Core views:
The company published an annual report for '23 and a quarterly report for '24. In '23, the company achieved revenue of 2.31 billion yuan, -27.8% year-on-year, net profit to mother of 170 million yuan, -160.6% year-on-year, and net profit after deducting non-attributable net profit of 260 million yuan, -197.0% year-on-year. The gross profit margin was 39.7%, -4.6% YoY. The decline in revenue performance is mainly due to the company being in the industrial chain inventory removal and product upgrade process in '23. The combined interest rate hike process affected demand for optional consumer goods and intense market competition. The performance in each quarter of '23 fell short of the same period in '22.
Multiple factors affected demand in 23 years, and Japan/Europe sales were under significant pressure. By product, portable energy storage products were 1.89 billion yuan in '23, with a gross profit margin of 39.5%, or 4.4pct; photovoltaic solar panels were 400 million yuan, -42.7% yoy, with a gross profit margin of 40.4%, and -5.0 pct yoy. Looking at the subregion, North America's revenue was 1.32 billion yuan, or -11.4% year on year, with minimal impact; Asia (excluding China) revenue was 550 million yuan, or -33.6% year on year; European revenue was 230 million yuan, -66.9% year over year. North America is the company's traditional dominant market, and the impact is relatively small. Japan and Europe are clearly under pressure.
Complementing the product matrix+improving channel layout+strengthening cost control, the 24Q1 business ushered in significant restoration. 24Q1 achieved revenue of 580 million yuan, +29.9% year on year, net profit to mother of 0.29 million yuan, +197.7% year on year, net profit without return to mother of 13 million yuan, +129.1% year on year.
The gross profit margin was 46.5%, +4.8pct year on year, +7.6pct month on month; the net profit margin was 5.0%, +11.6pct year on year, and +20.2pct month-on-month. The trend of operating capacity is clearly improving. The company has been improving its layout in multiple fields for 23 years. ① Product side: improving the 0.1-3 kWh, high power, ternary+lithium iron route product matrix, and laying out household optical storage solutions to contribute to new growth in the US high-end market. ② Market side: New expansion of market demand in Southeast Asia, Middle East Africa, etc. ③ Channel side: Increase the layout of high-profit offline channels.
Profit forecasting and investment advice. The company's 2024-2026 EPS is expected to be 1.27/2.33/3.39 yuan/share. As a leading enterprise in the field of portable energy storage, the company is expected to usher in rapid growth after performance restoration. Considering a comparable valuation, it is given a “buy” rating of 1.0xPEG in 2024 (G corresponds to the 2024-2026 performance forecast compound growth rate), corresponding to a reasonable value of 80.43 yuan/share.
Risk warning. The promotion of portable energy storage has fallen short of expectations; the risk of changes in the new energy policy; and the risk of worsening competition.