24Q1 revenue was +10.21% YoY. In '23, the company's revenue was 24.559 billion yuan, -4.1% year on year, net profit to mother was 5.627 billion yuan, -9.21% year on year, and net profit after deducting net profit of 5.395 billion yuan, or -9.57% year on year.
Net operating cash flow in '23 was $7.356 billion, +92.04% year-on-year, mainly due to the combined effects of increased contract liabilities and reduced costs, taxes and expenses. It is proposed to distribute a cash dividend of 6.6 yuan (tax included) for every 10 shares in '23. 24Q1's revenue was 7.694 billion yuan, +10.21% year on year, net profit to mother was 1,919 billion yuan, +11.85% year over year, net profit after deducting 1.86 billion yuan, or +13.34% year on year. In 2024, the company plans to target revenue of 27.51 billion yuan (yoy +12.01%) and net profit to mother of 6.23 billion yuan (yoy +10.72%).
24Q1 profit margins were slightly restored. The company's gross margin in '23 was 34.74%, -0.95pct year on year, mainly due to the decline in sales scale and the impact of the category structure; the sales expense rate/management expense ratio was 5.32%/5.05%/-2.38%, respectively, -0.06pct/+0.39pct/+0.48pc, respectively. Among them, the increase in the management expense ratio was mainly due to the increase in management labor and information technology expenses. The increase in the financial expense ratio was mainly due to a decrease in interest income; the net interest rate to mother was 22.91%, -1.29pct year on year. The 24Q1 company's gross margin was 37.31%, +0.38pct; sales expense ratio/management expense ratio/financial expense ratios were 5.5%/4.02%/-1.33%, respectively, +0.27pct/-0.38pct/+0.22pct, respectively, and net profit margin to mother was 24.94%, +0.37pct year on year.
24Q1 Other Product Revenue +22.1% YoY. The 23-year revenue/23-year growth rate/24Q1 growth rate for each product were: soy sauce 12.637 billion yuan/ -8.83%/+10.06%, seasoning sauce 2,427 billion yuan/ -6.08%/+6.44%, oyster sauce 4.251 billion yuan/ -3.74%/+9.63%, and other products 3.499 billion yuan/ +19.35%/+22.1%, respectively.
The net decline in dealers continued in 24Q1. Offline and online revenue for 23 years/annual growth rate/24Q1 growth rate were: offline 21.926 billion yuan/ -3.86%/+10.81%, and online 889 million yuan/ -10.06%/+20.67%, respectively.
Looking at the subregions, each region's 23-year revenue/23-year growth rate/24Q1 growth rate was: 4.354 billion yuan/ -7.26%/+10.33% in the east, 4.5 billion yuan/ -2.17%/+21.81% in the central region, 5.049 billion yuan/ -4.19%/+10.21% in the north, 5.925 billion yuan/ -4.78%/+6.46% in the west, and 2,986 billion yuan/ -0.68%/+10.08% in the west. There was a net decrease of 581 and 85 dealers in '23 and 24Q1, respectively. As of the end of the first quarter of '24, the total number of dealers in the company was 6506.
Profit forecasting and valuation. We expect the company's 24-26 EPS to be 1.13/1.28/1.45 yuan, respectively, and the relevant comparable 24-year PE is 27-30 times higher than the company's 24-year PE. Considering that the company is the absolute leader in the industry, the brand, channel, and product strength are all extremely excellent, and are continuously being strengthened. The company was given 40-50 times PE over 24 years, corresponding to a reasonable value range of 45.2-56.5 yuan, and given a “superior to the market” rating.
Risk warning. The decline in the catering industry; the impact of fluctuations in raw material prices; increased competition in the industry, etc.