Event: in the first three quarters of 2023, the company achieved operating income of 2.895 billion yuan, down 12.04% from the same period last year; net profit of 552 million yuan, an increase of 80.43% over the same period last year; and net profit of 517 million yuan, an increase of 103.42% over the same period last year.
Profits continue to increase and profitability continues to increase: in the first three quarters of 2023, the company's revenue fell 12.04% from the same period last year, of which Q3 revenue was 935 million yuan, down 19.94% from the same period last year. The decline in revenue is mainly due to the layout of the company's new products, which affects the flow of transactions to a certain extent, thus affecting revenue. In the first three quarters of 2023, the company's net profit increased by 80.43% compared with the same period last year. Specifically, the net profit of Q1 in 2023 was 133 million yuan, an increase of 45.48% over the same period last year. The net profit of Q2 increased by 200 million yuan, and the net profit of Q3 increased by 93.59% over the same period last year, an increase of 96.80% over the same period last year. The rapid increase in net profit is mainly due to the increase in the performance of overseas electronic payment products and the gross profit of the order collection value-added business. The company's gross profit margin in the first three quarters of 2023 was 36.74%, an increase of 11.47 percentage points over 2022. In 2023, the net interest rate of Q1-Q3 is 8.98%, 9.34% and 9.55%, respectively, and its profit is increasing.
Overseas payment hardware, receipt and other business layout: in the first half of 2023, the electronic payment equipment business realized overseas revenue of 466 million yuan, an increase of 77.39% over the same period last year, and shipments in overseas markets reached 3.4281 million units, an increase of 422.51% over the same period last year. Overseas markets have become the main source of revenue for electronic payment equipment business. The company's EU order collection business operation team has been initially established, and the relevant product service system is gradually being launched, and it is expected that the order collection business will be available in the EU market by the end of this year. At the same time, the company is also actively laying out new businesses such as cross-border payment around cross-border e-commerce scenarios, and has reached strategic cooperation with relevant banks.
The forward-looking layout of AI, outstanding data performance: relying on AI in-depth content generation, video processing technology, etc., the company has successfully launched a variety of tool products in overseas markets and launched in many key countries and regions, with great breakthroughs in commercial effectiveness and user scale. At present, the company's tool products in artificial intelligence mainly include FaceMagic, Picso, Meboom, etc., product operation data performance is good.
Profit forecast, valuation and rating: considering that the company's new product layout will be affected to a certain extent, the revenue forecast for 23-25 will be reduced to 39.5050.82 billion RMB 6.444 billion, which is 19% higher than the previous forecast of-20%. With the reduction of the company's subsidies to channels and merchants, the gross profit margin will gradually rise, raising the company's 23-25 net profit forecast to RMB 7.62 million, which is 0.4% higher than the previous forecast of + 1.2%, 1.4% and 0.4% of the previous forecast. The current stock price is 16x/12x/9x corresponding to PE, respectively, maintaining the "buy" rating.
Risk tips: the rate increase is not as expected, and the risk of industry supervision policy.