Events: The company released its report for the third quarter of 2023. In the first three quarters of 2023, the company achieved revenue of 423 million yuan, an increase of 5.42% over the previous year; realized net profit of 14 million yuan, a year-on-year decrease of 140.73%; realized net profit of 40 million yuan, a year-on-year decrease of 260.05%. On a quarterly basis, Q3 achieved revenue of 121 million yuan, a year-on-year increase of 38.76%, a year-on-year decrease of 28.54%; realized net profit of 16 million yuan, a year-on-year increase of 7.06%, a year-on-year decrease of 531.04%; and realized a net profit of -022 million yuan, an increase of 8.42% over the previous year and a decrease of 243.20% over the previous year.
Q3 performance improved year on year, and market development results were remarkable: Thanks to the company's vigorous market development, Q3 shipments increased year on year, and revenue increased 38.76% year on year. In the first three quarters of 23 years, the company's comprehensive gross margin was 23.77%, -8.04pcts; net profit margin was -6.20%, y-13.67 pcts. Q3 The company's gross margin was 23.51%, +4.33pcts yoy; net profit margin was -17.29%, +5.89pcts yoy. In terms of expenses, the company's sales, management, R&D, and financial expenses in the first three quarters of 2023 were 2.91%/6.05%/26.47%/-0.34%, respectively, with year-on-year changes of 0.67/0.18/7.83/0.20pcts, respectively.
In the first three quarters, R&D expenses were 112 million yuan, an increase of 49.67% over the previous year due to increased expenditure on personnel remuneration, materials and equipment investment in the company's new product line.
The repurchase of shares is used for equity incentives, demonstrating confidence in long-term development: On August 20, the company issued a share repurchase announcement: The company will use the overraised capital obtained from the initial public offering of shares not less than RMB 42 million and no more than RMB 84 million (all inclusive) to repurchase some of the company's RMB common stock (A shares) shares through centralized bidding transactions. The repurchase price shall not exceed 78 yuan/share (including principal amount). The repurchase price shall not exceed 78 yuan/share (including principal amount). The repurchase of shares will be used to implement employee stock ownership plans or equity incentive plans. On October 10, the company issued a progress announcement on the repurchase of shares: the company has repurchased a total of 69,530 shares of the company through the Shanghai Stock Exchange trading system through centralized bidding, accounting for 0.10% of the company's total share capital. The maximum price of the repurchase transaction was 49.32 yuan/share, the lowest price was 45.58 yuan/share, and the total amount of capital paid was RMB 3,262,854.18 (excluding transaction fees). The company's share repurchase will help to further improve the company's long-term incentive mechanism, enhance team cohesion and enterprise competitiveness, and promote the company's stability, health and sustainable development.
Product volume drives an increase in market share, and technology research and development is expected to expand application areas: with leading technical strength, reliable product quality and high-quality customer service, the company's product share in new consumer electronics, industrial control, network communications, data centers and automotive electronics continues to grow, and the product structure is continuously optimized. In the first half of 2023, the company used AC-DC chips as an entry point. Various chip solutions such as DC-DC, linear power supplies, and gate drives continued to expand in various application fields such as fast charging, household appliances, building automation, security and fire protection, server/data center power, power conversion, and energy storage. Among them, the company's sales volume in the household appliances sector increased by more than 40% year on year. In terms of LED drivers, the company has successfully entered the supply chain of many leading customers in the high-power LED lighting industry with the “PFC+LLC/LED Driver” high-performance domestic production solution. At the same time, the company continues to expand R&D and market layout in the field of battery management chips, actively develops and supports daisy-chain cascaded BMS AFE chips, and promotes ISO26262 functional safety standard certification. The target areas are large-scale energy storage systems and new energy vehicles.
Lower the profit forecast and maintain the “increase in holdings” rating: the company actively explores new fields and continues to launch new products, and the performance growth momentum is relatively good. Considering that the recovery of consumer electronics in the first half of the year fell short of expectations, while the company continued to increase its product layout and vigorously expand high-end talents, various expenses increased during this period, so the company's profit expectations were lowered. It is estimated that the company's net profit for 2023-2025 will be 0.04 million yuan, 61 million yuan, 106 million yuan, and EPS will be 0.06 yuan, 0.88 yuan, and 1.53 yuan respectively. The corresponding PE is 793X, 54X, and 31X respectively.
Risk warning: New product development falls short of expectations, downstream demand recovery falls short of expectations, risk of falling inventory prices, risk of market competition.