CIMC Vehicles Sustained Performance Growth in the First Three Quarters, with Net Profit Rising by 244.6% year-on-year to RMB2.277 Billion
(25 October 2023, Hong Kong) As the world’s leader in the sophisticated manufacturing of semi-trailers and specialty vehicles, CMIC Vehicles (Group) Co., Ltd. (“CIMC Vehicles” or the “Group”, Stock code: 301039.SZ/01839.HK) published its financial report for the third quarter of 2023. In the first three quarters of 2023, CIMC Vehicles fully implemented the core strategic measures while starting a business for the third venture. With breakthroughs in its operations, the Group sustained its growth in performance. It sold 116,273 units/sets of vehicles of various types worldwide, maintaining its world-leading position in manufacturing semi-trailers for the eleventh year in a row.
The Third Quarterly Report of 2023 revealed that CIMC Vehicles achieved revenue of RMB19.568 billion from January to September 2023, a year-on-year increase of 12.42%; the net profit attributable to shareholders of the Company reached RMB2.277 billion, a significant year-on-year increase of 244.64%; the net profit attributable to shareholders of the Company after deducting non-recurring gains or losses was RMB 1.404 billion, a significant year-on-year increase of 112.59%; basic earnings per share reached RMB 1.13, a year-on-year increase of 242.42%; and weighted average return on net assets was 16.62%, a year-on-year increase of 11.10 percentage points.
With Steady Improvement in Profitability, the Six Major Businesses or Groups Demonstrated Strength
Since 2023, there has been a complex and severe international environment. European and US governments have continued to raise interest rates, inflation has continued, and the recovery of the global manufacturing industry has diverged. As China's economy shifts to a new stage of high-quality development, the Chinese government's implementation of a series of stabilizing growth policies has effectively consolidated resilient economic growth. As the endogenous driving forces have strengthened, economic and consumption recovery has emerged, and the domestic heavy truck industry has been poised for recovery.
From January to September 2023, the Group actively seized growth opportunities in overseas markets, and its profitability in the global semi-trailers market was improved. Specifically, the supply and demand situation in the North American semi-trailer market is gradually returning to stableilizing. North American Business has firmly seized the market opportunities and achieved year-on-year growth in profitability. Furthermore, the Group has achieved strong business growth in the European and emerging markets, with a year-on-year improvement in profitability. The business in the Chinese market maintained a stable development trend and gained market share in market segments.
Champion Tanker Business Group: New Energy Concrete Mixer Truck
In terms of the six major businesses or groups, Light Tower Pioneer Business Group implemented the strategic initiative of structural reform of the domestic semi-trailer production organization, promoted the comprehensive reshaping, optimized and streamlined personnel, thereby increasing the gross profit margin of domestic semi-trailers year-on-year. Moreover, Light Tower Pioneer Business Group seized the opportunity of strong demand in emerging markets. It developed and integrated channel resources, increasing the revenue and gross profit margin of the semi-trailer business in emerging markets year-on-year. North American Business continued its growth momentum and consolidated its intercontinental operation niche, improving both revenue and gross profit margin year-on-year. European Business has achieved remarkable results in cost reduction and efficiency increase and made a profit breakthrough. Champion Tanker Business Group has moved forward against the headwind and started exploring overseas markets, increasing its market share, sales, and revenue year-on-year. TB Business Group – Dump Truck Business innovated and explored new energy development. TB Business Group – Urban Distribution Van Truck Bodies Business optimized organizational development and promoted business transformation.
“Star-chained Manufacturing Network” has Reached New Stage, and the Commercialization Process of Integrated New Energy Tractor and Trailer Products is Accelerating
In 2023, the Group launched the “Star-chained Manufacturing Network”, committed to promoting the structural reform of China's semi-trailer production organization, breaking through the bottleneck of the semi-trailer business, bringing about end-to-end business model changes, and promoting potential improvements in sales and profits. Eventually, the Group will achieve the vision of high-quality industry integration, distribution model innovation, and continuous improvements in market share and profitability.
While starting the third venture, CIMC Vehicles actively integrated the production, circulation, distribution, and consumption resources of seven domestic semi-trailer plants. Presently, the new organization of “Star-chained Manufacturing Network” has been well formed. The Star-chained LTP production line investment will be implemented. The Group has also built an innovative and entrepreneurial platform that supports new energy tractors and trailers and provides integrated solutions for transforming traditional tractors and trailers, accelerating the commercialization of new energy semi-trailers.
Star Chain Series Product：Modular flatbed trailer
Looking ahead, CIMC Vehicles will pool superior resources to promote all businesses under the “National Unified Market for Commercial Vehicle and Specialty Vehicles”. Meanwhile, the Group will rely on innovation to drive endogenous growth and steadily improve the operational quality of six major businesses or groups. Additionally, CIMC Vehicles will adhere to the new development concept of “innovation, coordination, green, openness, and sharing” to continue forging the endogenous force for starting the third venture and contribute to the construction of Chinese modernization.