Action Education(605098)2025-04-30 02:18Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for future performance [6]. Core Views - The company experienced a revenue decline of 7.21% year-on-year in Q1 2025, attributed to seasonal factors and a slowdown in customer engagement [2]. - Despite the revenue decline, the net profit attributable to shareholders increased by 17.80% year-on-year, largely due to non-recurring gains [1][3]. - The company is actively pursuing a large client strategy and a "Hundred Schools Plan" to expand its market presence, leveraging AI technology to enhance operational efficiency [4]. Financial Performance Summary - In Q1 2025, the company reported operating revenue of 131 million yuan, a decrease of 7.21% year-on-year, and a net profit of 28.26 million yuan, an increase of 17.80% year-on-year [1]. - The cash flow from operating activities turned negative, with a net outflow of 50.62 million yuan, primarily due to decreased sales collections and increased employee compensation [2]. - The gross profit margin for Q1 2025 was 73.77%, up by 1.99 percentage points year-on-year, while the net profit margin reached 21.99%, an increase of 4.31 percentage points year-on-year [3]. Profit Forecast and Valuation - The company’s projected net profits for 2025, 2026, and 2027 are 307 million yuan, 344 million yuan, and 383 million yuan, respectively, with corresponding EPS of 2.58 yuan, 2.89 yuan, and 3.21 yuan [5]. - The report anticipates a steady growth in revenue, with a projected increase of 11.71% in 2025 and 13.04% in 2026 [5]. - The company is expected to maintain a strong return on equity (ROE), projected to reach 30.72% in 2025 [5].