KINGDEE(268.HK):MACRO HEADWINDS WEIGHED ON GROWTH; LOSS REDUCTION ON TRACK
KINGDEE(268.HK):MACRO HEADWINDS WEIGHED ON GROWTH; LOSS REDUCTION ON TRACK
Kingdee reported its 1H24 results: revenue was up 11.9% YoY (1H23: 16.8% YoY) to RMB2.87bn, 2% shy of Bloomberg consensus, which in our view can be attributed to a lengthened deal cycle and softer-than-expected growth amid macro headwinds (especially small and micro enterprises, whose YoY revenue growth slowed to 9% YoY in 1H24 from 19% in 1H23), while the net loss of RMB218mn implies a YoY reduction of 23% and was 20% narrower than consensus estimates, which demonstrated Kingdee's determination to improve operating efficiency. Core SaaS product Galaxy's ARR growth momentum remained healthy with 24% YoY growth in subscription ARR in 1H24 (1H23: +29% YoY). Meanwhile, large enterprise revenue growth of 38.9% YoY (1H23: 38.4%) remains solid, in our view. Although we still expect the demand recovery to take time, especially for small enterprises, we are expecting the second half to deliver results driven by healthy growth in Kingdee's contract value and the lengthened deal cycle. We lower 2024E revenue forecast by 4%, but expect 2H24 revenue growth to reaccelerate to 16%. We maintain BUY rating but lower target price to HK$10.8 per share (was HK$15.5), based on 4.4x 2024E EV/Sales (was 6.4x), in line with the one year mean.
金蝶報告了其2024年上半年業績：營業收入同比增長11.9％（2023年上半年：同比增長16.8％），達到了28.7億元人民幣，比彭博社的預期低2％，我們認爲這可以歸因於較長的交易週期和宏觀環境影響下增長的疲軟（尤其是小微企業，在2024年上半年，其同比收入增速從2023年上半年的19％降至9％），而人民幣虧損218萬元意味着同比減少了23％，比共識預期窄20％，這表明了金蝶改善營運效率的決心。SaaS核心產品Galaxy的ARR增長勢頭保持健康，2024年上半年訂閱ARR增長24％YoY（2023年上半年：+29％YoY）。同時，大企業收入增長保持在38.9％YoY（2023年上半年：38.4％），在我們看來仍然很穩健。雖然我們仍然認爲需求復甦需要時間，尤其是對於小企業，但我們預計下半年將通過Kingdee合同價值和較長的交易週期的健康增長來帶來業績增長。我們將2024E的營收預測下調4％，但預計2H24的營收增長將重新加速到16％。我們保持買入評級，但將每股目標價格下調至10.8港元（原爲15.5港元），根據4.4倍的2024E EV /銷售計算（原爲6.4倍），符合一年平均值。
Revenue contribution from cloud continued rising. In 1H24, cloud revenue grew 17.2% YoY to RMB2.4bn, and was 83.2% of total revenue (1H23: 79.5%), while license ERP revenue declined by -8.8% YoY. Net loss shrank to RMB218mn in 1H24 (1H23: RMB284mn), driven by GPM expansion (+1.3pp YoY to 63.2% in 1H24) aided by an increase in cloud revenue contribution. The continuously rising trend in cloud revenue contribution should help enhance operating efficiency, in our view.
雲服務的營收貢獻繼續增長。2024年上半年，雲營收同比增長17.2％，達到24億元人民幣，佔總收入的83.2％（2023年上半年：79.5％），同時許可ERP營收同比下降了-8.8％。人民幣虧損在2024年上半年縮小至218萬元（2023年上半年：人民幣284萬元），得益於雲營收貢獻的增加，毛利率擴張(+1.3pp YoY至2024年上半年的63.2％)。我們認爲，不斷增長的雲營收貢獻趨勢應有助於提高運營效率。
Galaxy sustained healthy revenue growth and healthy profitability. In 1H24, Kingdee's core SaaS product Galaxy achieved revenue of RMB1.1bn, up 14.3% YoY (1H23: 17.3%), and Galaxy's subscription ARR was up 24% YoY (1H23: 29%). Dollar retention rate edged down to 95% in 1H24 from 96% in 1H23 due to macro headwinds. Customer acquisition for Galaxy was on track, in our view, with c.8,000 YoY net adds in 1H24, and the profitability of Galaxy remained healthy at c.20%.
Galaxy保持了健康的營收增長和健康的盈利能力。2024年上半年，金蝶的SaaS核心產品Galaxy實現了11億元人民幣的營收，同比增長14.3％（2023年上半年：17.3％），Galaxy的訂閱ARR同比增長24％（2023年上半年：29％）。由於宏觀環境因素，2024年上半年的美元保留率由2023年上半年的96％降至95％。我們認爲，Galaxy的客戶獲取途徑是正確的，2024年上半年淨增加約8000個客戶。同時，Galaxy的盈利能力保持健康，約爲20％。
Large enterprises: solid revenue growth contribution although facing a longer deal cycle. Benefiting from ongoing software localization demand, as well as enhanced product capability, Kingdee Cosmic & Constellation (C&C) revenue grew 38.9% YoY in 1H24 (1H23: 38.4% YoY) to RMB546mn (19% of revenue, as compared to 15% in 1H23). Kingdee signed up 275 new customers for C&C business during 1H24. Management highlighted a solid expansion trajectory for life time contract value (LTCV) of C&C customers from the initial contracts: in 1H24, the LTCV expanded to 5.3x/3.8x/2.9x/1.9x/1.8x/1.2x of initial value for the contracts signed in 2018/2019/2020/2021/2022/2023.
大型企業：雖然面臨較長的交易週期，但收入增長貢獻堅實。得益於不斷增長的軟件本地化需求以及增強的產品能力，金蝶宇宙&星座（C&C）業務收入在2024年上半年同比增長38.9％（2023年上半年：38.4％YoY），達到人民幣5.46億元（佔總收入的19％，2023年上半年爲15％）。2024年上半年，金蝶爲C&C業務簽約了275個新客戶。管理層強調C&C客戶的終生合同價值（LTCV）的穩步擴張軌跡從最初的合同開始：2024年上半年，LTCV擴展至簽訂於2018/2019/2020/2021/2022/2023年的合同的初始價值的5.3倍/3.8倍/2.9倍/ 1.9倍/1.8倍 / 1.2倍。
Guidance on OCF growth and breakeven point remains unchanged driven by efficiency improvement. Management's guidance on continued loss reduction and breakeven in 2025 remains unchanged. Although the overall pace of revenue growth is likely to be slightly slower than our previous expectation, but management's guidance on OCF of RMB900mn for 2024 remains unchanged as it is confident in driving operating efficiency improvement.
由於效率提升的驅動，OCF增長和盈虧平衡點的指導方針仍然不變。管理層對於持續減虧和2025年盈虧平衡的指導方針仍然不變。儘管總體營收增長的速度可能略慢於我們之前的預期，但管理層對於2024年OCF的指導方針仍然爲9億元人民幣，因爲它對推動運營效率的提高充滿信心。
譯文內容由第三人軟體翻譯。