JONJEE(SH:600872) Southwest Securities·2024-11-01 07:31Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company's Q3 profit continues to improve, with ongoing reforms steadily advancing [1] - The main business of soy sauce has resumed growth, while chicken essence and powder maintain high growth rates [2] - Cost benefits and expense reductions have led to sustained improvement in profitability [2] - Internal reforms are ongoing, with expectations for future momentum release [3] - Earnings forecasts for 2024-2026 are projected at EPS of 0.90, 1.09, and 1.35 respectively, with corresponding dynamic PE ratios of 25, 21, and 17 [3] Summary by Sections Financial Performance - In the first three quarters, the company achieved revenue of 3.95 billion yuan, a year-on-year decrease of 0.2%; net profit attributable to shareholders was 580 million yuan, an increase of 18.5 million yuan year-on-year; and net profit excluding non-recurring items was 550 million yuan, up 19.3% year-on-year [1] - For Q3 2024, revenue was 1.33 billion yuan, up 2.2% year-on-year; net profit attributable to shareholders was 230 million yuan, up 32.9% year-on-year; and net profit excluding non-recurring items was 210 million yuan, up 27.7% year-on-year [1] Product Performance - In Q3 2024, the revenue growth rates for soy sauce, chicken essence and powder, edible oil, and other products were +0.5%, +14%, -9.2%, and -9.1% respectively [2] - Revenue growth rates by region in Q3 2024 were +8.6% in the East, +1.2% in the South, -12.9% in the Central and Western regions, and +2.5% in the North [2] Cost and Profitability - The gross margin for the first three quarters was 36.9%, an increase of 4.9 percentage points year-on-year; Q3 gross margin was 37.4%, up 5.1 percentage points year-on-year [2] - The net profit margin for Q3 was 16%, an increase of 3.2 percentage points year-on-year, with the net profit margin for the subsidiary Meiwai Xian at 18.4%, up 4.4 percentage points year-on-year [2] Internal Reforms and Future Outlook - The company has implemented significant management reforms since the new executive team took over, establishing a divisional system in marketing and empowering frontline divisions [3] - A stock incentive plan for 2024 has been launched to boost team motivation and confidence in future development [3] - The company is actively adjusting channel inventory and increasing the number of sales personnel, with expectations for rapid growth in the seasoning business in Q4 [3]