Recently, custom furniture company Piano (002853. SZ) has published its 2023 annual report.
According to the 2023 annual report, Piano achieved revenue of about 1.316 billion yuan, a year-on-year decrease of 9.35%, a net profit attributable to the parent company of about 86 million yuan, a year-on-year decrease of 44.03%, and a non-net profit of about 56 million yuan, a year-on-year decrease of 49.36%.
On the one hand, it is in line with the overall situation of the industry.
In the past year, the overall performance of the domestic home furnishing manufacturing industry has declined compared with the previous year. According to the data of the National Bureau of Statistics, in 2023, the main financial indicators of the domestic furniture manufacturing industry will decline slightly year-on-year, of which the overall operating income of the industry will reach 655.57 billion yuan, a year-on-year decrease of 4.4%, and the total profit will be 36.46 billion yuan, a year-on-year decrease of 6.6%.
On the other hand, the furniture manufacturing industry, as a downstream industry of the real estate industry, is greatly affected by the real estate industry. According to the National Bureau of Statistics, in 2023, the sales area of commercial housing in China will be 1.117 billion square meters, a year-on-year decrease of 8.5%, of which the sales area of residential buildings will decrease by 8.2%, and the sales of commercial housing will be 11.66 trillion yuan, a year-on-year decrease of 6.5%, of which residential sales will decrease by 6%. In addition, according to the data of Aowei cloud network, in 2023, the penetration rate of fine decoration of commercial housing in China will be 37.2%, and the number of newly opened fine decoration units will be 933,900 units, a year-on-year decrease of 35.9%, and both indicators will fall due to the impact of the market.
However, it should be noted that driven by the continuous drive of the "guaranteed delivery" policy, the completed area of housing and residential buildings in the country will reach 724 million square meters in 2023, a year-on-year increase of 17.2%. At the same time, since the second half of last year, the central and local governments have successively implemented policies such as recognising housing without loans, reducing down payments, lowering loan interest rates, and relaxing purchase restrictions to support the demand for rigid and improved housing. In the context of favorable policies and the recovery of completion data, it may enhance the prosperity of the home furnishing industry.
According to the estimation of the China Research Network, the market size of the custom furniture industry in mainland China has increased from 195.96 billion yuan in 2016 to 525.074 billion yuan in 2023, indicating that with the growth of residents' income and the improvement of living standards, consumers' requirements for furniture products are no longer satisfied with basic functions, but pay more attention to product brand and experience, and customized furniture has gradually been accepted and recognized by the mass market.
It is worth noting that at present, the domestic custom furniture industry industry is low in concentration, regional brands are numerous, and the competition in the custom furniture industry is mainly reflected in the competition between national brands and regional brands, brand enterprises and small-scale manufacturers. Among them, the products of small-scale manufacturers are mostly concentrated in the domestic low-end market, and the phenomenon of product homogenization is more serious, while large-scale enterprises with brands, channels and scale effects are mainly positioned in the mid-to-high-end market.
It is reported that Piano specializes in the research and development, design, production, sales, installation and after-sales services of medium and high-end custom cabinets, wardrobes, wooden doors and supporting home furnishing products. In order to distinguish itself from similar enterprises, Piano has increased its investment in R&D in recent years, and intends to gain more market share by improving product performance and upgrading production technology.
According to the annual report data, in 2023, Piano will invest about 59.6692 million yuan in R&D, an increase of 26.99% over the same period in 2022, and the proportion of the company's revenue will be 4.53%, an increase of 1.29 percentage points over 2022. During the reporting period, the company carried out the research and development of cabinet non-porous connection technology, washing area sanitizing functional equipment, sink seamless splicing and installation technology, lightweight and environmentally friendly cabinet products, high-precision and stable door and wall systems, and intelligent production technology of customized furniture panels, and the above research and development projects have been completed.
However, 122 complaints can be retrieved by entering "Piano" on the Black Cat complaint platform, mainly involving design, materials, safety and other issues, which shows that the company should not only continue to invest in research and development, but also increase control in production.
Source: Black Cat Complaint Platform
In addition, Piano also announced the first quarter report of 2024, during which the company achieved revenue of about 174 million yuan, a year-on-year decrease of 2.61%, a net profit attributable to the parent company of 8.2 million yuan, a year-on-year increase of 1.12 times, a net cash flow from operating activities of -109 million yuan, a year-on-year deterioration, and an asset-liability ratio of 35.73%, a year-on-year decrease of 8.83 percentage points.
It is understood that the custom furniture industry is affected by the seasonality obviously, its downstream is mainly for the purchase of commercial housing, the second decoration of old houses and the launch of fine decoration of commercial housing real estate enterprises, due to the season and decoration cycle and other factors, the first half of each year spans the Spring Festival holiday, consumers after a period of comparison and choice, from the middle of each year to the end of the year for the decoration volume of the peak season, after the Spring Festival every year, belongs to the consumer intention storage period, from the perspective of volume, relatively belongs to the decoration off-season, thus leading to the company's weak performance.
In the secondary market, since the disclosure of annual report data on the evening of April 24, Piano's share price has been declining for two consecutive trading days, as of the close of April 26, the company's share price closed at 8.38 yuan, down 0.24%, and the company's total market value is about 1.563 billion yuan. (This article was first published on the Titanium Media APP, author: Chen Weina)