Event: the company released its three-quarter report in 2023. In the first three quarters, the operating income, net profit and non-return net profit in the first three quarters were 3.32 million yuan, 102 million yuan, and 89.49 percent, respectively, compared with the same period last year. The operating net cash flow is 72 million yuan, which is 1.49 yuan compared with the same period last year. Performance is in line with market expectations.
Comments:
The growth of Q3 performance has slowed down, and the profitability is still recovering: 23Q1-Q3, the revenue in a single quarter was RMB 0.96 million, respectively, compared with the same period last year, with revenue of RMB 1.24 billion, year-on-year + 77%, 55%, and 36%, respectively, and the net profit of return to the mother was RMB 0.30 million, + 77% / 91%, 30% compared with the same period last year, deducting the non-home net profit of RMB 0.26max, 0.390.25 million, and + 191%, 117%, 22%, respectively. The growth rate of 3Q23 income and net profit has slowed down, of which the growth rate at the profit end is lower than that at the income end, which is related to the increase in expense rates during the period compared with the first half of the year. In the first three quarters, the company's sales gross profit margin was from-1.96pp to 71.43%, and the net profit rate was from + 1.94pp to 30.65%. The expense rate during the period was from-7.95pp to 44.39%. With the recovery of sales scale, a reasonable decline was achieved. Compared with the first three quarters of 2021, there is still a gap between the company's gross profit margin and net profit margin, and profitability is still recovering.
Adhere to innovation-driven, enrich product matrix: the company insists on innovation-driven, continues to invest in the development and construction of magnetic stimulation, electrical stimulation / electrophysiology, robot, laser radio frequency and other technology platforms to enrich product pipelines and technology reserves.
The original products were iteratively upgraded, and the 1H23 second-generation pelvic floor functional magnetic stimulator, the second-generation transcranial magnetic stimulator and the second-generation group biofeedback instrument were successfully put on the market. Emerging products have been listed one after another, and plastic magnetic products were certified by FDA in March this year, and domestic evidence is expected to be obtained by the end of this year; high-frequency electrocautery second-class medical registration certificate and semiconductor laser third-class medical registration certificate were obtained in February and March respectively; the clinical trial of picosecond laser therapeutic apparatus has been started, and a clinical report is expected to be obtained and submitted for registration by the end of this year. The first generation of rehabilitation robot products have all been obtained evidence, covering the human upper and lower extremities full-cycle rehabilitation evaluation and training, the follow-up will continue to promote cost reduction and improve market competitiveness and commercial level.
Improve the organizational structure and incentive mechanism to promote long-term development: in order to adapt to the new business development, the company continues to optimize the marketing system, expand the sales team, and focus on promoting the construction of marketing and service localization management. Enhance the team's academic knowledge and professional and technical level. At the same time, on the basis of the original R & D system, the BU team is set up with the project as the core element, and the new product R & D and old products are iteratively synchronized to quickly meet the strategic and market needs. The company launched the 2023 restricted stock incentive plan, with June 7 as the first grant date, granting 1.0615 million restricted shares at the grant price of 26.50 yuan per share to 118 incentive targets, and October 25 as the reserved grant date. 188000 restricted shares were awarded to 49 incentive targets at the grant price of 26.5 yuan per share, thus promoting the long-term and stable development of the company.
Profit forecast, valuation and rating: as the leader of magneto-electric joint rehabilitation equipment, the company is in a high-growth blue sea track, insists on innovation-driven, and actively distributes rehabilitation robots and medical and aesthetic equipment products. It is expected to benefit from the high boom in the rehabilitation industry and the upgrading of household consumption. Taking into account the increased efforts to open up the market, the 23-25 net profit forecast for homing is 1.99 trillion yuan (compared with the last reduction of 5%, 10%, 11%). The current stock price is corresponding to the 23-25 PE, which is twice as much as 29-23-19, maintaining the "overweight" rating.
Risk tips: slow construction of rehabilitation department; failure of new product research and development or unfavorable market promotion; risk of safety accidents, etc.