Incident: The company released its 2023 annual report. Revenue for 2023 was 771 million yuan, down 28.25% year on year, and net profit to mother was 54 million yuan, down 74.99% year on year.
Key points of investment
Revenue and net profit decreased year on year: 2023 revenue was 771 million yuan, down 28.25% year on year, net profit to mother was 54 million yuan, down 74.99% year on year, after deducting non-net profit of 24 million yuan, down 88.36% year on year. The main reasons for the year-on-year decline in net profit due to the year-on-year decline in the reporting period: 1. Delivery of some of the company's products and project acceptance progress slowed during the reporting period, leading to a sharp year-on-year decline in revenue in the fourth quarter. 2. Based on the principle of prudence, the company conducted impairment tests on various assets in the consolidated statement as of December 31, 2023 and calculated impairment losses.
Deeply involved in the core components of unmanned systems, various products are widely used: the company has been deeply involved in the industry for nearly 20 years with inertial technology as the core. Currently, its products cover core components of unmanned systems such as inertial navigation, optoelectronic detection, and satellite communications. During the reporting period, in the field of inertial navigation, the company developed a series of products such as MEMS and optical fiber. In addition to being used in the company's complete unmanned systems, they are also widely used in railway traffic, robots, unmanned shearers, flying skateboards, etc.; in the field of photoelectric detection equipment, the company's photoelectric tracking turret was successfully used in law enforcement vessels, and high-light dazzling rejection equipment has also entered the finalization stage and has batch delivery capabilities. At the same time, the company has increased investment in R&D and production, expanded the production capacity of photoelectric detection products, and provided a strong guarantee for subsequent orders. In the field of security radar, the company has introduced bridge collision avoidance systems and participated in a number of bridge collision avoidance projects. The company's information perception business continued to grow, achieving revenue of 160 million yuan.
Leading the entire unmanned system industry, completing the development of unmanned vehicles and unmanned ships: The company has mastered the core technologies of unmanned systems such as inertial navigation, satellite communication, electronic confrontation, command and control, and has R&D and production capabilities from core components of unmanned systems to complete unmanned systems. In recent years, the drone business has developed rapidly. The company has now developed and produced low, medium and high spectrum unmanned target machines, with flight speed coverage of 70m/s-310m/s, covering land, marine and plateaus, and has accumulated core technologies such as heavy overload, high maneuverability, ultra-low altitude sea crossing, multi-aircraft formation, and anti-interference. At the same time, the company is also committed to building a training system integrating sea, land and air, and has completed the finalization of certain types of unmanned vehicles and the development of unmanned ships with strategic partners. During the reporting period, the company's unmanned systems business achieved revenue of 500 million yuan.
Profit forecast and investment rating: The company's performance is in line with expectations, but industry orders fluctuate greatly, so we lowered the company's 2024-2025 net profit forecast to 1.67 billion yuan (previous value: 307/405 million yuan), and added the 2026 net profit forecast value of 270 million yuan, corresponding PE is 26/20/16 times, respectively. Considering the key card positions of the company's three major business sectors of unmanned systems, information perception and satellite communications, the market share is large, and still maintains a “buy” rating.
Risk warning: 1) Market competition risk; 2) Business performance fluctuates seasonally; 3) Downstream demand falls short of expectations.