Bestore(603719) 长江证券·2024-05-06 05:32Investment Rating - The investment rating for the company is "Buy" and is maintained [25]. Core Insights - The company reported a revenue of 8.05 billion yuan in 2023, a year-on-year decline of 14.76%, and a net profit attributable to shareholders of 180 million yuan, down 46.26% year-on-year. In Q4 2023, the revenue was 2.046 billion yuan, a decrease of 16.02% year-on-year, with a net profit of -11.019 million yuan. For Q1 2024, the revenue increased to 2.451 billion yuan, up 2.79% year-on-year, but the net profit decreased by 57.98% to 62.483 million yuan [2][24]. Financial Performance - In 2023, the company's net profit margin decreased by 1.31 percentage points to 2.24%, while the gross profit margin increased by 0.18 percentage points to 27.75%. In Q4 2023, the net profit margin fell by 2.51 percentage points to -0.54%, with a gross profit margin decline of 0.43 percentage points to 25.43%. The expense ratio increased by 2.63 percentage points to 26.87% [24]. - For Q1 2024, the net profit margin decreased by 3.69 percentage points to 2.55%, and the gross profit margin fell by 2.74 percentage points to 26.43%. The expense ratio decreased by 0.11 percentage points to 22.35% [24]. Sales Performance - In 2023, the company's revenue from different sales models showed a decline in e-commerce and franchise sales, while direct retail and group purchase revenues increased. The e-commerce revenue decreased by 32.58%, while direct retail revenue grew by 21.69% [31]. - In Q1 2024, the e-commerce revenue returned to positive growth with an increase of 6.65%, while franchise sales declined by 16%. Direct retail revenue grew by 10.16%, and group purchase revenue surged by 57.32% [31]. Market Dynamics - The snack industry is experiencing intensified competition due to channel transformations and the entry of more small brands as consumer demand gradually recovers. This could impact product demand and sales concentration across channels [27]. - The company is expected to improve its profitability as it continues to expand its offline presence and diversify its online channels, despite facing short-term pressures from price adjustments [32].