The company released a quarterly report
24Q1 revenue was 1.2 billion, up 43%; net profit to mother was 120 million, up 170%; net profit after deducting non-return to mother was 110 million, up 325%; gross profit margin was 27%, up 4 pcts; net profit margin was 11%, up 5 pcts.
23Q1 overseas customers were in the inventory removal stage, and the market began to recover in 23H2. Therefore, 24Q1 turnover increased significantly year on year. Among them, kitchen and bathroom products increased significantly year on year, especially leading hardware products. The company has been entering leading products for more than five years. From team building and technology accumulation to product reserves, the company has accumulated sufficient experience to meet customer needs, and expanded the leading hardware product line in 2022. The differentiation of the company's leading products mainly includes two aspects. One is plastic and hardware combination technology; the second is the accumulation of electronic control sensing technology.
The company's business in the North American market has basically covered leading brand customers. While continuing to increase the penetration rate of North American brand customers, it has also continued to expand new customers in the European and American markets. 24Q1 has made new progress: including well-known local kitchen and bathroom brands, leading retail stores and wholesalers, some customers are already in the product selection and sample delivery stage; new domestic customers of water purification products have entered the new product production stage, and the introduction of new European and American customers is also steadily advancing the project progress, continuing to increase momentum for later growth.
The product portfolio is relatively diverse, and the category layout is more complete
In terms of product categories, Jianlin's product matrix covers kitchen and bathroom, clean water, livable air, health and personal care, automotive appliances and other products. The industry focuses relatively more on the development of one or some categories. Jianlin is deeply involved in multiple segments, broadens the competitive circuit, and enhances comprehensive competitiveness and resilience to risks; with its speed of innovation and ability to meet customer needs, it provides customers with multi-dimensional one-stop full-scenario solutions.
Furthermore, the steady development of the company over decades is inseparable from high-quality customer resources, continuous investment in R&D, advanced manufacturing capabilities, a stable talent team, and a unique corporate culture.
Digital intelligence transformation is the key to reducing costs and increasing efficiency for enterprises, and one of the driving forces for growth
The company's digital construction has begun to bear fruit in recent years, and is still continuously promoting improvements, making digitalization the core strength of the group, bridging the gap in operating costs in the industry and speeding up the pace of enterprise development. At a time when the global digital economy is booming, the company is increasing digital process optimization and intelligent manufacturing and operation innovation. The next step is to digitally restructure the core business operation model to achieve simpler customer transactions, more efficient internal operations, and more agile operation management. Through deep integration of industry and digital technology, the company will empower industrial transformation and upgrading, and promote the steady development of new business models.
Adjust profit forecasts to maintain “buy” ratings
The second phase of the plant in Thailand was completed in February '24. Currently, the construction of various production lines is progressing in an orderly manner, including the dental cleaner product line, water purification product line, faucet product line, and air outlet spraying line, etc., and trial production is gradually being implemented. The company expects the full line to be put into operation in early '25. The launch of the overall logistics, warehousing and digital system of the Thai factory is also progressing in an orderly manner to speed up the efficiency of the Thai factory. We expect the company's 24-26 years ago to be 503/5.79/673 billion yuan (24-26 years ago: 48/57/650 million yuan), EPS was 1.12/1.29/1.50 yuan/share, respectively, and the corresponding PE was 14/12/11X, respectively.
Risk warning: Customer development falls short of expectations, overseas demand recovery falls short of expectations, interest rate cuts fall short of expectations, industry competition intensifies, etc.