\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 888 China Tourism Group Duty Free Corporation Limited(601888) )
Key investment points:
The company released the financial report for 2021. During the period, the company realized a revenue of 67.675 billion yuan (+ 28.67%), a net profit attributable to the parent company of 9.653 billion yuan (+ 57.23%), deducting a net profit not attributable to the parent company of 9.533 billion yuan (+ 59.77%), and EPS 4.4 billion yuan 94 yuan. During the reporting period, the growth of the company’s operating indicators was mainly due to the rent concession of the capital airport and the preferential corporate income tax enjoyed by some subsidiaries in Hainan.
Affected by the epidemic, the business situation in March was obviously under pressure. In March, due to the rebound of the epidemic in Hainan, the closure of duty-free shops on outlying islands and the 70% decline of passenger flow at Sanya airport in March, the revenue in March was about 3.682 billion yuan, a year-on-year decrease of about 50%, the net profit attributable to the parent was about 163 million yuan, a year-on-year decrease of about 80%, and the net profit margin was about 4%, which was significantly under pressure compared with that from January to February. At present, Hainan has successively cleared its social aspects, and the duty-free stores have resumed business. It is expected that the operation will return to normal from the second quarter, and the duty-free business on outlying islands will continue to climb and repair.
In terms of business, the proportion of duty-free commodity sales continues to expand, and Hainan market has become the largest profit contributor. During the period, the company’s commodity sales reached 44.799 billion yuan (+ 43.93%), representing an increase of 0.12 PCT over the previous year. Among them, the sales of duty-free goods reached 26.697 billion yuan (+ 49.71%), an increase of 2.37 PCT over the same period of last year; The sales of taxable goods amounted to 18.101 billion yuan (+ 36.18%), representing a decrease of 2.55 PCT over the same period last year.
During the period, the company’s gross profit margin was 33.68% (-6.96 PCT) and the overall expense rate was 8.97% (-9.93 PCT). The sales expense ratio is 5.71% (- 11.11pct), the management expense ratio is 3.32% (+ 0.21pct), the financial expense ratio is – 0.063% (+ 0.974pct), and the net cash flow from operating activities is 8.328 billion yuan (+ 1.56%).
Profit forecast, valuation analysis and investment suggestions: the short-term epidemic is still the main factor affecting the company’s operation. In the medium and long term, the duty-free business is an important channel to guide the return of consumption. In 2022, the company will continue to expand its new retail business and promote the expansion of market share from multiple business lines at ports, cities, outlying islands and airports. We expect that the company’s EPS from 2022 to 2024 will be divided into 5.21 7.42 8.70 yuan, corresponding to the company’s closing price of 176.98 yuan on April 22. The PE from 2022 to 2024 will be divided into 34 23.9 20.4 times, maintaining the “overweight” rating.
Risk warning: the consumer demand of residents is less than the expected risk; Risk of tax exemption policy change.
