\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 327 Wuxi Commercial Mansion Grand Orient Co.Ltd(600327) )
Events
The company released its 2021 annual report, realizing a revenue of 6.905 billion yuan, a year-on-year decrease of 13.00%; The net profit attributable to the parent company was 641 million yuan, a year-on-year increase of 103.32%, and the basic earnings per share was 0.72 yuan.
Stripped off the auto sales business, and the revenue decreased slightly
The main reason for the decline of revenue in 2021 is that the sales revenue accounts for a large proportion of automobile sales and service business. In 2020, the automobile sales and service business achieved a revenue of 6.879 billion yuan, accounting for 86.68% of the total revenue. However, due to the low growth of the traditional automobile sales industry in the era of stock competition, in order to concentrate resources and promote transformation and development, the company transferred 51% equity of Dongfang automobile and new era automobile to the controlling shareholder in September 2021 and stripped off the automobile sales and service business, In 2021, the revenue of automobile sales and service business was 4.658 billion yuan (- 32.29%).
Strengthen the main retail business and expand medical business
Retail business: (1) Wuxi Commercial Mansion Grand Orient Co.Ltd(600327) department stores actively adjust their positioning according to the changes of consumer groups, layout high-end cosmetics, light luxury watches and fashion brands, and improve the floor efficiency; At the same time, strengthen marketing promotion, incubate young customers, enhance interactive experience and enhance consumer stickiness. (2) Baiye supermarket promotes the transformation of supermarket business and constantly adjusts the store verification model; For community fresh food stores, improve the selection ability, screen high-quality suppliers, strengthen cooperation with third-party logistics and improve distribution efficiency. In 2021, the commercial retail business achieved a revenue of 758 million yuan (+ 21.25%). (3) The impact of the epidemic has weakened, with the superposition of Sanfeng bridge, continuous expansion of new stores, accelerating the layout of chain stores, launching operation manuals to empower franchisees, launching light food stores, and tapping the consumption potential of young consumers. In 2021, the food & catering business achieved a revenue of 195 million yuan (+ 17.25%).
Medical business: through the holding subsidiary “Shanghai Junyao medical”, the company obtained 51% equity of “Shuyang Central Hospital” in June, 406667% equity of “Jiangao Pediatrics” in August, and 60% equity of “yaen health” in October. The company gradually cultivated the medical and health business as a new performance growth point, forming a dual main business strategic layout of “commercial retail + medical and health”. In 2021, three medical projects operated steadily, with a total revenue of 1.076 billion yuan.
The proportion of main retail businesses with high gross profit was increased, and the profitability was enhanced
The gross profit margin in 2021 was 14.83%, up 1.87pct year-on-year, mainly due to the company’s divestiture of low gross profit automobile sales and service business in September 2021 (the gross profit margin in 2021 was 7.76%), which increased the proportion of high gross profit commercial retail business (the gross profit margin in 2021 was 40.33%) and Food & Catering Business (the gross profit margin in 2021 was 42.17%). In terms of expense rate, due to the disposal of assets, expansion of medical business and other reasons, the sales expense rate and management expense rate increased by 0.13pct and 0.89pct to 4.74% and 6.12% respectively in 2021; Due to the change of leasing standards, the financial expense rate in 2021 increased by 0.19pct to 0.51%. The net interest rate in 2021 was 9.71%, with a year-on-year increase of 5.73 PCT, mainly due to the non recurring profit and loss of about 490 million yuan caused by the company’s disposal of automobile sales business.
Investment advice
In the short term, with the improvement of the epidemic situation, commercial retail and food catering sectors are expected to release performance flexibility; In the long run, the light luxury industry has a broad market space, the company continues to adjust and upgrade to improve the floor efficiency, and the retail department store business is expected to achieve steady growth; Under the catalysis of the epidemic, the fresh distribution and convenience store industry has ushered in new development opportunities. The company has opened fresh enhanced stores, obtained the management right of 7-ELEVEN Hubei, explored the chain expansion of franchise mode, and is expected to further strengthen the main retail business; The company acquired Jiangao medical treatment, Shuyang Central Hospital and yaen health, cut into the field of medical and health, and multi track linkage empowerment, which is expected to become a new performance growth point. We expect that the company’s EPS from 2022 to 2024 will be 0.26, 0.30 and 0.33 yuan / share respectively, corresponding to 23, 20 and 18 times of the current share price PE respectively, maintaining the “buy” rating.
Risk tips
Repeated outbreaks in some areas; The fresh food distribution industry is highly competitive; 7-Eleven store was not as expected; The cultivation of the medical sector was less than expected.
