Events: In the first three quarters of 2023, the company achieved operating income of 2,266 billion yuan, an increase of 2.37% over the previous year; net profit of 308 million yuan, an increase of 2.06% over the previous year; net profit after deduction of 298 million yuan, an increase of 4.92% over the previous year. On a quarterly basis, 2023Q3 achieved revenue of 885 million yuan, a year-on-year increase of 5.21%, a year-on-year decrease of 2.49%; net profit of 100 million yuan, a year-on-year increase of 3.90%, a decrease of 45.51%; net profit after deducting non-return net profit of 997 million yuan, a year-on-year increase of 3.53%, a decrease of 46.05% over the previous year.
In the first three quarters of 2023, the company's gross profit margin was 44.41%, a year-on-year decrease of 1.15pct; net profit margin of 13.59%, a year-on-year decrease of 0.04pct; and a weighted average return on net assets of 6.98%, a year-on-year decrease of 1.07pct. 2023Q3, the company's gross profit margin was 42.61%, down 4.87 pct year on year, down 4.16 pct month on month; net profit margin was 11.27%, down 0.14 pct year on year, down 8.90 pct month on month.
Cost management and control capabilities have been enhanced. In the first three quarters of 2023, the company's period expenses totaled 699 million yuan, a year-on-year decrease of 4.68%, accounting for 30.84% of total revenue, and a year-on-year decrease of 2.28 pct in revenue. Among them, sales expenses were 59 million yuan, up 25.35% year on year, accounting for 2.59% of total revenue, revenue increased 0.48 pct year over year; management expenses were 147 million yuan, up 2.86% year on year, accounting for 6.47% of total revenue, revenue increased 0.03 pct year over year; financial expenses were 5.8852 million yuan, down 4.57% year on year, accounting for 0.26% of total revenue, accounting for 0.02pct year on year; R&D expenses amounted to 488 million yuan, down 9.29% year on year, accounting for 21.52% of total revenue, accounting for 21.52% of total revenue, revenue A decrease of 2.77 pct from the previous year.
The total period expenses of the 2023Q3 company were 286 million yuan, a year-on-year decrease of 11.12%, an increase of 25.88% over the previous year, and a year-on-month increase of 32.35% in revenue, a decrease of 5.94 pct over the previous year, and an increase of 7.29 pct over the previous year. Among them, R&D expenses were 209 million yuan, a year-on-year decrease of 13.98%, an increase of 37.74% over the previous year, and R&D expenses accounted for 23.63% of revenue, a year-on-year decrease of 5.27 pct, a year-on-year increase of 6.90 pct.
Net cash flow from operating activities increased. In the first three quarters of 2023, net cash flow from the company's operating activities was -540 million yuan, an increase of 264 million yuan over the previous year, representing an increase in the company's sales payback during the reporting period; net cash flow from investment activities was 196 million yuan, a decrease of 2.34% over the same period last year; net cash flow from financing activities was -125 million yuan, a year-on-year decrease of 533 million yuan, compared to 409 million yuan in the same period last year.
As of the end of the third quarter of 2023, the company's accounts receivable, notes receivable and receivable financing totaled 4,061 billion yuan, up 25.87% from the beginning of the year; of these, accounts receivable was $3.695 billion, up 33.93% from the beginning of the year, notes receivable were 170 million yuan, a decrease of 43.17% from the beginning of the year, and receivables financing was 197 million yuan, up 16.59% from the beginning of the year; the accounts receivable turnover rate was 0.70 times, down 0.31 times from the beginning of the year. The inventory was 3.274 billion yuan, down 5.24% from the beginning of the year. The inventory turnover ratio was 0.37 times, up 0.06 times from the previous year.
We adjusted our profit forecast. It is estimated that the company's net profit from 2023-2025 will be 783/10.26/1,366 billion yuan, EPS will be 1.01/1.33/1.77 yuan/share, respectively, and the PE corresponding to the closing price of November 7 will be 26.6/20.3/15.3 times, maintaining the “increased holdings” rating.
Risk warning: Product development progress falls short of expectations, and customer procurement progress falls short of expectations.