2024Q3 毛利率29.1%/yoy+5.6pct，环比小幅下降1.5pct，主要系2023Q3 新项目开工率不足导致基数较低；2024H1 销售/管理/研发费用yoy+25.1%/+0.73%/-19%，对应费用率为7.2%/12.2%/4.3%，销售费用支出同环比均有明显提升。另外，三季度资产/信用减值损失同比有所收窄，综合归母净利率0.9%/yoy+0.5pct。2024年7 月至今公司公告中标四川大运会文化发展剧院、天津东丽湖实景演艺项目等7 个大额文体旅集成服务项目，累计订单金额4.79 亿元，占2023 年收入比重约24.7%，在手订单整体维持较高水位。公司加强客户回款能力、信用水平、项目执行等风险因素评估，项目质量有望进一步提升，看好盈利能力边际改善趋势。Actively adjust to release pressure, and fundamentals improve quarter by quarter
In the first three quarters of 2024, the company achieved revenue of 1.167 billion yuan/yoy -31.6%, net profit of 0.053 billion yuan/yoy -57.6%; of these, 2024Q2 revenue was 0.507 billion yuan/yoy -11.18%, and net profit to mother was 4.66 million yuan/yoy +101.82%. Since 2023Q3, macroeconomic recovery has weakened and local financial pressure has intensified. As a result, the delivery schedule of some construction projects fell short of expectations, hampering the implementation of the company's apparent performance. In 2024, the company actively reduced high-risk projects, optimized the order structure, and the revenue side showed a quarterly recovery trend. We raised our profit forecast for 2024-2026. We expect the 2024-2026 net profit to be 0.115/0.204/0.25 billion yuan, yoy +14.1%/+76.9%/+22.8%, the corresponding EPS is 0.28/0.5/0.61 yuan, and the PE corresponding to the current stock price is 36.4/20.6/16.7 times. We expect the main business to benefit from the renewal of cultural and sports equipment and the promotion of debt conversion policies in the future. We are optimistic about the positive restoration of the balance sheet and the flexible release of performance under a low base, and maintain a “buy” rating.
2024Q3 gross margin improved year-on-year, with on-hand orders supporting a rebound in performance
The 2024Q3 gross profit margin was 29.1% /yoy+5.6pct, a slight decrease of 1.5 pct from month to month, mainly due to insufficient operating rate of new projects in 2023Q3; 2024H1 sales/management/R&D expenses yoy +25.1%/+0.73%/-19%, corresponding expense ratio was 7.2%/12.2%/4.3%, and sales expenses all increased significantly from month to month. In addition, asset/credit impairment losses narrowed year-on-year in the third quarter, with a consolidated net interest rate of 0.9% /yoy+0.5pct. Since July 2024, the company announced that it has won the bid for 7 large-scale cultural and sports tourism integrated service projects, including the Sichuan Universiade Cultural Development Theatre and the Tianjin Dongli Lake Live Performance Project. The cumulative order amount is 0.479 billion yuan, accounting for about 24.7% of revenue in 2023, and the overall level of on-hand orders has remained high. The company strengthens the assessment of risk factors such as customer repayment ability, credit level, and project execution. The quality of the project is expected to be further improved, and it is optimistic about the trend of marginal improvement in profitability.
The debt conversion policy has been strengthened, and repurchases/shareholders' holdings have increased their confidence
On October 12, Minister of Finance Lan Foan stated at the press conference of the State Information Office to “increase debt recovery efforts, consolidate local principal responsibilities, and implement various debt conversion measures in accordance with one province, one policy.” Since 2024, the Ministry of Finance has arranged a debt limit of 1.2 trillion yuan to support local settlement of hidden debts and absorb corporate arrears from the government. As of 2024Q3, the size of the company's accounts receivable and notes was 1.525 billion yuan, a change of -1.6% from the beginning of the year. We believe that with active fiscal policy guarantees, the financial pressure on cultural, sports and tourism industry construction is expected to gradually ease, but it is still necessary to track the progress of debt conversion. In March 2024, the company announced a repurchase of at least RMB 0.1 billion with its own capital. As of October 8, the company had repurchased a total of 47.7 million shares, accounting for about 1.17% of the total share capital. On October 25, the company announced the implementation of the actual controller's plan to increase their holdings, increasing their total holdings by 0.66%, demonstrating confidence in long-term development.
Risk warning: The bid fell short of expectations, the project delivery schedule fell short of expectations, the expansion of the stadium operation project was blocked, etc.
