CAPOL(SZ:002949) EBSCN·2024-04-07 16:00Investment Rating - The report maintains a "Buy" rating for Huayang International (002949.SZ) [5][13] Core Views - The company reported a revenue of 1.51 billion yuan, a net profit attributable to shareholders of 160 million yuan, and a net profit excluding non-recurring items of 130 million yuan for 2023, reflecting a year-on-year change of -17.5%, +43.8%, and +48.1% respectively [11] - The company plans to distribute a cash dividend of 0.8 yuan per share, with a dividend payout ratio of 97%, resulting in a dividend yield of approximately 5.7% [11] - The company has seen significant improvements in profitability, with a gross margin of 32.2% and a net margin of 12.6% for 2023, both showing increases of 3.0 and 4.6 percentage points year-on-year [12] - The report highlights the strong growth in prefabricated orders, with new contracts signed amounting to 1.55 billion yuan, a year-on-year increase of 2.5%, and prefabricated design contracts reaching 880 million yuan, up 42.9% [20] - The integration of AI applications and the development of the low-altitude economy are expected to enhance operational performance and bring in additional orders [21] Summary by Sections Financial Performance - In Q4 2023, the company achieved revenue of 450 million yuan, a net profit of 20 million yuan, and a net profit excluding non-recurring items of 20 million yuan, with year-on-year changes of -14.4%, +170.1%, and +183.9% respectively [11] - The operating cash flow for 2023 was 290 million yuan, an increase of 20 million yuan compared to the previous year [12] Profitability and Cost Management - The company has successfully reduced its expense ratio to 15.5%, down 0.5 percentage points year-on-year, with specific expense ratios for sales, management, finance, and R&D at 2.7%, 8.0%, 0.3%, and 4.5% respectively [12] - The report indicates that the company has streamlined management and controlled labor costs, leading to a decrease in management expense ratio [12] Future Outlook - The report projects a downward revision of the net profit forecast for 2024 and 2025 to 200 million yuan and 230 million yuan, respectively, reflecting reductions of 21.1% and 27.1% [13] - The company is expected to benefit from the ongoing promotion of its "three major projects" and the growing demand for low-altitude economic development [21]