Events: In the first three quarters of 2023, the company achieved operating income of 2,662 billion yuan, a year-on-year increase of 55.70%; net profit of 387 million yuan, a year-on-year increase of 112.12%; net profit after deduction of 344 million yuan, an increase of 115.91%; and basic earnings per share of 0.87 yuan, an increase of 111.48% year-on-year. On a quarterly basis, 2023Q3 achieved revenue of 878 million yuan, a year-on-year increase of 40.94%, a decrease of 11.67% over the previous year; net profit of the mother was 129 million yuan, an increase of 84.91% year-on-year, a decrease of 26.53% over the previous year.
In the first three quarters of 2023, the company's gross profit margin was 50.36%, up 3.28pct year on year; net profit margin was 14.53%, up 3.87pct year on year; and weighted average return on net assets was 8.87%, up 3.79pct year on year. In 2023Q3, the company's gross profit margin was 51.53%, up 4.64pct year on year, down 0.86pct; net profit margin was 14.72%, up 3.50 pct year on year, down 2.98 pct month on month.
In the first three quarters of 2023, the company's period expenses totaled 906 million yuan, an increase of 50.00% over the previous year, accounting for 34.05% of total revenue, and a decrease of 1.29pct in revenue. Among them, sales expenses were 137 million yuan, up 39.94% year on year, accounting for 5.13% of total revenue, revenue decreased by 0.58 pct year on year; management expenses were 280 million yuan, up 84.80% year on year, accounting for 10.51% of total revenue, revenue increased 1.65 pct year over year; financial expenses were 0.28 million yuan, up 42 million yuan year on year, accounting for 1.06% of total revenue, accounting for 1.86 pct year on year; R&D expenses were 462 million yuan, up 25.19% year on year, accounting for 17.35% of total revenue. The share of revenue decreased by 4.23pct year over year.
The total period expenses of the 2023Q3 company were 325 million yuan, up 51.26% year on year, up 7.69% month on month, accounting for 37.03% revenue, up 2.53 pct year on year, and 6.66 pct over month. Among them, R&D expenses were 158 million yuan, up 17.40% year on year, down 7.52% month on month. R&D expenses accounted for 17.98% of revenue, down 3.60 pct year on year, and increased by 0.81 pct over month.
In the first three quarters of 2023, net cash flow from the company's operating activities was 145 million yuan, up 12.60% year on year, mainly due to increased cash flow from product sales due to good repayment; net cash flow from investment activities was -1,471 million yuan, compared with -719 million yuan for the same period last year, a decrease of 752 million yuan; net cash flow from fund-raising activities was 1,461 million yuan, up 245.27% year on year.
As of the end of the third quarter of 2023, the company's accounts receivable, notes receivable and receivable financing totaled 1,507 billion yuan, up 52.94% from the beginning of the year; of these, accounts receivable was 1,325 billion yuan, up 60.22% from the beginning of the year, notes receivable was 177 million yuan, up 13.56% from the beginning of the year, and receivables financing was 5.2686 million yuan, up 87.62% from the beginning of the year; the turnover rate of accounts receivable was 2.47 times, down 0.20 times from the beginning of the year. The inventory was 1,672 billion yuan, up 11.72% from the beginning of the year. The inventory turnover rate was 0.83 times, up 0.19 times from the previous year.
Using October 23, 2023 as the reserved grant date, the company granted 1 million restricted shares to 42 incentive recipients at a grant price of 19.89 yuan/share, accounting for 0.22% of the total share capital. The amortization costs of the company's equity incentive plans for 2023-2028 are 196 million yuan, 137 million yuan, 71.4982 million yuan, 32.197 million yuan, 8.557 million yuan, and 4857 million yuan, respectively.
We adjusted our profit forecast based on the latest financial report. We expect the company's net profit from 2023-2025 to be 5.70/7.93/1,017 million yuan, EPS of 1.27/1.77/2.27 yuan, respectively, and PE corresponding to the closing price of November 1, 37.6/27.0/21.1 times, maintaining the “increased holdings” rating.
Risk warning: special orders fall short of expectations, overseas business expansion falls short of expectations.