\u3000\u30 Shaanxi Zhongtian Rocket Technology Co.Ltd(003009) 47 Shanghai Dobe Cultural & Creative Industry Development (Group) Co.Ltd(300947) )
Event: the company released its annual report for 2021, and achieved operating revenue of 955 million (YoY + 14.6%) in the whole year; The net profit attributable to the parent company is 104 million yuan (YoY + 5.96%), and the net profit attributable to the parent company after deduction is 79 million yuan (YoY + 22.7%).
The outward expansion has achieved initial results, and the rental income has increased steadily
Shanghai's regional recovery, combined with the opening and operation of foreign expansion projects in Beijing, Chengdu, Changsha and other places, has driven the steady growth of revenue. Among them, the regional revenue in Shanghai is 660 million (YoY + 12.8%), that in Beijing is 180 million (YoY + 20.5%), and that in Chengdu is 30 million (YoY + 21.4%). In the whole year, the average rental rate of the company's operating projects was 93.5% (YoY + 4.5pct), and the overall rental rate of the company was 4.3pct higher than the average level of Shanghai Industrial Park.
Among them, the investment promotion progress of Dobe we in Beijing Dongfeng and Dobe we in Yuelu, a raised investment project in Changsha, exceeded the expectation, superimposed on the investment promotion climbing of jiagard Biyi Park, a new project in Shanghai, with a total management area of 102000 m2, and contributed an income of 133 million (yoy + 53.2%) in 2021. By the end of 2021, jiajiadobe e-manor has been put into mature operation, which will further contribute to the growth of rental income.
Stable profitability, cash flow management, living within our means
According to the profit statement in 2021, the gross profit margin of the company's leasing business is 48.3% (YoY + 10.8pct), and the net profit margin attributable to the parent company is 10.9% (yoy-0.9pct). The change of gross profit margin is mainly affected by the new leasing standards. Under the old standard, the company's rental expense to the upstream owner is directly recognized from the operating cost. After the new standards, the adjustment of rental expenditure is recognized by both parties in the depreciation of right of use assets and the financial expenses of lease liabilities. If we restore the financial expenses to the cost, the adjusted gross profit margin of lease business is 38.5% (yoy+1pct), and the profitability remains stable.
In terms of cash flow, thanks to the continuous expansion of the park management scale and the company's good operation ability, the operating cash inflow continued to grow, with an annual inflow of 1.12 billion (YoY + 16.6%). Considering that the new standard will collect the rent paid to upstream landlords in the financing cash flow, after we restore the operating cash flow to a comparable perspective, the total net operating cash inflow is 180 million (yoy-9.7%), which is close to the capital expenditure scale in the investment cash flow (130 million), reflecting the company's cash flow management strategy of living within our means.
The expansion continued to make efforts, and the scale of the park under management increased rapidly
By the end of 2021, the company had 57 Parks under its management (YoY + 11.8%), with a management area of 1.002 million square meters (YoY + 25%). Throughout the year, 9 new projects were signed in the mode of leasing operation and equity participation operation, with a total leasable area of 208000 m2, and the expansion areas include Shanghai, Hefei, Shenzhen and Nanjing.
All new projects have started the preliminary transformation in 2021, and some projects have entered the investment promotion stage. It is estimated according to the transformation cycle from half a year to three quarters, taking into account the impact of the pre investment promotion rhythm of the project. We expect that the rental rate of new projects will gradually climb to mature operation from 2022 to 2023, the scale of management will continue to improve, the contributed cash inflow and potential profit growth will further provide the cash flow of project expansion.
Investment suggestion: as the operator and service provider of China's leading cultural and Creative Industrial Park, the company has obvious advantages in large-scale, standardized and integrated operation. Under the background of updating the stock of old properties, the business model of light assets and fine operation has good cash creation ability and sustainable operation ability. Due to the uncertainty of the epidemic situation, we expect that the company will realize operating revenue of 1.16 billion, 1.42 billion and 1.76 billion from 2022 to 2024 (1.20 billion and 1.41 billion before 2022 and 2023), with a year-on-year increase of 21.8%, 22.5% and 23.3%, and realize net profits attributable to the parent company of 120 million, 150 million and 190 million (130 million and 150 million before 2022 and 2023), with a year-on-year increase of 19.4%, 22.7% and 23.8%. The current share price of the company corresponds to 22 times of PE in 2022, maintaining the "buy" rating.
Risk tips: the risk of repeated epidemic, the risk of sharp decline in rental rate caused by macroeconomic downturn, the risk of breach of contract by the property owner or lessor, the risk of customer returning the lease or investment promotion less than expected, and the risk of untimely update of information or data used in the Research Report.
