\u3000\u3 Shengda Resources Co.Ltd(000603) 444 G-Bits Network Technology(Xiamen)Co.Ltd(603444) )
Event: G-Bits Network Technology(Xiamen)Co.Ltd(603444) ( G-Bits Network Technology(Xiamen)Co.Ltd(603444) . SH) released the annual performance report of 2021 on April 8, 2022.
Comments:
The company achieved a revenue of 4.619 billion yuan in 2021, with a year-on-year increase of 68.44%, mainly due to: 1. Yinian Xiaoyao, which was launched in February 21, performed well in the category of cultivating immortals and contributed to the main incremental revenue; 2. The income of “asking questions” and “asking questions mobile Tour” increased compared with the previous year; 3. The newly launched agent Games “Moore Manor”, “eight wastelands of ghost Valley”, “underground castle 3: poem of soul” and other products contribute revenue. The net profit attributable to the parent was 1.468 billion yuan, a year-on-year increase of 40.34%, and the non attributable to the parent was 1.226 billion yuan, a year-on-year increase of 36.24%, slightly lower than expected.
In terms of business, the revenue from independent operation in 2021 was 2.039 billion yuan, a year-on-year increase of 70.19%; The revenue from joint operation was 2.181 billion yuan, an increase of 83.15% year-on-year; The authorized operation revenue reached 336 million yuan, a year-on-year increase of 38.98%; Other income was 50 million yuan, a year-on-year decrease of 52.07%.
Quarter by quarter, 21q4 achieved a revenue of 1.134 billion yuan, a year-on-year increase of 63.68%, a net profit of 263 million yuan, a year-on-year increase of 4.48%, and a deduction of 223 million yuan, a year-on-year increase of 13.59%.
The main games “ask questions” and “ask questions hand tour” have a stable performance, and “Yinian Xiaoyao” has contributed to the main incremental performance. The company’s main games “ask” and “ask mobile game” have a stable performance. Among them, “ask” continues to carry out iterative development of version content to increase user stickiness, and launched the wegame platform in March 2021, bringing some new users and some old users back. “Ask for a hand tour” opened its 5th anniversary service. At the same time, in order to maintain a high popularity, it strengthened marketing and promotion, and the income increased slightly. In addition, “Yinian Xiaoyao” has become a popular product. By the end of the year, it has registered more than 10 million users. After going online in February of 21, it has performed well. According to the data of Qimai, it ranked among the top 15 in the best-selling list of IOS games in the first month and has also performed stably so far. It went to Hong Kong, Macao and Taiwan in October of 21, and entered the top 10 in the best-selling list of IOS games in the first 22 Anniversary Edition. “Yinian Xiaoyao” is expected to become another long-term operation product of the company after “asked” and consolidate the base of performance.
The overall gross profit margin decreased. The company’s overall gross profit margin in 21 years was 84.88%, down 1.12pct year-on-year. The overall gross profit margin of 2021q4 was 91.15%, with a year-on-year increase of 1.76pct. The main reason is that Q4 adjusted the promotion cost from operating cost to sales expense, which led to the increase of gross profit margin and the increase of sales expense rate. By business, the gross profit margin of independent operation is 90.21%, yoy + 0.75pct; The gross profit margin of authorized operation is 97.75%, yoy + 0.12pct; The gross profit margin of joint operation is 78.53%, yoy-6.31pct. The gross profit margin of independent operation and authorized operation remained basically stable, while the gross profit margin of joint operation decreased, mainly due to: 1 The gross profit margin of agency products jointly operated by ghost Valley and eight wastelands is low; 2. The gross profit margin of the agency products of Moore Manor is low and the joint operation accounts for a large proportion.
The promotion of new products in the fourth quarter led to the increase of sales expenses, and the long amortization cycle of Moore Manor had a significant impact. In 2021, the annual sales expense was 1.274 billion yuan, with a year-on-year increase of 325.67%, and the sales expense rate was 27.57%, with a year-on-year increase of 16.66pct; The sales expense of 2021q4 was 439 million yuan, with a year-on-year increase of 386.91%, a month on month increase of 54.22%, and a sales expense rate of 38.69%, a year-on-year increase of 25.69pct and a month on month increase of 12.79pct, mainly due to the launch of new games such as “one mind carefree” version in Hong Kong, Macao and Taiwan, “underground castle 3: Soul poem” and “world catapult story”, the large investment in marketing scheme, operation service and advertising display, as well as the adjustment of the promotion cost of Q4. In addition, affected by the amortization cycle of props and the accounting recognition rules for R & D shares, products such as Moore Manor have not generated financial profits by the end of the period, and affected by the increase in the balance of unused recharge and consumable props in games such as Moore Manor, the company’s contractual liabilities reached 585 million yuan in 2021 (279 million yuan at the end of v.s.20). In 2021, other non current liabilities reached 214 million yuan (130 million yuan at the end of v.s.20). In 2021, the net cash flow generated from the company’s operating activities was 2.418 billion yuan (v.s. 1.533 billion yuan in 20 years), with good operation, steady growth in performance and abundant cash flow.
Xinyou has rich reserve categories and explores overseas incremental space. The company’s new tour reserve covers places such as roguelike, SLG and other tracks. The reserve of subsequent games is rich, and a variety of games have obtained version numbers. From the perspective of reserve items, the company will have 11 mobile game agent products in the future, including Obi Island: a dream country, dawn elite and flowers falling in Chang’an, of which 6 have obtained the version number. Among them, “Obi Island: dream country” mobile game has attracted much attention. It is an IP community nurturing game. Its page game version has been operating stably since it was launched in 2008, accumulating a large number of IP users. Up to now, there are about 5 million reservation users on the whole platform of OBI Island: dream country. At the same time, the company continues to expand the overseas market, and new projects will be positioned in the global market. At present, the company has obtained the overseas distribution rights of many games such as ice field guardian and oil tycoon, and SLG’s masterpiece Code: Yuanqi has entered the testing period, and will also carry out global development.
Continue to increase dividends and share the company’s growth with shareholders. The company’s annual profit distribution in 2021 is expected to be 1.15 billion yuan. It plans to distribute cash dividends of 160.00 yuan (including tax) to all shareholders for every 10 shares, that is, 16 yuan per share. The cash dividend rate is 78.33% and the dividend rate is 3.79%. Compared with the annual dividend of 12 yuan per share in 2020, the cash dividend rate was 82.41% and the dividend rate was 2.82%.
Investment suggestion: To sum up, the net profit performance of the company in 21 years is slightly lower than expected, but the balance sheet and cash flow statement are of good quality, with high dividends and shared growth. The new tour and performance in 22 years can be expected. The company has a diversified product matrix, covering game categories such as placement and cultivation, simulation operation, roguelike and strategy. 22q1 data of various stock games such as “ask for a hand tour” and “one read carefree” are outstanding, and there is a rich reserve of game version numbers that can be issued in 22 years. “Ask” the mobile game has a stable long-term operation, and the long-term flow continues to maintain a good trend; “Yinian Xiaoyao” went online on February 1, 2001. After going online, it continues to maintain the buying mode. It has excellent performance in the category of Xiuxian, and is expected to become another long-term operation product of the company after “asked”; The performance of “Obi Island: dream country” represented by thunder in 22 years is worth looking forward to, and it is suggested to focus on it.
Risk factors: the performance of core games is less than expected; the online progress of new games is less than expected; industry policy risk: the risk of core brain drain.
