The company released its 2023 annual report and 2024 quarterly report. In 2023, the company achieved revenue of 544 million yuan (+14.59%; the following are all year-on-year values), net profit to mother of 154 million yuan (-24.61%), and net profit after deducting non-return to mother 140 million yuan (-23.42%). The profit side decline was mainly due to a sharp increase in expenses during the period and an increase in depreciation and amortization due to an increase in the company's sales and technical personnel.
24Q1 achieved revenue of 146 million yuan (+6.67%), net profit attributable to mother of 31 million yuan (-31.91%), and net profit of 30 million yuan (-32.12%) after deducting non-return to mother.
The company's regular overseas business continued its high growth trend, and personnel expansion put pressure on the profit side. In 2023, after deducting products related to specific acute respiratory infectious diseases, the company achieved revenue of 499 million yuan, an increase of 29% over the previous year. Among them, the overseas routine business increased by more than 37% year on year. In terms of profitability, the company's gross margin fell 1.25pp to 91.26% year-on-year in 2023, while sales, management, R&D, and financial expense ratios were +7.15pp, +0.44pp, -1.02pp to 30.83%, 15.51%, and 22.98%, respectively, and the net profit margin fell 14.85pp to 27.12% year over year. The decline in the company's profit side was mainly due to the increase in employee remuneration and sales expenses due to the expansion of overseas markets during the reporting period.
Deepen the clinical business layout and create a new business growth engine. The company's customer R&D pipeline is mainly focused on the preclinical or early clinical stage. As the project progresses to the clinical stage, future clinical products will be in great demand. The company actively lays out clinical products and has successfully developed nearly 30 high-quality GMP grade products, such as IL-2 and IL-7. As the GMP grade plant in Suzhou is put into operation in the second half of '24, customer service capabilities will be significantly enhanced.
Profit forecasting and investment advice. We expect the company's 2024-2026 EPS to be 1.36, 1.71, and 2.13 yuan/share, respectively, giving the company 38 times reasonable PE in 2024, corresponding to a reasonable value of 51.73 yuan/share for the company, giving it a “buy” rating.
Risk warning. New product development falls short of expectations; risk of domestic demand recovery falling short of expectations; risk of falling overseas demand; risk of iterative technology upgrades; risk of increased market competition, etc.