Under the influence of internal and external factors, the 1Q24 company's performance grew steadily
The company achieved revenue/net profit of 40.1/670 million yuan (yoy +24.1%/+29.6%) and 1Q24 achieved revenue/net profit of 98/160 million yuan (yoy +5.1%/+3.8%). We speculate that the slowdown in the company's 1Q24 performance growth rate was mainly due to disturbances in the external environment affecting the release of consumer ophthalmology and other medical needs. This is compounded by the high base in the context of rapid recovery of ophthalmology diagnosis and treatment after the 1Q23 epidemic. The company's 1Q24 gross profit margin was 49.0% (yoy+0.8pct), and the increase in revenue share of high-margin projects contributed to a steady increase in overall gross margin. Considering the impact of external environmental disturbances on the company's consumer ophthalmology and other business revenue growth, we adjusted the 24-26 EPS forecast to 0.94/1.09/126 million yuan (the value of 1.05/1.37 yuan 24/25 years ago). The company's overall strength is in the first tier of the industry, with excellent business capabilities and steady expansion of the service network. The target price was adjusted to 32.85 yuan (compared to the previous value of 56.88 yuan) for 24 years, and the target price was adjusted to 32.85 yuan (previous value of 56.88 yuan, mainly considering the reduction in the PE average value of comparable companies) to maintain “buying”.
Adhering to the two-wheel drive of “basic eye diseases+consumer medicine”, various business trends are upward 1) Cataract: Revenue of 990 million yuan (yoy +31.4%) in 23 years, mainly due to the obvious recovery in demand for related diagnosis and treatment after the epidemic. We are optimistic that the company's cataract business will improve in 24 years; 2) Future projects:
With revenue of 530 million yuan (yoy +26.9%) in 23 years, considering the company's excellent comprehensive diagnosis and treatment capabilities for complex eye diseases and the continuous increase in influence in the industry, we are optimistic that the company's post-eye projects will achieve positive development in 24 years; 3) Consumer ophthalmology: 23 years of refractance/optometry revenue of 12.1/1.02 billion yuan (yoy +12.4%/+14.9%), considering the continuous expansion of the company's consumer ophthalmology diagnosis and treatment network, and the company's refractive and optometry diagnosis and treatment programs are complete. We are optimistic that the revenue of the sector will grow steadily in 24 years.
Benchmark hospitals continue to improve, and other hospitals are making steady progress
The company continues to strengthen the coverage of the diagnosis and treatment service network. By the end of 23, the company had 57 ophthalmology specialist hospitals and 60 optometry centers in China, including: 1) Benchmark Hospitals: Xiamen Ophthalmology Center/Shanghai Heping /Fuzhou Ophthalmology Revenue of 9.8/2.2/170 million yuan in 23 years (yoy +15.2%/+36.4%/+8.7%); looking forward to 24 years, we are optimistic that it will achieve good development in the context of its strong regional brand strength and diagnosis and treatment capabilities. 2) Other hospitals: Revenue of 23 billion yuan (yoy +21.1%). Considering that the company's stock of hospitals continues to climb the slope and the increase in the contribution of newly opened hospitals, we are optimistic that the trend of the company's other hospitals will improve in 24 years.
Acquiring an extracorporeal ophthalmology hospital to accelerate the “endogenous growth+epitaxial merger and acquisition” development strategy, the company announced on April 26 that it plans to invest 502.5 billion yuan to acquire 100% of the shares of Xiamen Huaxia Juxin No.1 Investment Consulting Co., Ltd. (“Yuanju Aidi”). The investment consulting company currently holds 51% of the shares of Sichuan Yuanju Aidi Eye Hospital Management Co., Ltd. (“Yuanju Aidi”), and Yuanju Aidi already holds Chengdu Aidi Eye Hospital (Top 3), Weishan Medical University Eye Hospital and Suining Fuxing Ophthalmology Hospital; after the completion of this acquisition, the company will achieve the above An indirect holding in an ophthalmology hospital. We are optimistic that the company will use the M&A fund model to accelerate the expansion of the service network and further enhance the company's overall performance.
Risk warning: Increased market competition, medical accidents and disputes, management risks of continued expansion.