The company announced its third quarterly report for 2023: Q3 made a profit of 1.84 billion, an all-time high. Financial data: 1) 2023Q3:
Revenue 6.07 billion, year-on-year + 105.8%, compared with 19 years + 37.5%, profit 1.84 billion, the highest in a single quarter, exceeding market expectations, deducting non-profit 1.82 billion, 19Q3 profit 870 million, 23Q3 increased by 113% compared with 19Q3, equivalent to 2019 full-year profit, fully showing the flexibility of ticket prices in the peak season. Q3 RMB appreciation against the US dollar 0.6pct, estimated exchange gains of 10 million. 2) 23Q1-Q3: revenue of 14.1 billion, year-on-year + 113.5%, compared with 19 years + 21.9%; profit of 2.68 billion in the first three quarters, deduction of non-profit of 2.57 billion, profit of 1.72 billion in the first three quarters of 19, and estimated exchange gain of 20 million in the first three quarters. 3) other income: Q3 other income is 320 million yuan, + 18.4% year-on-year, 830 million in the first three quarters, + 21.4% year-on-year.
Business data: 1) 23Q3:ASK year-on-year + 41.6%, compared with 19 years + 18.9% 13.9pct year-on-year + 66.9%, compared with 19 years + 18.7%, occupancy rate 91.8%, year-on-year + 13.9pct, compared with 19 years-0.1pct. 2) the first three quarters: ASK year on year + 46.5%, compared with 19 years + 10.6% Personality RPK year-on-year + 75.3%, compared with 19 years + 7.7%, occupancy rate 89.4%, year-on-year + 14.7pct, compared with 19 years-2.4pct.
Revenue level: the revenue of Q3 passenger kilometers exceeds 17.2% in 19 years. 1) it is estimated that the passenger revenue of Q3 passenger kilometers (including fuel surcharge) is 0.48 yuan (including fuel surcharge), + 24.8% compared with the same period last year, + 17.2% compared with the same period in 19 years, and 0.44 yuan per kilometer, + 47.1% from the same period last year, compared with + 17.0% in 19 years. 2) it is estimated that the passenger revenue of passenger kilometers in the first three quarters is 0.43 yuan, + 22.8% over the same period last year, an increase of 13.9% over the same period of 19, and that of passenger kilometers is 0.39 yuan, + 47.0% compared with the same period last year, and + 11.0% compared with the same period in 19 years.
Cost: Q3 unit deduction cost is higher than 19-1.7%. 1) the operating cost of 23Q3 is 4.18 billion, which is + 17.0% compared with the same period last year. The cost of aviation oil is estimated to be 1.56 billion, an increase of 4.7% over the same period last year. During the period, the cost of comprehensive mining of domestic oil prices was-24.9% compared with the same period last year.
The cost of withholding oil is 2.62 billion, which is + 25.8% compared with the same period last year. The cost of seat kilometers is 0.308 yuan,-17.4% compared with the same period last year, an increase of 5.8% over 19 years, and the cost of deducting fuel for seat kilometers is 0.193 yuan, 11.2% year-on-year and 1.7% higher than that of 19 years. 2) the operating cost in the first three quarters is 11.14 billion, year-on-year + 27.5%, estimated aviation fuel cost 4.07 billion, year-on-year + 30.5%, seat kilometer cost 0.313 yuan, year-on-year-13.0%, compared with 19 years + 5.9%, seat kilometer deduction cost 0.198 yuan, year-on-year-14.1%, compared with 19 years-0.7%. 3) fees: the total annual three fees of 23Q3 (foreign exchange deduction) is 210 million,-6.8% compared with the same period last year, and the foreign exchange deduction rate is 3.4%. In the first three quarters, the three foreign exchange deduction fees totaled 570 million,-9.2% compared with the same period last year, and the foreign exchange deduction rate was 4.0% (note: excluding R & D expenses).
3. Investment suggestions: 1) profit forecast: considering the profit level of the first three quarters, we slightly adjust the profit forecast for 23-25 to 24.2,42.0 and 5.09 billion (the original forecast is 23.3,41.8 and 5.03 billion), and the corresponding EPS for 23-25 is 2.47,4.29,5.20 yuan respectively, and the PE is 21,12 and 10 times respectively. 2) emphasize that since 23Q3, China's aviation industry has entered a real profit cycle. Q3 achieved an all-time high of 1.84 billion in a single quarter, more than double that in 19 years, fully demonstrating the flexibility of ticket prices in the peak season. However, the international transport capacity of the Q3 industry has only recovered by about 50%. According to the latest winter and spring time plan, 23 winter and spring international routes plan to increase classes to 70% in 19 years. And on October 27, the US Department of Transportation announced that there would be additional flights between China and the United States. since November 9, the Chinese Aviation Department will be allowed to operate a total of 35 regular direct passenger flights between China and the United States each week (currently 24). If the United States operates equally, a total of 70 classes will be breakthroughs on international lines. Wide-body aircraft gradually fly overseas, excess capacity to return to the international, the price side will have more support. Continue to emphasize that since Q3, China's aviation industry is expected to enter a truly profitable cycle, the 24-year Q1 Spring Festival travel season may be more to look forward to. With reference to the historical average valuation level of the company, it is given 20 times PE in 24 years, corresponding to the target market value of 84 billion yuan and the target price of 85.8yuan, which is expected to be 62% higher than the current space, emphasizing the "strong push" rating.
Risk tips: a sharp decline in the economy, a sharp rise in oil prices, a sharp devaluation of the exchange rate.