According to the company's quarterly report for 2023, the revenue of the company was 1.053 billion yuan, down 18.73%, and the net profit returned to its mother was 139 million yuan, down 3.64%. The company's profitability continues to improve, with a gross profit margin of more than 40% in the third quarter. The company has been deeply engaged in the field of prefabricated architecture and BIM for many years, and is expected to open up a new growth space in the process of architectural industrialization and digital transformation. Maintain the company's buy rating.
Support the main points of rating
Performance has declined and net cash outflows have shrunk sharply. 2023Q3's revenue was 348 million yuan, down 20.02%, and its net profit was 69 million yuan, with a decrease of 10.67%. The cash flow of operating activities of 2023 1-3Q company was-30 million yuan, and the net outflow was significantly reduced by 65.83% compared with the same period last year. Among them, the net cash flow of operating activities of the company in the third quarter was-20 million yuan, from net inflow to net outflow. By the end of the third quarter, the size of the company's accounts receivable and notes receivable was 624 million yuan, a decrease of 7.16%.
The company's profitability continued to climb, and the expense rate increased slightly during the period. The comprehensive gross profit margin of 2023 1-3Q company is 31.95%, with an increase of 2.01pct, and the net profit rate of return to the mother is 13.19%, with an increase of 2.06pct. Among them, the company's comprehensive gross profit margin in the third quarter was 41.56%, with an increase of 4.46pct; the net return to the mother was 19.75%, with an increase of 2.06pct. In terms of period expenses, the total period expense rate of 2023 1-3Q company was 16.83%, with the same increase of 0.79pct, in which the sales / management / R & D / financial expense rate increased by 0.02/0.37/0.39/0.02pct respectively compared with the same period last year. In the third quarter, the company's period expense rate was 18.00%, with the same increase of 0.99pct, in which the sales / management / R & D / financial expense rate changed 0.08/0.95/0.21/-0.25pct respectively compared with the same period last year.
The adjustment of business structure has achieved results, and the company continues to cultivate prefabricated buildings and BIM. The company continues to adjust its business structure, focusing on business coverage areas, the proportion of EPC business with low gross profit margin continues to decline, and the company's business coverage areas are concentrated in South China, where the first-mover advantage is strong. At present, some results have been achieved, with 2023Q3 gross profit margin exceeding 40%. As one of the earliest enterprises to carry out prefabricated architectural design and BIM technology research, the company has rich research experience and achievements. In the future, the company will continue to strengthen the research and development of prefabricated buildings, BIM, green construction, dual carbon, artificial intelligence and other fields, which is expected to open up new growth space in the process of building industrialization and digital transformation.
Valuation
The company's performance is basically in line with our expectations, and we maintain our original profit forecast. It is estimated that the income of the company from 2023 to 2025 is 18.3,20.5 and 2.34 billion yuan, the net profit of returning to the mother is 1.8,2.1 and 250 million yuan, and the EPS is 0.92,1.06,1.28 yuan. Maintain the company's buy rating.
Main risks faced by rating
The growth rate of prefabricated construction has declined, downstream demand has recovered less than expected, and the effect of business expansion has been lower than expected.