China Public Education (002607) 2019 Third Quarterly Report Review: Public Employment Recruitment Rising Company Growth Curve Rise

31/03/2020 0 Comment

China Public Education (002607) 2019 Third Quarterly Report Review: Public Employment Recruitment Rising Company Growth Curve Rise

Event: Q3 2019 financial report: Q3 single quarter revenue 25.

2.2 billion (YoY: 46.

08%), net profit 4.

6.6 billion (YoY: 41.

62%); Revenue in the first three quarters totaled 61.

5.9 billion (YoY: 47.

67%), net profit 9.

5.9 billion yuan (YoY: 77.


The high growth of cash inflows in the third quarter is evidence that the company’s business continued to grow at a rapid rate.

6.6 billion is at the center of the performance forecast range, which is in line with expectations.

Q3 revenue increased by 46 in ten years.

08%, the first is the rapid growth of teaching and recruiting, postgraduate and other business, the growth rate of public institutions has picked up from the previous month (recruitment recorded a quarter-on-quarter recovery).

Q3 single quarter gross margin was 57.

74% (+0.

64pct, at least -0.

4pc), the overall performance is stable; the overall cost of the period is stable and normal.

In terms of cash flow, Q3 net operating cash flow was -13.

1.2 billion (the same period last year -9.

82 billion, a year-on-year: -33.

68%), basically the quarterly change in business affects cash inflows (excessive expenditures), while personnel and other flexible expenditures.

Q3 Operating cash inflows 8.

5.6 billion (considering the net amount after the current refund), an annual increase of 84.

35%, indicating that the company’s business flow is growing rapidly and business development is excellent.

Public class recruitment rebounded. The public test business in the first to third quarters was affected by institutional reforms and the growth rate was suppressed. However, companies in adverse markets increased 杭州夜网 their market share. The end of the institutional reforms (the end of the national institutional reforms in October 2018, 12The provincial level ends and the city and county levels end in March 2019), the national examination recruitment has rebounded (recruitment ratio yoy: 66%), provincial examinations, public institutions (including medical education) are expected to rebound, some kind of JiangsuIn 2020, the provincial examination was 3 months earlier than the previous year, and the recruitment scale exceeded 22.


We expect 2020 to be a period of great rebound for the entire public service category.

Investment advice and profit forecasting continue to focus on the company. The company’s industry barriers are high. The “1 + N” pattern will continue to be maintained. The leading Matthew effect is obvious. The cross-replication ability of the strong operation management system has been verified.

We believe that the growth of the company’s public employment business will gradually improve due to the rebound in gradual recruitment. Teaching and recruitment, postgraduate research and other businesses are expected to maintain rapid growth. The company’s net profit for 2019-2021 is expected to be 1.7 billion and 23, respectively.

8.8 billion, 33.

65 billion, EPS is 0.

28 yuan, 0.

39 yuan, 0.

55 yuan, corresponding to the current expected PE of 67 times, 48 times, and 34 times, maintaining the “Buy” rating.

Risks indicate changes in industry policies, performance is not up to expectations, and the impact of emergencies.