The company released its 2023 annual report and 2024 quarterly report

In 2023, revenue was 2.681 billion yuan, -3.58% year on year; net profit to mother was 55 million yuan, -0.59% year over year; deducted from non-return mother of 0.24 million yuan, -38.85% year on year.

Q1 revenue in 2024 was 661 million yuan, +8.76% YoY, -1.95% month-on-month; net profit to mother was 9.78 million yuan, -8.44% YoY and -42.30% month-on-month; Deducted of 6.19 million yuan, or +558.51% YoY.

Copper-based materials still contribute to the basic market for gross profit

In 2023, the company's total gross profit was 223 million yuan, +9.49% year on year; gross profit margin was 8.31%, +0.98pct year on year. Among them, the gross profit of the main business was 6823, 11855, 904, and 7.37 million yuan in that order, with year-on-year changes of +1.47%, +20.08%, -2.69%, +119.26%, accounting for 31.01%, 53.89%, 4.11%, and 3.35% in that order.

Copper and tin-based metal powder business actively explores market space

In 2023, revenue for copper-based metal powder materials was 1,528 billion yuan, +0.76% year over year, gross profit margin 7.76%, +1.25pct year on year. Production and sales volumes were 2.43 and 23,300 tons, respectively, up 5.43% and 0.93% year-on-year, respectively. The company selects key areas to develop new customers and new markets, while optimizing the structure, increasing product gross profit, and actively exploring overseas markets.

In 2023, microelectronics tin-based solder materials achieved revenue of 803 million yuan, -13.53% year-on-year, gross profit margin of 8.50%, and +1.26pct year-on-year. Production and sales volumes were 2,927 and 2,955 tons, respectively, a year-on-year decrease of 8.67% and 5.86%, respectively. The company focuses on promoting the sale of high value-added products and the maintenance and development of small and medium-sized customers.

In 2024, the company plans to prioritize quantity in the field of copper-based and tin-based powder materials, increase market share, and focus on domestic market collaboration and international market development.

Expansion of electronic paste production capacity, iteration of new product technology

In 2023, e-paste achieved revenue of 60.138 million yuan, +133.68% year over year, gross profit margin of 12.26%, and -0.81 pct year on year. Production and sales volumes were 340.56 and 334.98 tons respectively, up 135.11% and 133.11% year-on-year respectively. In April 2023, the company established R&D and expanded production capacity. The company seized the development opportunities of photovoltaic new energy sources, combined with the company's overall asset optimization goals, and reorganized the Raw Powder Research Institute to achieve business independence in the field of electronic interconnect slurries.

In 2024, the company plans to increase the production capacity of existing products and increase sales volume, while completing new product technology iterations to form small-batch sales. According to the December 23 investor activity record table, the production capacity is expected to reach about 700 tons in 2024.

The 3D printing business volume has increased significantly, and there is considerable room for growth

In 2023, the revenue of 3D printed powder materials was 30.45 million yuan, +42.98% year over year, gross profit margin 29.70%, and -13.94 pct year on year. Production and sales of 3D printed powder materials were 102.3 and 89.78 tons, respectively, with year-on-year increases of 37.46% and 22.38%, respectively. The company developed new customers and achieved a significant increase in sales.

In 2024, the company plans to seize a period of rapid growth in the 3D printing field, strive to double sales, and explore extending the industrial chain.

Fund-raising project progress

? Thailand base: In 2023, the Thai base construction project has passed the inspection of Thailand's IEAT Industrial Administration. The plant is ready for use. The mechanical and electrical parts have been fully fueled. The installation and commissioning of the electrolytic copper production line is nearing completion. It is expected to be put into operation in June 2024. The copper powder production capacity will increase by 5,000 tons, mainly for the European and Asia-Pacific international markets.

? Chongqing base: In 2023, the Chongqing base completed project construction, equipment commissioning and full commissioning, and production capacity was expanded by 4,000 tons.

? Science and Technology Innovation Center: In 2023, the science and technology innovation center construction project will advance steadily in favor of 3D printing and future industries according to the company's development situation.

Investment advice:

We expect the company to achieve operating income of 33.70, 39.13, and 3,929 billion yuan respectively in 2024-2026, and achieve net profit of 1.03, 1.47, and 155 million yuan, corresponding EPS of 1.00, 1.42, and 1.50 yuan/share, respectively. Currently, the corresponding PE price is 35.2, 24.8, and 23.5 times. The company maintained a “buy-A” rating, and the target price for 6 months remained at 47.04 yuan/share, corresponding to about 47 times PE in 24 years.

Risk warning: demand falls short of expectations, project progress falls short of expectations, risk of raw material price fluctuations