occurrences
On March 29, Aviation Materials Co., Ltd. released its 2023 annual report. In 2023, the company achieved revenue of 2,803 billion yuan, a year-on-year increase of 20%, and achieved net profit of 576 million yuan to mother, an increase of 30% over the previous year.
reviews
1. The operating target was exceeded, and the performance maintained a relatively rapid growth rate. In 2023, the company focused on high-quality operation and accelerated innovation and transformation. Business performance continued to improve steadily, exceeding the annual operating target, and achieved revenue of 2,803 billion yuan, an increase of 20% over the previous year; net profit of 576 million yuan, an increase of 30% over the previous year. By product, the company's revenue from basic materials was 1,323 billion yuan, up 20% year on year; revenue from finished aviation parts was 1,238 million yuan, up 24% year on year; revenue from non-aviation finished parts was 124 million yuan, down 15% year on year; and revenue from processing services was 80 million yuan, up 28% year on year.
2. Due to changes in military tax exemption policies, gross margin declined, and the cost ratio was well controlled. In 2023, the company's gross sales margin was 31.55%, down 2.24pcts year-on-year, mainly affected by changes in military tax exemption policies. In terms of cost ratio, the company's four-fee rate was 8.93%, down 1.93 pcts year on year, and cost control was good. Among them, the sales expense ratio was 0.53% and 2.92% respectively, which was basically the same; the financial expenses ratio was -1.80%, down 1.16 pcts year on year, mainly due to the increase in interest income due to the company's listing to raise capital; the R&D expense ratio was 7.27%, down 0.74 pcts year on year, and R&D expenditure was 204 million yuan, up 9% year on year, maintaining strong R&D investment.
3. In 2023, sales revenue within the aviation development system increased 27% year-on-year. The estimated value of daily related transactions shows strong downstream demand for aviation development. In 2023, the company's sales revenue to customers within China's aviation development system (including labor provision) was 846 million yuan, an increase of 27% over the previous year. On March 29, the company disclosed the expected daily related transactions for 2024. It is estimated that in 2024, the amount of products sold and labor services to customers within China's aviation development system will be 1,054 billion yuan, an increase of 25% over the actual accrued value of 846 million yuan in 2023, reflecting strong downstream demand for aviation development.
4. Actively expand new business growth points, and overseas markets are in strong demand. The company actively connects with OEMs, adapts to the new task acquisition model of competition and merit, and improves response speed and response quality around customer needs. The company is actively expanding new business growth points and achieving new product layouts in various fields. The new product development of the Titanium Alloy Precision Casting Division has fully blossomed, and the Rubber and Sealing Materials Division has successfully included sealant products in the qualified product catalogs of Shanghai Flying Company and Xifei Civil Aircraft. Furthermore, the company has accelerated business development in the gas engine, nuclear industry, automotive, biomedical and international fields, and has achieved new breakthroughs in various fields. Overseas market. In 2023, the company's overseas sales revenue was 190 million yuan, an increase of 32% over the previous year.
5. We expect the company's net profit to be 714, 8.62, and 1,033 million yuan respectively for 2024-2026, corresponding to the current share price PE of 35, 29, and 24 times, respectively, to maintain a “buy” rating.
Risk warning
Demand in the military goods market fell short of expectations; expansion of the civilian goods market fell short of expectations; price fluctuations of products or raw materials exceeded expectations, etc.