Incident: Audience Media revealed the 2023 Annual Report and the 2014 Quarterly Report. In '23, the company achieved revenue of 11.904 billion yuan, an increase of 26.30%; net profit to mother of 4.827 billion yuan, an increase of 73.02%; net profit after deducting non-return to mother was 4.374 billion yuan, an increase of 82.68%. The results in 23 years were impressive, mainly due to the recovery in the advertising market and the release of flexibility in performance recovery. 23Q4 revenue was 3.28 billion yuan, up 57.13%; net profit to mother was 1,225 million yuan, up 85.81%; net profit after deducting non-return to mother was 1,117 billion yuan, up 152.0%. 24Q1 revenue was 2.73 billion yuan, up 6.02%; net profit to mother was 1,040 million yuan, up 10.50%; net profit after deducting non-return to mother was 945 million yuan, up 18.17% year on year.
Looking at the advertiser structure of Ladder Media and other businesses, FMCG advertisers' advertising budgets have clearly recovered year over year in '23, and their share has increased. In 2013, the revenue of consumer goods for daily use was 6.285 billion yuan, an increase of 27.24% over the same period, increasing its share to 56.45% (accounting for the revenue of Ti Media and other businesses).
Looking at the location, the elevator TV media site continues to expand, and the overall frame poster is stable. According to the company's financial report, as of the end of 24Q1, domestic elevator TV media had self-operated 897,000 units, continuing to penetrate Tier 1 and 2 cities. The domestic self-operated location of the frame poster is relatively stable. Rapid expansion of overseas locations is currently a strategic priority, and overseas business growth can be expected in 24 years. By the end of 24Q1, the company's overseas elevator TV self-operated media had increased by 43.9% to 154,000 units compared to the end of '22. Overseas elevator poster self-operated media had increased sharply by 350% to 18,000 units, and overseas locations grew rapidly. Looking at overseas profits, regions such as Singapore, Indonesia, and Hong Kong, China have been profitable in 23 years.
The company plans to pay a dividend of 3.3 yuan (tax included) for every 10 shares in '23, with a total cash dividend of 4.766 billion yuan, accounting for 98.73% of net profit returned to mother in '23, maintaining a high dividend rate.
Profit forecasting and investment advice. The company's revenue for 24-25 is estimated to be 126.12 billion yuan and 13.341 billion yuan, respectively, and net profit to mother is 5.317 billion yuan and 5.749 billion yuan, respectively. With the macroeconomic economy and consumption recovery, FMCG is the most resilient advertiser, and there is a certain guarantee of growth and sustainability in subsequent marketing, and overseas business expansion is expected to bring growth. Combining DCF and the relative valuation method, the reasonable value of the company was obtained at 8.34 yuan/share, corresponding to 23X PE in 24 years, maintaining a “buy” rating.
Risk warning. The macroeconomy is sluggish; competition in the advertising market is intensifying; repayments fall short of expectations.