Core views:
The 23-year performance was under pressure, and the Q1 performance in '24 exceeded expectations, verifying the inflection point of operation. In 2023, the company achieved revenue of 4.35 billion yuan, down 9.6% year on year; net profit to mother was 2.01 billion yuan, down 7.7% year on year, mainly due to declining industry demand affected by the overseas environment, and the company's dealers entered the inventory removal cycle. The comprehensive gross margin in 2023 was 65.72%, an increase of 2.7 percentage points over the previous year, mainly due to the upgrading of the company's products to high-end and compounded exchange rate changes. The company achieved revenue of 1.16 billion yuan in 24Q1, up 31.0% year on year, and net profit to mother of 570 million yuan, up 34.5% year on year, verifying that the company ended inventory removal and returned to the growth trajectory.
The company's second and third businesses are developing steadily, and products are constantly moving towards advanced intelligence. In 2023, the company's conference products achieved revenue of 1.47 billion yuan, up 12.8% year on year, accounting for 33.7% of revenue, up 6.7 percentage points from the same period last year. This is mainly due to the company's continuous development of full-scenario solutions, quick response to market demand, and a high level of R&D and innovation capabilities. At the same time, the product continues to advance towards advanced intelligence and has a first-mover advantage. The company's cloud office terminal business continues to improve the competitiveness of the headset product line and has completed the iterative upgrade of the BH series business Bluetooth headset. Currently, feedback on the new product within the channel is quite positive, giving sufficient impetus for further market user verification.
The equity incentive target shows confidence, and the cash dividends are considerable. The company's new equity incentives assess 24-25 revenue and performance on a 23-year basis: the 24-year revenue and net profit growth target is 20%, and the 25-year revenue and net profit growth target is 40%. In 2023, the company plans to pay a dividend of 1.14 billion yuan (tax included), which is compounded by a dividend of 630 million yuan in mid-23, and the annual dividend ratio will reach 87.9%.
Profit forecasting and investment advice. The company's net profit for 2024-2026 is estimated to be RMB 24.1/29.5/3.61 billion, respectively, and the corresponding EPS is RMB 1.91/2.33/2.86 yuan per share, respectively. Referring to comparable company valuations, the company was given a reasonable valuation ratio of 26 times PE in 2024, with a reasonable value of 49.65 yuan/share, maintaining a “buy” rating.
Risk warning. Risk that industry demand recovery falls short of expectations; risk of exchange rate fluctuations; increased industry competition; new product business falls short of expectations