Event: The company released its three-quarter report for 2023. In the first three quarters of 2023, it achieved revenue of 40.716 billion yuan, -0.89% year-on-year; realized net profit of 1,866 billion yuan, -46.45% year-on-year, and achieved net profit of 200 million yuan after deducting non-return net profit of 200 million yuan, -19.35% year-on-year. In the third quarter of 2023, it achieved operating income of 128.826 billion yuan, -6.79% year-on-year; realized net profit of 288 million yuan, -44.59% year-on-year; and achieved net profit of 263 million yuan after deduction of non-return net profit. Due to commodity market price fluctuations in 2023, the company's operating performance was under pressure.

Affected by fluctuations in demand, commodity operations declined, and performance gradually recovered after downstream operating demand picked up. In the first three quarters of 2023, domestic and foreign demand was insufficient, commodity prices declined overall, downstream customer demand and profitability were under pressure, and the company's commodity operating margin declined. In September, the manufacturing purchasing managers' index (PMI) was 50.2%, up 0.5 percentage points from the previous month. The commodity price index for Q3 in 2023 fluctuated. The China Commodity Index (CBMI) in September 2023 was 103.6%. The index rose twice in a row to the highest point since August 2020, up 0.9 percentage points from the previous month.

The core business maintains a leading edge, and health technology combined with digitalization continues to empower the entire industry chain. The scale of the company's core categories continues to grow, and the incremental space comes from the increase in the market share of leading companies in the domestic commodity supply chain and the expansion of overseas markets. Continuously adjust its strategic positioning and business content, and expand and increase the health technology business sector. Another breakthrough in the industrial chain layout to promote integrated supply chain services. As a smart logistics platform for Xiamen Guomao, Guomao Cloud Chain expands the digital application scenarios of Xiamen Guomao in the supply chain field and accelerates the digital transformation process.

Profit forecasting and company ratings: Xiamen Guomao is actively transforming its business layout and focusing more on the development of the overseas layout of supply chain business. We are optimistic about the expansion of the commodity market and the increase in market share of leading companies, as well as high-quality assets with high dividend rates. Due to commodity price fluctuations in 2023, we expect the company's net profit from 2023-2025 to be 28.5/33.91 billion yuan (previous value was 32.8/37.3/43.1 billion yuan), corresponding to PE 5.3/4.5/3.8 times, maintaining the company's “buy” rating.

Risk warning: commodity price fluctuation risk, policy change risk, exchange rate risk.