ORIENT CABLE (NBO)(SH:603606) Minsheng Securities·2025-03-30 10:23Investment Rating - The report maintains a "Recommended" rating for the company, considering the expected recovery in industry demand, the scale and structure of the company's orders, and its leading profitability in the industry [3][5]. Core Viewpoints - The company achieved a revenue of 9.093 billion yuan in 2024, representing a year-on-year growth of 24.38%. The net profit attributable to shareholders was 1.008 billion yuan, with a slight increase of 0.81% year-on-year. However, the net profit excluding non-recurring items decreased by 6.07% to 909 million yuan [1][2]. - The company has a record high order backlog of 17.975 billion yuan as of March 21, 2025, with significant contributions from both submarine cable systems and land cable systems [2][3]. - The company is actively expanding its domestic and international operations, with a notable increase in overseas revenue, which reached 733 million yuan in 2024, a year-on-year increase of 480.54% [3]. Summary by Sections Financial Performance - In Q4 2024, the company reported a revenue of 2.394 billion yuan, a year-on-year increase of 22.1%, but a quarter-on-quarter decline of 9%. The net profit for the quarter was 76 million yuan, down 57.32% year-on-year and 73.6% quarter-on-quarter [1]. - The gross margin for 2024 was 18.83%, a decrease of 6.38 percentage points year-on-year, while the net margin was 11.09%, down 2.59 percentage points year-on-year [1][3]. Business Segments - Revenue from the submarine cable system in 2024 was 2.778 billion yuan, a slight increase of 0.41%. The marine engineering segment generated 889 million yuan, up 25.29%. The land cable revenue was approximately 5.416 billion yuan, reflecting a growth of 41.52% [2]. - The gross margins for submarine cable systems, marine engineering, and land cables were 39.57%, 21.93%, and 7.59%, respectively, with year-on-year declines of 9.57, 2.60, and 0.37 percentage points [2]. Order Backlog and Future Projections - The company has secured several significant contracts, including a 382 million yuan contract for land cables and a 900 million yuan contract for submarine cables [2]. - Future revenue projections for 2025, 2026, and 2027 are estimated at 11.632 billion yuan, 14.131 billion yuan, and 15.328 billion yuan, respectively, with net profits expected to be 1.613 billion yuan, 2.289 billion yuan, and 2.446 billion yuan [4][3].