Incident: The company released its 2024 three-quarter report. In the first three quarters of 2024, it achieved operating income of 3.736 billion yuan, +21.48% year over year; realized net profit of 0.385 billion yuan, +0.35% year over year, and realized net profit of 0.37 billion yuan without return to mother, +2.16% year over year. Among them, 2024Q3 achieved revenue of 1.363 billion yuan, +10.44%/+3.80%, respectively; realized net profit of 0.129 billion yuan, or -16.19%/-14.99%, year-on-month; realized net profit of 0.123 billion yuan without return to mother, or -17.48%/-12.12% year-on-month, respectively. The 2024Q3 corporate headquarters achieved net profit of 0.074 billion yuan, -6.64% year-on-year and -2.26% month-on-month; investment income in joint ventures was 0.055 billion yuan, -26.26% year-on-year and -27.58% month-on-month.
Revenue growth is slowing, and profitability is under pressure in the short term. 2024Q3 achieved revenue of 1.363 billion yuan, +10.44%/+3.80% year-on-month, respectively. The revenue growth rate has slowed down, mainly affected by the decline in sales volume for customers such as Audi and Volkswagen.
In the first three quarters of 2024, the company's gross margin was 17.67%, -2.59pp year on year, and the 2024Q3 gross margin was 16.82%, year-on-year -2.75pp. As the company's customer structure continues to be optimized and the degree of project integration deepens, subsequent gross margin is expected to improve. The company's net interest rate for the first three quarters of 2024 was 10.22%, -2.21pp year on year, and the 2024Q3 net margin was 9.32%, -3.01pp year on year. The cost ratio increased slightly year-on-year during the period. The Q3 sales/management/ financial/ R&D expenses ratio was 1.14%/5.33%/0.90%/3.82%, respectively, +0.26pp/+0.57pp/-0.20pp/ -0.46pp.
New energy customers continue to expand, and the share of revenue is increasing. The company's share of new energy sales revenue showed an upward trend. 2024H1 accounted for 32.5% of new energy sales, +1.09pp. The company continues to deepen cooperation with new energy customers, and has established good partnerships with Mercedes-Benz EQB, BMW EV, Volkswagen MEB, BYD, Tesla, Ideal, Xiaopeng, NIO, Jiyue, Nana, Zero Run, Extreme Fox, Chery New Energy, Xiaomi, British Jaguar Land Rover, and North American ZOOX.
The new domestic plant began mass production and climbed, and invested in the construction of the Hungarian factory to lay out overseas production bases. In the first half of 2024, the company added additional bases in Zhaoqing, Hefei and Anqing, and further expanded production capacity in Wuhu, Shenyang and Tianjin. The company's new plant has begun mass production, and production capacity will gradually rise in the fourth quarter. On October 26, the company issued an announcement to establish Changshu Auto Accessories (Hungary) Smart Cabin Co., Ltd. to invest in the construction of a Hungarian factory and carry out overseas production base layout. As the overseas layout continues to deepen, the company is expected to receive new projects from more overseas brand customers in the future.
Profit forecasting and investment advice. The company's 2024-2026 EPS is expected to be 1.50/1.85/2.27 yuan, and the three-year compound annual growth rate of net profit is 16.4%. As the new energy business revenue of the company headquarters grows rapidly, the smart cockpit and lightweight business enhances the company's ASP, and the performance is expected to continue to improve and maintain the “buy” rating.
Risk warning: Risks such as customer expansion falling short of expectations, fluctuating raw material prices, large and fluctuating investment returns, falling short of expectations in smart cockpit business development, and falling short of expectations in overseas markets.
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