Incidents:
[Putamen BLCO E_SMM AR2Y0] In its quarterly report of '24, Q1 achieved revenue of 306 million yuan/ +10.06%, net profit of 107 million yuan/ +21.69%, net profit after deducting non-return to mother of 103 million yuan/ +24.60%, and non-recurring profit and loss of 0.04 billion yuan, mainly from government subsidies.
Comment:
IVD and clinical medicine are developing steadily, and there is sufficient potential for medical aesthetics and consumer health. The company's IVD and clinical medicine are constrained by factors such as industry policies. It is expected to grow steadily. Along with the improvement of the product matrix and the strengthening of marketing capabilities, product coverage will be further expanded. Among them, luminescence and saccharification have obvious technical and cost advantages, which are expected to continue to drive the growth of the IVD sector. The dermatology and consumer health sector is progressing steadily, and is expected to maintain a high growth rate. Among them, the treatment effects of the major medical and aesthetic products “Cold Lift” and “Ultrasound V Latin America” have been recognized, and the new product “MM Light” has been promoted smoothly. The company will continue to develop new products in the fields of anti-aging, skin whitening, skin treatment, hair removal and hair growth, and intimate treatment, and continue to provide consumers with complete solutions.
The results of improving quality and efficiency are obvious, and the cost rate is declining steadily. Q1 The company's expense ratio was 26.62% /-2.66pct, of which: 1) sales expense ratio was 12.80% /-0.69pct, sales expenses continued to grow, and the cost rate decreased due to scale effect; 2) management expense ratio 4.96% /+0.12pct; 3) R&D expense ratio 11.97% /+0.20pct; 4) financial expense ratio -3.11% /-2.29pct, due to increased interest income and reduced exchange losses.
Product structure optimization led to an increase in gross margin and a steady increase in profit levels. Profitability: Q1 The company's gross profit margin was 69.99% /+4.00pct, net profit margin 35.07% /+3.35pct, net interest rate after deducting non-return mother net interest rate of 33.78% /+3.94pct; the company's gross margin reached a new high in a single quarter since listing, mainly due to a further increase in sales share of high-margin products. Liquidity: Q1 The company has an inventory turnover of 139 days/-27 days, accounts receivable turnover days of 53 days/+21 days, good inventory management, and accounts receivable increased with market expansion. Cash flow: Q1 The company's net operating cash flow was 26 million yuan/ +12.51%, due to increased sales receipts. The company's cash flow is relatively healthy.
Investment advice: On the basis of stabilizing IVD and clinical medical advantages, the company actively expands dermatology, aesthetic medicine and consumer health businesses, and continuously promotes technology research and development and product innovation. The market competitiveness is expected to continue to strengthen. Considering the intensification of market competition and adjusted profit forecasts, the estimated revenue for 2024-2026 will be 1,461 million/1,799 million/2.55 billion, respectively, and net profit to mother will be 421 million/534 million/642 million, corresponding to PE 19 times/15 times/13 times. Maintain a “buy” rating.
Risk warning: Market competition intensifies; equipment installation falls short of expectations; industry procurement risks; performance forecasts and valuation judgments fall short of expectations.