The company released its 2022 annual report & 2023 quarterly report. Among them, the company achieved total operating revenue of 3.2 billion yuan in 2022, +38.3% year on year; achieved net profit of 290 million yuan, +2.6% year on year; plans to distribute a cash dividend of 20.83 yuan (tax included) for every 10 shares and transfer 3 shares from the Capital Provident Fund to every 10 shares. In Q1 2023, the company achieved a total operating income of 450 million yuan, or -26.8% year on year; the net profit returned to the mother was -0.3 billion yuan, -140.4% year on year. Affected by the overseas consumption environment and the pace of demand fulfillment, the company's 2023Q1 performance was under slight pressure.

The revenue side continued to grow rapidly in 2022, and 2023Q1 performance came under some pressure. By brand: “Jackery Electric” portable energy storage and photovoltaic products achieved revenue of 3.06 billion yuan in 2022, +36.6% year on year; “Geneverse” household energy storage and photovoltaic products achieved revenue of 145 million yuan, +88.0% year on year. By category: In 2022, portable energy storage products achieved revenue of 2.47 billion yuan, +34.4% year on year; photovoltaic solar panels achieved revenue of 7.0 billion yuan, +60.2% year on year; of these, photocharging package revenue was 1.02 billion yuan, accounting for 31.8% of revenue. Subregion: In 2022, the European region benefited from the energy crisis and achieved revenue of 690 million yuan, +417.0% year on year; North America maintained steady growth, achieving revenue of 1.49 billion yuan, +26.7% year on year; and Asia achieved revenue of 82 billion yuan, +1.6% year on year. Sub-channels: In 2022, the independent website of the brand achieved revenue of 680 million yuan, +97.4% year on year, third party e-commerce platforms achieved revenue of 1.71 billion yuan, +3.7% year on year; offline retail channels achieved revenue of 8.1 billion yuan, +153.9% year on year. At present, the company has completed the construction of 8 global brand websites, entered more than 6,000 offline retail stores, set up 16 overseas warehouses, and continuously improved its global operation capacity. Entering 2023Q1, consumer sentiment became rational under the normalization of the European energy crisis. High inflation and continued interest rate hikes also showed a clear dampening effect on consumption. Combined with the impact of last year's high base, the company's first-quarter revenue was 450 million yuan, -26.8% year on year. Considering that portable energy storage products are still in the low-penetration category globally, the short-term pace change may not change the long-term growth trend.

202Q4 & 2023Q1 gross margin is under pressure, and strong brand building+R&D drags down short-term profitability.

The company's gross profit margin for the full year of 2022 was 44.3%, -3.1 pcts year on year, related to the increase in raw material costs such as lithium carbonate; among them, the gross profit margin of portable energy storage products was 43.9%, -5.6 pcts year on year, and the gross profit margin of solar panels was 45.4%, +5.3 pcts year on year; 2022Q4 and 2023Q1 had a single-quarter gross profit margin of 41.0% and 41.7% year-on-year, -5.0 pcts, -6.7 pcts year on year, which may be mainly affected by price reduction promotions and high-cost inventories during the promotion period. In terms of cost rate, the company increased marketing investment and boosted brand building, while the number of sales staff increased dramatically. In 2022, the sales expense rate reached 27.4%, +3.0 pcts year on year; the R&D expenses rate reached 3.7%, +0.9 pcts year on year, further strengthening technical barriers through continuous investment in R&D; management/financial expenses ratios were 4.3/ -1.1%, respectively, +0.2/-3.1 pcts, respectively; net interest rate to the mother's return in 2022 was 9.0%, year-on-year -3.1 pcts.

Raw material prices+sea freight have declined, compounded by self-production of core components, and the pressure on the cost side has gradually eased. In terms of raw materials, iFind data shows that since 202Q4, the price of battery-grade lithium carbonate has fallen from a high of nearly 600,000 yuan/ton to less than 200,000 yuan/ton in mid-April 2023, while batteries account for more than 1/3 of the cost of portable energy storage products. Prices of other raw materials such as chips, plastics, copper, aluminum and silicon have also declined to varying degrees in the same dimension. At the same time, the company is also actively promoting self-development and production of inverters, solar panels, etc., so it is expected that the company's cost pressure will ease at the end of 2023.

New high-capacity portable energy storage products are on the market, household storage products are expected to be launched, and revenue elasticity is worth looking forward to. At the CES 2023 exhibition at the beginning of the year, the company unveiled the latest high-end Pro series products “Jackery Electric Double Light Charged Outdoor Power 3000 Pro” and “Light Charged Outdoor Power Supply 1500 Pro”, which completed the high-capacity product line, achieved an industry-leading 25% photoelectric conversion rate, and officially launched sales in March. Considering that the European energy crisis has not improved significantly, North American camping demand is still strong, and Japan's disaster preparedness demand is still strong, and Japan's disaster preparedness demand is expected to continue to be high in 2023; at the same time, the company expects the industry to continue to be booming in 2023; at the same time, the company expects the industry to continue to be booming this year The launch of household energy storage products with higher capacity and higher power will rely on the advantages of brands and localized operations to quickly lay out the fixed household energy storage market, thereby further raising the growth ceiling.

Adjusted to “increase holdings” investment rating. We expect the company to achieve revenue of 45/60/76 billion yuan in 2023-2025, +42%/+32%/+26%, respectively; to achieve net profit of 3.5/47/ 60 billion yuan, +23%/+34%/+27%, respectively. The current stock price corresponding to PE is 34/25/20X respectively, adjusted to the “increase in holdings” investment rating.

Risk warning: Overseas demand has declined, costs have risen sharply, the competitive pattern has deteriorated, etc.