Incident: The company released its 2022 annual report. In 2022, the company achieved revenue of 2.74 billion yuan, an increase of 5.5% over the previous year; Guimu's net profit was 350 million yuan, an increase of 49.8% over the previous year; after deducting non-net profit of 340 million yuan, an increase of 87.7% over the previous year.
Looking at a single quarter, Q4 achieved revenue of 750 million yuan, an increase of 7.3% over the previous year; Guimu's net profit was 0.7 billion yuan, an increase of 112.7% over the previous year. Furthermore, the company plans to distribute a cash dividend of 4 yuan for every 10 shares to all shareholders, with a dividend rate of 46.23%.
The revenue structure has been optimized, and domestic and foreign sales have been growing steadily. By region, the company's domestic business achieved revenue of 400 million yuan, an increase of 13.65% over the previous year. The company collaborated with Fangtai to develop floor scrubber products. In 2022, the online sales of v series products exceeded 100 million. In the future, with the further increase in the penetration rate of domestic floor washers, the company will continue to launch various new models of floor washers, and it is expected that the contribution of floor washers to the company's revenue will continue to grow. Looking at overseas markets, the company achieved revenue of 2.29 billion yuan in 2022, an increase of 3% over the previous year. Against the backdrop of weak demand in overseas markets, the company actively developed new products, and export sales bucked the trend. In the future, with the gradual mass production of the company's new products, commercial beauty devices, it is expected that the company's business scale will expand further.
Profitability continues to be optimized. During the reporting period, the company's comprehensive gross margin was 20.1%, an increase of 3.3 pp over the previous year.
Among them, domestic sales gross margin increased 4.8 pp to 20.3% year on year; export gross margin increased 2.8 pp to 19.7% year on year. On the one hand, the decline in raw material prices has relieved the pressure on the company's cost side; on the other hand, new products such as floor washers amortize fixed costs, and the company's domestic sales profits have been steadily optimized. In terms of expense ratio, the company's sales expense ratio was 0.5%, and the management expense ratio was 6.7%, which remained stable over the previous year. Affected by fluctuations in the RMB exchange rate, the company received exchange income of 60 million yuan, driving a year-on-year reduction in the financial expense ratio by 2.7 pp. Taken together, the company's net interest rate was 12.7%, an increase of 3.7PP over the previous year.
Invest in the future of Xihe and boost the energy storage circuit. In 2022, the company invested in the new energy company Shenzhen Xihe Future Technology Co., Ltd. to jointly develop new products and become its exclusive manufacturer. Xihe Future mainly deals in household energy storage products such as solar photovoltaic inverters, solar photovoltaic energy storage equipment, and lithium-ion battery modules. The company actively lays out projects with certain synergies and development potential with the company's existing business, which is expected to further enhance the company's overall competitiveness, profitability and performance level.
Profit forecasts and investment recommendations. It is estimated that in 2023-2025, the company's operating income will be 31.5/34.7/3.84 billion yuan respectively, net profit of the mother will be 36/4/45 million yuan respectively, EPS will be 0.9/1/1.12 yuan respectively, and the corresponding dynamic PE will be 23/20/18 times respectively. The corresponding dynamic PE will be covered for the first time and given a “hold” rating.
Risk warning: The risk of large fluctuations in the RMB exchange rate, the risk of new product sales falling short of expectations, and the progress of extension expansion falling short of the expected risk.