Main points of investment:
The company's third-quarter results are in line with expectations: according to the company's third-quarter report in 2023, the company achieved operating income of 1.745 billion yuan in the first three quarters, an increase of 15% over the same period last year, of which domestic market revenue was 1.023 billion yuan, up 9.12% from the same period last year, and international market revenue was 723 million yuan, up 25.71% from the same period last year. In the first three quarters, the net profit was 387 million yuan, up 70% from the same period last year (excluding the impact of share payments, 44% year-on-year). In the first three quarters, the net profit was 377 million yuan, up 75% from the same period last year. In the third quarter alone, the company realized operating income of 598 million yuan, an increase of 8.4% over the same period last year, a net profit of 122 million yuan, an increase of 19.7% over the same period last year, and a non-return net profit of 119 million yuan, an increase of 22.3% over the same period last year. In the third quarter of this year, the policy environment of the domestic medical industry is complex, the company overcomes the unfavorable factors, and the performance growth is in line with market expectations.
The gross profit margin increased, and the rate of management and R & D expenses decreased: according to the company's third quarterly report in 2023, the company's gross profit margin in the first three quarters was 64.04% (60.65% in the same period last year). The reasons for the increase include exchange rate fluctuations, lower production costs, changes in product structure, and so on. The company has reduced costs and increased efficiency this year. In the first three quarters, the sales expense rate was 21.93% (20.36% in the same period last year), and the sales expense rate increased, but the management expense rate was 12.97% (17.23% in the same period last year), and the R & D expense rate was 5.88% (8.05% in the same period last year). Both were significantly lower than in the same period last year.
Optimistic about the company's product upgrading and overseas prospects: in terms of products, the demand for endoscopic consumables is rigid, the company's product structure is constantly enriching, and the cost reduction of automated production is beginning to appear. The admission of visualization products is also going smoothly. In terms of overseas markets, through the integration of overseas channels, the company has improved the income scale of the direct sales team and strengthened its terminal control ability. with the overseas volume of visualization products in Europe and the United States from next year, the prospect of overseas development is expected.
Maintain the "overweight" rating: taking into account the impact of changes in the domestic policy environment on domestic demand, we slightly downgrade the company's profit forecast for 2023-2025. The estimated net profit is 484 million yuan, 627 million yuan and 822 million yuan respectively (previously forecast to be 493 million yuan, 640 million yuan and 826 million yuan), corresponding to 34 times, 26 times and 20 times earnings, respectively.
Risk tips: increased market competition, exchange rate fluctuations, R & D risk