Revenue increased slightly year-on-year, and profits decreased slightly. 2024Q1 achieved revenue of 1.37 billion yuan, +0.85% year-on-year, net profit -0.46 billion yuan, year-on-year net profit of +18.2%, net profit without return to mother of 0.58 million yuan, year-on-year net profit of -60 million yuan, +2.6% year-on-year, EPS was -0.14 yuan/share. Affected by the overall slow resumption of work and continued pressure on real estate, revenue increased slightly year-on-year, and profit decreased slightly. Among them, the year-on-year increase in non-recurring profit and loss was mainly due to depreciation of accounts receivable and preparation for a return of 9.39 million yuan.
The gross margin increased year over year, and the cost ratio was slightly optimized. The comprehensive gross profit margin of 2024Q1 is 30.4%, +0.3 pp/month-on-month -3.5 pp. The month-on-month decline is expected to be mainly affected by changes in product structure, but it benefits from the year-on-year decline in prices of major raw materials and the gradual cultivation and maturity of some categories, increasing gross margin over year, and partly hedging the impact of product structure. The cost ratio for the period was 32.2%, year-on-year -0.14pp/month-on-month +9.2pp, with sales/management/ financial/ R&D expense ratios compared to the same period
-1.2pp/+0.44pp/+0.16pp/+0.44pp, the cost ratio is slightly optimized.
Repayments remain healthy, the scale of accounts receivable has been further reduced, and the debt structure has been optimized. 2024Q1 achieved net operating cash flow of -610 million yuan, compared to -360 million yuan in the same period last year, mainly affected by a decrease in sales receipts and an increase in operating expenses, as well as a relatively high repayment base for the same period due to partial centralized collection. The payout ratio and payout ratio were 1.01/1.31, respectively, and 1.18/1.37 for the same period last year. As of the end of March 2024, accounts receivable and notes receivable were $3.58 billion, or $480 million, compared to the beginning of the period, with a balance ratio of 41.2%, or -8.6pp/month-on-month. The scale of accounts receivable was further reduced, and the debt structure was optimized.
Risk warning: Real estate recovery falls short of expectations; raw material prices have risen sharply; new categories and market expansion fall short of expectations
Investment advice: Steady operation, growth is expected to gradually return, maintain “buy” rating companies to continue to pay attention to improving input, output and labor efficiency, stick to quality and cash flow, and continue to actively expand overseas markets. They are expected to contribute more growth in the future, adding maturing categories and improving internal management efficiency. There is room for further improvement in profits, and continue to be optimistic about the company's long-term development. EPS is expected to be 1.56/2.04/2.46 yuan/share in 24-26, corresponding PE is 19.3/14.7/12.2x, maintaining a “buy” rating.