Investment Rating - The report maintains a "Recommend" rating for JS Global Lifestyle (01691 HK) with a target price of HKD 1 7 [1] Core Views - JS Global Lifestyle completed the spin-off of SN Group retaining the Joyoung division and SN Asia-Pacific business The retained business achieved revenue of USD 1 43 billion in 2023 a year-on-year decrease of 3 2% on a comparable basis [1] - The Joyoung division saw a significant revenue decline of 20 5% to USD 1 05 billion due to weak demand in the domestic small household appliance market while SN Asia-Pacific business surged 137 4% to USD 150 million driven by strong growth in the Japanese vacuum cleaner market [1] - The company's gross margin for continuing operations in 2023 was 34 1% down 2 3 percentage points year-on-year Joyoung's gross margin fell by 1 percentage point to 31 1% while SN Asia-Pacific's gross margin increased by 2 6 percentage points to 42 2% [1] - The spin-off of SN Group to list on the US stock market is expected to enhance the overall value of SN and allow both JS Global and SN to focus on their respective business areas improving operational efficiency and talent incentives [1] - The report forecasts adjusted net profit attributable to shareholders of USD 70 million for 2024 USD 80 million for 2025 and USD 90 million for 2026 [1] Financial Performance - In 2023 JS Global Lifestyle reported revenue of USD 1 438 billion a year-on-year decrease of 71 7% and net profit attributable to shareholders of USD 132 million a year-on-year decrease of 60 4% [2] - The company's gross margin for 2023 was 34 1% with a net margin of 9 2% [8] - Revenue is expected to grow by 7 8% in 2024 5 8% in 2025 and 5 0% in 2026 reaching USD 1 720 billion by 2026 [2] - Net profit attributable to shareholders is projected to decline by 45 8% in 2024 but recover with growth of 16 0% in 2025 and 9 0% in 2026 [2] Business Segments - The Joyoung division contributed USD 1 05 billion in revenue in 2023 a 20 5% decline year-on-year due to weak domestic demand [1] - SN Asia-Pacific business achieved revenue of USD 150 million in 2023 a 137 4% increase year-on-year driven by strong performance in the Japanese market particularly the Shark brand which saw revenue grow by 62 5% to USD 120 million [1] Future Outlook - The company is expected to benefit from the recovery in domestic small household appliance demand and the growth potential of SN Asia-Pacific's product development and channel expansion [1] - The report anticipates improved profitability and gross margins in the future supported by product iteration and innovation strategies [1]
JS环球生活：2023年报点评：拆分SN集团，SN亚太重新起航