In '23, the company's revenue and profits grew rapidly, and profitability improved significantly. The company achieved revenue of 2,683 billion yuan in 2008, an increase of 26.09% over the previous year; realized net profit of 590 million yuan, an increase of 29.75% over the previous year; realized net profit without deduction of 566 million yuan, an increase of 64.2% over the previous year. Looking at a single quarter, 23Q4 achieved revenue of 635 million yuan, up 18.75% year on year and down 11.21% month on month; realized net profit of 111 million yuan, up 60.27% year on year and 34.79% month on month. In terms of profitability, the company's gross margin was +3.03pct to 33.28% year on year in '23, and net profit margin to mother +0.62pct yoy to 21.99%.
The company is a leading panel woodworking machinery company, leading domestic technical strength and business in more than 70 countries and regions. The company is a leading domestic panel woodworking machinery company with leading independent R&D and manufacturing capabilities. It provides a full range of numerical control manufacturing equipment, automated production lines and intelligent manufacturing solutions for intelligent furniture production. The company participated in the development of the first profiled edge banding machine in China, and independently developed core products such as the first domestic double-end edge banding machine and fully automatic four-sided processing and multi-row drilling. The company absorbs advanced international technology such as Germany and Italy through epitaxial mergers and acquisitions. The company has R&D and manufacturing bases in China and Italy. By the end of '23, it had cooperated with more than 120 dealers around the world, and operated in more than 70 countries and regions.
The domestic panel furniture machinery market is over 15 billion yuan, and domestic suppliers are gradually promoting import substitution.
Panel furniture is the largest profile application category in custom furniture. According to Huajing Industry Research Institute, the market size of China's panel furniture machinery industry increased 7.66% year-on-year to 16.25 billion yuan in 2019. After years of development, China's furniture and machinery enterprises have gradually caught up with overseas countries in size and technical level, gradually achieved import substitution in the high-end market, and maintained a large share in the mid-tier market.
The company has increased R&D to improve product performance, continue to promote overseas markets, and the new plant can be put into operation to contribute to new growth. In 2023, the company continued to step up research and development of new products and processes, and launched products such as high-speed flexible edge banding machines in the area of high-end product innovation. The processing speed and degree of flexibility were significantly improved, and the gap with European advanced technology was shortened. Furthermore, the company enhances its brand influence through active participation in exhibitions, etc., and continues to advance in overseas markets. The Guangzhou edge banding machine manufacturing base and the Foshan CNC equipment manufacturing base were put into trial operation in November 23 and January 24, respectively, and are expected to contribute additional volume to the company's performance.
Investment advice: We expect the company to achieve net profit of 7.12/8.26/972 million yuan in 24-26 years, respectively, and the corresponding PE is 13/11/9 times, respectively. The company is a leading domestic woodworking machinery company. It continues to expand overseas markets and is covered for the first time, giving it a “Highly Recommended” rating.
Risk warning: risk of fluctuations in the real estate market, risk of changes in the international trade situation, technology research and development process falling short of expectations