Brief comment on performance
On October 30,2023, the Company disclosed the performance of 03, realizing revenue of 586 million yuan, with a year-on-year growth of 5.63%; realizing net profit of 61.36 million yuan. Excluding exchange gains and losses, the total profit of Q3 was 68.8 million yuan, with a year-on-year growth of 47.87% and a month-on-month growth of 3.66%; excluding exchange gains and losses, the net profit attributable to the parent company was 60.62 million yuan, with a year-on-year growth of 61.94% and a month-on-month growth of 12.37%. The overall business showed a recovery trend.
Business analysis
The effectiveness of advertising business continued to be repaired and operational efficiency improved. 03 Revenue and profit excluding exchange gains and losses have improved year-on-year and month-on-month. With the catalyst of Q4 overseas e-commerce marketing peak season, the main business of the Company is expected to continue the recovery trend. The gross profit margin of 302023 was 24.6%, up 3.82pct year-on-year, the sales expense ratio was 1.95%, up 0.04pct year-on-year, the management expense was 6.71%, up 2.1pct year-on-year, and the R & D expense ratio was 3.39%, down 0.85pct year-on-year. Influenced by the fluctuation of RMB exchange rate against USD, the exchange income of 302023 of the Company was RMB 909,100 Yuan, the exchange income of the same period of last year was RMB 40.8144 million Yuan, and the exchange income of 202023 was RMB 28.3771 million Yuan. After excluding exchange gains and losses, the total profit and net profit of 302023 increased positively year-on-year and month-on-month, and the recovery trend continued.
Assist consumer brands to go to sea and contribute to performance increment. The company cooperates with Chinese brands to promote its internationalization and digital transformation. Since August, it has become the official sailing partner of Kudi Coffee. The marketing cases of cooperation between Q3 and Nezha Automobile, Geely Automobile, Trip, etc. have been recognized by professional institutions and organizations.
Al layout continues to deepen, the company launched AIGC digital marketing creation platform KreadoAl on July 12, 2023, providing four solutions including Al digital people, Al models, Al tools, Al creative assets, global registered users exceeded 600,000, covering 67 countries, single month user visits exceeded 1 million. The Company continues to cooperate with Top models and cloud vendors (such as Huawei Cloud and Alibaba Cloud) to promote the application of AIGC in the field of overseas marketing.
Earnings forecast, valuation and rating
The company has been deeply engaged in overseas marketing for many years, with high-quality customer resources, Al continues to empower to reduce costs and increase efficiency.
We estimate that the net profit attributable to the parent company from 2023 to 2025 will be 261 million yuan, 317 million yuan and 391 million yuan respectively. The corresponding PE is 29.16x, 24.00x, 19.44x. Give it a "buy" rating.
Risk hint
The risk of overseas market environment and policy change, the recovery of overseas demand is not as expected, the R & D and landing of new technology is not as expected, the risk of customer loss, the risk of concentrated suppliers, and so on.