CTS INTERNATIONAL LOGISTICS(603128):UNIT EARNINGS TO RECOVER; DIVIDEND YIELDS LIKELY TO BE 4.4%
CTS INTERNATIONAL LOGISTICS(603128):UNIT EARNINGS TO RECOVER; DIVIDEND YIELDS LIKELY TO BE 4.4%
Direct-customer strategy continues; overseas expansion well on track. 1) Since 2024, the firm has established and operated overseas outlets in Kazakhstan, Brazil, Chile, Colombia, and Nigeria to strengthen its local service capabilities. 2) The firm continues to enhance the stability of its products and widen product coverage. For marine transportation, it cooperated with contractors, while for air transportation, it consolidates core capacity for European and American routes to improve its product mix.3Q24 earnings miss our expectations
第3季度24財年收益未達到我們的預期
CTS International Logistics announced its 3Q24 results: Revenue rose 52% YoY and 23% QoQ to Rmb5.82bn, gross profit grew 4% YoY and 14% QoQ to Rmb556mn, and attributable net profit fell 21% YoY and grew 24% QoQ to Rmb169mn. The firm's 3Q24 profit slightly missed our expectations, mainly due to: 1) Volatile ocean freight rates and pressure on earnings from agency business; 2) investment costs and expenses increased in the early stage due to the firm's efforts to expand overseas network; and, 3) the firm generated a high base related to investment income, as it sold a 25% stake in JCEX International Logistics in 3Q23.
CTS國際物流宣佈其第3季度24財年業績：營業收入同比增長52%，環比增長23%至人民幣582億，毛利潤同比增長4%，環比增長14%至人民幣5.56億，淨利潤同比下降21%，環比增長24%至人民幣1.69億。該公司第3季度24財年利潤略微低於我們的預期，主要原因是：1）海運運價波動大，代理業務收益受壓；2）由於公司努力拓展境外業務網絡，投資成本和費用在初期上升；3）公司產生的與投資收益相關的高基數，是因爲它在第3季度23將其在JCEX國際物流的25%股權出售。
Trends to watch
需要注意的趨勢
Direct-customer strategy continues; overseas expansion well on track. 1) Since 2024, the firm has established and operated overseas outlets in Kazakhstan, Brazil, Chile, Colombia, and Nigeria to strengthen its local service capabilities. 2) The firm continues to enhance the stability of its products and widen product coverage. For marine transportation, it cooperated with contractors, while for air transportation, it consolidates core capacity for European and American routes to improve its product mix.
直接客戶策略持續進行；境外擴張順利進行。1）自2024年以來，公司在哈薩克斯坦、巴西、智利、哥倫比亞和尼日利亞建立並運營境外門店，以加強其當地服務能力。2）公司繼續增強產品穩定性並拓寬產品覆蓋範圍。對於海運，公司與承包商合作，對於空運，鞏固歐美航線的核心能力以改善產品組合。
If container freight rates stabilize, we expect the firm's unit earnings to recover. As the firm provides full-process logistics services for some clients, the sharp fluctuations in container freight rates since 2024 have increased the firm's costs in the short term. Since July, SCFI freight rates have gradually fallen (as of October 18, SCFI US west coast routes and European routes have fallen 42% and 64% from the highs in early July). If container shipping rates stabilize in the future, we expect the firm to improve its pricing and cost management capabilities, and its earnings per container will likely recover.
如果集裝箱運價穩定下來，我們預計公司的單箱收益將恢復。由於公司爲某些客戶提供全流程物流服務，自2024年以來集裝箱運價的急劇波動已經在短期內增加了公司的成本。自7月份以來，SCFI運價逐漸下降（截至10月18日，SCFI美國西海岸航線和歐洲航線已經較7月初高點下降了42%和64%）。如果未來集裝箱運價穩定下來，我們預計公司將改善定價和成本管理能力，每個集裝箱的收益可能會恢復。
The firm promises a dividend payout ratio of no less than 60%, and its dividend yield provides underlying income. According to the firm's previous announcement, dividends for each year over 2023–2025 should be no less than 60% of the distributable profit of the year. If there are no major capital expenditure arrangements in the current year, the proportion of cash dividends in profit should be at least 80%. Assuming a dividend payout ratio of 60%, we estimate the firm's dividend yield at 4.4% in 2024, supporting the firm's shareholder returns.
該公司承諾將分紅比例設定爲不低於60%，其分紅率提供底層收入。根據公司之前的公告，2023年至2025年的每年分紅應不低於當年可分配利潤的60%。如果當年沒有重大資本支出安排，利潤中現金分紅比例應至少爲80%。假設分紅比例爲60%，我們估計該公司2024年的股息收益率爲4.4%，支持該公司的股東回報。
Financials and valuation
財務和估值。
We cut our 2024 net profit forecast 38.6% to Rmb592mn, and introduce our 2025 net profit forecast of Rmb661mn, as freight rates have been more volatile in recent years and the firm's overseas expansion boosted costs. The stock is trading at 13.6x and 12.2x 2024e and 2025e P/E. We maintain an OUTPERFORM rating. Due to the aforementioned reasons, we cut our TP 28% to Rmb7.20 (implying 15.9x 2024e P/E and 14.3x 2025e P/E), offering 17.1% upside.
我們將2024年的淨利潤預測下調38.6%，至人民幣592百萬元，並引入我們2025年的淨利潤預測爲人民幣661百萬元，由於近年來運費率更加波動，公司的境外擴張增加了成本。該股票的市盈率爲2024年預估13.6倍和2025年預估12.2倍。我們保持跑贏市場評級。基於上述原因，我們將目標價下調28%，至人民幣7.20（暗示2024年預估市盈率爲15.9倍，2025年預估市盈率爲14.3倍），提供17.1%的上行空間。
Risks
風險
Lower-than-expected revenue from direct-customer business; international trade friction; disappointing overseas demand.
來自直接客戶業務的營收低於預期；國際貿易摩擦；境外需求令人失望。
譯文內容由第三人軟體翻譯。
