Description of the event
The company disclosed its 2023 annual report: The company achieved operating income of 710 million yuan, an increase of 7.51% year on year; realized net profit of 170 million yuan to mother, a year-on-year decrease of 7.57%.
Incident comments
The product structure is constantly being optimized. Looking at the company's downstream products, the first quarter of 2023 was affected by inventory accumulation downstream of the 2022 industrial chain, and the pressure was obvious; since 2023Q2, the industrial chain has bottomed out and recovered. According to SIA statistics, sales in the global semiconductor industry have continued to grow for 8 consecutive months since March 2023. In this context, the company actively promoted the transformation and upgrading of the product structure, increasing the share of high-end products, which in turn increased its revenue during the reporting period by 7.51% over the same period last year.
Specifically, sales of square products were 70,600 tons, up 3.02% year on year; corresponding revenue of 233 million yuan, up 0.61% year on year; gross profit margin of square products was 32.75%, down 2.66 pcts year on year; sales volume of spherical products was 25,800 tons, up 8.37% year on year, corresponding revenue of 369 million, up 4.19% year on year, gross profit margin of 46.22% year on year, up 3.17 pcts year on year. Looking at the subregion, domestic sales were 608 million yuan, up 12.5% year on year, gross profit margin was 37.61%, down 0.63 pcts year on year; overseas sales were 103 million yuan, down 14.49% year on year, and gross margin was 48.82%, up 5.42 pcts year on year.
Looking at the single quarter, 23Q4 achieved revenue of 200 million yuan, up 15.3% year on year and 2% month on month, reflecting the relative stability of the overall downstream; net profit attributable to the single quarter was 49 million yuan, down 13.7% year on year, and slightly lower than 23Q3.
Under the trend of advanced packaging, the company ushered in new growth opportunities. According to Yole data, the global advanced packaging market is about US$44.3 billion in 2022, and is expected to reach US$78.6 billion in 2028. The CAGR for the year 2021-2028 is 10.6%, which is far higher than 3.2% of traditional packaging. According to SEMI statistics, the global packaging materials market reached US$26.1 billion in 2022, and the global packaging materials market is expected to reach US$29.8 billion in 2027, with a CAGR of 2.6%. The continuous development of communication equipment, consumer electronics, automotive electronics, industrial control, medical, aerospace and other industries is driving demand growth in industries such as high-density packaging chips, copper-clad plates, thermal interface materials, etc., which in turn has driven the demand for advanced chip packaging materials, liquid encapsulation materials, and high-frequency high-speed copper clad plates, which in turn has provided new mid-term growth for the company Opportunity.
The new product layout is worth paying attention to. During the reporting period, the company kept an eye on trends in downstream fields such as EMC, LMC, UF, electronic circuit substrates, thermal interface materials, etc., and continued to launch various low-CUT point Lowα micron/sub-micron spherical silicon powder, spherical alumina powder with low cut-point specifications, low loss/ultra-low loss spherical silicon powder for high-frequency high-speed copper clad plates, and high thermal conductivity micron/sub-micron spherical alumina powder for new energy batteries. The sales volume of the company's spherical products continued to increase.
The 2024-2025 performance is expected to be 210 to 270 million yuan, corresponding PE is 36 or 28 times, and the purchase rating.
Risk warning
1. Downstream demand for spherical aluminum falls short of expectations; 2. Progress in improving the penetration rate of spheroidal silicon falls short of expectations.