Incident: The company released its 23rd annual report, achieving revenue of 23.351 billion yuan in 23, an increase of 16.78% over the previous year; realized net profit of 1,527 billion yuan, an increase of 19.05% over the previous year, and realized net profit of 1,398 billion yuan after deduction, an increase of 21.00% over the previous year, and basic earnings per share of 1.66 yuan.
23Q4 revenue and profit growth increased month-on-month: 4Q23 achieved operating income of 7.492 billion yuan, a year-on-year increase of 19.54%, and realized net profit of 433 million yuan to the parent company, an increase of 24.62% year-on-year, and revenue and profit growth increased month-on-month in the fourth quarter. By business, revenue from writing tools in 23 years was 2,273 billion yuan, up 4.83% year on year, student stationery revenue was 3.466 billion yuan, up 8.58% year on year, office stationery revenue was 3.511 billion yuan, up 8.91% year on year, direct office sales revenue was 13.307 billion yuan, up 21.75% year on year. The growth of writing tools and student stationery was mainly driven by an increase in average price. Sales volume changed by -2.75%/+2.06% year on year, respectively. Office stationery sales increased 6.18%, achieving steady growth.
The gross margin of writing tools and student stationery increased, and the net margin increased slightly: in '23, the company's gross profit margin was 18.86%, down 0.50pct from the previous year. By business, the gross margin of writing tools/student stationery/office stationery/office direct sales changed by +2.35/+1.58/+1.31/-1.20pct, respectively. In terms of the cost ratio for the period, the sales expense ratio decreased by 0.15 pct to 6.64% year on year, the management expense ratio decreased by 0.47 pct to 3.50% year on year, the R&D expense ratio decreased by 0.16 pct to 0.76% year on year, and the financial expense ratio decreased by 0.02 pct to -0.23% year on year. Under the combined influence, the company's net interest rate increased by 0.26pct year-on-year to 7.04%.
Colipu's revenue remained high, and net profit grew: in '23, Colipu's revenue was 13.307 billion yuan, up 22% year on year, and realized net profit of 401 million yuan, up 8% year on year. We expect net interest rates to continue to rise as scale effects gradually materialize. In terms of customer development, the company continues to expand state-owned enterprises, government, finance and MRO customers. In terms of business scenarios, the company focuses on the four major sectors of one-stop office, MRO industrial products, marketing gifts, and employee benefits, while continuing to improve platform management capabilities and storage efficiency. The Northwest Warehouse was officially put into operation in '23. We believe that as Colipu gradually becomes a digital pioneer and industry leader in enterprise procurement, its market position is expected to further improve.
Profit forecast and rating: We expect the company's net profit for 24-25 to be 18.21 billion yuan and 21.19 billion yuan respectively, with year-on-year growth rates of 19.3% and 16.3%. The closing price on April 10 corresponds to the 24-25 PE of 18.7 and 16.1 times. Refer to the comparable company giving the company a 24-year PE valuation of 22-24 times, corresponding to a reasonable value range of 43.34 to 47.28 yuan, giving a “superior to the market” rating.
Risk warning: New business expansion falls short of expectations, and terminal demand is weak.