Event: The company released results for the first quarter of 2022 and 2023. In 2022, the company achieved operating income of 383 million (+21.54% year-on-year); achieved net profit of 67 million (+3.95% year-on-year). 2023Q1 achieved revenue of 72.71 million yuan (+39.83% year on year) and net profit of 13.41 million yuan (+457.73% year on year).
Inventory/contract liabilities indicate that 23Q1 orders may be confirmed late, and automation equipment is expected to recover in a highly flexible manner throughout the year: the growth rate of the company's net profit to the mother in '22 was lower than revenue, mainly due to Weigao Automation's consolidated revenue and share payments of 15.67 million. Order elasticity recovered after the epidemic, and order conversion was accelerated after the launch of new product lines such as insulin pin/pre-filling. The company had sufficient orders for automation equipment in hand in '23. It is expected that the delay in confirming Q1 orders will affect short-term performance. The 23Q1 inventory increased by 34.08 million compared to the end of '22, and contract debt in '22 was 6.05 million. 23Q1 contract liabilities increased by 16.06 million compared to the end of '22. As Q1 orders were confirmed to Q2 revenue, Q2 performance continues to improve, and high elasticity is expected to recover throughout the year.
Contact lens OEM is progressing steadily and is expected to open up a second growth curve: the company established a subsidiary in May 2022 and made a smooth journey into the field of contact lens manufacturing. By introducing top talents in the industry and the ability to actively deploy the contact lens business, the contact lens research project is in the trial production stage and is currently progressing steadily. It is expected that in the future, the ophthalmology business type will be further expanded and the company's revenue ceiling will continue to open up the company's revenue ceiling.
Profit forecast and investment advice: The company has sufficient orders in hand for 23 years, and is expected to recover in high elasticity throughout the year. The contact lens research project is in the trial stage and is currently progressing steadily, starting a second growth curve with future commercialization.
Excluding the flexible contribution of the contact lens business, the company's revenue for 2023-2025 is estimated to be 604/792/1.03 billion, respectively, with a year-on-year growth rate of 57.5%/31.1%/30.6%; the net profit of the mother is 1.2/16/210 million, with a year-on-year growth rate of 79.6%/32.9%/31.6%, and the corresponding PE is 25/19/14 times. Maintain a “buy” rating.
Risk warning: Order confirmation fell short of expectations, post-epidemic production recovery fell short of expectations, overseas sales fell short of expectations, and approval of contact lens registration certificates fell short of expectations