Event: on October 26, the company released its three-quarter report. The company's 2023Q1-Q3 net profit was 208 million yuan,-21.87% compared with the same period last year.

Performance comments: according to the third quarterly report, the company's 2023Q3 achieved revenue of 254 million yuan, year-on-year-47.43%; net profit of 67 million yuan, year-on-year-45.84%; and non-return net profit of 66 million yuan,-46.89% of the same period last year. The company's 2023Q1-Q3 realized revenue of 844 million yuan, year-on-year-30.72%, net profit of 208 million yuan, year-on-year-21.87%, and non-return net profit of 203 million yuan, year-on-year-23.66%. The pressure on the company's performance is mainly due to the overall decline in consumer demand for the company's main products in the United States this year and the intensification of competition in the product market.

23Q1-Q3 company sales gross margin year-on-year + 3.66pct, sales net profit margin year-on-year + 2.8pct. 2023Q1-Q3 's gross profit margin is 33.42%, year-on-year + 3.66pct, and net sales margin is 24.69%, year-on-year + 2.8pct.

The sales / management / R & D / financial expense rates of 2023Q1-Q3 are 2.87%, 3.48%, 3.39%, 4.98%, respectively, compared with the same period last year + 1.25pct/+1.49pct/+0.67pct/-2.43pct. Among them, the decrease in financial expenses is mainly due to the increase in interest income generated by cash management.

The company has good financial position, excellent cash flow and debt paying ability. In the first three quarters, the company's debt-paying liquidity ratio was 16.42%, with excellent short-term solvency; 23Q1-Q3 's net profit cash content was 82.01%, with an average of 100.66% in the past five years, with excellent cash flow; and 23Q1-Q3 's main business cash-to-cash ratio was 98.76%, with an average of 99.99% in the past five years.

Investment suggestion: we expect the company's revenue from 2023 to 2025 to be 12.03,14.44 and 1.757 billion yuan, compared with the same period last year, which is-18.2%, 20.0% and 21.7%, respectively, and the net profit is 2.96,3.50 and 422 million yuan respectively. Compared with the same period last year, the company's net profit is 2.96,3.50 and 422 million yuan respectively, and the corresponding pre-valuation is 15, 13 and 11 times, respectively.

Risk hint: there is a greater risk of dependence on the first two major customers, intensified competition in the industry, and fluctuations in raw material prices.