's annual revenue was hit hard by the pandemic, but subsequent travel market confidence gradually recovered and the backlog of travel demand was released, which is expected to drive the company's business travel business to resume, and we will maintain the company's increased holdings rating.
Key points to support ratings
Affected by the pandemic, there were losses throughout the year, and the funding situation was relatively stable. According to the company's annual report for '22, the company achieved revenue of 1,035 million yuan in '22, -32.22% year on year; net profit of the mother was 178 million yuan, or -39.30% year on year; after deducting non-net profit - 242 million yuan, or -31.32% year on year. At the end of the reporting period, the company's balance ratio was 31.06%; monetary capital accounted for 36.84% of total assets, and financial and capital performance was relatively healthy. In addition, the revenue for the four quarters accounted for 18.14%, 17.97%, 46.43%, and 17.46% of the full year, respectively. There were quarterly differences in revenue and some quarters were significantly affected by the pandemic.
The outbound travel business continues to advance, and the layout is deepening to welcome the recovery of the industry. After the Hong Kong and Macao Affairs Office of the State Council issued a notice to resume personnel exchanges between the mainland and Hong Kong and Macao on February 3, 23, Guangzhou Tour, a subsidiary of the company, launched more than 500 Hong Kong and Macau group tour routes and other related products. The outbound travel business of the seven major operating centers was restarted one after another. On the first day of the outbound tour restart on February 6, Guangzhou Tour organized more than 600 visitors, accounting for 60% of the number of outbound group tours in the country. The recovery of the industry is also driving Guangtur's national expansion. In '22, Hubei Guangtour signed contracts to expand more than 20 stores, and plans to join more than 60 stores in 2023, setting a model for building a national channel sales platform. The number of Guangzhou Tour offline channel terminals may be expected to catch up with the level of 19 years before the pandemic. Furthermore, the company implemented the “smart +” strategy, empowered offline channels with an online “easy to start” platform and CRM database, and built an omni-channel intelligent management system.
Diversified innovation boosted competitiveness, and revenue growth during the Spring Festival exceeded expectations. In '22, the company grasped cultural tourism consumption trends, launched integrated cultural tourism projects and a series of activities, and occupied the market ahead of schedule. Demand from the commercial travel industry rebounded during the Spring Festival in '23. The Spring Festival revenue of Hunan Guangzhou Tour and Xi'an Guangzhou Tour increased 32% and 12%, respectively, compared to before the pandemic. The number of people visiting the Xi'an Qinfeng Spring Festival local micro vacation product group increased 25% compared to before the pandemic. Since March, the number of people in the Guangzhou Tour surrounding travel business has increased 38% month-on-month in the past month. Looking ahead to the whole year, after the “Twenty Rules”, the “New Ten Rules”, the “Class B” and the new regulations on the movement of Chinese and foreign personnel, the China Institute of Tourism Research predicts that the annual tourism economy is expected to pick up at an accelerated pace, and summer tourism is expected to fully recover. The number of domestic tourists and revenue for the whole year is expected to return to 70-75% of what it was before 2020, and the number of inbound and outbound tourists is expected to return to 30-40% before 2020. The company's business has been severely hampered by the pandemic, and is expected to quickly rebound as the market recovers after the pandemic.
valuations
After the impact of the pandemic, the industry's recovery trend has arrived. The company integrates the resource advantages of the entire cultural, commercial and tourism industry chain, and its performance is expected to rebound deeply. Based on the company's performance in '22, the company's EPS forecast for 23-25 is 0.21/0.42/0.48 yuan, and the corresponding price-earnings ratio is 55.1/28.3/24.6 times, maintaining the stock increase rating.
The main risks faced by ratings
The recovery of the industry fell short of expectations, market competition risks, and expansion fell short of expectations.