\u3000\u3 China Vanke Co.Ltd(000002) 624 Perfect World Co.Ltd(002624) )
Perfect World Co.Ltd(002624) disclosed in the 21st Annual report that in 2021, the company achieved an operating revenue of 8.518 billion yuan, a year-on-year decrease of 16.69%, a net profit attributable to the parent company of 369 million yuan, a year-on-year decrease of 76.16%, and a net profit attributable to the parent company of 102 million yuan after deduction, a year-on-year decrease of 90.26%. Non recurring gains and losses mainly include gains from equity disposal and losses from global single investment, totaling 268 million yuan. The company plans to distribute 12 yuan (including tax) to all shareholders for every 10 shares.
The company also disclosed that in the first quarterly report of 22 years, 22q1 company achieved a revenue of 2.128 billion yuan, a year-on-year decrease of 4.6%. After excluding the impact of the sale of European and American subsidiaries, 22q1 revenue increased by 2.34% year-on-year. The net profit attributable to the parent company was 840 million yuan, a year-on-year increase of 81.0%, and the net profit attributable to the parent company after deducting non profits was 414 million yuan, a year-on-year increase of 30.15%. Non recurring gains and losses mainly come from the investment income from the above-mentioned sale of European and American subsidiaries.
In the game sector, 21 years of personnel optimization brought adjustments, and the performance of 22q1 magic tower was released and stepped into a normal growth rhythm. In 21 years, the company’s game revenue was 7.42 billion yuan, a year-on-year decrease of 19.77%, and the net profit attributable to the parent company was 720 million yuan, a year-on-year decrease of 68.48%. The net profit of 22q1 games after deducting non profits was 446 million, a year-on-year increase of 34.52%. The company actively broke through the transformation of new categories, and launched new products such as “dream new kill immortal” and “magic tower” in 21 years.
In the film and television sector, the global film list has been impaired for 21 years and developed steadily for 22 years. The operating income of film and television business in 21 years was 952 million yuan, with a year-on-year increase of 1.84% and a loss of 200 million yuan; The net profit of 22q1 film and television business is 22 million yuan.
Looking forward to 22 years, the company has rich reserves of new games. In addition to continuing to maintain classic advantage projects, the company will focus on innovation and continuously promote the upgrading of game strategy. At the same time, it will focus on the two dimensions of “Chinese products going to sea + overseas localization development”, which is expected to become a new growth curve of the company’s games.
In terms of product reserve, the company’s mobile game products such as black cat anecdote society, dragon eight Part 2, the kingdom of morning and night, one punch Superman: the world, million King Arthur, killing immortals 2, perfect Shanghai New World Co.Ltd(600628) , magic land 2, and end game products such as killing Immortals world, perfect NewWorld and havea nice eat are actively promoting, and spirit cage Fengshen series and other well-known IP game development work is also actively preparing. In terms of Chinese products going to sea, the mobile game “dream new kill immortal” was launched simultaneously in the overseas market on March 17, 2022. In addition, the “magic tower” mobile game will be tested in many overseas places in the near future, and is expected to be officially launched in the overseas market within this year. Many game products reserved by the company are more suitable for the overseas market than previous products. At the same time, the corresponding distribution team of the company has been adjusted in terms of structure and personnel. The overseas distribution of Chinese products will gradually transition from authorized third-party distribution to independent distribution.
Investment suggestion: Perfect World Co.Ltd(002624) on the basis of continuously expanding the competitive advantages of core categories such as MMORPG, accelerate the implementation of diversification and rejuvenation strategy, and uphold the long-term concept. Although there is short-term performance pressure in the transformation process, with the centralized embodiment of personnel costs and impairment in 21 years, the release of game performance in 22 years and the launch of new products, the company is expected to gradually restore the rhythm of performance growth under the new product cycle. We estimate that the net profit attributable to the parent company from 2022 to 2024 will be RMB 1.89 billion / 2.12 billion / 2.49 billion respectively, and the corresponding PE will be 15.2x / 13.5x / 11.5x respectively, maintaining the “buy” rating.
Risk tip: the game launch is delayed, the game flow is not up to expectations, the film and television project is confirmed not up to expectations, and the industry supervision is becoming stricter
