The company announced Q1 results for 23 and 24:
24Q1: Revenue of 1.24 billion (+15%), net income of 130 million (+37%), deducted non-120 million (+35%).
23Q4: Revenue of $1.33 billion (+14%), net of $160 million (+41%), net of $160 million (+98%).
Year 23: Revenue of $4.84 billion (+12%), net of $560 million (+69%), net of 550 million (+87%).
Q1 Revenue profit is in line with expectations. In addition, the company plans to pay a dividend of 5 yuan for every 10 shares to 4 additional shares, corresponding to a dividend rate of 50% (51% of the previous year's dividend rate).
Revenue side: Overseas and smart home entry lead growth
Year 23: Export sales are better than domestic sales, revenue growth rate smart home entry > cloud service > camera? By region: Within 23 years, export sales revenue increased +8%/25%, respectively, and the share of export sales climbed to 30%.
Cameras: H2/Annual Revenue +1%/+3% YoY, Annual Volume/Price +10%/-6% YoY, respectively. We expect H2 camera volume growth to accelerate month-on-month, mainly due to overseas growth.
Smart Home Entry: H2/Annual Revenue +68%/+49% YoY, Annual Volume/Price +45%/+3% YoY, respectively. We expect H2 smart locks to double, mainly due to the expansion of domestic e-commerce hardware channels and overseas European growth.
Cloud services: H2/annual revenue +32%/28% year-on-year, and 2C/2B +18%/40% year over year, respectively. We expect export sales to grow faster than domestic sales. The C-side will follow the increase in the number of users, and the B-side ARPU will increase.
24Q1: Expected export sales account for more than 30%
The company Q1 launched new products such as the video call camera S10, the AI three-camera fully automatic face video lock DL60FVX Pro, and the home assistant robot RK3, and increased R&D investment.
Profit side: On the improvement channel
Year 23:23Q4/23A gross margin was +3.9/6.4 pct year on year, and net margin was +2.4/3.9 pct year over year, respectively. The main reasons include an increase in the share of export sales+structural optimization+raw material costs. The increase in gross margin led to continued profitability.
24Q1: Gross margin +1.6 pct year on year, net margin +1.7 pct, profit continued to rise; sales/R&D/finance rates were +2.0/+1.9/-2.5 pct year on year, respectively. The company increased investment in marketing and R&D, and interest income increased profits.
Investment advice:
Our point of view:
The company's hardware has formed a triple growth curve of camera+smart door+robot, and the product matrix has successively opened up space for penetration; cloud services benefit from the continuous growth of 2C consumer entry products and 2B open platforms, and AI is poised to advance.
Profit forecast: We expect the company to achieve revenue of 59/71/82 billion yuan in 2024-2026, +22%/+21%/+16%; realized net profit to mother of 7.1/8.6/1.02 billion yuan, +26%/+19% year over year; current stock price corresponds to PE37/30/26X, maintaining a “buy” rating.
Risk warning
Industry demand fluctuates, development falls short of expectations, and costs fluctuate greatly.