Wanda Films (002739) 2019 Semi-annual Report Review: 1H19 Return to Mother’s Net Profit Reduced by 62% Meets Guidelines
The core budget 1H19 return to mother net profit exceeded 62%, in line with guidelines.
1H19 Wanda Movies earned 75.
6 billion, a ten-year average.
2%; net profit attributable to mother 5.
2.4 billion, exceeding 62% in one year, falling into the guidance range.
Cinema business at least twice.
7% to 67.
1H19 movie viewing income is about 46.
6 billion / -3.
7%, mainly due to the insufficient supply of high-quality films in the industry; advertising business every 7 times.
2% to 11.
4 billion; merchandise sales revenue temporarily decreased 6.
4% to 9.
Looking forward to 2H19, the summer box office benefited from “Nez” is expected to remain flat. Based on the low base of 4Q last year, we expect the 2H box office growth to improve.
The growth rate of the number of theaters will continue to decrease, and the supply and demand pattern will improve, and the leading players will benefit.
Wanda’s film and television revenue improved significantly.
1H19 Wanda film and television revenue of about 8.
4 billion / -42.
6%; net profit is about 0.
3 billion vs.
The focus is mainly due to the lack of major film and television projects in the first half of the year.
The movie projects that will be launched in the second half of the year include “Silent Witness” and “Manslaughter”. The TV drama projects that will be launched include “Airborne Blade” and “Surge”.
Reduce target price to 20.
3 yuan, maintain BUY rating.
We expect the 2019E / 2020E net profit of the theater segment to be approximately 12.
400 million; after the content business is consolidated, we give 2019E PE15x with a comprehensive corresponding target price of 20.
We are optimistic about the long-term growth potential of domestic film box office, the coordinated layout of Wanda Film’s entire industrial chain and the ability to increase market share in the future, and maintain a Buy rating.
Risk reminders: policy risk, film investment risk, location risk, rapid expansion risk, increased competition