传统业务稳健，智慧家庭持续保持双位数增长1) 移动通信服务业务稳健，人均ARPU 保持稳定。前三季度，移动通信服务收入1,568.2 亿元，同比增长3.2%，移动用户净增1,490 万户，达到4.23 亿户，5G 套餐用户净增2,640 万户，达到3.45 亿户，5G 套餐用户渗透率81.6%，移动用户ARPU 为人民币45.6 元，保持平稳。Incidents:
The company released its three-quarter report. In Q1-Q3 of 2024, revenue was 391.97 billion yuan, up 2.85% year on year, net profit to mother was 29.3 billion yuan, up 8.11% year on year, and net profit after deducting non-return net profit of 28.69 billion yuan, up 5.40% year on year.
2024Q3 achieved revenue of 125.99 billion yuan in a single quarter, up 2.92% year on year, net profit to mother of 7.49 billion yuan, up 7.76% year on year, after deducting net profit of 7 billion yuan without return to mother, an increase of 3.54% year on year.
The traditional business is steady, and smart homes continue to maintain double-digit growth 1) The mobile communication service business is steady, and the ARPU per capita remains stable. In the first three quarters, mobile communication service revenue was 156.82 billion yuan, up 3.2% year on year, with a net increase of 14.9 million mobile users, reaching 0.423 billion users, and a net increase of 26.4 million 5G package users, reaching 0.345 billion. The 5G package user penetration rate was 81.6%, and the ARPU for mobile users was RMB 45.6, which remained stable.
2) Fixed network and smart home service business, smart home increased 17% year over year. In the first three quarters of 2024, the company's fixed network and smart home service revenue was 95.62 billion yuan, up 2.9% year on year, cable broadband users reached 0.196 billion households, smart home revenue increased 17.0% year on year, broadband comprehensive ARPU was RMB 47.8, and smart home value contribution continued to increase.
3) Industrial digitalization accelerates the construction of a second growth curve. In the first three quarters of 2024, the company's industrial digitization business revenue was 105.549 billion yuan, an increase of 5.8% over the previous year. The company continues to cultivate ecological cooperation in the industry and promote the development of strategic emerging businesses.
Continue to strengthen scientific and technological innovation, strengthen operational efficiency, and enhance core capabilities. The operating cost for the first three quarters of 2024 was 274.41 billion yuan, an increase of 3.0% over the previous year, mainly due to increased investment in industrial digitalization and other fields. The overall gross profit margin was 30.0%, a slight decrease of 0.85pct year over year.
The overall cost rate for the first three quarters of 2024 was 19.3%. Among them, the sales/management/ financial expenses ratio was 10.1%/6.9%/0.1%, respectively, -0.3/+0.2/+0.0pct year-on-year. The R&D expenditure rate was 2.2%, an increase of 0.4 pct over the previous year, mainly focusing on strategic emerging industries and future industries.
Cash flow control was strengthened. The inventory level in the post-5G construction cycle fell in the 2024 third quarter. Net cash from operating activities was 97.41 billion yuan, a decrease of 13.8% year on year, and cash income ratio was 0.99, which was a slight improvement over the previous year. The company's overall accounts receivable and notes were $59.85 billion, up 14.5% year on year, and accounts payable and notes were 158.7 billion yuan, up 5.5% year on year, continuously strengthening the payment ratio and supplementing the company's cash flow situation. Inventory was 4.27 billion yuan, down 14.9% from the same period last year. According to the semi-annual report, it was mainly due to a decrease in inventory materials.
Investment advice:
We believe that the continued promotion of the digital industrial business is accompanied by a decline in capital expenditure and stable profit margins. Considering the growth rate of traditional business, the expected revenue for 2024-2026 will be adjusted from 540.25/576.02/614.77 billion yuan to 519.91/539.94/562.56 billion yuan, respectively. The estimated earnings per share will be adjusted from 0.37/0.40/0.45 yuan to 0.36/0.38/0.40 yuan, respectively, corresponding to October 22, 2024 The daily closing price of 6.65 yuan/share PE was 18.69/17.47/16.46 times, respectively, maintaining the “overholding” rating.
Risk warning:
Market competition risk; industry policy change risk; industrial digital business promotion falls short of expectations; systemic risk.
