The company's revenue for the third quarter of 2024 was 0.386 billion yuan (down 9.18% year on year), net profit due to mother -0.062 billion yuan (year-on-year decrease of 229.50%), after deducting non-return net profit of -0.069 billion yuan (year-on-year decrease of 242.34%).

The company's revenue for the first three quarters of 2024 was 1.398 billion yuan (down 4.74% year on year), net profit due to mother was 0.109 billion yuan (down 66.01% year on year), after deducting non-return net profit of 0.086 billion yuan (down 73.21% year on year).

The company's 2024Q3 gross sales margin was 64.37% (down 3.72 pp year on year), net sales profit margin was -15.98% (year-on-year decrease 27.18 pp), sales, management, R&D, and finance expense ratios were 44.49% (up 15.93 pp), 9.89% (up 2.93 pp), 32.72% (up 10.62 pp), and 0.43% (year-on-year increase of 0.64 pp).

As of the end of the third quarter of 2024, the company's accounts receivable were $0.161 billion (down about 69 million yuan from the 2024 mid-year report), and the company's inventory was 776 million yuan (up about 0.106 billion yuan from the 2024 mid-year report).

Profit forecasting and investment advice. We expect the company's EPS to be 0.44, 0.94, and 1.43 yuan respectively in 2024-2026, with net profit growth rates of -57.7%, 112.0%, and 52.3% respectively. Referring to comparable company valuations and considering the company's high prosperity and leading position in the soft mirror and ultrasound industry, we will give the company 31-40 times PE in 2025, corresponding to a reasonable value range of 29.18-37.65 yuan, and give it a “superior to the market” rating.

Risk warning. There is a risk that the growth rate of traditional product lines will decline, the risk that the volume of new product lines will fall short of expectations, and the risk that domestic bidding and procurement will slow down.