Incident: The company released the third quarter report of 2022. The company achieved revenue of 1,995 million yuan in 2022/Q1-Q3, an increase of 4.87% over the previous year; it achieved net profit of 274 million yuan to the mother, an increase of 38.75% over the previous year. Among them, 2022Q3's quarterly revenue was 763 million yuan, an increase of 7.05% over the previous year; Guimu's net profit was 124 million yuan, an increase of 32.57% over the previous year.
Export sales exceeded expectations, and bucking the trend showed resilience. Export: According to data from the General Administration of Customs, domestic vacuum cleaner exports in July-September '22 were 1109/1031/10.36 million units, down 12.95%/29.09%/27.75% from the same period last year. The company performed well against the backdrop of a downturn in the 22Q3 industry, and achieved positive growth in revenue and performance. Domestic sales: The company's 22H1 domestic sales revenue accounted for 17%, an increase of 14% over the previous year.
We judge that the company is vigorously expanding domestic customers such as Fangtai this year, and it is expected that domestic sales will continue to grow in a single quarter.
In addition, during the year, the company passed ISO13485 medical device quality management system certification and completed trial production of the first batch of commercial beauty devices.
Exchange gains and losses contribute to profit flexibility, and the cash flow situation is good. The exchange rate of the US dollar against the RMB has continued to rise since 22H1. As of October 26 this year, the spot exchange rate of the US dollar against the RMB was 7.31, up 9.18% from the middle of the year. The company mainly focuses on overseas OEM and benefits from continuous improvement on the profit side contributing to exchange gains and losses. Gross profit margin: In 22Q3, the company's gross margin increased by 3.2 pct to 19.55% year on year. We judge that this was mainly due to falling raw material prices. Period expenses: 22Q3 sales/management/R&D/finance rates were 0.43%/2.40%/3.02%/-5.13%, -0.44pct/-0.58pct/0.75pct/-4.53pct. Among them, the large change in financial expenses was mainly affected by the appreciation of the US dollar. The 22Q3 company's financial expenses decreased by 34.88 million yuan to -39.14 million yuan over the same period last year, contributing about 5% to net interest. Net interest rate: Taken together, the decline in raw material prices compounded by the impact of exchange gains and losses. The company's 22Q3 net interest rate increased 3.11pct to 16.30% year-on-year. Operating cash flow: The company's cash flow situation is good. The company's net operating cash flow in 22Q3 was 192 million yuan, an increase of 297.41% over the same period last year.
Set up overseas production bases and expand domestic customers in depth. During the reporting period, the company continued to build production bases in Vietnam. Improving the efficiency of the company's overseas production bases will effectively enhance the stability of the company's production capacity and better meet the needs of domestic and foreign customers. In addition, the company continues to expand its domestic customers and launched products such as the “Mibo Rollless Floor Washer V6” with domestic customers during the year. It is expected that the company's domestic cleaning appliance OEM share will continue to increase.
Profit forecasts and investment recommendations. The company's net profit for 2022-2024 is expected to be 309/385/472 million yuan, an increase of 33.3%/24.8%/22.4%, maintaining the “increase in holdings” rating.
Risk warning: increased overseas inflation, impact of exchange rate fluctuations, channel expansion falling short of expectations