The company released its 2024 semi-annual report

The company's 24Q2 revenue was 0.4 billion, +7.9% year on year, net profit to mother 0.02 billion, +12% year on year, before deducting 0.02 billion yuan of non-return mother, -37.4% year on year;

24H1's revenue was 0.76 billion, +4.9% year on year, net profit to mother 0.04 billion, +2.2% year on year, before deducting 0.05 billion yuan without return to mother, -6.8% year on year. 24H1 is at an inflection point, resuming its growth trend, and new growth potential has been formed.

By product, the company's 24H1 sunshade product revenue was 0.66 billion, or +3.4%, accounting for 88%. Among them, the revenue from starry sky tent products was 0.39 billion, +47.9% year-on-year, and is expected to maintain a high growth trend; leisure furniture revenue was 0.04 billion yuan, -11.2% year-on-year, accounting for 4.9%;

Looking at product segments,

1) Old products such as folding awnings, car awnings, umbrellas, etc. have basically bottomed out, and major customers are resuming replenishment; 2) Currently, popular products such as starry sky awnings are still in the growth dividend period, continue to replace traditional wooden pergolas, lead the market share industry, and continue to cover more regions and large customers;

3) The trial sales of new popular products received positive feedback. Storage boxes, furniture sets, etc. were highly recognized by consumers and major customers after being launched, and sold out frequently through major channels.

By region, export revenue was 0.7 billion yuan, +3% YoY, accounting for 93.1%; domestic sales were 0.05 billion, +39.6% YoY, accounting for 6.9%.

The company's 24H1 gross profit margin was 27.9%, +1.9pct year on year; net profit margin to mother was 5.7%, -0.1pct year on year.

By product, the gross profit margin of shading products was 29.4%, 2.5 pct year on year; the gross profit margin of outdoor leisure furniture was 21.2%, -2.3 pct year on year;

By region, the company's 24H1 export gross profit margin was 29%, +2.4 pct year on year; domestic sales gross profit margin was 13.3%, -0.3 pct year on year.

On the cost side, the company's 24H1 sales/management/ R&D/ finance ratio was 8.7%/3.4%/-0.8%, respectively, +0.4pct/+1.0pct/-0.3pct/+2.4pct.

Develop derivative products and new products, and lay out multi-channel marketing

In terms of product development: 1) Serialization of existing explosives: Develop derivative products such as barbecue racks, metal garages, and outdoor garden houses based on starry sky tent products, and rely on existing sales channels and production lines to quickly develop the market. ;

2) Continued breakthroughs in new explosives: We insist on developing new products that stand out to consumers and large channels through original design and engineering breakthroughs, but maintain high cost performance to ensure that new products can continue to explode the market.

Marketing aspect: 1) Major customer expansion: “Deepening old customers and developing new customers”, the number of starry sky tent products entering offline stores continues to increase, and new products such as barbecue racks, storage boxes, furniture sets, etc. continue to enter major customer channels; it has continued to expand new customers in the past six months, and has fully covered major channels in Europe and the US, including Sam's, The Home Depot (The Home Depot), etc., to promote the company's revenue growth in all aspects; 2) Cross-border e-commerce efforts: the company has completed the transformation of cross-border e-commerce from proxy operation to self-operation, and relied on multiple professionals to transform the company Hot products made it to Amazon” “Best Seller”; 3) Digital marketing: The company has formed its own professional digital marketing team to complete low-cost and efficient distribution through various marketing methods such as influencer marketing, to promote revenue growth for major customers and self-operated cross-border e-commerce.

Maintain profit forecasts and maintain “increase holdings” ratings

The company integrates R&D, production and sales of outdoor leisure furniture and supplies, and has established a relatively complete outdoor leisure furniture and supplies business system. As one of the earliest high-tech enterprises engaged in the outdoor leisure furniture and supplies industry in China, the company has a high market position in the industry. Taking into account factors such as the company's 24H1 performance, we maintain our profit forecast. The company's net profit for 24-26 is 0.111/0.134/0.157 billion yuan, EPS is 1.01/1.22/1.43 yuan/share, respectively, and the corresponding PE is 21/17/15x, respectively.

Risk warning: New product development falls short of expectations; risk of exchange rate fluctuations; risk of intellectual property infringement; risk of fluctuations in raw material prices.