Incident: The company announced that in 2023, it achieved revenue of 538 million yuan, an increase of 32.21%; converted net profit from loss to profit of 0.18 million yuan; deducted non-attributable net profit - a loss of 46 million yuan. 2024Q1 achieved revenue of 144 million yuan, a year-on-year decrease of 21.69%; attributable net profit of 0.05 billion yuan turned a loss into a profit; and deducted non-vested net profit of 0.07 billion yuan.
Proceeds from investment projects helped to improve results in 2023. The company's operations gradually returned to normal in 2023, achieving a gross profit ratio of 36.37% with an increase of 17.75pct; the period expense ratio of 34.12% decreased by 10.26pct; the asset and credit impairment loss rate was 12.06%, a decrease of 12.03pct; the Gongqingcheng Qiushi Equity Investment Partnership purchased by the company in 2023 was listed in May 2023. The company confirmed the fair value change income of the corresponding equity investment fund. In 2023, 64 million yuan was eventually attributed to the net interest rate 3.
31% increase of 41.65pct. The company's net operating cash flow in 2023 was 139 million yuan, an increase of 304 million yuan over the previous year; the revenue ratio increased by 23.2 pcts from 132.88%; and the payout ratio decreased by 114.32% and 13.57 pcts.
Gross margin and impairment losses continued to improve. The company's 2024Q1 gross profit margin of 32.45% increased by 3.31pct; the period expense ratio of 24.18% increased by 2.77pct; the asset and credit impairment loss ratio decreased by 1.25% by 6.77pct; and the net vested interest rate of 3.72% increased by 2.74pct. The company's net operating cash flow inflow of 2024Q1 was 0.07 billion yuan, with a year-on-year increase of 0.04 billion yuan; the revenue ratio increased 0.84 pct by 93.75%; and the payout ratio decreased by 22.37 pcts from the payout ratio of 77.73%. As of 2024Q1, the size of the company's accounts receivable and notes, inventory+contract assets, accounts payable and notes, accounts receivable plus contract liabilities was RMB 4.6/4.3/3/0.9 billion, respectively, with a year-on-year change of -2.62%/-2.39%/5.00%/1.44% from the beginning of the year.
Investment suggestions: In terms of main business, domestic economic activity is on the right track in 2023, with the release of consumer consumption and government investment demand, and the company's main business is expected to bottom out; the company's power exchange heavy truck operation business is progressing smoothly. The construction of 3 heavy truck power exchange stations was completed in 2023, and 3 heavy truck exchange stations are under construction; and a strategic cooperation agreement was signed with Yangquan Yu County to build and operate 100 new energy power exchange stations in stages. We forecast that the company's net profit in 2024-2026 will be 0.23/0.580.90 million yuan, with a year-on-year growth rate of 29.72%/151.95%/54.92%, EPS 0.15/0.39/0.60 yuan/share, respectively. The latest closing price corresponding to 2024-2026 PE will be 71.93/55/28.18.43 times, respectively, maintaining the “increase” rating.
Risk warning: Investment returns fall short of expectations, heavy truck power exchange operations fall short of expectations, macroeconomic downturn.