Incident: On April 15, 2024, the company announced first-quarter results, achieving revenue of 1,259 million yuan, +22.86% YoY; net profit to mother was 170 million yuan, +111.26% YoY. Net profit after deducting non-return to mother was $158 million, +156.73% year-on-year.
The performance was in line with expectations. Breaking the influence of the traditional off-season, the company's 24Q1 basically continued the booming development trend in the second half of '23, with a year-on-year increase in revenue. Among them, the January business reached a record high in a single month. By product, 24Q1 signal processing, power management, automotive electronics & energy storage, ceramics & PCB and other products achieved revenue of 5.37 million yuan, 4.10, 1.90, and 122 million yuan respectively, compared with +27.87%, -0.07%, +93.42%, and +26.82% over the same period last year.
Among them, the proportion dedicated to automotive electronics and energy storage increased dramatically, to 15.09% in 24Q1, +5.51pct compared to the previous year.
The gross margin increased year-on-year, and the expense ratio was relatively stable during the period. 1) Gross profit margin: 24Q1 gross margin was 36.95%, +4.77pct. Mainly due to the smooth development of business in the field of precision electronic components and new applications, increased market orders, which led to a continuous increase in capacity utilization. 2) Expense rate for the period: The cost rate for the 24Q1 period was 17.98%, +0.06pct year-on-year. Among them, sales, management, R&D, and financial expenses rates were 2.04%, 5.54%, 8.53%, and 1.87%, respectively, +0.01, +0.21, -0.21, and +0.05pct.
Across the field of inductors, we build a multi-dimensional product and multi-dimensional market development trend. Over the past 5 years, relying on the industry reputation and basic research strength established by inductor products, the company has made comprehensive efforts in the field of components. Not only has the inductor series products continued to expand and innovate, but magnetic device series products, microwave device series products, and precision ceramics series products have also gone hand in hand. They have also achieved breakthrough progress, and have been widely recognized by many leading global companies. It has fully covered new energy, mobile terminals, consumer electronics and many other fields, laying a solid foundation for the comprehensive growth of the company's business. Looking forward to the future, the company will actively lay out around the “Five Five-Year Strategic Plan”. It is expected that it will continue to benefit from growing demand in downstream emerging application fields and increasing its share in the long term, and start a second growth curve.
Profit forecast: Based on the rapid development of new business, we expect the company's net profit to be 886, 10.47, and 1,181 billion yuan respectively in 2024-26, maintaining a “buy” rating.
Risk warning: The recovery in consumer demand fell short of expectations; the development of new businesses such as automotive electronics fell short of expectations.