Items:
On October 28,2023, the Company disclosed its third quarter report for 2023. During the reporting period, the Company realized operating income of RMB 300 million yuan, with a year-on-year growth of 20.45%; net profit attributable to parent company of RMB 27 million yuan, with a year-on-year decrease of 22.77%; basic EPS of RMB 0.4 yuan, with a year-on-year decrease of 21.57%. Among them, single Q3 realized operating income of 104 million yuan, with a year-on-year growth of 10.88%, and net profit attributable to mother was 0.04 billion yuan, down 69.16% year-on-year.
Comments:
Revenue growth, price cuts and increased expenses led to lower net profit. From January to September 2023, the Company realized operating income of RMB 300 million yuan, with a year-on-year growth of 20.45%; net profit attributable to parent company was RMB 27 million yuan, with a year-on-year decrease of 22.77%. The overall operation status of the company is in good condition, and the production at home and abroad is stable. Due to fierce competition in the industry, the product price is lowered; the production line of Leiboteco Tianjin where the investment project is located has been put into use, and the production costs such as depreciation have also increased. The comprehensive gross profit margin of the whole line of products in 23Q1 -3 is 44.57%, which is 4.38pct lower than that of the same period last year and 3.14pct lower than the average gross profit margin level of 2022; 23 The sales expense/management expense/financial expense ratio of the Company in Q1-3 was 17.57%/7.40%/-0.87%, respectively, and the expense ratio changed by +0.73pct/+0.04pct/-0.15pct respectively compared with the previous year. The increase in sales expense was mainly due to the increase in marketing expenses required for the promotion of new products.
R & D investment has not decreased, and technological innovation has not stopped. During the reporting period, the company invested 36.8574 million yuan in R & D, with a year-on-year growth of 36.71%, accounting for 12.29% of revenue, and the number of R & D personnel increased by 20 compared with the end of last year. ICP-Q-TOFMS is expected to complete acceptance by the end of this year and officially launch in 2024;GC-MS and full-spectrum direct reading spectroscopy are expected to launch commercial products by the end of 2024. We expect that with the continuous increase of R & D investment, the company will continue to launch new products with high technological content and strong competitiveness in the future to accelerate the process of domestic substitution.
Orderly launch of products. The LabMS 5000 ICP-MS/MS for semiconductor industry R & D and production was officially released on March 10, 2023. It is the latest product for semiconductor industry users after the release of single quadrupole LabMS 3000 ICPMS in 2021. In May 2023, the company launched three types of atomic spectroscopy products: inductively coupled plasma emission spectrometer, atomic absorption spectrometer and atomic fluorescence spectrometer, marking that Leptotec has achieved comprehensive coverage of inorganic element detection product line and has become an analytical instrument manufacturer capable of providing a full range of inorganic element analysis products.
Investment suggestion: Driven by the tide of scientific research and innovation in China, the market prospect of experimental instruments is broad. With the advantages of domestic leading products and the performance growth brought by the continuous volume of new products, Leptec is expected to become the leader in the replacement of scientific instruments in China in the future. We maintain the original forecast unchanged. It is estimated that the net profit of the company from 2023 to 2025 will be RMB 66 million, RMB 89 million and RMB 105 million respectively, corresponding to PE 36x/27x/23x. Considering that the ICP mass spectrum of the Company is about to be released, with reference to the valuation of comparable companies in the same industry, the Company will be given 50 times PE in 2023, corresponding to the target price of 49 yuan, and the rating of "strong push" will be maintained.
Risk tips: domestic substitution is not as expected; competition in the industry is intensified; business development is not as expected; sales of mass spectrometer products are not as expected.