SKSHU(603737) Minsheng Securities·2024-10-31 15:38Investment Rating - The report maintains a "Cautious Recommendation" rating for the company [4] Core Views - The company reported a revenue of 9.146 billion yuan for the first three quarters of 2024, a year-on-year decrease of 2.81%, with a net profit attributable to shareholders of 410 million yuan, down 26.00% year-on-year [1] - The report highlights improvements in cash flow quality, with operating cash flow net amounting to 916 million yuan, a year-on-year increase of 53.24% [2] - The company is expected to see net profits of 550 million yuan, 731 million yuan, and 850 million yuan for 2024, 2025, and 2026 respectively, with corresponding PE ratios of 41, 31, and 26 times [2][3] Financial Performance Summary - For Q3 2024, the company achieved a revenue of 3.385 billion yuan, a year-on-year decrease of 7.87%, while the net profit attributable to shareholders was 200 million yuan, an increase of 17.89% year-on-year [1] - The gross profit margin for the first three quarters was 28.66%, down 2.67 percentage points year-on-year, while the net profit margin was 4.44%, down 1.48 percentage points year-on-year [1] - The report indicates that retail and auxiliary material businesses performed well, with sales volume for home decoration wall paint and adhesives increasing by 13.76% and 17.26% year-on-year respectively [2] Cost and Expense Analysis - The report notes that the total expense ratio for the first three quarters was 24.01%, an increase of 1.26 percentage points year-on-year, with sales and management expenses rising by 4.10% and 3.69% respectively [2] - Raw material costs showed significant fluctuations in Q3, with wall paint and waterproof roll material prices adjusting considerably [2] Cash Flow and Receivables - The company has seen a reduction in accounts receivable and impairment scales, with accounts receivable and bills totaling 4.291 billion yuan, down 12.53% year-on-year [2] - The cash and cash equivalents at the end of the period were 2.112 billion yuan, an increase of 15.74% year-on-year [2]