Phoenix Media (601928) 18th Annual Report and 19Q1 Comment: The Company’s Asset Optimization Main Business Steady Development Digitalization Continues to Promote Performance Growth and Increase Dividend Ratio

Phoenix Media (601928) 18th Annual Report and 19Q1 Comment: The Company’s Asset Optimization Main Business Steady Development Digitalization Continues to Promote Performance Growth and Increase Dividend Ratio

Events: 1. The company announced its 18-year results and achieved revenue of 117.

8.9 billion (+6 year-on-year.

68%), net profit attributable to mother 13.

2.5 billion (+13 year-on-year.

63%), attributable to non-net profit 10.

08 thousand yuan (+29 compared with the same period last year).

89%); net cash flows from operating activities21.

8.8 billion (+20 compared to the same period last year).

43%).

Gross profit margin 36.

3% (YoY-1.

51pct), net sales margin 11.

79% (+0 year-on-year.

84pct).

The company plans to pay 3 yuan (including tax) for every 10 shares, with a dividend payment rate of 57.

62% (+24 compared to the same period last year).

88pct).

2. Operational status by business: Publishing business achieved revenue of 37 in 18 years.

9.2 billion (+ 4% year-on-year.

84%) and gross profit margin of 30.

3% (-3% YoY).

69pct); revenue from issuing business 83.

6.7 billion (+5 year-on-year.

88%), gross margin 28.

71% (YoY-0.

9 points); Printing revenue achieved 1.

4.1 billion (YoY-58.

04%), gross profit margin 7.

37% (-5% YoY).

58pct)武汉夜网论坛; game business revenue is 0.

7.3 billion (YoY-6.

17%), gross margin of 40.

81% (year-on-year.

35pct); revenue from film and television business is 0.

8.8 billion (YoY-4.

96%), gross margin 71.

92% (-5% YoY).

98 points); software business revenue 1.400 million (YoY-30.

43%), gross profit margin 36.

72% (+ 3% YoY).

09pct); data service business revenue 2.

2.4 billion (+7 year-on-year.

81%), gross margin of 60.

46% (6 compared to the same period last year).

92pct); Other main business income 3.

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

92%), gross margin 34.

42% (+11 YoY).

26pct); another internal compensation income19.

1.7 billion; other business income 4.

9.8 billion (+ 4% YoY).

86%), gross profit margin 79.

11% (+ 3% YoY).

99pct).

3rd and 19th quarter results: 23 revenue.

500 million (+14 compared to the same period last year).

北京夜网91%), net profit attributable to mother 3.
.

2.2 billion (+20 compared to the same period last year).

85%), deducting non-net profit2.

7.4 billion (+ 34% YoY).

54%); net operating cash flow 6.

9.8 billion (+302 compared to the same period last year).

53%).

Opinions: 1. The company divested inefficient assets, optimized the operating structure, and improved management efficiency to achieve a significant improvement in performance.

In 18 years, the company merged its main business of publishing and distribution, copying inefficient assets such as videos and games with weak synergy, while enhancing shareholder support, and selling printing business that has been replaced year after year in cash, realizing the optimization of the company’s main business structure and the improvement of profitability.

18 years Phoenix Group to cash 4.

The 1.6 billion transferee company holds 93% of Xinhua Printing.

76% of the equity will enhance the company’s main business operating efficiency; at the same time, the company accrues 0 to goodwill formed by the merger of Shanghai Muhe and American Children’s Books.

4 trillion impairment provision, clearing obstacles for subsequent performance improvement.

18 years of publishing and distribution business realized 121 operating income.

5.9 billion (+5 year-on-year.

55%), the total revenue of printing, gaming and film and television business3.

20,000 yuan (YoY-40.

36%).

2. The company’s education products continue to give full play to its content advantages. Under the policy of three disciplines, the development of teaching aids business is stabilized. At the same time, smart education businesses such as digital education are rapidly advancing and they are upgrading to integrated education operators.

Books generally rank first in the industry, with a market share of 3 in the retail market.
03%, ranked third.
The company’s teaching materials both inside and outside the province have achieved growth.

5%, the extra-provincial budget textbooks increase by 4 million volumes each year.

The textbook price increase policy was successfully introduced, and comprehensive cooperation was reached with Renjiaoshe on the three subjects for the compilation of textbook rental types, teaching assistant authorization, etc., to consolidate the company’s main education publishing industry; at the same time, digital education publishing continued to advance, completing more than 400 digital teaching materials, Teaching and product upgrades, online products such as “Phoenix Easy to Teach” and “Phoenix Enjoy Learning” launched a breakthrough in smart education business.

In 18 years, the company’s teaching materials and auxiliary publishing achieved revenue of 20.

9.7 billion (+14 compared to the same period last year).

9%), of which the revenue from teaching materials publishing was 10.

2.2 billion (+ 21% YoY).

95%), teaching assistant publishing revenue 10.

7.5 billion (+8 year-on-year.

94%); revenue from the issuance of teaching materials was 51.

7.1 billion (+12.

02%), of which the revenue from teaching materials is 24.

4.3 billion (+15 compared with the same period last year).

05%), Jiao Fu issued revenue 27.

2.8 billion (+ 9% YoY).

42%).

In 18 years, the company’s K12 smart education business income continued to grow rapidly and achieved expansion scale profit.

2.8 billion (+35 year-on-year.

98%), net profit is 0.

1.2 billion, turning losses into profit; the leading position of the subject network continues to expand, the site currently has more than 24 million registered members, more than 40,000 cooperative schools, covering more than 90% of the country’s top 100 primary and secondary schools.

3. The company adjusted its governance structure, improved the operating efficiency of the issuing group, actively implemented cost reductions and increased efficiency, and the expense ratio decreased.

In 18 years, the company realized the intensive and efficient management under the “total-point” structure by reorganizing the headquarters to the standardization of the organizational structure of the branches in cities and counties, unified department settings, unified agency names, unified middle-level positions, and unified business processes.

The number of departments in the city and county branches decreased from 647 to 432, a decrease of 33.

23%; the number of middle-level people decreased from 930 to 652, a decrease of 29.

89%.

Through core ERP construction, sort out business processes and clarify business operation lines.

The company’s expense ratio during the 18-year sales period was 23.

83% (-2% YoY).

57pct); of which the sales rate is 13% (YoY-0.

72pct), management fee rate 12.

49% (0% YoY.

86pct).

4. Cash flow from operating activities increased, and the cash balance was on the books. The dividend ratio has increased significantly. In 18, the company plans to pay 3 yuan (including tax) for every 10 shares, and the dividend payment rate is 57.

62% (+24 compared to the same period last year).

88pct).
Net cash flow from operating activities of the company for 18 years21.

8.8 billion (+20 compared to the same period last year).

43%), 19Q1 net cash flow from operating activities6.

9.8 billion (+302 compared to the same period last year).
53%).
As of 19Q1, the company’s monetary fund balance was $ 9.9 billion.

5. Profit forecast and investment grade: We estimate that the company’s net profit attributable to the mother in 19-21 will be 15 respectively.

08/16.

78/18.

670,000 yuan, the corresponding EPS is 0.

59/0.

66/0.

73 yuan, corresponding PE is 14/12 / 11X, given “recommended” grade.

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 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.