Incident Overview
In 2023, the company achieved revenue of 1,848 billion yuan, +27.36% year over year; net profit to mother was 329 million yuan, +107.82% year over year; net profit after deducting non-return to mother was 292 million yuan, +96.76% year over year. Among them, 23Q4 achieved revenue of 534 million yuan, +10.85% year over year; net profit of 115 million yuan, +67.08% year over year; net profit after deducting non-return to mother of 104 million yuan, +45.39% year over year.
2024Q1 achieved revenue of 586 million yuan, +49.75% year over year, net profit to mother of 91 million yuan, +65.30% year over year, net profit after deducting non-return to mother of 84 million yuan, +68.54% year on year.
Analytical judgment:
Omni-channel strategy implemented, Q1 ushered in a good start
In 2023, the company continued to implement the “omnichannel+multi-category” business model, expanding from a single bean to flavored nut products and puffed baked goods to achieve diversified product development; offline channels further expanded from traditional supermarkets to high-end member stores, snack stores, etc., and online channels were launched on major e-commerce platforms, achieving a year-on-year increase in sales scale of 27.36% to 1,848 billion yuan.
By product, comprehensive nuts and soybeans, green peas/ melon kernels/ broad beans/ other/ other business revenues were 5.04/4.65/2.73/2.32/3.62/0.11 billion yuan respectively, up 32.16%/26.04%/18.38%/11.02%/43.29%/41.13%, respectively. The old three products continued to grow rapidly. Comprehensive nuts benefited from the impressive performance of flavored nuts, shrimp, beans and other products.
By channel, distribution/e-commerce and other channels achieved revenue of 1,572/2.16/49 billion yuan respectively in '23, up 27.63%/29.39%/9.86% year-on-year, respectively. Traditional distribution channels are still the main increase.
By region, East China/ North China/ Central China/ Southwest/ E-Commerce/South China/Northwest/ Northeast China/ Other regions achieved revenue of 4.53/3.26/2.89/2.45/2.16/1.30/0.95/0.78/ 0.04 billion yuan respectively, compared with 53.14%/12.97%/19.97%/22.50%/29.39%/36.96%/9.41%/21.85%/-6.97%, all core regions achieved year-on-year growth.
24Q1 ushered in the peak consumption season for the Spring Festival. According to the company's customs activity record, the products sold by the company, such as melon seeds, peanuts, macadamia nuts, and cashew nuts, are essential New Year's goods. All major categories of products maintained a relatively rapid growth rate, driving overall revenue up 49.75% year-on-year to 586 million yuan.
The scale effect brought about an increase in cost efficiency ratio, and profits continued to increase
On the cost side, the company's gross margin increased by 1.98 pct to 36.2% year on year, mainly due to the fact that the company's core raw materials all declined to varying degrees year over year. According to the company's customs investment activity record, macadamia nuts decreased by 31.6% and palm oil decreased by 23.6%. On the cost side, the company's sales/management/R&D/finance expense ratios were 11.5%/3.8%/1.3%/-0.8%, respectively, -2.55/-0.71/-0.29/ -0.04pct. The sales expense ratio decreased a lot, mainly due to the scale effect. The parent company was certified as a high-tech enterprise at the end of '23, and the income tax rate was reduced to 15%, which also increased profits. Taken together, the company's net interest rate increased 6.90 pct to 17.8% year over year due to increased revenue, lower cost, and higher cost efficiency ratio; the corresponding net profit to mother increased 107.82% year over year to 329 million yuan.
24Q1 On the cost side, we believe that due to strong promotions and discounts during the Spring Festival under the e-commerce model, gross margin decreased by 1.0 pct to 35.4% year on year; the cost side sales/management/R&D/finance cost rates were 13.1%/1.1%/-0.6%, respectively, -0.6/-0.8/-0.1/-0.1 pct. We believe that thanks to the increase in scale, all expense rates declined year on year; the decline in income tax rates also boosted profits. Taken together, the Q1 net margin increased by 1.5 pct to 15.6% year on year, and the corresponding net profit increased by 65.30% year on year to 91 million yuan.
24 has had a bright start, and the potential has improved throughout the year
The company got off to a good start in '24. We are optimistic that the company will continue to focus on product R&D innovation, optimize supply chain efficiency, improve organizational management efficiency, give full play to cost advantages, and achieve scale improvement. The channel side deepens the omnichannel strategy, further increases the network coverage of traditional channels such as KA, BC, and CVS, and stabilizes and expands the market size of emerging channels such as snack stores, e-commerce platforms, social e-commerce and live streaming, and O2O timely retail; the product side continues to optimize product categories, strengthen and upgrade the old three series of products, and continue to refine the core products to further consolidate the dominant position of the old three products, quickly follow up and add superior categories to promote multi-category layout; the operation side improves operational efficiency and continuously improves cost control, warehousing and logistics, and cost control Equal abilities to achieve Optimization of management capabilities.
Investment advice
Referring to the latest performance forecast, we lowered the forecast of the company's 24/25 revenue of 25.86/3.115 billion yuan to 2,402/3.02 billion yuan; raised the 24/25 EPS forecast of 3.96/4.93 yuan to 4.38/5.44 yuan, and added the 26-year EPS forecast of 6.65 yuan; and the valuation corresponding to the closing price of 83.64 yuan on April 25, 2024 was 19/15/13 times, respectively.
Risk warning
The expansion of supermarket channels fell short of expectations, the decline in raw material prices fell short of expectations, and industry competition intensified