\u3000\u3 China Vanke Co.Ltd(000002) 027 Focus Media Information Technology Co.Ltd(002027) )
Event: the company released its 2021 financial report, and achieved a revenue of 14.836 billion yuan in 2021, a year-on-year increase of 22.64%; The net profit attributable to the parent company was 6.063 billion yuan, a year-on-year increase of 51.43%, which was in line with the forecast range of 6.02 billion yuan to 6.2 billion yuan. In addition, the company achieved a revenue of 2.939 billion yuan in 2022q1, a year-on-year decrease of 18.19%; The net profit attributable to the parent company was 929 million yuan, a year-on-year decrease of 32.12%.
In 2021, the performance reached a record high and the structure of advertisers was continuously optimized. Under the low base and continuous optimization of advertisers’ structure, the company’s performance growth in 2021 was strong, driving the gross profit margin to increase by 4.29pct to 67.53% year-on-year, and the net profit margin to increase by 8.12pct to 41.19% year-on-year; The annual net cash flow from operating activities was 9.59 billion yuan, an increase of 27.63% year-on-year after excluding the impact of the new leasing standards. By business, the building media revenue was 13.618 billion yuan, a year-on-year increase of 17.64%; Cinema media revenue was 11.73%, with a year-on-year increase of 14.54 billion yuan. From the perspective of the structure of advertisers, the daily consumer goods industry in building media has become the largest category of customers of the company, with a revenue scale of 5.805 billion yuan, accounting for an increase of 3.67 PCT to 39.12%; The Internet industry ranked second, with a revenue scale of 4.02 billion yuan, a slight decrease of 0.03pct to 27.10%; The proportion of income in other industries such as automobile transportation, real estate and home furnishing decreased to varying degrees.
The epidemic has put pressure on short-term operation. We should pay attention to the offline economic repair opportunities brought by the easing of the epidemic. In March, the epidemic situation in Shanghai and other cities was repeated, and the company’s short-term operation was under pressure. In 2022q1, the revenue of building media reached 2.655 billion yuan, a year-on-year decrease of 18.15%; Cinema media revenue was 282 million yuan, a year-on-year decrease of 16.85%; The net profit attributable to the parent decreased by 32.12%, and the impairment loss of contract assets and the credit loss of accounts receivable totaled 117 million yuan. It is expected that with the effective prevention and control of the follow-up epidemic, the offline flow of people and the confidence of advertisers will be improved, and the operation and performance of the company will gradually recover. In terms of media outlets, by the end of March 2022, the company had 781000 self operated elevator TVs and 1549000 self operated elevator posters, which were 7000 and – 31000 respectively compared with the end of 2021. It is expected that the expansion rate of 10% will be maintained every year under normal operating conditions.
Investment advice and profit forecast: the short-term company is greatly impacted by the epidemic; However, the medium and long-term mainstream population and brand advertising value remain unchanged. It is estimated that the company’s revenue in 2022 / 2023 / 2024 will be 14.057 billion yuan / 16.813 billion yuan / 19.327 billion yuan respectively, the net profit attributable to the parent company will be 4.727 billion yuan / 5.568 billion yuan / 6.329 billion yuan, EPS will be 0.33 yuan / 0.39 yuan / 0.44 yuan, and the corresponding PE will be 17.81/15.12/13.30 times respectively. Taking 2022 as the benchmark, the company will be given 22-25 times PE, and the target price range is 7.26-8.25 yuan. Maintain the “buy” rating.
Risk warning: policy supervision risk; The advertiser’s delivery is less than expected; Industry competition intensifies.
