In 2023, the company achieved revenue of 15.34 billion yuan, a decrease of 0.8%; net profit to mother of 1.91 billion yuan, a decrease of 38.4%; net profit after deducting non-return to mother of 1.78 billion yuan, a decrease of 39.8%; and cash flow from operating activities of 1.12 billion yuan, a decrease of 8.6%. In 2023, the company's consolidated gross profit margin was 32.9%, down 2.7 pct.
2023Q4 achieved revenue of 3.65 billion yuan, a decrease of 9.8% and a decrease of 5.9%; net profit to mother of 280 million yuan, a decrease of 66.0% and a decrease of 12.9%; net profit of non-return to mother of 230 million yuan, a decrease of 69.9% and a decrease of 20.3%; and cash flow from operating activities of 480 million yuan, a decrease of 54.3%, and an increase of 348.1%. The comprehensive gross profit margin was 36.4%, an increase of 2.8 pct, and a circular decrease of 2.5 pct.
In 2023, the company's four fees totaled 1.90 billion yuan, with a four-rate rate of 12.4%, an increase of 1.3 pct. Among them, sales expenses were 214 million yuan, with a sales expense ratio of 1.39%, an increase of 0.13 pct; management expenses of 648 million yuan, with a management expense ratio of 4.22%, an increase of 0.22 pct; and financial expenses of 0.76 million yuan, with a financial expense ratio of 0.49%, an increase of 0.61 pct.
2024Q1 achieved revenue of 3.03 billion yuan, a decrease of 18.0% and a decrease of 16.9%; net profit to mother of 450 million yuan, a decrease of 36.6%, an increase of 57.4%; net profit after deducting non-return to mother of 420 million yuan, a decrease of 38.3% and an increase of 79.2%; cash flow from operating activities - 1.36 billion yuan, a decrease of 175.0% and a decrease of 385.3%. The comprehensive gross profit margin was 31.4%, down 3.0 pct, and the circular decrease was 5.1 pct.
By business: In '23, revenue from anode materials and graphitization was 6.61 billion yuan, a decrease of 16.0%; sales volume was 155,000 tons, an increase of 11.4%. Revenue from membrane products and coating processing was 4.82 billion yuan, an increase of 23.6%; sales volume was 5.27 billion square meters, an increase of 21.5%; gross profit margin was 52.1%, an increase of 7.9pct over the previous year, and the profitability of membrane products and coating processing increased significantly. Sales of coated diaphragms accounted for 40.7% of domestic wet diaphragm shipments during the same period. The shipment volume of aluminum-plastic packaging film was 15.75 million square meters, laying a good foundation for sales growth in 2024. PVDF achieved revenue of 1.02 billion yuan (including internal sales), a year-on-year decrease of 44.3%; sales volume of 11,000 tons, an increase of 97.8%; gross profit margin of 50.7%, an increase of 15 pcts over the previous year, and PVDF's profitability increased significantly. Achieved revenue from lithium battery equipment (including internal sales) of 3.59 billion yuan, an increase of 49.6% over the same period. It achieved industrial investment revenue of 1.06 billion yuan, a decrease of 36.1%, a gross profit margin of 19.5%, and an increase of 0.3 pct.
Considering that the price drop in the lithium battery industry chain exceeded expectations (the corresponding company depreciated a lot in 23 years), we lowered the company's net profit to mother by 2.8-3.5 billion yuan in 24-25 (previously forecast 5.5-6.5 billion yuan) to correspond to the current valuation of 14,1X. The additional net profit is expected to reach 4.2 billion yuan in 26 years, corresponding to a valuation of 9X. I am optimistic that after the company's anode business reaches a relative bottom in history, it is expected that the diaphragm and equipment business will continue to expand, and maintain a “buy” rating.
Risk warning: The release of production capacity fell short of expectations, the decline in anode prices exceeded expectations, sales of electric vehicles fell short of expectations, and the rise in coke prices exceeded expectations.