The company released its 24-year report, and the performance was basically in line with expectations. 2024H1 achieved operating income of 0.713 billion yuan, a year-on-year decrease of 0.86%, net profit to mother 0.144 billion, a year-on-year decrease of 4.48%, after deducting non-net profit of 0.143 billion yuan, a year-on-year decrease of 3.96%.

2024Q2's revenue in a single quarter was 0.42 billion, down 4.98% year on year, net profit to mother 0.088 billion, down 13.74% year on year, after deducting non-net profit 0.087 billion, down 13.33% year on year.

Product: Focus on R&D and promotion to consolidate product advantages, and the multi-category layout opens up room for growth. 2024H1 earns 0.598 billion for smart home products, 0.085 billion for ordinary clothes rack products, and 0.006 billion for other products. The company always adheres to the product leadership and multi-category development strategy, and lays out smart home products (smart drying racks, smart door locks, etc.), ordinary drying racks (hand drying racks, floor drying racks, external drying racks), and others (drying racks, towel racks, etc.). At the same time, around the product development idea of “research generation, reserve generation, and development generation”, we continuously improve the three-level R&D system for basic research, applied technology research, and product development, continue to independently develop and introduce new products, new materials, new processes, and new technologies to consolidate product advantages.

Channel: Diversified sales network layout, deep coverage of consumer groups. The company has built a diversified and three-dimensional channel network to achieve deep integration and collaborative development of online and offline. 2024H1's online channel revenue is 0.449 billion and offline channel revenue is 0.239 billion. Offline channels. Through hierarchical and hierarchical management, the company lays out a wide range of specialty stores and outlets, deeply covering low-tier cities and empty markets, and consolidating its leading position in the market. At the same time, promote the transformation of offline retail, enhance retail capabilities and performance, set retail benchmarks, and innovate marketing methods. Online channels, the company covers all platforms, stabilizes traditional e-commerce and explores the growth of emerging e-commerce, uses new media platforms to expand the market, and stay at the top of the industry's online revenue list. In the future, the company will focus on improving the quality of offline terminals and single stores, explore the potential of emerging e-commerce online, and continue to improve the omni-channel layout. Engineering channels. The company focuses on market development and risk management, establishes strategic relationships with many leading real estate companies and partners in various fields, and explores cross-industry cooperation and diversified product application scenarios to optimize channel structures, strictly control risks, and develop new businesses.

Actively promoting cost reduction and efficiency, gross margin increased significantly over the same period last year. 2024H1's gross margin was 54.4%, up 5.2 pct year on year, net margin was 20.1%, down 0.8 pct year on year. The significant increase in the company's gross margin is related to reducing costs and improving efficiency, and strengthening self-control of raw materials. On the cost side, the 2024H1 company's cost rate for the period was 32.0%, up 6.0 pct year on year. Among them, the sales expense rate/management cost rate/R&D cost rate/financial cost ratio were 23.3%, 6.3%, 3.4%, and -1.0%, respectively, +5.1, +1.0, +0.4, and -0.6 pct, respectively. The significant increase in the company's sales expenses ratio was mainly due to strengthening e-commerce channels and increasing marketing investment.

Enjoying the dividends of smart drying racetrack expansion, good wife can be expected to continue to grow. Driven by technological development and consumption upgrades, the drying industry is undergoing intelligent upgrading. The penetration rate of smart clothes dryers is expected to increase rapidly, driving the smart drying market to expand. Mrs. Hao is deeply involved in the drying industry, and has occupied the minds of consumers earlier, and has become synonymous with the drying category. It is expected to continue to grow steadily with strong brand power, product power and diversified channel layout. Driven by the dividends of increasing the penetration rate of smart drying racetracks!

The company is deeply involved in the intelligent drying circuit. Brand and product advantages continue to be consolidated, and the diversified channel layout is expected to drive steady growth. Considering weak terminal consumption, increased company spending, and increased industry competition, we lowered net profit from 2024-2026 to 0.342, 0.366, and 0.398 billion yuan (previous values were 0.375, 0.426, and 0.476 billion yuan), corresponding year-on-year growth rates were 4.4%, 7.2%, and 8.6%, respectively, and corresponding PE was 14, 13, and 12 times, respectively. The corresponding PE was 14, 13, and 12 times, respectively, to provide a margin of safety and maintain the “buy” rating!

Risk warning: The penetration rate of smart clothes dryers has fallen short of expectations, and industry competition has intensified.