Core views
The company released its 2023 annual report and 2024 quarterly report, and achieved revenue of 316.1/9.39/116 million in 2023, respectively, +37.11%/+201.3%/+122.6% compared with the same period last year.
In the first quarter of 2024, revenue was achieved respectively at 7.508/0.69/0.11 billion, or +4.61%/-8.56%/+195.3% YoY; -23.6%/-89.3%/-83.8% YoY. The company's shipments increased significantly throughout the year, and overseas customers expanded rapidly. The gross margin increased sequentially in the first quarter, and the business situation improved. The company continues to promote high-end product research and development, and has successively launched 8 third-generation batteries; expanding overseas customers, UC batteries have been designated by Volkswagen for the first time in the world; boosting the energy storage market; and deploying production capacity globally, which is expected to increase in volume and profit in the future.
occurrences
The company released its 2023 annual report and achieved revenue of 316.1/9.39/116 million for the whole year, +37.11%/+201.3%/+122.6% compared with the same period last year. Among them, single Q4 achieved revenue/attribution/deduction of $98.27/6.47/65 million, respectively, or +13.93%/+300.4%/+142.1% year-on-year, and +50.27%/+678%/+325% month-on-month.
The company released its 2024 quarterly report and achieved revenue of 7.508/0.69/0.11 billion respectively, +4.61%/-8.56%/+195.3% YoY; -23.6%/-89.3%/-83.8% YoY.
Brief review
Revenue and shipments increased significantly throughout the year, and the energy storage business and overseas business grew rapidly. The company's annual product delivery exceeded 40 GWh, an increase of more than 40% over the previous year. Among them, power battery system revenue was 23.051 billion yuan, up 24.72% year on year, gross profit margin was 15.04%, down 1.69 pct year on year; energy storage battery system revenue was 6.932 billion yuan, up 97.61% year on year, and gross profit margin was 18.29%, up 1.69 pct year on year. Revenue from overseas regions (including Hong Kong, Macao and Taiwan) was 6.428 billion yuan, +115.7% year over year, and gross margin was -0.02pct year over year, which was basically the same.
Companies that focus on research and development to continuously launch new products and enhance the company's profitability have successively launched 8 third-generation batteries, including UC and Qichen. UC batteries were selected by Volkswagen for the first time in the world; the L600 Kai Chen battery pack system has an energy density of 190 Wh/kg. The battery system covers standard battery boxes for commercial vehicles, hybrid battery systems for passenger cars, and the latest two-wheelers, which can meet the power requirements of various models. Energy storage products cover batteries, PACs, battery clusters, and overall energy storage system solutions, etc., to meet the needs of various scenarios of centralized power storage, industrial and commercial energy storage, and household energy storage.
Globalization forms a new layout, and overseas markets continue to expand
The company built three major sectors: America, Europe, Africa, and Asia Pacific, and overseas revenue doubled. In terms of market expansion, in addition to being designated by Volkswagen in overseas markets, the company has established long-term strategic partnerships with various companies and organizations such as iNOBAT, Japan's Edison Energy, Germany's BASF, US listed company Pacific GreenTechnologies, and British charging service provider Pod Point to jointly explore new energy markets in Europe and America. In terms of base construction, products from the four Pack factories in Germany, Indonesia, Thailand, and Silicon Valley in the US were successfully launched; production bases in Vietnam, Chicago in the US, Michigan in the US, Slovakia in Europe, Argentina, and Indonesia are gradually progressing, and the layout of the top ten overseas bases covering materials, batteries, and packs is initially being formed.
Finance: Non-recurring profits and losses are mainly input tax credits. The impairment is mainly due to accounts receivable accruing, and the company confirmed additional income of $1,273 billion for the year, mainly government subsidies of $1,002 million and VAT plus deductions of $270 million. Q1 Credit impairment of $207 million is estimated to be mainly due to bad preparation for accruing accounts receivable.
Investment advice and profit forecasting
The company is expected to ship 65-70GWh in 2024 and 80-90GWh in 2025. The expected return in 2024 and 2025 will be 13.00 billion or 1.922 billion.
Risk analysis
1) Demand side: Downstream NEV production and sales fall short of expectations, demand from major customers such as Volkswagen falls short of expectations, demand for energy storage, two-wheelers, etc. falls short of expectations.
2) Supply side: The rise in lithium prices raises costs, or the price reduction is too fast, leading to a decrease in the company's lithium mine output.
3) Policy aspects: Energy storage policies fall short of expectations, domestic and foreign electrification policies fall short of expectations, etc.
4) In terms of the international situation: international trade barriers have deepened, exports have been blocked; requirements for localized production have increased, and overseas factories have raised costs; international conflicts have blocked overseas transportation and increased freight rates.
5) Market side: Prices and gross profit are lower than expected due to increased competition.
6) Technical aspects: Product performance cannot meet high-end market requirements, resulting in delivery falling short of expectations, etc.