Zhongnan Media (601098) 18th Annual Report Comment: The impact of Jiao Fu’s new policy fully reflects the improvement in performance and the expected proportion of dividends to a new high

Zhongnan Media (601098) 18th Annual Report Comment: The impact of Jiao Fu’s new policy fully reflects the improvement in performance and the expected proportion of dividends to a new high

Events: 1. The company announced 18-year results and achieved 95 revenue.

7.6 billion (YoY-7.

57%), net profit attributable to mother 12.

3.8 billion (YoY-18.

19%), deducting non-net profit of 10 from the mother.

9.9 billion (YoY-21.

95%); net cash flows from operating activities.

6.9 billion (YoY-35.


Gross profit margin 38.

72% (YoY-0.

24pct), net sales margin 14.

32% (YoY-1.


2. Business breakdown: Revenue from publishing business in 2016 was 24.

3.6 billion (YoY-14.

77%), gross margin of 30.

95% (+2 YoY).

92pct); revenue from issuing business 69.

9.3 billion (YoY-10.

82%), gross profit margin 29.

03% (YoY-1.

93pct); revenue from material business13.

2.2 billion (+35 compared to the same period last year).

67%), gross profit margin 4.

16% (YoY-0.

49pct); printing business achieved revenue 9.

610,000 yuan (an increase of 3.

53%), with a gross profit margin of 11.

76% (+0 year-on-year.

45pct); media business revenue 7.

6.9 billion (+8 year-on-year.

95%), gross margin 25.

91% (+0 compared to the same period last year).

88pct); digital publishing business realized revenue 2.

8.6 billion (YoY-24.

91%), gross margin of 20.

49% (+2 YoY).99pct); financial services income 4.

2.5 billion (+ 21% YoY).

85%), gross margin 68.

21% (+12.

09pct); the total number of internal offsets is 38.

3.3 billion.

Other business income 2.

1.7 billion (YoY-18.

47%), with a gross profit margin of 64.

77% (+ 23% YoY).


Opinions: 1. The performance is in line with expectations. In 18 years, affected by the New Educational Policy of Hunan Province, there was an overall increase in the 18Q4 single quarter interval, which gradually weakened the impact and is expected to achieve improvement.

In 18 years, the company’s revenue and profit have been significantly reduced, mainly due to the implementation of the new policy of teaching aid in Hunan in the second half of 2017, and the downward impact of the teaching aid business.

18 years of teaching materials published income 18.

31 ppm (YoY-19.

7%), the revenue from teaching materials is 41.

1.8 billion (YoY-19.


Q1-Q4’s single-quarter net profit attributable to mothers increased by -25 each year.

3% /-29.

8% /-20.

7% / 9.

8%, 18Q4 single quarter rebound ahead of schedule, is expected to achieve improvement.

Hunan Xinhua Bookstore actively responded to the impact of standardized market education and supplementary policies in the province, fully implemented the regional responsibility system, and carried out stalls and door-to-door service for all employees. The sales of market education and supplementary materials picked up in the fall, while children’s teaching materials were seized as newGrowth point, achieving sales code of over 100 million.

2. The company’s general book business revenue has grown significantly, and the general book publishing record has maintained the forefront of the book retail market.

The distribution system has continued to improve, while physical bookstores are being built and upgraded simultaneously, while actively expanding online sales.

18 years of general book publishing income5.

10,000 yuan (+16 compared with the same period last year).

14%), and general book distribution income18.

6.3 billion (+ 10% year-on-year.


According to open book data, the company’s market share in the country’s comprehensive book retail market is 3.

10%, ranking second.

The share of yards in the book retail market of physical stores nationwide increased by 3.

69%, ranking first in the square.

In 18 years, the company continued to increase the construction of brick-and-mortar bookstores. There were 81 new campus chain bookstores, the total number of which increased to 1062, and 32 new center stores.

3. The company continues to focus on product innovation and industry optimization, and has made progress in various aspects such as IP operations and digital education; media integration has continued to advance and operating performance has steadily improved.

18 years of media business revenue 7.

69 ppm, a ten-year increase of 8.

95%.The company continues to advance in the field of digital reading and audio products. It has launched a variety of audio programs, developed audio and video, and deepened IP operations. At the same time, the “Red Net Cloud” platform was launched on media convergence, enabling cloud platform feeds and central kitchen collection., The country’s first body-thousand-screen outdoor live broadcast system; the party and government clouds and the provincial direct network group have developed well, and reached a cooperation agreement with more than 70 counties and cities in the province on the construction of a county-level financial media center.

4. The account has sufficient cash, the financial company’s performance has continued to improve, and the dividend ratio has hit a record high.

The company plans to pay dividends for every 10 shares for 18 years.

1 yuan, the 成都桑拿网 dividend payout rate is 88.

5% (+ 17% YoY).


In 18 years, the company’s finance company achieved revenue4.

1.8 billion, net profit 3.

1.4 billion, an increase of 22 each year.

35%, 51.


As of the end of 18, the company’s monetary fund balance was 123.

4.1 billion.

5. Profit forecast and investment grade: We estimate that the company’s net profit attributable to its mother in the years 19-21 will be 13 respectively.



840,000 yuan, the corresponding EPS is 0.



83 yuan, corresponding PE is 17/16 / 15X, maintaining the “recommended” level.

Risk reminders: policy risks, policy guidance for students to reduce their burden, teaching and publishing, changes in circulation, and development and improvement of teaching and teaching business.

Risks of technological 杭州夜网论坛 progress, development of digitalization and education informatization, and changes in the traditional book business landscape.

The decline in the birth rate, the decline in the number of new students, and the decline in the number of people have led to a decline in overall demand for books and a downside risk to the book industry.