\u3000\u3 Shengda Resources Co.Ltd(000603) 466 Shanghai Fengyuzhu Culture Technology Co.Ltd(603466) )
Event: the company released the first quarterly report from 2021 to 2022. In 2021, the company achieved an operating revenue of 2.94 billion yuan, an increase of 30.30% year-on-year; The net profit attributable to the parent company was 439 million yuan, a year-on-year increase of 28.12%; The net cash flow from operating activities was 327 million yuan, a year-on-year increase of 49.51%. In 2022q1, the operating revenue was 242 million yuan, a year-on-year decrease of 59.89%; The net loss attributable to the parent company was 157848 million yuan, a year-on-year decrease of 109.96%; The net cash flow from operating activities was RMB - 288 million, a year-on-year decrease of 37.53%. The substantial growth of the company's performance in 2021 is mainly due to the huge demand for cultural infrastructure under the background of the 14th five year plan. The loss in 2022q1 is mainly due to the repeated national epidemic since 2021q4 and the outbreak of Shanghai epidemic, which has a great impact on the company.
Orders: newly signed orders increased by 17.20% year-on-year, with about 5 billion orders in hand for three consecutive years. In 2021, the company signed new orders of 3.597 billion yuan (YoY + 17.20%), including 2.309 billion yuan (YoY + 12.89%) for cultural and brand digital experience space, 1.223 billion yuan for urban digital experience space and 645556 million yuan (YoY + 135.21%) for digital products and services. As of December 31, 2021, the company had a balance of 5.351 billion yuan in orders on hand, with abundant orders on hand. In recent three years, the amount of orders on hand of the company is RMB 4.969/53.87/5.351 billion respectively, and the newly signed orders are RMB 2.068/30.69/3.597 billion. The improvement of order digestion speed and the certainty of performance are guaranteed.
The proportion of culture and brand digital experience space business has further increased, and the company's business is driven by two wheels. In terms of business, 1) urban digital experience space: in 2021, the revenue was 1.167 billion yuan (yoy-19.23%), and the gross profit margin was 35.98% (a year-on-year increase of 3.09pct); 2) Culture and brand digital experience space: in 2021, the revenue will reach 1.719 billion yuan (YoY + 121.51%), and the gross profit margin will be 30.23% (down 6.52 PCT year-on-year). The digital experience space of culture and brand has a wider demand for the industry track and is more closely related to the new cultural infrastructure, so as to broaden the growth space of the company. In 2021, the company's comprehensive gross profit margin was 32.96%, down 1.92pct from 2021. We believe that it is mainly due to the low gross profit margin of some benchmark projects in the cultural and brand digital experience space (such as Dubai China Pavilion). In the long run, the company's gross profit margin level is still relatively stable.
The related businesses of yuancosmic infrastructure have been continuously implemented, and the digital content production of its wholly-owned subsidiary has achieved revenue. Relying on the advanced application experience of CG vision, rendering, AR / VR, holographic image, naked eye 3D and other digital technologies accumulated for many years, the company has realized the forward-looking layout of meta universe track, mainly including meta universe infrastructure, virtual anchor, NFT digital collection, etc. The company consolidated the role of the construction team in the yuancosmos track, signed yuancosmos cooperation orders with Shanghai Fengxian, Zhejiang Deqing and other local governments, and set an industry benchmark. Fengyuzhou, a subsidiary of fengyuzhou, joined hands with Xinhua news agency to launch the national "two sessions" Yuan universe reporting activity. Since November 2021, it has achieved a digital content production service revenue of 4.55 million yuan, and the business layout has begun to take effect.
Investment suggestion: with the success of the company's business structure transformation and the expansion of yuancosmos business, the company is expected to usher in a dual engine profit driven. We expect the company to achieve a revenue of 3.467/41.02/4.845 billion yuan from 2022 to 2024, and the net profit attributable to the parent company will reach 554703/812 million yuan, maintaining the "buy" rating.
Risk warning: the recovery of the epidemic situation is less than expected, the business development of yuancosmic is less than expected, and the competition intensifies the risk
