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Changjiang Securities
Event description:
The company announced its performance in the third quarter of 2012. From January to September, it achieved an operating revenue of 708 million yuan, a year-on-year increase of 47.06%, and a net profit attributable to shareholders of listed companies of 134 million yuan, a year-on-year increase of 31.19%, or EPS of 22 yuan; From July to September, the operating revenue was 259 million yuan, up 71.72% year on year. The net profit attributable to shareholders of listed companies was 28.76 million yuan, down 25.67% year on year. EPS was 0.05 yuan, down 20.75% year on year.
Event comment:
A number of business highlights promoted steady growth of operating revenue. In the first three quarters, the operating revenue grew steadily, with a year-on-year growth of 47.06%, mainly due to the good box office of many films such as Painted Skin 2 in the first half of the year; Palm Fun Technology Non recurring gains and losses such as investment income and government subsidies brought by listing. The base of TV series and cinema business was relatively low in the same period last year, still maintaining the high growth since the second quarter, and the operating revenue increased 74% and 200% year on year respectively.
The pressure on financial expenses gradually emerged, resulting in lower than expected performance. The issuance of two short-term bonds totaling 600 million yuan and long-term loans totaling 150 million yuan last year and this year has brought greater pressure on financial expenses. The total financial expenses from January to September exceeded 41 million yuan, dragging down the company's performance, while the interest income from the same period last year was 10 million yuan. If excluding the impact of financial expenses, the year-on-year growth of performance exceeded 70%, and the single quarter performance of the third quarter increased 28% year on year; Gross profit margin rose slightly month on month, and profitability remained at a high level.
We are optimistic about the company's perfect industrial chain layout, and the embryonic form of media and entertainment group has already been formed. The company's current industrial chain has covered multiple links such as production, distribution, screening, artist brokerage, etc. The acquisition of Dom Music and cooperation with Tencent on Taiji series games have fully confirmed the company's future development idea of "content+channel+derivation", ensuring the release of the company's high-quality content resource advantages, In the future, the company is likely to continue to realize resource integration and channel expansion in online games.
Investment suggestion: We are still optimistic about the amplification of the company's strong production capacity and perfect industrial chain layout on the company's high-quality content resources in the long run, but there is a great pressure on short-term expenses. The EPS of the company's profit forecast will be lowered to 0.51 yuan, 0.61 yuan and 0.79 yuan respectively in 2012, 2013 and 2014. The current share price corresponds to 30 times, 25 times and 20 times of PE in 2012, 2013 and 2014, respectively, Maintain the rating of "prudent recommendation".
