Smoore International Reports Decreased Financial Performance in 2023

Smoore International (06969.HK) has released a financial update announcement, which reveals that for the nine months ending on September 30, 2023, the group achieved a revenue of 8.002 billion yuan (RMB, the same below), representing a decrease of 9.7% compared to the same period last year. Pre-tax profit amounted to 1.323 billion yuan, indicating a decrease of 47.1% year-on-year. After adjustment, the net profit stood at 1.225 billion yuan, showing a decline of 43.2% compared to the previous year.

As of September 30, 2023, during the three-month period, the group achieved a revenue of 2.879 billion yuan, an increase of 10.9% compared to the previous period, but a decrease of 10.3% compared to the same period last year. The pre-tax profit reached 526 million yuan, showing a 10.4% increase compared to the previous period, but a decrease of 36.3% compared to the same period last year. Meanwhile, the adjusted net profit reached 467 million yuan, an increase of 3.1% compared to the previous period, but a decrease of 35.2% compared to the same period last year.

Smoore International reported a year-on-year decline of approximately 36.3% in pre-tax profits for the current period compared to the same period last year. The main reasons for the decrease were a decrease in revenue of about 10.3% compared to the same period last year, largely due to an 85.6% decline in revenue from the mainland China market. Additionally, the company experienced an overall increase in sales expenses, management expenses, research and development expenses, as well as other income, expenses, gains, and losses of about 30.1% compared to the same period last year.

The group's pre-tax profits for the current period increased by approximately 10.4% compared to the second quarter of 2023. The main reasons for this growth were a 10.9% increase in revenue during the current period compared to the second quarter of 2023. Additionally, there was an overall increase of about 47.6% in sales expenses, management expenses, research and development expenses, other income and expenses, and other gains and losses compared to the second quarter of 2023. This increase can mainly be attributed to the rise in research and development expenses, which partially offset the increase in profits.