Financial Services Association, March 29 (Reporter Wang Bin) Due to exchange rate fluctuations and rising raw materials and production costs, Zongshen Power's (001696.SZ) performance in 2023 still shows no signs of stopping falling.

This evening, Zong Shen Dynamics disclosed its annual report, and the company's performance continued to decline in 2023. According to financial data, the company achieved revenue of 7.997 billion yuan last year, a slight decrease of 0.04% over the same period last year; realized net profit of 362 million yuan, a year-on-year decrease of 7.26%. It is worth noting that since 2022, Zongshen Power's revenue and net profit have both declined continuously, and its net profit has declined three times since 2021.

According to the annual report, Zongshen Power's net profit loss for the fourth quarter of 2023 was 11.355 million yuan, and the net loss for the same period last year was 47744 million yuan, further expanding the loss.

In addition, fluctuations in the company's performance are also related to a sharp decline in export sales revenue and an increase in expenses during the period. Specifically, in 2023, Zongshen Power achieved export revenue of 3,621 billion yuan, a year-on-year decrease of 14.74%, accounting for 45.28% of the company's revenue. A CIFA reporter noticed that this is the first time since 2020 that the share of the company's export revenue has fallen below 50%.

In terms of expenses, the company's sales expenses, management expenses, and R&D expenses in 2023 were 220 million yuan, 239 million yuan, and 312 million yuan respectively. Among them, the first three expenses increased by 3.55%, 5.33% and 7.46%, respectively. However, since the fluctuation of the US dollar to RMB exchange rate decreased last year compared to the previous year, the company's exchange earnings declined sharply year over year. The company's financial expenses in 2022 were -3.4811 million yuan. Last year, this figure rose to 54.6529 million yuan.

On the financial side, Zong Shen Power's net cash flow from operating activities last year was 603 million yuan, a year-on-year decrease of 54.85%. According to the company, it was mainly due to a year-on-year decrease in the amount collected due for notes. By the end of 2023, the book value of the company's goodwill was 1.09 billion yuan.

At present, Zongshen Power has formed an industrial layout with “motorcycle engines and general machinery” as the core, covering emerging business fields such as “aerodynamics, new energy, and high-end components.” By business segment, as the two traditional main businesses of Zongshen Power, the company's motorcycle engine business achieved product sales of 2,5204 million units in 2023, an increase of 12.98% over the previous year. The corresponding sales revenue was 3.364 billion yuan, an increase of 18.72% over the previous year, stopping the downward trend in 2022.

In the same period, the company's general power machinery business achieved revenue of 3,862 billion yuan, and the new energy business achieved main business revenue of 133 million yuan.

It is worth mentioning that Zongshen Power's aerodynamics business, which has received enthusiastic attention from the capital market in recent times, is mainly the holding subsidiary Zongshen Hangfa Company as the carrier. According to the annual report, at present, Zongshen Aviation Development Company has formed a product line with aero piston engines below 200HP, built five basic product platforms, and launched more than 20 derivative products and propeller products, covering the drone and light general aviation aircraft markets.

Regarding the company's strategic policy for business development in 2024, Zong Shen Power said that the company will continue to consolidate its leading position in the two traditional main businesses of “motorcycle engines” and “general machinery”; on the other hand, it will increase continuous investment in the three emerging fields of “aero engines,” “new energy,” and “high-end components.”