Revenue and profit reached record highs in 2023, and the profit side grew rapidly in the first quarter of 2024. In 2023, the company achieved revenue of 2,411 billion yuan (+21.78%), net profit attributable to mother of 486 million yuan (+46.99%), and net profit of non-return to mother of 463 million yuan (+54.67%). Among them, 23Q4 single-quarter revenue was 666 million yuan (+42.33%), net profit attributable to mother was 99 million yuan (-4.09%), and net profit after deducting non-return to mother was 86 million yuan (+3.16%). Revenue for the first quarter of 2024 was 620 million yuan (+12.72%), net profit attributable to mother was 143 million yuan (+41.36%), net profit after deducting non-return to mother was 141 million yuan (+42.21%). The company's revenue and profit reached record highs in 2023, and the profit side grew faster than the revenue side. Mainly due to significant cost reduction and efficiency results, net profit to mother continued to grow rapidly in the first quarter of 2024.
Domestic business fluctuated in the short term, and overseas business grew rapidly. By region, the company's domestic market sales revenue in 2023 was 1.35 billion yuan (+18.2%), and the domestic business growth rate was slightly lower. The pace of promotion of new products was affected by industry restructuring. Overseas business maintained rapid growth, mainly due to the continuous expansion of overseas channels and the promotion of its own brands.
The results of reducing costs and increasing efficiency are remarkable, and profitability has improved markedly. In 2023, the company's gross profit margin was 64.50% (+3.55pp). The increase in gross margin mainly benefited from the increase in the sales share of high-margin products and the continuous promotion of cost reduction measures; sales expense ratio 23.74% (+1.86pp), management expense ratio 13.63% (-1.98pp), R&D expense ratio 6.25% (-2.10pp), financial expense ratio -3.23% (-0.16pp), four rates of 40.40% (-2.37pp), excellent cost control ability and reduced cost ratio; net profit ratio to mother 20.15% (+3.46pp), the proportion of high-margin products increased, and the cost control effect was remarkable, and the company's profitability continued to improve.
Investment advice: Considering the impact of industry restructuring and mining, lower the profit forecast for 24 and 25, and add a profit forecast for 26 years. The estimated revenue for 2024-2026 is 29.1/34.7/4.12 billion yuan (previously $30.3/3.85 billion yuan), 21%/19% year-on-year growth, and net profit of 6.0/7.3/91 billion yuan (originally $64/83 million in 24.25), the year-on-year growth rate is 24%/22%/24%, and the current stock price corresponds to PE = 24/19 /16x, maintain the “Overweight” rating.
Risk warning: risk of R&D failure; risk of exchange rate fluctuations; risk of new product release falling short of expectations.