Operating and financial data: In 2023, the company achieved revenue of 258.409 billion yuan, -3.39%; realized net profit attributable to mother of 8.234 billion yuan, +33.38% year over year; realized net profit without return to mother of 7.134 billion yuan, +33.67% year over year. The company completed a business volume of 11.97 billion tickets in 23 years, +7.5% year over year, and single ticket revenue was 16.06 yuan, +2.1% year over year. Among them, in 23Q4, the company achieved net profit of 1.97 billion yuan to mother, +15.76% year-on-year.
The net profit level of the express and bulky goods division increased, and the international division was under pressure. In terms of divisions, the express and bulky goods division achieved net profit of 8.453 billion yuan, compared with +54.62%, showing the results of measures such as continuous optimization of the business structure and lean management costs; the Tongcheng Instant Distribution Division completed net profit of 51 million yuan to reverse losses, gradually releasing network effects, and continuous optimization of the customer structure; the supply chain and international division experienced a net loss of 535 million yuan. The profit level of the freight forwarding business narrowed sharply due to pressure on international trade demand and declining air and sea freight rates.
The results of multi-network integration have been shown, and profit levels are expected to continue to recover. In 2023, the company's gross margin was 12.82%, +0.33pp year on year, net profit margin 3.06%, +0.44pp year on year. Against the backdrop of slow restoration of the business environment and year-on-year decline in revenue, the company achieved an increase in gross profit levels through continuous promotion of multi-network integration, lean resource planning and cost control. On the cost side, without Kerry Logistics, the company's management and sales expenses ratio decreased by 0.46pp compared to the same period in '22, and operating and management efficiency improved. In '23, in an environment where domestic macroeconomic recovery was slow and international business demand was sluggish, the company's profit margin increased again, waiting for the business environment to recover.
Profit forecasting and investment advice. EPS is expected to be 1.99, 2.38, and 2.79 yuan/share in 24-26, respectively, giving the company a 24-year PE valuation of 20 times, corresponding to a reasonable value of 39.80 yuan/share, giving it an “gain” rating.
Risk warning. The recovery of the macroeconomic environment fell short of expectations, the promotion of lean cost control fell short of expectations, the expansion and operation of international business fell short of expectations, the growth of new business fell short of expectations, and the rise in production capacity at Ezhou Airport fell short of expectations.