The company announced that in Q1 2024, it achieved revenue of 3.453 billion yuan, a year-on-year increase of 5.27%, net profit to mother of 356 million yuan, an increase of 9.54% year-on-year, and net profit after deducting non-return to mother of 333 million yuan, an increase of 15.99% year-on-year. The company's gross sales margin was 34.94%, up 0.99 percentage points year on year and down 6.25 pct month over month.
Performance growth is generally in line with expectations. The company announced that in Q1 2024, it achieved revenue of 3.453 billion yuan, a year-on-year increase of 5.27%, net profit to mother of 356 million yuan, an increase of 9.54% year-on-year, and net profit after deducting non-return to mother of 333 million yuan, an increase of 15.99% year-on-year. The company's gross sales margin was 34.94%, up 0.99 percentage points year on year and down 6.25 percentage points from month to month.
Profitability remains stable. The company's gross margin for the first quarter of 2024 was 34.94%, up 0.99 percentage points year on year, down 6.25 percentage points from month to month, and gross margin remained stable. The large month-on-month decline is mainly due to the fact that gross margin in the fourth quarter of last year was affected by export-side exchange rates, and the lower cost of mergers and acquisitions of Hongxingtai had a high base.
The total annual company expense ratio for the first quarter of 2024 was 19.34%, up 1.27 percentage points year on year. Among them, sales, management, R&D, and finance expenses were 3.12%, 10.22%, 5.16%, and 0.84%, respectively, with year-on-year changes of 0.02, 0.79, 0.67, and -0.21 percentage points. The expense ratio increased slightly due to depreciation and amortization, business development, etc., and remained stable overall.
Traditional businesses are gradually picking up, and new business expansion can be expected. In the company's traditional business, household appliances, automobiles, and power relays benefited from the strong downstream boom. They all achieved relatively rapid growth in the first quarter, and the outlook is expected to be maintained in the second quarter.
Industrial relays remained flat month-on-month in the first quarter and declined year-on-year, but orders have recovered and are expected to grow in the second quarter. High-voltage DC relays continued to grow rapidly in the Mesozoic business, and downstream new energy power relays are still being refined, waiting to be reversed. The company's low-voltage electrical appliances, new categories such as capacitors, connectors, current sensors, and oxygen sensors are reorganizing development ideas based on the “75+” strategy and focusing on expanding businesses in the fields of new energy and automotive, and are expected to achieve relatively rapid development.
Investment advice: The company's Indonesian and German factories are progressing in an orderly manner, and the level of internationalization and overall competitiveness of the supply chain continues to increase. Under the guidance of the company's “75+” strategy, the traditional advantages of the seven categories of relays continue to be maintained, and the development ideas of the five major promotion categories are clear. Overall, the company's operations have remained steady, the competitiveness of the Mesozoic business has remained leading, the new generation business has clearly developed ideas, the traditional business has clearly recovered, and maintained a “highly recommended” rating.
Risk warning: The economic downturn affects the company's product demand, the decline in the value of HVDC products and the upward pressure on raw materials