Incident: The company released 23 annual reports and quarterly reports, and achieved operating revenue of 3.65 billion yuan in 23, an increase of 2.6% over the same period.
Net profit to mother was 290 million yuan, up 5.4%; net profit margin to mother was 8.0%, up 0.2 pct. Net profit after deducting non-return to mother was 230 million yuan, up 22.2%; net profit margin after deducting non-return to mother was 6.4%, up 1.0 pct.
Looking at a single quarter, 23Q1-24Q1 achieved revenue of 5.7/9.3/10.4/11.0/ 6.4 billion yuan respectively, a year-on-year change of +1.1%/+8.0%/-1.6%/+3.2%/+11.4%. Net profit attributable to mother was 0.3/0.4/0.9/1.3/0.4 billion yuan, a year-on-year change of +8.2%/-29.9%/+24.8%/+11.8%/+11.2%.
The consolidated gross margin in '23 was 29.6%, up 0.1 pct from the same period. The cost rate for the period was 22.8%, an increase of 0.6 pct over the same period.
Among them, the sales/management/R&D/finance expense ratios were 12.0%/4.7%/6.2%/-0.1%, respectively, and the year-on-year change was -0.1/0.0/+0.6/+0.1pct. The 24Q1 consolidated gross margin was 28.0%, a decrease of 1.1 pct. The cost rate for the period was 25.2%, a decrease of 1.4 pct. Among them, sales/management/R&D/finance expenses were 13.3%/6.3%/5.3%/0.3%, respectively, with year-on-year change of -1.3/-0.5/+0.6pct.
By product, overall kitchen cabinets/overall wardrobe/ wooden doors achieved revenue of 22.3/1.04 billion yuan, accounting for 61%/29%/7%, a year-on-year change of -5.6%/+8.7%/+65.0%. The gross margin was 29.2%/29.7%/7.2% respectively, year-on-year change -0.02/+0.5/+0.03pct. 24Q1 overall kitchen cabinet/overall closet/wooden door achieved revenue of 3.9/1.9/0.3 billion yuan respectively, accounting for 61%/30%/4%, a year-on-year change of +7.6%/+19.9%/14.9%. The gross margin was 26.0%/28.2%/7.3%, respectively, with year-on-year change of -2.3/+0.3/+1.7pct.
By sales model, dealers/direct-run stores/bulk business/overseas achieved revenue of 18.8/1.28/270 million yuan respectively in '23, accounting for 53%/3%/36%/8%, a year-on-year change of +2.6%/-24.1%/-0.3%/+16.9%. The gross margin was 35.4%/51.3%/15.4%/24.7%, respectively, with year-on-year changes of -0.6/-18.0/+0.8/+4.7pct. 24Q1 dealers/direct stores/bulk business/overseas achieved revenue of 2.9/0.05/23/0.8 billion yuan respectively, accounting for 45%/1%/37%/13%, a year-on-year change of -5.3%/-65.3%/+24.7%/+68.2%.
The gross margin was 35.8%/55.3%/11.5%/29.9%, respectively, with a year-on-year change of +0.4/-5.4/+1.8/-1.7pct.
By region, domestic/overseas revenue in '23 was 3.27/270 million yuan, a year-on-year change of +0.8%/+16.9%, accounting for 92.3%/7.7% of revenue. Gross margin was 28.1%/24.7%, year-on-year change of -0.9/+4.7pct. As of 24Q1, the company had 3,945 stores, an increase of 216 compared to the end of '22. Among them, the number of gold medal kitchen cabinet, gold medal wooden door, decoration hall, balcony bathroom, and Maneo stores was 1702/1163/681/158/90/151, respectively.
Profit forecast and rating: We expect the company's net profit for 24/25 to be 330 million and 370 million, respectively, up 13.5% and 11.7% year on year. The current stock price corresponds to PE 9.8 and 8.8 times, respectively. Referring to comparable companies, the PE valuation is 12 to 14 times in 24 years. The corresponding reasonable value range is 25.78-30.08 yuan/share, giving it a “superior to the market” rating.
Risk warning: Real estate sales area has declined, channel category expansion falls short of expectations, raw material price fluctuations, and industry competition has increased the risk.