occurrences
On February 9, Aerospace Technology released its 2023 performance report. In 2023, the company achieved revenue of 2.104 billion yuan, a year-on-year increase of 44.69%, and achieved net profit of 185 million yuan to mother, an increase of 1.15% over the previous year.
reviews
1. Domestic sales and foreign trade demand continued to grow. In 2023, the company's revenue increased 45% year-on-year, and there were sufficient orders in hand. In 2023, the company's overall downstream domestic market grew steadily, foreign demand for commercial aero engines continued to recover, demand in the gas turbine sector increased, and sales increased.
At the same time, production capacity of Deland Aerospace's subsidiary was gradually released, and manufacturing capacity continued to be strengthened. The company seized market development opportunities and leveraged the company's first-mover advantage. It achieved significant growth in stock and incremental international and non-aviation customers, achieving revenue of 2.104 billion yuan, an increase of 45% over the previous year. As of the end of the third quarter of 2023, the company had orders of 2,314 billion yuan, with sufficient orders in hand.
2. Affected by factors such as inventory removal and cost reduction by some downstream customers, the company's profit growth rate has slowed in the short term. In 2023, the company's growth rate slowed in the short term due to factors such as inventory and cost reduction for some downstream customers starting in the second half of the year. In addition, the company implemented an equity incentive plan, and the share payment fee amount was 83.4053 million yuan in 2023. After excluding share payment fees, it achieved net profit of 257 million yuan, an increase of 14.50% over the previous year.
3. Overseas business has a significant first-mover advantage and is expected to maintain rapid growth. The company signed new agreements with aviation customers such as Safran, Pratt & Whitney, and Rollo in 2023. The long-term agreement period was 3-7 years, involving mainstream commercial engine models such as LEAP, and its share increased significantly compared to the past.
At the same time, the company is actively expanding application areas in overseas markets. The company's overseas non-aviation customers include international industrial giants such as GE Energy, Alfalaval, Baker Hughes, Fuji Electric, and Meggitt.
2023H1, the company's overseas main business revenue was 246 million yuan, an increase of 90.69% over the previous year, accounting for 21.68% of the company's main business revenue; in 2023, the company's overseas revenue accounted for more than 30%; in 2024, the company's overseas business share is expected to continue to increase to about 40%.
4. We expect the company's net profit to be 334 million yuan and 453 million yuan respectively in 2024 and 2025, corresponding to the current PE share price, 15 and 11 times, respectively, to maintain a “buy” rating.
Risk warning
Military orders fell short of expectations; overseas market expansion fell short of expectations; product price reductions and raw material price increases exceeded market expectations, etc.