公司加大销售费用投入Incident: The company achieved operating income of 1.977 billion yuan in the first three quarters of 2024, +6.2% year-on-year, and net profit of 0.143 billion yuan, or -4.11%; of these, 2024Q3 achieved operating income of 0.672 billion yuan, -5.58% year on year, and net profit to mother 0.032 billion yuan, or -48.07% year on year.
The gradual release of data center orders supports revenue
The company's revenue growth rate in a single quarter was slightly under pressure. By business, we expect the revenue growth rate of the data services sector to be relatively good. According to the 24H1 situation, the company's new data service sector orders are about 3 times that of the same period last year, which is close to the total number of new orders added last year. We expect that the successive delivery and execution of orders will help increase overall revenue. The company's overall revenue growth rate declined slightly in a single quarter, so we expect the industrial, specialty, public construction and commercial sectors to perform relatively weakly.
The company increases investment in sales expenses
The company's gross margin for the first three quarters of 2024 was 26.37%, -1.8pct year on year, and the net margin was 6.94%, or 1.24pct; of these, 2024Q3 gross margin was 26.2%, -0.64pct year on year, and the net margin was 4.38%, and -4.72pct year on year. Gross margin declined year over year, and we expect this to be due to changes in the revenue structure during the quarter. The company's sales, management, R&D, and financial expense ratios for the first three quarters of 2024 were 7.95%, 6.18%, 5.51%, and 0.6%, respectively, +1.23, -0.83, +0.81, and -0.09pct; of these, the 24Q3 quarter sales, management, R&D, and finance expenses rates were 8.39%, 6.73%, 6.04%, and 0.94%, respectively, +1.63, +1.14, +1.02, +0.26pct. The company's sales expense ratio increased a lot over the same period last year. We refer to the 24H1 situation. It is expected to be mainly due to an increase in sales scale, an increase in sales remuneration, and early development of overseas business.
Investment advice: We believe that in the future, with the increase in demand for servers and data centers driven by supercomputing application scenarios such as AI, demand for liquid cooling and cooling equipment used in data centers may once again experience rapid growth, and new orders will gradually be implemented. At the same time, with the expansion of the company's overseas business, the scale of revenue and profit is expected to increase further. According to the company's three-quarter report, we appropriately lowered our revenue and gross profit margin. We expect net profit to be 0.16/0.21/0.26 billion yuan for 24-26 (0.32/0.43 billion yuan 24-25 years ago), respectively, and the corresponding PE is 38.4x/29.3x/23.9x, respectively, and downgraded to an “increase in holdings” rating.
Risk warning: market competition risk; alternative product risk; revenue growth falling short of expectations, etc.; order confirmation progress falls short of expectations; equity incentive performance targets fall short of expectations.
