Juewei Food (SH:603517) KAIYUAN SECURITIES·2024-09-03 00:00Investment Rating - The investment rating for the company is "Outperform" (Maintain) [1] Core Views - The company experienced pressure on same-store operations, but profits benefited from cost reductions, maintaining an "Outperform" rating [1] - In H1 2024, the company achieved revenue of 3.34 billion yuan, a year-on-year decline of 9.7%, while net profit attributable to shareholders was 296 million yuan, a year-on-year increase of 22.2% [1] - The company is expected to gradually improve store operations and stabilize its food ecosystem, with net profit forecasts for 2024-2026 at 680 million, 790 million, and 900 million yuan, representing year-on-year growth of 98.3%, 16.2%, and 13.4% respectively [1] Revenue and Store Operations - In Q2 2024, the company reported a revenue decline of 12.3%, with a total of 14,969 stores in mainland China, a net reduction of 981 stores compared to the end of 2023 [2] - Revenue by product category in Q2 2024 included poultry at 950 million yuan (down 16.4%), vegetables at 160 million yuan (down 9.4%), and packaged products at 140 million yuan (up 111.1%) [2] - Regional revenue performance varied, with declines in Southwest, Northwest, and Central China, while North China saw a 7.4% increase [2] Profitability and Cost Management - The gross profit margin for Q2 2024 was 30.6%, an increase of 8.2 percentage points year-on-year, primarily due to improved prices of duck by-products [3] - Selling expenses increased to 10.0% of revenue, up 2.6 percentage points year-on-year, attributed to higher advertising costs [3] - The company achieved a net profit of 131 million yuan in Q2 2024, reflecting a year-on-year growth of 25.1% [3] Financial Projections - The company’s projected financial metrics for 2024E to 2026E include revenue of 6.961 billion yuan, 8.169 billion yuan, and 9.550 billion yuan, with corresponding net profits of 683 million yuan, 793 million yuan, and 900 million yuan [4] - The projected P/E ratios for 2024E, 2025E, and 2026E are 11.4, 9.8, and 8.6 respectively, indicating a favorable valuation trend [4]