三季度年份、柔和系列实现较快增长，省外有较优表现，带动公司营收同比+15.8%。分档次看，300 元以上价格带营收1.6 亿元，同比+42%，100-300 元价格带营收3.1 亿元，同比+14.9%，两个价位带表现较好主因公司主动把控节奏，将订货回款时点提前到三季度锁定回款量，价格方面，公司通过搭赠礼品、反向红包等保障提价平稳落地，多举措保障重点价位带量价表现；而100 元以下价格带营收0.8 亿元，同比-24.3%略显疲软主因大众消费场景需求偏弱及公司终端活动重心转移所致。分区域看，3Q24 甘肃省内营收3.7 亿元，同比+4.4%，延续平稳增长；3Q24 省外营收1.7 亿元，同比+37.9%，调整略显成效，传统强势的陕西等省外市场贡献主要增量。3Q24 results slightly exceeded our expectations
The company announced 3Q24 results: operating income of 0.574 billion yuan for single 3Q24, +15.8% year-on-year, net profit to mother 0.038 billion yuan, +108.84%; net profit of 0.035 billion yuan, +71.58% year-on-year. This performance was better than our expectations, mainly due to the relatively rapid growth of the year and the Soft Series, while the company's cost contraction exceeded our expectations.
Development trends
In the third quarter, the Yue and Soft series achieved relatively rapid growth, with excellent performance outside the province, driving the company's revenue +15.8% year-on-year. In terms of grade, prices above 300 yuan include revenue of 0.16 billion yuan, +42% of the same, and the price of 100-300 yuan with revenue of 0.31 billion yuan, +14.9% over the same period. The two price bands performed well mainly because the company took the initiative to control the pace and locked in the repayment volume until the third quarter. In terms of price, the company guaranteed price increases smoothly through gifts and reverse red envelopes, etc., to guarantee volume and price performance at key prices; while prices below 100 yuan had revenue of 0.08 billion yuan, year over year. The slight weakness of 24.3% was mainly due to weak demand in mass consumption scenarios and a shift in the focus of the company's terminal activities. Looking at the subregion, revenue from Gansu Province in 3Q24 was 0.37 billion yuan, +4.4% year-on-year, and continued to grow steadily; in 3Q24, revenue from outside the province was 0.17 billion yuan, +37.9% over the same period. The adjustments showed slight results, and traditional markets outside the province, such as Shaanxi, contributed mainly to the increase.
Strong tasting had an impact on gross profit margins, but effective cost control led 3Q24 net profit to mother +108.84% year-on-year. The gross margin side of 3Q24 was -1.5ppt compared with the combined impact of increased investment in tasting and other factors driving up costs, as well as a slight increase in raw material costs. However, the company's 3Q24 sales expense ratio/management expense ratio was -3.2/-1.4ppt, continuing the previous trend of cost contraction. We believe that the increase in marketing activities in the fourth quarter may drive an increase in quarterly expenses, but the trend of reducing the cost rate throughout the year is clear.
The company continues to demonstrate strong strategic strength, while also being flexible in controlling the quarterly pace. The company continues to be deeply involved in the Gansu base market, steadily advancing the key price band layout of 100-300 yuan and above 300 yuan with the goal of accounting for more than 50% of the city in the province, and has made major breakthroughs in regions with opportunities around the Gansu market, which are beginning to show results in Shaanxi and other places. At the same time, short-term companies are also flexible in grasping the quarterly pace, rescheduling order times, and closely linking sales promotion activities to cope with weak demand and increased competition in the industry.
Profit forecasting and valuation
We maintain our profit forecast for 2024/2025, with net profit of 0.409/0.507 billion yuan for 2024/2025, +24/ +24% year over year, respectively. We maintain a target price of 22 yuan, corresponding to the 2024/25 27/22X price-earnings ratio, and the current stock price corresponds to the 2024/25 25/20X price-earnings ratio, with 8.3% upside compared to the target price, maintaining the outperforming industry rating.
risks
Gansu's economic development and consumption upgrade fell short of expectations, competition within the province intensified, and expansion outside the province fell short of expectations.
