Incident: The company released its 2024 quarterly report. In the first quarter of 2024, the company achieved revenue of 68.98 billion yuan, an increase of 6% over the previous year; realized net profit of 4.77 billion yuan, an increase of 20.2% over the previous year; and realized net profit of 4.64 billion yuan after deduction, an increase of 25.4% over the previous year.
Revenue at home and abroad is growing steadily. The company's revenue in the Chinese market increased by 8.1%. Among them: ① the refrigeration and cleaning industry maintained steady growth, and the aquaculture industry achieved double-digit growth; ② revenue from potential industries such as household air conditioning, kitchen appliances, and smart buildings all increased by more than 10%. The Casadi brand's revenue increased 14% in the first quarter. With the deepening of digital transformation, operating profit in the Chinese market increased by more than 30%. Against the backdrop of declining overseas demand, the company's overseas revenue increased by 4% in the first quarter of 2024, and operating profit increased by more than double digits.
Profitability increased at an accelerated pace. During the reporting period, the company's net profit margin was 6.9%, up 0.82 percentage points. On the one hand, the company's gross profit margin for the first quarter was 29%, an increase of 0.3 percentage points over the previous year; on the other hand, the sales expense rate/management expense rate/R&D expense ratio was optimized by 0.5/0.3/0.1 percentage points compared to the same period last year. Affected by overseas interest rate hikes, interest expenses were 600 million yuan, an increase of 210 million yuan over the previous year. The financial expense ratio was basically the same as the previous year. The company's profitability has been optimized significantly, and the phased results of digital construction have been reflected.
Profit forecasting and investment advice. As a leader in major appliances and smart home solutions, the company lays out multiple brands and products around the world, fully grasps the growth opportunities of the ultra-high-end home appliance market segment, and deeply explores user value through integration. We slightly raised the company's 2024-2026 EPS to 2.05 yuan, 2.37 yuan, and 2.61 yuan, respectively, to maintain the “buy” rating.
Risk warning: Risks such as customer growth falling short of expectations, consumption falling short of expectations, and increased competition.