"Star Daily" October 28th news (Reporter Wu Xuguang) On the evening of October 27th, Guangzhou Fangbang Electronics released its third-quarter report.

The report shows that the company's revenue for the first three quarters was 0.242 billion yuan, a year-on-year decrease of 10.30%; net income attributable to equity holders was -39.6267 million yuan, narrowing the loss by 24.46%; non-net profit attributable to equity holders was -56.9693 million yuan, narrowing the loss by 11.72%; basic earnings per share was -0.49 yuan.

According to the third-quarter report, Guangzhou Fangbang Electronics achieved total operating income of 93.0681 million yuan in the third quarter, a year-on-year decrease of 4.64%; net income attributable to equity holders was -17.6714 million yuan; non-net profit attributable to equity holders was -22.2412 million yuan.

In the first three quarters of 2024, the company's gross margin was 30.60%, an increase of 0.78 percentage points year-on-year; net margin was -14.58%, an increase of 3.83 percentage points compared to the same period last year.

In terms of assets, during the reporting period, the company's total assets at the end of the period were 1.888 billion yuan, with accounts receivable of 0.135 billion yuan; in terms of cash flow, the net cash flow from operating activities was -5.0281 million yuan.

Guangzhou Fangbang Electronics stated that the reasons for the decline in performance were threefold: firstly, increased market competition in the smart phone and Flexible Printed Circuit (FPC) industries during the reporting period. The industry chain showed a trend of cost reduction, which had a certain impact on the company's sales volume, selling price, and product structure of the shield membrane. Secondly, the company's R&D expenses increased compared to the previous period in areas such as peelable copper, flexible copper-clad laminate, shield membrane, thin film resistors, affecting short-term profitability. Thirdly, labor costs increased compared to the previous year.

Guangzhou Fangbang Electronics' main business is high-end electronic materials, with main products including electromagnetic shielding film, flexible copper-clad laminate, ultra-thin copper foil. Among these, electromagnetic shielding film is the main source of revenue.

Regarding the outlook for the electromagnetic shielding film business in 2024, Guangzhou Fangbang Electronics indicated that based on data from the Ministry of Industry and Information Technology and others, the domestic and global smartphone shipments have continued to recover in the first half of this year. Coupled with the company obtaining the qualification as the main supplier of shielding films for the latest flagship models of top smartphones, it is expected that the company's shielding film business will achieve good growth this year.

In the increasingly competitive upstream and downstream segments of the consumer electronics market, exploring new growth points has become an important focus for Guangzhou Fangbang Electronics.

Currently, the company has invested in the construction of a series of new projects including ultra-thin flexible copper clad laminate (FCCL), ultra-thin copper foil, and thin film resistors.

Regarding the progress of the company's new products, in late September, Guangzhou Fangbang Electronics revealed during institutional research that they have been continuously receiving small batch orders for carrier-peelable ultra-thin copper foil since the third quarter of last year. It is expected that in the second half of this year, they will achieve mass production certification from some downstream clients, with the potential for further order increase. Flexible copper clad laminate (FCCL) has achieved sales at a certain scale, aiming to achieve annual sales volume of 0.2-0.3 million square meters gradually becoming a key driver for the company's performance growth. As for thin film resistors, they have consistently received small batch orders.

Recently, Guangzhou Fangbang Electronics announced a strategic investment in Jiangsu Shangda Semiconductor Co., Ltd., which specializes in the production of thin film encapsulated substrates for display driver ICs, holding 0.4975% equity of the target company.

Guangzhou Fangbang Electronics stated that the company's investment in Shangda Semiconductor aims to enhance its industrial layout, strengthening the research and industrialization process of the flexible copper clad laminate (FCCL) business.

Looking at the demand in the semiconductor chips, lithium batteries, and other related markets, Guangzhou Fangbang Electronics' aforementioned new products align well with industry development trends.

Firstly, under the trend of "lightweight and miniaturization" of electronic products, the development of fine-line width and line spacing in flexible printed circuit boards (FPC) is progressing. There is an increasing demand for no-adhesive double-layer flexible copper clad laminates (FCCL) and ultra-thin flexible copper clad laminates (FCCL). Secondly, the fine development of HDI, SLP, and IC carrier boards will drive the demand for carrier-peelable ultra-thin copper foil. Thirdly, thin film resistors also align with the trend towards high density development.

Haitong International believes that with the AI leader Nvidia's release of the GB200, the future market space for high-speed copper cables in servers will quickly expand.

There are also market views that although markets such as extremely thin flexible copper clad laminates (FCCL) show a bullish trend in demand, the market competition is fierce, leading to significant price fluctuations. Sales revenue fluctuates, and uncertainties arise for projects with the continuous changes in the global economic situation, market competition, and demands in the electronic product market.