\u3000\u3000 Yunnan Yuntou Ecology And Environment Technology Co.Ltd(002200) (002200)
Matters: the company issued a performance forecast on January 28, 2022. It is expected that the company will realize an operating revenue of 390 million yuan to 420 million yuan in 2021, with a year-on-year increase of 45.68% – 56.88%; The net profit attributable to shareholders of listed companies ranged from – 37 million yuan to – 45 million yuan, with a year-on-year decrease of 52.30% – 60.78%; Net profit after deduction of non-profit was – 52 million yuan to 60 million yuan, a year-on-year decrease of 67.44% – 71.78%.
Focus on the “ecological +” strategy and build four business segments. According to the announcement, the company follows the corporate philosophy of “state-owned enterprise background and market operation”, adheres to the corporate purpose of “casting state-owned enterprise quality and expanding beautiful space”, takes “1 (Yunnan) + 4 (urban area of southwest province) + n (other key areas)” as the layout, and focuses on the strategic positioning of “ecology +”, Integrate and form four business segments of “ecological landscape, ecological environmental protection, ecological seedlings and flowers and ecological human settlement”. At the same time, the company focuses on its main business and sells inefficient assets. The company sold all its shares in land, real estate, seedling base and other companies, withdrew from relevant business areas, and invested more resources in “ecological +” business areas. After four years of contraction, the company’s business ushered in a turnaround in 2021. The annual operating revenue is expected to be 390 million yuan to 420 million yuan, with a year-on-year increase of 45.68% – 56.88%, and the business scale shows rapid growth; The net profit attributable to the parent company was – 37 million yuan to – 45 million yuan, a year-on-year decrease of 52.30% – 60.78%, and the loss reduction was relatively large.
The change of shareholders temporarily affected the business, and Yunnan Trading and investment helped the rapid growth. According to the announcement, in November 2021, the equity held by Yuntou group was transferred to Yunnan Jiaotou free of charge, and the share change registration was completed at the end of 2021. The change of shareholders affected the company’s business in the fourth quarter to a certain extent. Historically, the fourth quarter is the “peak season” of the company’s business. From the fourth quarter of 2019 to 2020, the company achieved operating revenue of about 200 million yuan and 185 million yuan respectively, accounting for 29.32% and 69.03% of the annual business of the year, respectively. In the fourth quarter of 2021, it is expected to achieve operating revenue of 40-70 million yuan, accounting for 10.26% – 16.67% of the annual business, Significantly lower than the proportion of business in the fourth quarter of the past two years. In January 2022, the company completed the change of the board of directors, and the management is in place, which is conducive to the normal development of the company’s business. At the same time, Yunnan Jiaotou has provided the company with shareholder loans of no more than 1.072 billion yuan. In addition to 1.022 billion yuan for new and old loans, 50 million yuan is used for the company’s daily operation. In addition, the shareholder loan interest rate of Yunnan Jiaotou is relatively low, and the strong support of shareholders helps the company grow rapidly.
The litigation risk is coming to an end, and the overall impact is relatively limited. The company has triggered two civil lawsuits with great impact due to contract disputes – the civil lawsuit for contract disputes of Nanchong agent construction center project and the civil lawsuit for contract disputes of Liupanshui foreign language project. The litigation amount is large and the impact on the company is obvious. The company has fully accrued the estimated liabilities. At present, the company is actively claiming rights from the project owner through litigation and other means. The Sichuan high court has ruled in favor of the company in the civil litigation for contract disputes of Nanchong agent construction center project. At present, both parties appeal to the Supreme Court. If the judgment is won and finally implemented, the company will be able to offset the estimated liabilities accrued previously and increase the company’s profits. The final judgment of Liupanshui foreign language project has been made, and the company has fully accrued the estimated liabilities in 2020, which will not put pressure on the company’s future performance. The overall impact of civil litigation over contract disputes of the company’s two major projects is limited, and the controlling shareholder has issued a promise to reveal the bottom. The controlling shareholder will urge the company to compensate for the possible losses by suing the owner, and the part that eventually causes the loss of the company’s interests will be compensated within 12 months.
Profit forecast and investment suggestion: the change of the controlling shareholder of the company may have a great impact on the company, and it is relatively difficult to predict the company’s performance. Based on the company’s existing orders, business team and shareholder support, excluding the expected debt write back, the company’s operating revenue is expected to be 405 million yuan, 586 million yuan and 792 million yuan from 2021 to 2023, with a year-on-year increase of 51.10%, 44.94% and 35.09% respectively, and the net profit attributable to the parent company is – 40 million yuan, 23 million yuan and 32 million yuan, with a year-on-year increase of – 57.3%, 156.0% and 42.9% respectively, EPS is – 0.22 yuan, 0.12 yuan and 0.18 yuan respectively, and the corresponding dynamic PE is – 34.8 times, 62.2 times and 43.5 times respectively. Benefiting from the reform of state-owned enterprises in Yunnan, the company has become the only listing platform of Yunnan stock exchange and investment through equity transfer. Shareholders are expected to increase management, capital and business support. At the same time, the company has seen an operational inflection point in its main business through the “slimming” plan and business focus, and it is expected that its performance will be released rapidly in the future. We are optimistic about the value of the company’s platform and the synergy with Yunnan trading. We give a “Buy-A” rating for the first time, with a target price of 9.92 yuan.
Risk tips: civil litigation lost, shareholder support was less than expected, project payment collection was slow, and the growth of newly signed orders was slow.
