The year-on-year revenue/net profit ratio for 23 years was +2%/+394%, maintaining the “purchase” rating. On March 36, the company released its annual report for the year 23: achieved revenue/net profit to mother/net profit after deduction of 78.0/3.2/290 million yuan in 23 years, +2%/+394%/651% year-on-year (restated). Net profit returned to mother in '23 is in line with the performance forecast ($32-340 million). Among them, Q4 achieved revenue/return to mother net profit of 22.5/180 million yuan (yoy +0.6%/194%, qoq +2.7%/+36.8%), and the ring was relatively well repaired. Considering weak real estate sales, we lowered the company's 24-26 revenue forecast to 84/95/10.8 billion yuan (previous value: 99/119 billion yuan). Comparable to Wind, the 24-year average PS was expected to be 2.4x. The company's direct sales exceeded 50,000 small B customers, and the performance was highly sensitive to real estate sales. However, considering the favorable recovery in 23Q4, the 24E PS was given 1.8x, with a target price of 47.13 yuan (previous value of 46.24 yuan) to maintain the “purchase”.
The growth rate of new products was faster in '23, and the gross margin was better. Repairing the company's door and window hardware systems/household products/other building hardware products/door and window components/point support glass curtain wall components/ door control hardware systems/stainless steel fence components achieved revenue of 36/14/11/6/4/4/200 million yuan, compared with +1%/+20%/-4%/-8%/+6%/-17%. Other new construction hardware categories grew faster. The gross profit margin for 23 years was 32.26%, 2.06 pct. The main reason was the year-on-year decline in raw material prices. The average price of stainless steel/aluminum alloy for the main raw materials in 2023 was -10.7%/-8.2% year-on-year, of which the gross margin for the 23Q4 single quarter was 34.0%, +1.6/+1.8pct year-on-month.
In the main business, the gross margin of door and window hardware systems/other construction hardware products/household products was 40.4%/19.0%/29.8%, +3.95/+1.80/ -1.83 pct compared to the same period.
The sales rate decreased slightly year-on-year, and the pay-as-you-go ratio increased by 25.2% compared with the year-on-year rate of -1.0pct. Among them, the sales/management/R&D/finance expenses ratio was 16.1%/5.1%/3.8%/0.3%, and the year-on-year rate was -0.6/basically flat/+0.02/-0.4 pct. The company's net interest rate/net interest rate without return to mother in '23 was 4.2%/3.7%, +3.3/+3.2pct year on year; 23Q4 was 8.0%/6.8%, +5.2/+4.9pct year on year. At the end of 23, the company's balance ratio/interest-bearing debt ratio was 45.6%/4.9%, -6.7/-3.9 pct year-on-year. Net operating cash flow for 23 years was +50 billion yuan, year-on-year - 440 million yuan, of which 23Q4 was 60 billion yuan. 23 The annual cash/cash ratio was 108%/98%, +8.6/+24.7pct; 23Q4 was 108%/70%, +20.4/+52.8pct year on year.
Expand rich product categories and actively expand overseas sales
The company is committed to building a full-chain sales model of “R&D+manufacturing+service”, improving traditional product systems while laying out markets such as energy efficiency, green buildings, smart homes and security. Targeted development of “Belt and Road” related emerging markets. In recent years, 15 overseas warehouses have been established, and products have been sold to more than 100 countries and regions. At the same time, we are actively developing domestic third- and fourth-tier markets and strengthening channel construction. Currently, we have more than 1,000 domestic and foreign sales outlets.
Risk warning: Policy support falls short of expectations, demand growth in the construction hardware market is slowing down, and raw material prices have risen sharply.