The company announced its third quarterly report for 2023: 23Q3 made a profit of 55 million and deducted 53 million from non-profit. 1) 2023Q3: revenue 1.64 billion, year-on-year + 110.9%, compared with 19 years + 5.2%, profit 55 million (loss of 560 million in the same period of 22 years), non-profit 53 million, Q3 RMB appreciation of 0.6%, estimated exchange gain of 30 million. 2) 23Q1-Q3: revenue 3.85 billion, an increase of 90.0% over the same period last year, compared with-4.5% in 19 years; a loss of 700 million (a loss of 1.51 billion in the same period of 22 years), deducting a non-loss of 700 million, and the net profit of Q1-Q3 is-2.76,4.76 and + 55 million respectively. The RMB from Q1 to Q3 depreciated by 3.1%, and the exchange loss was estimated to be 120 million. 3) other income: Q3 other income is 130 million yuan, which is 280 million yuan compared with the same period last year and + 75.6% compared with the same period last year.
Business data: 1) 23Q3:ASK year-on-year + 103.9%, compared with 19 years + 9.3% 2.7pct year-on-year + 137.0%, year-on-year + 5.7%, occupancy rate 80.1%, year-on-year + 11.2pct, compared with 19 years-2.7pct, peak season characteristics appear. 2) 23Q1-Q3:ASK year-on-year + 74.8%, compared with 19 years + 3.9% dint RPK year-on-year + 98.4%, compared with 19 years-2.4%, occupancy rate 75.7%, year-on-year + 9.0pct, compared with 19 years-4.9pct.
Income level: 1) estimated 23Q3 passenger kilometer income (including fuel surcharge) 0.60 yuan, year-on-year-8.1%, compared with the same period in 19 years-2.1%, seat kilometer income 0.48 yuan, year-on-year + 6.8%, compared with 19 years-5.3%. 2) it is estimated that the income of Q1-Q3 passenger kilometers is 0.58 yuan,-3.6% year-on-year, 5.3% compared with the same period in 19 years, and 0.44 yuan per seat kilometer, + 9.4% year-on-year,-11.0% compared with the same period in 19 years.
Cost: 1) 23Q3 operating cost 1.46 billion, year-on-year + 39.1%, seat kilometer cost 0.45 yuan, year-on-year-31.8%, compared with 19 years + 11.2%. Q1-Q3 operating cost 3.98 billion, year-on-year + 35.8%, per kilometer cost 0.48 yuan, year-on-year-22.3%, compared with 19 years + 13.0%. 2) fees: the total annual three fees of 23Q3 (foreign exchange deduction) is 266 million, which is + 1.9% compared with the same period last year, and the foreign exchange deduction rate is 16.2%. The total of the three fees deducted by Q1-Q3 is 774 million, and the rate of foreign exchange deduction is 20.1% (note: excluding R & D expenses).
Civil aviation regional subsidy: the bureau announced the regional aviation subsidy budget for 2024. The regional aviation subsidy budget for 2024 is 1.405 billion yuan, a decrease of 437 million yuan compared with 1.845 billion yuan in 23 years, and a decrease of 23.74% compared with the same period last year. The subsidy budget for Huaxia Airlines feeder line is 145 million, which is 30 million less than that of 175 million years in 23 years, and-17.1% compared with the same period last year, which is less than the decline of the industry.
From the analysis of the degree of recovery of flight volume, the constraints of the company have been gradually eliminated: according to the statistics of flight housekeepers, the average daily flight volume of Q3 is 273, which is + 102.9% compared with the same period last year, and 12.7% compared with Q2, which is 16.9% higher than that of the same period in 19 years. The average daily flight volume of Q1-Q3 is + 68.2% compared with the same period last year, compared with-22.0% in 19 years. Q4 so far, the company's average daily flight volume is 285, which is 4.5% higher than that of Q3 and-14.6% higher than that of the same period in 1919. Judging from the degree of recovery of flight volume, the constraints of the company will be gradually eliminated.
We continue to be optimistic about the regional aviation market space and the company's unique business model. 1) Regional aviation: a blue ocean market with great potential. 2) advantages of the company: a) leading market segmentation: covering half of the domestic regional destinations, with solo routes accounting for more than 90%. B) normalization: the company has both growth and robustness. C) first-mover advantage, operation advantage and innovation mode build core barriers together.
Investment advice: 1) profit forecast: considering that the company's flight volume and utilization are still in a recovery period, as well as the continuous rise in aviation fuel prices since August, we adjust the 23-25 profit forecast to a loss of 790 million, a profit of 600 million and a profit of 1.06 billion.
(the original forecast is loss 2.5,9.0 and 1.21 billion), corresponding EPS is-0.62,0.47 and 0.83 yuan respectively, 24-25 PE is 14 and 8 times respectively. 2) Investment advice: we believe that the company's performance inflection point has reached, at the bottom of the valuation, will return to the growth logic. It is expected that the capacity will maintain a compound growth rate of 20% + after it is on the right track. With reference to the company's past PE and annualized growth rate, it will be given 20 times PE in 2024, with a target market value of 12 billion, a target price of 9.4 yuan, and a "push" rating with 43% more space than the current space.
Risk tips: a sharp decline in the economy, a sharp devaluation of the RMB, a sharp rise in oil prices.