JGJC(SZ:000799) Huaxin Securities·2024-04-29 06:00Investment Rating - The report maintains a "Buy" rating for the company [2][4] Core Views - The company is undergoing a deep adjustment in expense reform, with performance slightly below expectations. The total revenue for 2023 was 2.83 billion yuan, a decrease of 30.14% year-on-year, and the net profit attributable to shareholders was 548 million yuan, down 47.77% [2][3] - The company is focusing on consumer cultivation and marketing, with consumer marketing expenses increasing by 10% year-on-year, and the number of effective core terminals increasing by 19% [2][3] - The company aims for long-term growth by sacrificing short-term performance, with expected EPS for 2024-2026 at 1.50, 1.83, and 2.25 yuan respectively, corresponding to PE ratios of 34, 28, and 22 times [4][6] Summary by Sections Financial Performance - In Q4 2023, total revenue was 687 million yuan, an increase of 21.72% year-on-year, while net profit was 69 million yuan, a decrease of 10.05% [2] - Q1 2024 total revenue was 494 million yuan, a decrease of 48.80% year-on-year, with net profit at 73 million yuan, down 75.56% [2][3] - The gross margin and net margin for 2023 were 78.35% and 19.36%, respectively, showing a year-on-year decline [2][3] Market Coverage and Sales - The company achieved 97% coverage in provincial markets and 73% in municipal markets, with 1,381 signed distributors and 393 signed specialty stores [3] - Domestic and international revenues for 2023 were 281.6 million yuan and 0.4 million yuan, respectively, with year-on-year growth of 30.19% and 101.30% [3] Profitability Forecast - The report forecasts a revenue growth rate of -30.1% for 2023, followed by 4.9%, 10.1%, and 15.0% for 2024, 2025, and 2026, respectively [4][6] - The net profit is expected to decline by 47.8% in 2023, with subsequent growth rates of -11.2%, 21.9%, and 23.4% for the following years [4][6]