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Lingnan Shares (002717) Annual Report 2018 Review: Business Structure Continues to Optimize for Future Growth

2020-03-31

Lingnan Shares (002717) Annual Report 2018 Review: Business Structure Continues to Optimize for Future Growth

Matters: The company released the 2018 annual report, reporting a series of realized operating income88.

43 ppm, an 85-year increase.

05%; realize net profit attributable to shareholders of listed companies.

79 trillion, an increase of 52 in ten years.

90%, budget benefit 0.

77 yuan / share.

The company plans to distribute a cash dividend of 0 天津夜网 to all shareholders for every 10 shares.

80 yuan (including tax), the capital reserve will be transferred to all shareholders for every 10 shares of 5 shares.

The company’s business income has grown rapidly, and the proportion of water and water environment revenue has increased.

Since 2015, the company has closely focused on the two major industries of ecological environment and cultural tourism. Through endogenous growth and extension of expansion, the company’s development momentum has been enhanced. Ecological environment and cultural tourism orders have quickly landed. The pan-entertainment PPP strategy has continued to develop, and the company has entered a high-speed development.stage.

From 2016 to 2017, the company’s revenue increased by 35 each year.

94% and 86.

11%; net profit attributable to mothers 武汉夜网论坛 increased by 55 each year.

29% and 95.

27%.

In 2018, the company’s revenue continued to maintain a rapid growth trend (multiple +85.

05%), the substantial increase in revenue was mainly due to the company’s ecological environment restoration, water management, water environment governance and cultural tourism business average growth.

From the perspective of business structure, the three businesses of ecological environment restoration, water management, water environment governance and cultural tourism have realized income42.

RMB 990,000 (ten years +40.

59%), 31.

500,000 yuan (+279 for the whole year.

89%), 13.

930,000 yuan (ten years +56.

31%).

The growth of the ecological environment business income mainly benefited from the company’s capital increase, agricultural technology, and the soil remediation business chain. At the same time, EPC orders increased rapidly and gradually landed. The rapid growth of the water and water environmental treatment business mainly benefited from the company’s completion of the acquisition of 90% equity of Xingang Water, and the reorganizationThe aquatic ecological comprehensive management capacity has been greatly improved; the growth of cultural tourism business income has benefited from the implementation of Henrun Technology and Demagji large and medium-sized cultural tourism projects.

Hengrun Group, Demagee, and Water Group all fulfilled their performance commitments in excess, of which Hengrun Group completed 152 of the promised performance.

24%, Demagee completed 105 of the promised performance.

40%, Water Group completed 101 of its promised performance.

95%.

In 2018, the proportion of the three businesses of ecological environment construction and restoration business, water management, water environment governance, and cultural tourism business were 48.

62% (year -15.

37), 35.

62% (+18 per night.

27 pct) and 15.

76% (decade -2.

9 pct).

The company gradually reduced its dependence on traditional ecological and environmental business. The water and water environment revenue and cultural and tourism business segments increased. The business structure continued to be optimized. The company deployed cultural tourism through the “second entrepreneurship” strategy and extended mergers and acquisitions to strengthen the successful implementation of the water and water environment strategy.

Profitability has improved, and operating cash flow has improved significantly.The total number of reports is 25.

02%, a decrease of 3 compared with the same period in 2017.

With 72 pcts, the company’s gross profit margin decline was mainly due to intensified market competition, which led to the decline in gross profit margin for ecological environment construction and water and water environment business.

The company’s ecological environment construction and restoration, water affairs, water environment, and cultural tourism business gross margins were 21 respectively.

07% (year -5.

32), 22.

74% (decade-3.

31), 42.

39% (ten years +3.

09 pct).

In terms of period expenses, the company’s sales expenses, management expenses, financial expenses and R & D expense ratios were 1 in 2018.

99% (decade +1.

53), 5.

78% (decade-3.

87), 2.

46% (decade +1.

56 pct), 2.

51% (decade -0.

59 pct), the total cost accounts for 12.

74% (year -1.

37).

According to the content of the annual report, report the annual sales expenses (+704 per year).

