Introduction to this report:
The company's 2023 performance is in line with expectations, and the dividend ratio has further increased. We are optimistic that the leading overseas market share will continue to increase and high-end technology will drive the improvement of profit efficiency.
Summary:
Investment advice: Maintain an “Overweight” rating. The company's performance in 2023 was in line with expectations, and a 26-year forecast was added. The company's net profit for 24-26 is estimated to be 182.2/203.2/22.35 billion yuan, corresponding EPS of 1.93 yuan, 2.15 yuan, and 2.37 yuan, respectively, +10%/11%/10% compared to the same period last year.
The 2023 results are in line with expectations: the company achieved operating income of 261,428 billion yuan in 2023, net profit of 16.597 billion yuan, +12.8% year over year; of these, 2023Q4 achieved operating income of 62.77 billion yuan, +6.8% year on year, and net profit to mother of 3.447 billion yuan, +13.2% year on year.
The scale of air conditioning is growing faster, and the overseas share continues to increase: Among the company's five main businesses, air conditioning revenue was +14% ahead of other sectors compared to the same period last year. In terms of export sales, Europe led the way in growth, revenue +24% year over year, and the US GEA performed steadily. The significant increase in the European market comes from the company's commitment to improving the competitiveness of products and supply chains: establishing strategic cooperation with well-known local testing centers to enhance the company's R&D and design capabilities. 2) Launched the “New Candy” project to enhance brand positioning; 3) In terms of distribution, the company strengthened partnerships with leading European retailers.
The cash dividend ratio has increased, and the future commitment ratio is even higher: the company plans to distribute cash dividends of 7.471 billion yuan, accounting for 45.02% of net profit returned to mother in '23, an increase of 9% over 2022.
This dividend corresponds to the current dividend rate of 3.4%; “The shareholder return plan for the next three years (2024-2026) requires that the 2025-26 company's cash distribution of profits should account for no less than 50% of the current year, and the corresponding current price dividend ratio is expected to exceed 4%.
Risk warning: raw material prices fluctuate, cost pressure does not decrease; real estate recovery falls short of expectations