Wanda Movies (002739): waiting for the film market to pick up and look forward to the performance of film and television business
2019H1 returns to mother’s net profit 5.
24 ppm, in line with market expectations, maintaining the overweight rating company released its 2019 Interim Report on August 20, with 19H1 revenue of 75.
6.4 billion, a decrease of 11.
18%; net profit attributable to mother 5.
2.4 billion, down 61.
88%; deduct non-attributed net profit 5.
4 billion, with a decrease of 40.
The performance is in the middle of the performance forecast, which is in line with market expectations.
In May 2019, the company completed the acquisition of Wanda Film.
We lower our 2019-2021 profit forecast to 13.
33 trillion, EPS is 0.
83 yuan, with reference to the company’s 19-year PE estimation interval of 17X-23X. Considering the company’s entire industrial chain layout and industry leader layout, a certain valuation premium is given. We believe that it is reasonable to give a 19-year PE valuation of 25X-26X, corresponding to the adjustment target.The price is 15.
3 yuan to maintain the overweight level.
The performance was mainly due to the decline in the projection business, and the impact of Wanda’s film-controlled film release replacement in 19H1 was affected by both the film projection business and Wanda’s film and television business.
For movie projection business, the company achieved box office 49 in 19H1.
7 trillion, same minus 0.
97%; add 208 screens, increase by 4.
The box office declined while the screen continued to grow, resulting in a single screen length from 1.03 million in the same period of the previous year to 910,000 yuan, and the gross profit of the show fell by 8pct.
In addition, the number of moviegoers in the first half of the year was 1.
0.8 billion, with a decrease of 9.
36%, the sales revenue and advertising revenue based on film visits also decreased; in terms of film and television business, the 18H1 Wanda film-controlled film “Chinatown Detective 2” achieved a high box office, while the 19H1 main-control film screening decreased, resulting in film productionIncome fell by 70.
14%; other game businesses are affected by version number application control, and some new game alternatives are on-line as scheduled, with revenue ranking of about 40.
Film projection business outlook: Due to the short-term shortage of high-quality content, the short-term downturn is optimistic. According to the semi-annual report, it is revealed that the 19H1 national film market box office was 311.
7 trillion, the same minus 2.
7%; number of moviegoers 8.
100 million, with a decrease of 10.
3%; We believe that the downturn in the movie market is mainly due to the rapid improvement of audience appreciation standards and the insufficient supply of high-quality movies. However, from the long-term perspective, the quality of content will become a trend. Through the sound and self-improvement of the movie industry chain, the quality ofSupply will increase, and we remain bullish on the Chinese film market.
At the same time, the average value of some operating indicators of Wanda Cinema Line is leading, showing its good operating experience.
We are still optimistic about the long-term performance of the company’s projection and non-ticket business.
Film and television business outlook: Many high-quality films and theme series are expected to bring incremental performance in the second half of the year. The company will actively deploy high-quality films, expand core copyright operations, and invest in or participate in the production of “Silent Witness”.Peak Glory of Full-time Masters “,” Manslaughter “,” Heroes of Fire “,” Captain China “and other films are about to be released in the second half of 19; in TV series, as the 深圳桑拿网 company’s investment in” airborne blade “,” turbulent “,” bigTimes “,” Best Times “,” Hidden and Great “and many other theme-distorting episodes are expected to be broadcast in the second half of the year, which will increase the income of film and television business. We do n’t change the position of the leader for the time being. We are optimistic about the company ‘s future development and maintain an overweight rating. We believe that the negative growth of the national box office in the first half of the year was mainly due to insufficient supply of high-quality films.Downgrade, currently lowering 2019-2021 profit forecast to 13.
3.3 billion (before adjustment: 14.
480,000 yuan), EPS for 2019-2021 is 0.
With reference to the 2019 PE estimation range of comparable companies of 17X-23X, given the company’s overall industrial chain layout and industry leader layout, given a certain premium, we believe that the 2019 PE estimation of 25X-26X is reasonable, and the corresponding adjusted target price is 15
3 yuan to maintain the overweight level.
Risk reminder: The box office growth of the country’s movies is less than expected, and the effect of Wanda’s film and television products is less than expected.