8%) Increased the main department companies’ restructuring of the organization in 2018, dividing personnel with sales performance into separate sales departments and their corresponding expenses included in the sales expense company; financial expenses increased significantly (+406.

59%) This was mainly due to the increase in the scale of corporate borrowings and bond issuance and the corresponding increase in interest expenses.

The net interest rate in 2018 was 9.

04% (year -1.

79 pct), the slight increase in profitability was mainly due to the decline in gross profit margin.

From the perspective of cash flow level, the company’s operating cash flow has improved significantly. The net operating cash flow in 2018 was 1.

160,000 yuan (ten years +122.

20%), mainly due to the substantial increase in business repayments of strategic companies.

With relatively sufficient funds in hand to carry out the security business, the company’s debt ratio still has room to fall.

As of the end of 2018, the company’s monetary funds were 20.

3.3 billion yuan (+97 per year).

33%), mainly due to the company’s increased recovery of project funds and expected scale, while the company completed 6 in 2018.

The US $ 600 million convertible bond financing and the massive growth of monetary funds have consolidated the company’s development momentum and helped the rapid release of performance.

In terms of dividend yield, as of the end of 2018, the company’s asset-liability ratio was 71.

74%, an increase of 5 from the end of 2017.

86 digits, an increase of 1 from the end of September 2018.

77 foreign countries.

Judging from the reasons for the rise in the company’s debt ratio in the third quarter, it was mainly issued 6.The US $ 600 million convertible bonds formed the payable bonds, and the increase in the debt rate in 2018 was also due to the long-term shortening and increase in accounts payable.

As the company has now reduced its convertible bonds to 8.

96 yuan / share, considering the acceleration of the conversion in the future, the company’s loss rate is still down.

Large-scale stock incentives were launched, and order surpluses provided support for performance. The future growth of the company is still worth looking forward to.

The first-tier company reported that it has launched an optional stock incentive plan, and plans to award 1,493 to 217 middle managers and core business backbones of the company.

720,000 shares per share, the grant price is 6.

05 yuan.

According to the budget stock exercise conditions, it is estimated that the company’s net profit growth after deductions for 2018-2021 will be 60%, 30%, 30% and 20%, respectively.

From a speed perspective, the company’s performance growth rate will be reduced by less than 30% in 2019-2021. This is a relatively rapid growth based on a high base, and the quality of growth is improved.The proportion of the company’s cultural travel business may increase, and once again improve the quality of the company’s development.

According to the summary of the company announcement, the company’s new extension order has been 214 since 2018.

08 million yuan, which is 2 of the company’s operating income in 2018.

47 times, the company has a large order reserve, which guarantees the release of the company’s performance. The future growth of the company is still worth looking forward to.

Estimates and investment recommendations.

For the time being, we do not consider the impact of the capital increase on the company’s equity and EPS, and it is estimated that the revenue from 2019 to 2021 will be 119.

380,000 yuan, 156.

39 ppm and 195.

48 ppm, a 35-year growth rate of 35.

0%, 31.

0% and 25.

0%; net profit attributable to shareholders of the parent company is 10 respectively.

1.4 billion, 12.

99 ppm and 15.

64 ppm, a previous growth rate of 30.

2%, 28.

1% and 20.

4%; EPS are 0.

99 yuan, 1.

27 yuan and 1.

53 yuan, dynamic PE is 10 respectively.

2 times, 7.

9 times and 6.

6 times.

The company’s “second venture” strategy has been launched. At present, the company’s “big ecology + pan-amusement” layout covers the business sector layout of water management, water environment governance, ecological environment restoration, and cultural tourism.growing up very fast.

The completion of the company’s convertible bond financing strengthened its capital strength, and its operating cash flow improved significantly. Debt-to-equity swaps helped reduce the debt rate and the company’s growth was better.

Maintain “Buy-A” rating and target price of 13.

0 yuan, corresponding to about 13 in 2019.

1x PE.

Risk reminders: changes in PPP policies, rising interest rates, high receivables, market adjustments, shareholders’ reductions and other risks.