The company released the performance forecast for 2021, and the performance of 21q4 was under pressure due to the impact of the epidemic: the net profit attributable to the parent company was 36.1-37.7 million yuan in 2021, with a year-on-year increase of 2.95% – 7.51%; Non recurring gains and losses of 5-6 million yuan, mainly government subsidies; The net profit attributable to the parent company after deducting non profits was 30.8-31.95 million yuan, with a year-on-year increase of 1.46% – 5.25%. The company’s performance rebounded in the first three quarters due to the control of the epidemic, and the net profit attributable to the parent company of 21q1-3 was 33.71 million yuan, an increase of 85.11% year-on-year; In the fourth quarter, the repeated epidemics and the upgrading of epidemic prevention and control in some provinces affected the demand for business travel. The net profit attributable to the parent company in 21q4 was 239-3990000 yuan, a year-on-year decrease of 76% – 86%, and the net profit attributable to the parent company after deduction was 25000-1175000 yuan, a year-on-year decrease of 92.9% – 99.8%.
The company announced the acquisition of relevant assets of Junlan: the company acquired relevant assets of Junlan with a total price of 140 million yuan. The acquisition funds were used for listing and fund-raising, and the purpose was transferred from self construction to acquisition. The acquired assets include 79% equity of Junlan hotel management company of 66 million yuan, 70% equity of Jinglan hotel investment management company of 14 million yuan and “Junlan” series trademarks of 60 million yuan.
The acquisition accelerates the layout of the national medium and high-end market and is expected to increase the performance: 1) Junlan is a high-end national hotel management company in China. By the end of 2021, it has invested and managed more than 180 hotels in 23 provinces and cities, with a total number of rooms exceeding 50000. Junlan’s 20-year / 21q1-3 revenue is 4151 / 47.3 million yuan and net profit is 880 / 13.85 million yuan. The company expects to generate an annual revenue of 6828 / 79.56 million yuan and a profit of 1522 / 19.03 million yuan on 22 / 23. 2) Jinglan is a new brand of Junlan and a professional hotel management and consulting service organization. Since its establishment in 2015, it has invested and managed 75 hotels in 13 provinces and cities. Jinglan’s 20-year / 21q1-3 revenue is 1496 / 13.32 million yuan and net profit is – 431 / – 670000 yuan. The company expects to generate an annual revenue of 2714 / 30.11 million yuan and a performance of – 1.9/842000 yuan on 22 / 23. 3) In addition, 63 “Junlan” series trademarks are the subject of this transaction, of which the trademarks waiting for substantive examination and the trademarks in the preliminary examination stage are transferred together when the transfer conditions are met.
On the one hand, after the acquisition, the company managed more than 300 hotels and more than 60000 guest rooms, further improving the national market share and becoming a leading enterprise of medium and high-end hotels, especially high-end hotels. On the other hand, it helps to improve the business scale and profitability of listed companies. After a 3-5-year climbing period, Junlan / Jinglan stable period will generate an annual income of 100 million yuan / 40.12 million yuan and 27.81/2.19 million yuan.
Zhejiang Ssaw Boutique Hotels Co.Ltd(301073) showed business resilience during the epidemic period, and the acquisition is expected to accelerate the scale transition. In 2019, the revenue was 337 million yuan, the net profit attributable to the parent was 72 million yuan, and the normalized profit margin was 19% and roe30%. As of September 21, there were 47 hotels, of which 16 were directly operated and joint ventures, accounting for 34% and the contribution of revenue and profit exceeded 80%. It is recommended to pay active attention.
Risk warning: the epidemic situation repeatedly disturbs the recovery rhythm; Macroeconomic downturn affects business travel demand; Acquisition and integration are not as expected; The performance forecast is the preliminary calculation result, and the specific financial data shall be subject to the annual report disclosed by the company.
