Q1 net profit to mother slightly exceeded expectations. Due to differences in exhibition pace and collection ratio, contract debt decreased slightly year-on-year. The company announced that 2024Q1 achieved revenue of 76.13 million/yoy +12.2%, net profit to mother of 4.81 million/yoy +349.4%, after deducting net profit of 1.53 million/yoy +311.6%. Among them, the profit and loss from changes in the fair value of financial assets and liabilities held by the financial sector amounted to 3.14 million. The Q1 contract debt was 170 million/yoy -23%/+77% month-on-month. The year-on-year decline meant that the exhibition schedule was more focused on the second half of the year, and the advance payment ratio decreased compared to the same period in 2023. The 2023 contract debt accounts for about 75% of the contract amount, while the 2024 advance payment accounts for about 50%. If the contract debt is equivalent to the contract amount, as of 2024Q1, the contract amount is 340 million yuan/yoy +15.6%. By the end of April, nearly 7,800 booths had been sold, and booth sales progress was in line with expectations. We keep our profit forecast unchanged. We expect the company's 2024-2026 net profit to mother of 2.8/38,466 million yuan, yoy +48.7%/+35.9%/+22.5%, corresponding EPS 1.22/1.66/2.03 yuan. The current stock price corresponds to PE 18.2/13.4/11 times, maintaining a “buy” rating.
The brand effect is amplified, the price increase is smooth, and profitability remains stable
2024Q1 held the Indonesia exhibition (500+ booths) and the Vietnam exhibition (600+ booths), with a total sales booth of 1100+ units/yoy +10% +. Q1 The price of booths at the Indonesia and Dubai exhibitions increased by 7.5% (3,000 yuan) to 42,800 yuan. Starting April 1, the unit price of booths in Brazil, Mexico, and South Africa will also increase by 3,000 yuan. Prices are expected to increase for 5000-6000 booths throughout the year. Q1 gross profit margin of 54.4% /yoy-3.8pct, net profit margin 4.24% /yoy+5.23pct, sales management/R&D/finance expense ratio reached 42.1%/12.7%/4.1%/-4.3%, yoy+0.3/-3.7/-2.1/-1.4pct. Q1 traditionally hosts fewer exhibitions in the off-season, and both exhibitions are medium in size. It is expected that the peak season will begin in Q2. Intensive exhibition housing+professional upgrading will help increase profitability.
Build “Miaozhan Global” to further serve Chinese enterprises overseas, and the boom in overseas trade helps the exhibition industry to warm up Miao Exhibition and Tiancheng Company to jointly build “Miao Global”. With the professional experience and deep resources accumulated by helping hundreds of thousands of Chinese companies successfully expand overseas markets, Mio combines Tiancheng's 100,000 + successful business coaching cases and foreign trade practices to provide a one-stop solution for Chinese enterprises to go overseas. Mio will help attract exhibitors and increase customer stickiness by deepening overseas services. According to data from the General Administration of Customs, the number of foreign trade enterprises with import and export performance in 2024Q1 is yoy +8.8%. In Q1, China's import and export volume of goods trade exceeded 10 trillion yuan for the first time in the same period. The growth rate hit a six-quarter high, and the sea view continued. According to Baidu Search Index, the “International Exhibition” search index yoy +290%/+299%/+224% in January/March 2024, and search popularity continues to rise.
Risk warning: The foreign trade environment has deteriorated, the exhibition rate of domestic enterprises falls short of expectations, and mergers and acquisitions have fallen short of expectations.