Incidents:
The company released its 2023 performance forecast, and achieved net profit of 40%-490 million yuan in 23, +180%-242% year over year; net profit after deducting non-return to mother of 3.7 to 450 million yuan, +316%-417% year over year.
The 23Q4 company achieved net profit of 0.4 to 130 million yuan, +129%-195% year-on-year (-140 million yuan in the same period last year); net profit without return to mother was 0.2 to 110 million yuan, +114%-165% year-on-year (-170 million yuan in the same period last year).
The Q4 revenue growth rate improved under a low base, and the C-side drove growth. According to industry online data, the 23Q4 Vantage range hood sales volume was 380,000 units, +19%, and the growth rate improved significantly compared to +5% in Q3; according to Aowei Cloud Network data, online retail sales of 23Q4 Vantage range hoods/gas stoves were +20%/+30%, respectively, and volume and price increased sharply. Combined with tripartite data and a low reporting base, we expect the company's 23Q4 revenue to achieve double-digit growth. By channel, we expect double-digit growth in the company's C-end retail (online+offline, accounting for 75% in total in '22) channels, and revenue from engineering channels and overseas channels may decline year-on-year. Looking ahead to 24, overseas channels that dragged down overall revenue performance in 23 are expected to recover due to a low base. Engineering channels are expected to remain flat after contraction, and C-side retail is expected to continue to grow steadily, so the company's overall revenue growth is expected to accelerate (or reach double digit growth) in 24.
On the profit side, under the influence of factors such as rationalizing internal governance, reducing costs and increasing efficiency, and promoting channel flattening, the company's gross margin has improved quarterly over the past 23 years. The 23Q3 company has already calculated asset impairment losses and credit impairment losses of about 43 million yuan. With the gradual completion of real estate bad debt accruals, the company's reporting side is expected to show a more realistic operating situation in '24, and the company's net interest rate is expected to return to double digits in the medium term.
Investment suggestions: The company is paying more and more attention to brand image upgrading and channel management capabilities, continuously promoting new channels to form competitiveness, and enriching the product matrix with new products such as integrated stoves and integrated cooking center tracks. We are optimistic that the company will practice internal skills in the process of rationalizing channels and strengthening governance, continue to explore growth potential in a multi-category and multi-brand matrix, and achieve better profits in the process of channel flattening, high-end products, and intelligent production. The estimated net profit for 23-25 is 4.6/6.1/690 million yuan (previous value: 51/63/7.2 billion yuan, considering a slight decrease in the Q4 calculation for the full year of 23), corresponding to 10.1x/7.7x/6.8x, maintaining the “buy” rating.
Risk warning: the risk of rising raw material prices; the risk of fluctuations in the real estate market; the risk of increased market competition; the risk that demand for new products falls short of expectations; the performance forecast is a preliminary estimate. The specific financial data is subject to the annual report disclosed by the company.