Incident: The company released its 2023 annual report and 2024 quarterly report. In 2023, the company achieved operating income of 1,848 million yuan, an increase of 27.36%; realized net profit to mother of 329 million yuan, an increase of 107.82%. 23Q4 achieved revenue of 586 million yuan, an increase of 10.85%; realized net profit of 115 million yuan to mother, an increase of 66.99%. In line with the performance forecast, in line with market expectations. The dividend plan is to pay 21.8 yuan in cash (tax included) for every 10 shares, with a dividend rate of 61.06%. The 24Q1 company achieved revenue of 586 million yuan, an increase of 49.75%; net profit to mother was 91 million yuan, an increase of 65.3%. Revenue and profits are in line with expectations.
Investment rating and valuation: Considering the decline in the corporate income tax rate, the 24-25 profit forecast is estimated to be 4.16, 5.12, and 614 million yuan (3.58 billion yuan and 459 million yuan in the 24-25 year period), respectively, with year-on-year increases of 26%, 23%, and 20%. The corresponding EPS is 4.46, 5.50, 6.59 yuan (3.84 and 4.92 yuan before 24-26), respectively. The current stock price is 19, 15, and 13x, respectively. Maintain an increase in holdings rating. The company has accelerated product development and promotion efforts in recent years, from the expansion of single bean products to flavored nut products and puffed bakery products. The channel side is based on traditional supermarket channels, and actively expands channels such as mass snack stores, live e-commerce, and high-end member stores. At present, the company has completed a multi-category omnichannel layout, and future development momentum is expected to continue to increase.
New product superposition channels are gaining strength, and revenue is growing rapidly. Considering the impact of the Spring Festival misschedule, the 23Q4+24Q1 company achieved a total revenue of 1.120 billion yuan, an increase of 28.3% over the previous year. By product, comprehensive nuts/green peas/other series/melon kernels/broad beans achieved revenue of 504 million/462 million/273 million/232 million/232 million, respectively, with a year-on-year ratio of 32.2%/26.0%/43.3%/18.4%/11.0%, respectively. Looking at volume and price breakdown, sales of comprehensive nuts/green peas/other series/melon kernels/broad beans were 76.7%/25.3%/50.2%/18.4%/10.3%, respectively, and the average price was -25.2%/0.6%/-4.6%/0.0%/0.7%, respectively. Among them, the old three products achieved steady growth, while the other series of high-growth products were mainly due to the rapid release of categories such as potato chips. By channel, in 2023, the company's distribution/e-commerce and other models achieved revenue of 1,572/2.16/49 billion yuan respectively, an increase of 27.63%/29.39%/9.86% over the previous year.
The effect of scale is evident, income tax rates have declined, and profitability has increased. According to the company announcement, the company achieved a gross profit margin of 36.24% in '23, an increase of 1.98 pct over the previous year. The forecast is mainly due to a decline in raw material costs and an adjustment in the company's product structure. Among them, the purchase price of macadamia nuts decreased by 31.65% year over year. In 2023, the company achieved sales, management, R&D, and financial expense rates of 11.5%/3.8%/1.3%/-0.8%, respectively, -2.5pct/-0.7pct/-0.3pct/0.0pct year-on-year, respectively. As the scale of sales increased, the sales expense ratio and management expense ratio both declined year-on-year. Furthermore, the company was rated as a high-tech enterprise in December '23, and corporate income tax was levied at a 15% rate. Overall, the company achieved a net interest rate of 17.81% in '23, an increase of 6.9pct over the previous year. 24Q1 achieved a gross profit margin of 35.39%, a year-on-year decrease of 0.96pct. It is expected that e-commerce platform promotions will increase during the Spring Festival. The 24Q1 expense rate was generally stable, but the 24Q1 net interest rate was 1.48pct to 15.58%, thanks to lower income tax rates.
Stock price performance catalyst: new product release exceeds expectations
Core hypothetical risks: increased competition, category expansion falling short of expectations, food safety issues