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CYTS (600138): Progressive performance growth, Gubei passenger flow down in Wuzhen

CYTS (600138): Progressive performance growth, Gubei passenger flow down in Wuzhen

Event: On April 19, CYTS released its 2018 annual report.

The company achieved operating income of 122 in 2018.

$ 6.5 billion / growth 11.

30%; net profit attributable to mother 5.

$ 9.7 billion / growth 4.

50%; net profit after deduction to mother 4.

$ 9.3 billion / growth 14.

40%; basic profit income is 0.

83 yuan / increase 4.


Among them, Q4 achieved operating income of 33.

3.6 billion / increase of 0.

84%; net profit attributable to mother 50.83 million yuan / down 27.

91%; net profit after deduction is 47.76 million yuan / down 23.


Comments: 1. Overall income has steadily increased, and real estate income and expense control have driven performance growth.

In 2018, the company’s revenue increased by 11.

3%, including integrated marketing and the contribution rate of real estate sales around Wuzhen; net profit attributable to mothers increased by 4.

5%, the company received a total of about 2 government subsidies.

02 billion / 24 decrease.

6%, excluding the effects of government subsidies, after deducting non-financial performance increased by 14.

4%, mainly due to the large real estate settlement income in Gubei Water Town, the increase in sales of real estate around Wuzhen, and the company’s sales, management fee rate has improved.

2. The passenger flow in Wuzhen dropped, and the unit price of passengers increased against the trend.

Wuzhen received 915 in 2018.

30,000 person-times / down 9.

7% (Q4 received about 1.96 million passengers / down 6.

7%), under the competition of higher base and competitive advantage, passenger flow appears to be substituted.

Among them, Dongzha passenger flow was 4.01 million passengers / decrease by 14.

5%, Xizha passenger flow 5.14 million passengers / down 5.

At 6%, Xizha in the leisure industry shows a stronger position.

Initial realization of income 19.

0.5 billion / increase of 15.

7%, excluding sales income from surrounding real estate2.

After 06 trillion, the tourism main industry income was 17 trillion / an increase of 6.

5%, corresponding to a customer unit price of 186 yuan / an increase of 18.


In August 2017, the ticket price increase and the optimization of the passenger structure (increasing the proportion of high-single-sale exhibition guests) drove the unit-price increase, but from September 20, 2018, the Wuzhen Dongzha and East-West grid joint tickets were reduced by 10 yuan, and the unit price for passengersCause some inhibition.

Initial realization of net profit7.34 ppm / increase of 6.

0%, excluding the impact of the decrease in government subsidies and the real estate sales profit of about 60 million (assuming that the net interest rate on real estate sales remains unchanged), the net profit increased by about 9.


3. Passenger flow in Gubei Water Town decreased slightly, and real estate settlement revenue contributed to performance.

Gubei Water Town received 256 in 2018.

490,000 person-times / down 6.

9% (in the fourth quarter received about 510,000 people / increase 5.

2%), mainly due to the 佛山桑拿网 downward pressure on the economy, dragged down by summer floods and traffic.

In 2018, the popularity of the internal consumption scene and cooperation in the scenic spot was further enriched, and the customer unit price reached 389 yuan / an increase of 9.

5%, realized income 9.

$ 9.8 billion / growth 2.


Investment income due to real estate settlement2.

200 million yuan, net profit reached 3.

08 ppm / 170% increase, after excluding property income, the net profit of the main tourism industry is about 88 million yuan / 17% decrease, mainly due to the increase in depreciation and financial costs after the conversion of Gubei Water Town.The net profit of the main tourism industry increased by about 2.


4. The advantages of integrated marketing are prominent, and the performance of hotel expansion is slightly lower.

In 2018, revenue from integrated marketing business increased by 25.

1%, net profit increased by 33.

5%, successfully serving high-end conferences such as the World Intelligent Manufacturing Conference and the World Robot Conference, highlighting the resources and leading strength; the number of Shanshui hotel stores has reached 108 (including preparatory establishment) / 24 growth

1%, the average store price increased due to the upgrade of existing stores, and revenue increased by 13.

8%, the increase in the management expenses and the provision of bad debts for the corresponding receivables dragged down, and the net profit fell by 6.

3%; IT product sales are adjusted due to the rebate policy of manufacturers, and lottery business performance is changed due to changes in contract terms.

5. Strategic business and scenic spot business dragged down gross profit margin, and expenses improved during the period.

The company’s gross profit margin fell by 0 in 2018.

15 points to 25.

30% was mainly dragged down by the decline in gross profit margin of IT, lottery, housing rental, and attractions business.

Selling expense ratio decreased by 0.

55 points, the management expense rate dropped by 0.

32pct, the effect of fee control appears.

Finance expense ratio rose by 0.

15pct, mainly due to the increase in interest payments on bank loans.

Under the comprehensive influence, the net interest rate dropped by 0.

35pct to 7.


6. Investment suggestions: In 2018, the company faces a lot of pressures such as decline in passenger flow, adjustments in channel policies of IT product manufacturers, and changes in lottery business contracts. However, the average value of the unit price of the two major attractions has grown, and integrated marketing has successfully served high-end conferences to show strength and benefit fromBeishui Town Real Estate Settlement, Wuzhen Real Estate Sales and Headquarters Fee Control, etc., achieved steady growth in performance.

Yuangu Town is expected to open in 2020.

We forecast net profit attributable to mothers for 2019-2021.

8 ppm, corresponding to PE valuation of 18x / 16x / 14x, maintaining the investment rating of “Highly Recommended-A”.

Risk reminder: The passenger flow in Wuzhen and Gubei Water Town is not up to expectations; government subsidies have decreased significantly.