外贸业务延续增长，整家战略下定制业务快速扩张：2024 年前三季度，我们估计，内销收入受国内地产景气不佳影响有所下滑，外销方面，通过持续推进与战略大客户的业务合作，抢抓了大批量优势品类订单，估计收入有所增长。在产品和店态的迭代优化以及整家赋能体系变革下，我们认为，公司定制业务收入保持较快增长。Incidents:
The company released its three-quarter report for 2024. The realized revenue/net profit for the first three quarters was 13.8/1.36 billion yuan, respectively, -2.4%/-9.5% year-on-year; 3Q2024 realized revenue/net profit to mother was 4.89/0.46 billion yuan, respectively, -6.9%/-19.9%.
Comment:
The foreign trade business continued to grow, and the customized business expanded rapidly under the overall strategy: In the first three quarters of 2024, we estimate that domestic sales revenue declined due to poor domestic real estate conditions. In terms of export sales, by continuing to promote business cooperation with strategic customers, a large number of advantageous category orders were seized, and revenue is estimated to have increased. Under the iterative optimization of products and store formats and changes in the overall enabling system, we believe that the company's customized business revenue has maintained a relatively rapid growth rate.
The company firmly adheres to the “1+N+X” channel strategy, accelerates the integration of large store layouts, and continues to promote the development of all categories of households. The number of integrated stores continues to grow, and retail capacity continues to increase. In terms of operating cash flow, 3Q2024's net operating cash flow was 0.92 billion yuan, +43.7% year over year.
The decline in high-margin domestic sales business dragged down profitability performance. Expense control was strict: in the first three quarters of 2024, the company's gross margin was 31.9%, -0.5 pcts year on year; net interest rate to mother was 9.8%, -0.8 pcts year on year. 3Q2024, the company's gross margin was 29.8%, -4.0pcts year on year; net profit margin to mother was 9.5%, -1.5pcts year over year. We believe that the company's gross margin has declined, mainly due to a decrease in the share of revenue from high-margin domestic sales business and an increase in the share of revenue from low-margin export business.
In the first three quarters of 2024, the company's annual expense ratio was 20.1%, +0.4 pcts year-on-year. By project, the sales/management/R&D/finance expense ratios were 15.9%/2.2%/1.8%/0.1%, respectively, -0.3/flat/+0.4/+0.2pcts year-on-year, respectively. Among them, the cost rate for the 3Q2024 period was 17.9%, -2.7 pcts year on year; by project, the sales/management/R&D/finance expenses ratio was 14.0%/1.7%/1.5%/0.7%, respectively, -2.4/-0.5/+0.1/+0.1 pcts year on year, respectively. Under the cost reduction and efficiency strategy, the company's sales expenses rate declined; the average exchange rate of 3Q2024 US dollars to RMB was 7.17 yuan, a decrease of 0.08 yuan compared to 3Q2023. We believe that the main reason for the increase in financial expenses is due to a decrease in exchange earnings.
Leading soft home furnishing companies maintain a “buy” rating: Considering that domestic real estate sales are lower than expected, we lowered the company's 2024 revenue forecast to 18.73 billion yuan (3.3% reduction) and basically maintained the 2025-2026 revenue forecast. Considering that market competition exceeded expectations, we lowered the net profit forecast for 2024-2026 to 1.82/2.05/2.36 billion yuan, respectively (the reductions were 11.8%/7.7%/4.7%, respectively), 2024- The 2026 corresponding EPS is 2.21/2.50/2.87 yuan, respectively, and the current stock price corresponding PE is 15/13/11 times, respectively. Currently, domestic real estate policies are blowing frequently, and the real estate market is expected to stop falling and stabilize. US real estate is also expected to recover quickly after interest rate cuts. The company is a leading soft home furnishing company, actively exploring and breaking through innovative business models, and is expected to continue to increase its market share in the future. Currently, the company's valuation level is at the bottom of history, maintaining a “buy” rating.
Risk warning: US/China ZHONGGUODICHAN sales fell short of expectations, product sales fell short of expectations, and market competition exceeded expectations.
