Description of the event
2023: Operating income of 38.312 billion yuan, +18.47% year on year; net profit to mother of 548 million yuan, +32.24% year over year; net profit without deduction of 258 million yuan.
2023: Foreign companies in Beijing that invested assets achieved operating income of 38.157 billion yuan, +19.78% year over year; net profit to mother of 825 million yuan, +12.78% year over year; net profit of 490 million yuan after deduction, +14.33% year over year.
2024Q1: Revenue of 10.550 billion yuan, +12.87% year on year, net profit to mother of 211 million yuan, -18.92% year on year; revenue of foreign companies with invested assets in Beijing +14.74% year on year, net profit to mother -27.35%, net profit after deducting non-return to mother +3.46% year on year, non-recurring 24.7 million, -77.60% year on year.
Incident comments
In 2023, despite slight differences in the macroeconomic environment and job market sentiment and expectations, the company achieved steady growth in revenue performance with a diverse product portfolio, high-quality customer structure, and the synergy of national integration. In particular, the income and return of foreign companies in Beijing that were placed in the bid have both achieved double-digit growth, which is invaluable.
By business, business outsourcing revenue grew rapidly in 2023. In 2023, revenue from business outsourcing, recruitment and flexible employment, compensation and benefits, and personnel management was +23.59%/+3.36%/+2.95%/-3.72%, respectively. Among them, business outsourcing revenue growth was mainly due to the company's strategic focus, actively seeking business breakthroughs in various industries such as information technology, energy, and FMCG retail. Overall, the company continues to deepen the professional development of outsourcing business in different fields, different industries, different regions, and different customer groups, forming new successful practices and useful experiences, which fed back to steady revenue growth.
In the first quarter of 2024, although market demand has not improved significantly, the company's business line represented by outsourcing grew steadily, driving the company's revenue side to achieve double-digit growth. On the performance side, the decline in net profit attributable to mother was mainly due to the incorrect payment of other income represented by government subsidies (the recording time was late compared to the same period last year).
Looking ahead to the future market, I am optimistic that the company will adhere to the strategic development direction of “marketization, specialization, digitalization and internationalization”, make full use of its deep professional service capabilities, unique ecological resource advantages and rich data asset value, and fully implement the strategic plan of “product innovation, data empowerment, ecological links, and national collaboration” to continuously drive the steady improvement of the company's performance.
Profit forecast and investment advice: The company's net profit due to mother for 2024-2026 is estimated to be $955/ 10.31/11.48 billion, respectively, and the corresponding PE is 12.47/11.55/ 10.37X, respectively, maintaining a “buy” rating.
Risk warning
1. The macroeconomic environment is complex, and the risk that customer demand is growing less than expected; 2. The pace of promotion of fund-raising projects and the risk that the return on investment falls short of expectations; 3. Increased competition will trigger a price war and the risk that the company's profitability will decline; 4. The pace of government subsidy disbursement falls short of expectations, which may affect performance errors.