Investment Rating - The report maintains a "Buy" rating for China Oriental Education (0667) [5][3]. Core Views - The 2023 annual performance was below expectations, with employee compensation and marketing expenses front-loaded, leading to temporary pressure on profit margins. However, new student enrollments are gradually recovering, and revenue-driven profit recovery is anticipated [3][4]. - The expected EPS for 2024-2026 is projected at 0.18, 0.22, and 0.24 CNY, respectively, with a target price of 2.70 CNY/2.93 HKD based on a 15x PE valuation for 2024 [3][4]. Financial Summary - In 2023, the company achieved revenue of 39.79 billion CNY, a year-on-year increase of 4.2%, and an adjusted net profit of 2.81 billion CNY, up 5.4% year-on-year. However, performance was below expectations due to a decline in new enrollments during the pandemic [3][4]. - The gross profit margin decreased by 1.56 percentage points to 47.96%, primarily due to significant increases in employee salaries and benefits. The company anticipates that as new enrollments stabilize, the student-to-teacher ratio will improve, potentially enhancing the gross margin [3][4]. - The company’s operating expense ratio for 2023 was 43.3%, an increase of 0.46 percentage points, with sales, management, R&D, and financial expense ratios showing various year-on-year changes [3][4]. Enrollment and Training Growth - In 2023, the company added 152,900 training participants, a year-on-year increase of 13.8%, with an average of 146,800 training participants, up 2.9% year-on-year. The revenue from various training segments showed mixed results, with notable growth in automotive repair and culinary training [3][4].
2023年报业绩点评：利润阶段性承压，新招稳步恢复