高端产品占比提升，非传统渠道高增。23 年：分品类看，23 年生活用纸/个人护理营收分别同比+14.1%/+31.9%至96.6/1.39 亿。生活用纸方面，公司完善布局高端市场，升级迭代现有产品以及深度挖掘小品类机会，量/价同比+15.5%/-1.1%，其中高端系列增速超20%，约占生活用纸业务的25%；高毛利品类增速达16%，约占生活用纸业务的68%；健康精品业务则通过聚焦打造拳头产品，其中湿巾/柔巾业务约占总营收的3%/1%；护理产品业务打通线上线下渠道，聚焦重点活动档期开展品牌推广活动，积极拓展校园市场，以提升品牌知名度，吸引和培育新客户群体，全年销售约占总营收的1%。分渠道看，23 年传统渠道/非传统渠道分别实现收入44.1/53.9 亿元，同比增3.8%/24.7%，主要系公司加大电商和新零售平台投入，搭建相应的供应链系统，推动非传统渠道渗透率持续提升，23 年非传统渠道营收占比从22 年的50%提升至55%。Matters:
The company released its 2023 annual report and quarterly report for the year 24. In 2023, the company achieved operating income/net profit after deduction of 98.0/3.3/3.0 billion yuan, YoY +14.4%/-4.9%/-6.5%; 24Q1 achieved operating income/net profit to mother/net profit after deducting 18.5/1.0/0.9 yuan, YoY -10.5%/+6.7%/+7.9%.
Commentary:
The share of high-end products has increased, and non-traditional channels have increased. Year 23: By category, tissue paper/personal care revenue in '23 was +14.1%/+31.9% year-on-year, respectively, to $96.6/139 million. In terms of household paper, the company perfected the layout of the high-end market, upgraded and iterated on existing products and further exploited small category opportunities. The volume/price ratio was +15.5%/-1.1%, with the high-end series growing at over 20%, accounting for about 25% of the household paper business; the high-margin category grew 16%, accounting for about 68% of the household paper business; the health boutique business focused on building specialty products, with a focus on creating specialty products, with a focus on 3%/1% of total revenue; the nursing products business opened up online and offline channels to focus on key activity schedules to actively expand the campus brand market to improve Brand awareness, attracting and nurturing new customer groups, and annual sales account for about 1% of total revenue. By channel, traditional channels/non-traditional channels achieved revenue of 44.1/5.39 billion yuan respectively in '23, an increase of 3.8%/24.7% over the previous year. The main reason was that companies increased investment in e-commerce and new retail platforms, built corresponding supply chain systems, and promoted a continuous increase in the penetration rate of non-traditional channels. In '23, the share of non-traditional channels' revenue increased from 50% in '22 to 55%.
Profitability continues to improve, and spending is being upgraded. In 23, the company achieved a gross profit margin of 33.2%, +1.2pcts year on year, mainly driven by a drop in pulp prices and household paper upgrades; on the cost side, the sales/management/finance expenses ratio was 22.5%/4.4%/-0.3%, respectively, +2.1/+0.01/+0.03pcts year on year. Among them, the sales cost ratio increased or the main reason was that the company increased product promotion efforts to promote the product structure. Taken together, the net interest rate to mother was 3.4% /-0.7pcts in '23. In 24Q1, the company achieved a gross profit margin of 34.5%, +7.1 pcts year over month, or -5.4 pcts month over month, or mainly due to the use of low-cost raw materials to bring about a year-on-year improvement on the cost side; however, considering the rise in pulp prices, the 24Q1 comprehensive cost may still be higher than 23Q4, so gross margin is under pressure. On the expense side, the sales/management/finance expense ratios were 20.5%/5.7%/0.1%, respectively, compared with +3.8/+2.2/+0.3 pcts. The cost ratio increased, with a comprehensive impact on the net interest rate of +0.8 pcts to 5.2%.
Investment advice: The company is a leading household paper company. It continues to promote product structure upgrades and channel optimization, and may further increase its market share. Looking ahead to 24 years, the current slurry price remains high, and is expected to contribute to profit elasticity after subsequent price declines. We expect net profit to be 425/4.87/551 million yuan respectively in 24-26, corresponding to PE of 24/25/26 being 28/24/22X. Referring to the absolute valuation method, we will give a target price of 10.2 yuan, maintaining a “strong” rating.
Risk warning: rising prices of bulk raw materials; risk of blocking international shipping; consumption recovery falling short of expectations, etc.
