The company announced its 2023 annual report: net profit of 1.57 billion yuan to mother, putting pressure on short-term results. 1) Revenue: Achieved 459 billion yuan for the full year of 2023, -15% year over year, of which 23Q4 was 90.4 billion yuan, -38% year over year.
Mainly due to insufficient domestic and external demand, commodity prices are under overall pressure, and industrial production is under certain pressure. At a low point in the industrial cycle, the company and manufacturing customers are sharing the downward pressure on the market. 2) Gross profit: Achieved 8.8 billion yuan for the full year of 2023, with a gross profit margin of 2%, a year-on-year decrease of 0.2 percentage points; of these, 23Q4 gross profit reached 2.9 billion yuan, an increase of 14%, a year-on-year increase of 63%, and a gross profit margin of 3.2%, an increase of 1.9 percentage points over the previous year. 3) Expenses: The total cost rate for the period (sales/management/R&D/finance expenses) for the full year of 2023 was 1.2%, an increase of 0.3 percentage points over the previous year; 23Q4 was 1.3%, a decrease of 0.1 percentage points over the previous year. 4) Net profit to mother: Net profit to mother achieved 1.57 billion yuan for the full year of 2023, -40% year on year, down 0.2 percentage points year on year; of these, 23Q4 achieved 390 million yuan, -15% year over year, +35% month on month, and 0.4% month-on-month net profit, up 2 percentage points from month to month.
By business, performance declined throughout the year 23 due to factors such as falling prices of major business products and pressure on customer demand. 1) Commodity operations: a) 23 The annual supply chain business revenue was 439.2 billion yuan, -15.6% year-on-year.
Among them, metal minerals/agricultural products/energy chemicals/new energy were -22.2%/+16.7%/-5.52%/-23.2%, respectively; revenue accounted for 62%/14%/20%/4%. b) Gross profit: The current gross profit for the full year 23 supply chain was 6.1 billion yuan, with a gross profit margin of 1.4%, a decrease of 0.33 percentage points over the previous year. The current gross profit margin for metal minerals/agricultural products/energy chemicals/new energy was 1.91%/-0.89%/1.21%/1.78%, +0.33/ -3.61/-0.56/-0.12 percentage points year-on-year, respectively; the gross profit amounts were 51.77/ -5.42/10.5/342 million yuan, respectively. The gross margin of the agricultural products sector was negative mainly due to falling downward prices in the corn market. c) Cargo volume: 23 The total volume of goods in the supply chain for the whole year was 225 million tons, +14% over the same period last year. The volume of the four major categories was +12.53%/+15.33%/+15.32%/+71.09%, respectively; the volume accounted for 58%/9%/32%/0.2%. d) Gross profit per ton: 23 The annual supply chain's revenue per ton was 1951 yuan/ton, +35% year-on-year; current gross profit per ton period was 27 yuan/ton. The revenue per ton of the four major categories was +45%/-1%/+22%/+130%; the current gross profit per ton period was 39/ -27/14/924 yuan, respectively. e) According to subsidiary information disclosed by the company, the net profit of Xiangyu Agricultural Products in 2023 was 980 million yuan, compared to 305 million yuan for the same period last year. 2) Bulk logistics business: 23 The annual revenue of bulk logistics business was 7.1 billion yuan, -7.84% year-on-year. The gross profit margin was 9.9%, down 1.89 percentage points year over year. Integrated logistics/agricultural logistics/railway logistics revenue was 55.41/2.9/12.54, -13.39%/-6.88%/28.09%; gross profit margin 9.9%/35.2%/4.1%, a year-on-year decrease of 0.04/25.6/4.24pct. 3) The company disclosed its shipbuilding business and achieved revenue of 4.75 billion yuan in 2023, +43% year over year, gross profit of 1.07 billion yuan, and +258% year over year. According to the company's disclosure of subsidiary information, Xiangyu Marine (Ship Construction) had operating profit of 456 million yuan in 2023, net profit of 700 million yuan, and net profit loss of 70 million yuan for the same period last year. The company received 37 new orders in 2023, and the total number of new orders received exceeded 8.2 billion yuan. Both the number of orders received and the gross profit from the orders received reached record highs. By the end of 2023, there were 64 orders in hand.
In recent years, the company has continued to optimize its customer structure and increase the number of manufacturing enterprises and the proportion of service volume. As of the full year of 2023, the overall customer service volume of the company's manufacturing industry has stabilized at more than 60%. Among them, the new energy supply chain manufacturing industry accounts for more than 80% of customer service, the ferrous metal, aluminum, coal, and grain raw grain supply chain manufacturing accounts for more than 70% of customer service volume, more than 60% of the coal and grain raw grain supply chain, and more than 50% of the stainless steel supply chain. In the second half of the year, the company will further expand its international layout, seize opportunities to increase scale and market share on the basis of strengthening risk management and control, and strive to achieve marginal profit improvements.
Investment suggestions: 1) Profit forecast: Considering market environmental pressure and declining profit margins in the agricultural sector, we adjusted the company's 24-25 net profit forecast to be 19.4 billion yuan and 2.29 billion yuan (the original forecast was 2.6, 31.7 billion yuan), and introduced a profit forecast of 2.64 billion yuan. The corresponding EPS was 0.8, 1.01, 1.16 yuan, and the corresponding PE was 8, 7, and 6 times. 2) Investment suggestion: Considering that the compound net profit growth rate of the company's net profit in the next three years is 19%, with a target market value of 23.3 billion yuan in 2024. After considering the impact of the increase (proposed issuance to raise 3.22 billion yuan), the target price is 8.8 yuan, which is expected to be 28% more space than the current price, emphasizing the “strong push” rating.
Risk warning: demand for commodities has declined sharply; transformation has fallen short of expectations; asset-heavy investment costs have exceeded expectations, etc.