Incident: The company announced its 2023 and 2024Q1 performance reports; in 2023, the company achieved revenue of 578 million yuan, +10.01% year over year; net profit to mother -0.19 million yuan, -150.24% year over year; net profit without return to mother -59 million yuan, -404.22% year on year. 2024Q1, the company's revenue was 136 million yuan, +2.48% year over month, -12.98% month on month; net profit to mother was 285 million yuan, which turned a loss into profit year on month; net profit without return to mother - 08 billion yuan, +33.82% year over year, +58.90% month on month.
2024Q1 gross margins have been fixed. On the profit margin side, 2024Q1's gross margin was 26.59%, +4.15 pcts year on month, +3.57 pcts month on month; net profit margin was -2.68%, +1.32 pcts year on year, and +3.75 pcts month on month.
2024Q1's gross margin and net profit margin have both recovered year on month. We believe the main reasons are: 1) the share of high-end product shipments has increased and the product structure has improved; 2) the price of some low margin items has been repaired; 3) the company strives to increase efficiency and reduce costs, and the cost structure continues to improve.
R&D maintains high investment, and equity incentives are tied to core key teams. In 2023, the company's R&D expenses were 159 million yuan, +38.21% over the same period; the R&D expenditure rate was 27.54%; by the end of 2023, the number of R&D personnel reached 268, an increase of 39 over the previous year, and the number of R&D personnel exceeded 74% of the company's total number of employees. In order to enhance the cohesion and stability of the team and achieve the common growth and progress of the company and employees, the company continued to optimize and improve the relevant equity incentive system policies, and continued to grant equity incentives to core key teams. A total of 20.784,500 yuan in share payments were generated throughout 2023.
The product portfolio continues to expand, and key downstream areas maintain a high growth rate. The company continues to invest in R&D in AC-DC, LED drivers, DC-DC, battery management, motor drives, signal chains, etc. With leading technical strength, reliable product quality and excellent customer service, the product share in the new consumer electronics, industrial control, network communication, data center and automotive electronics markets continues to grow, and the product structure continues to be optimized; among them, the company's revenue in the household appliances sector increased 58.04% year-on-year in 2023.
Investment advice: We expect the company's revenue for 2024/2025/2025/2026 to be 705/8.22/975 million yuan, respectively, and net profit to mother 0.07/0.26/0.46 billion yuan. The corresponding PE was 271.89/70.55/40.15 times, respectively, maintaining the “gain” rating.
Risk warning: New product development falls short of expectations; downstream demand falls short of expectations; industry competition intensifies.