Description of the event
Dike Co., Ltd. released its report for the first quarter of 2024. 2024Q1 achieved revenue of 3.644 billion yuan, up 135.38% year on year, up 3.95% month on month; net profit to mother of 176 million yuan, up 103.71% year on year, up 89.01% month on month; net profit after deducting non-return to mother was 194 million yuan, up 143.45% year on year, up 102.39% month on month.
Incident comments
2024Q1, the company's silver paste is expected to remain flat from month to month, with TopCon's share further increasing. From a profit perspective, the increase in LECO's share of silver paste led to an increase in processing costs that was basically offset by a reduction in other silver paste processing fees, and the company's gross profit per unit is expected to remain basically the same as the previous month.
On the financial side, the company confirmed additional revenue of 60 million yuan in 2024Q1, mainly VAT plus deduction of reduced VAT amounts. The pace of confirmation varies from quarter to quarter. In addition, the company accrued a net loss of 30 million yuan from fair value changes due to fair value changes in silver futures contracts, foreign exchange derivatives, etc., and calculated a credit impairment loss of 37 million yuan based on prudent considerations.
The company's expenses for the 2024Q1 period were 184 million yuan, a year-on-month decrease of 48 million yuan, mainly due to lower financial & R&D expenses.
Looking ahead, with the rapid release of production capacity for N-line batteries in the industry, especially TopCon batteries, and the introduction of LCOE silver paste, the company will continue to focus on strengthening the upgrade and iteration of the complete metallization scheme of conductive silver paste on the front and back sides of N-type TopCon batteries, continue to lead the industrialization and large-scale mass production of new metallization processes represented by LCOE, further consolidate its market leadership position, and actively develop next-generation photovoltaic cell metallization paste solutions such as perovskite/crystalline silicon laminated cells. In addition, the company's 5,000 ton silver nitrate and 2,000 ton metal powder project in Dongying, Shandong is expected to be completed and put into operation in '24, further boosting the company's profits.
The company is expected to achieve net profit of 650 million in 2024, which is 11 times the corresponding PE.
Risk warning
1. Deterioration of the competitive landscape;
2. PV installation falls short of expectations.