Description of the event
The company released its financial report for 2023, which achieved revenue of 3.298 billion yuan/ +558.96%, recovering to 26% in the same period in 2019; net profit to mother of 0.32 million yuan/ +114.58%, an increase of 254 million yuan over the same period of the previous year, reverting to 47% in the same period in 2019; net profit after deducting non-return to mother of 9.12 million yuan/ +103.56%, an increase of 265 million yuan over the same period last year, turning a loss into profit; EPS 0.03 yuan. Among them, 2023Q4 achieved revenue of 1,245 million yuan/ +436.09%, net profit of 18.1415 million yuan/ +120.25%, net loss of 1.0974 million yuan/ +99.09% after deducting non-return net loss of 1.0974 million yuan/ +99.09%, a decrease of 120 million yuan compared to the same period last year.
Incident reviews
Benefiting from multiple benefits such as travel policy optimization during the period, the company's core business sector resumed in an orderly manner and achieved steady growth in performance. The wholesale business achieved revenue of 2,027 billion yuan/ +1858.48%, and a gross profit margin of 11.51% /-3.05pct. The company uses its two major wholesale brands Unide Travel and Panorama Travel to highlight scale advantages, and has more advantages in optimizing the supply chain and reducing procurement costs. The retail business achieved revenue of 466 million yuan/ +433.18%, and a gross profit margin of 15.55% /+1.73 pct. Online+offline omni-channel retail model to accurately reach the customer base. At the end of the period, there were more than 1,500 stores and more than 3,500 professional consultants, and the number and scale of stores and professional consultants surpassed the same period in 2019; during the year, the total number of live broadcasts on the company's e-commerce platform exceeded 6,000, the cumulative number of viewers exceeded 14 million, sold nearly 40,000 live streaming products, and nearly 520,000 active fans.
The company's gross profit margin was 11.57% /-1.53pct during the period, and the net profit margin was 1.03% /+50.65pct. The overall cost ratio is 11.85% /-49.67pct, of which the sales expense ratio is 8.17% /-24.02pct, the management expense ratio is 3.22% /-15.58pct, and the financial expense ratio is 0.47% /-10.07pct. Net cash flow from operating activities was 170 million yuan/ +179.52%.
Increased popularity of inbound and outbound travel led to an accelerated recovery of the company's 2024Q1 performance. 2024Q1 achieved revenue of 1,025 million yuan/ +643.38%, recovering to 42% in the same period in 2019; net profit due to mother of 0.28 million yuan/ +174.79%, up 66 million yuan from the same period last year, reverting to 43% in the same period in 2019; net profit after deducting non-attributable net profit of 28 million yuan/ +171.52%, an increase of 67 million yuan over the same period last year, turning a loss into profit; EPS 0.03 yuan. 2024Q1 company gross profit margin 14.89% /+1.48pct, net profit margin 2.71% /+31.68pct. The overall cost ratio is 12.19% /-31.4pct, of which the sales expense ratio is 8.32% /-14.92pct, the management expense ratio is 2.49% /-11.75pct, and the financial expense ratio is 1.37% /-4.72pct.
Investment advice
I am optimistic that the increase in flight supply during the year, favorable visa-free policies, and the implementation of paid leave policies will drive a continuous recovery in inbound and outbound travel levels; measures such as improving the company's procurement capacity, reducing costs and increasing efficiency, as well as the number of retail stores and the number of travel consultants, have returned to pre-pandemic levels, and I am optimistic that the company's profitability will continue to increase. We expect the company's 2024-2026 EPS to be 0.13\ 0.29\ 0.55 yuan respectively, corresponding to the company's closing price of 6.56 yuan on May 6, and PE 51.5\ 22.6\ 11.8 times in 2024-2026, respectively, maintaining the “Increased holdings - B” rating.
Risk warning
The recovery in consumer consumption fell short of expectations; the risk of changes in immigration policies; the risk of market competition.