我们2024年度的业绩线上发布会衷心的感谢大家长期以来对公司的关心和支持那么今天和我一起在线上的呢还有公司的董事长和CEO张龙泉先生大家晚上好谢谢以及公司的CFO胡宇安先生大家晚安好 我们首先将邀请公司的管理层就2024年度我们的财务和业绩表现进行一个介绍那么并且会分享一下公司对于未来的战略展望之后呢我们就投资者所关心的一些话题来进行这个问答的环节那首先我们先邀请胡总来给我们回顾一下今年的这个财务表现好的那个各位投资的朋友晚上好我首先代表公司的管理层向大家汇报一下全峰公股2024年代主要的财务数据2024年 公司实现销售收入17.74亿美元于去年相上一年同期相比增长了29%第二项更重要的更亮眼的应该是我们的Gross margin的这个表现Gross margin绝对额达到了6.16亿美元同期增长了59%Gross margin ratio也达到了34.7% 这个良好的表现最后主要的原因是因为公司的销售规模的增长带来的规模效应以及公司在博士多年智能制造方向投入带来的生产运营阶段的效率的提升同时2024年供给侧的主要成本要素包括达成材料点心价格还有人民币汇率对我们都相对比较有利所以这些因素综合影响给我们2024 ...

Investment Rating - The investment rating for the company is "Outperform the Market" [6][4]. Core Views - The company has shown a significant recovery in operations and profitability, with a revenue of $1.77 billion in 2024, representing a year-on-year growth of 29.0%. The second half of the year saw a revenue of $950 million, up 49.5% year-on-year. The net profit attributable to shareholders reached $112 million, marking a turnaround from losses [1][2]. - All business lines have experienced strong growth, particularly in North America, where revenue rebounded significantly post-inventory destocking [1]. - The company plans to sell its entire stake in a subsidiary, which will allow it to focus on its core business and enhance shareholder value. A special dividend of HKD 1.1905 per share is proposed, totaling approximately HKD 608 million [3]. Summary by Sections Financial Performance - In 2024, the gross margin improved by 6.6 percentage points to 34.7%, driven by scale recovery and operational efficiency. The net profit margin increased by 9.0 percentage points to 6.3% [2]. - The company reported a significant reduction in expense ratios across sales, management, and R&D, contributing to improved profitability [2]. Revenue Breakdown - The Outdoor Power Equipment (OPE) segment generated $1.01 billion, a 24.2% increase, while the electric tools segment saw revenue of $750 million, up 36.3% [1]. - Revenue by region for 2024 was $1.29 billion in North America (+37.5%), $310 million in Europe (+11.2%), $110 million in China (+9.8%), and $56 million in other regions (+8.9%) [1]. Future Projections - The company expects net profits of $121 million, $143 million, and $168 million for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 7%, 19%, and 17% [4][5]. - The projected earnings per share (EPS) for 2025, 2026, and 2027 are $0.24, $0.28, and $0.33, respectively, with corresponding price-to-earnings (PE) ratios of 10, 9, and 7 [4][5].

Financial Performance - Revenue increased by 29.0% to $1,773.8 million compared to $1,374.7 million in 2023[5] - Net profit for 2024 was $112.7 million, a significant recovery from a net loss of $37.2 million in 2023[6] - Adjusted net profit for 2024 reached $135.7 million, compared to a loss of $36.7 million in the previous year[5] - Operating cash flow improved from an outflow of $173.7 million in 2023 to an inflow of $167.7 million in 2024[5] - Gross profit increased by 59.2% from $386.8 million in 2023 to $615.7 million in 2024, with overall gross margin rising from 28.1% to 34.7%[20] - The company recorded a net profit of $112.7 million in 2024, compared to a net loss of $37.2 million in 2023, resulting in a net profit margin of 6.4%[30] - Operating profit turned positive at $155,357,000 compared to an operating loss of $27,225,000 in the previous year[62] - The company reported a basic earnings per share of $0.22, recovering from a loss of $0.07 per share in the previous year[62] Revenue Growth - The company's revenue increased by 29.0% from $1,374.7 million in 2023 to $1,773.8 million in 2024, driven by strong end-user sales and higher customer order volumes post-inventory destocking[17] - Sales revenue for OPE products rose by 24.2% from $811.4 million in 2023 to $1,007.5 million in 2024, primarily due to accelerated inventory destocking and increased customer orders, especially for the EGO brand[18] - Revenue from North America grew by 37.5% from $940.2 million in 2023 to $1,293.1 million in 2024, while revenue from Europe increased by 11.2% to $314.1 million[19] - Revenue from the electric tools segment increased to $747.638 million in 2024, up 36.3% from $548.544 million in 2023[72] Product Development and Innovation - Approximately 200 new products were launched in 2024, with 90% being lithium battery products[7] - EGO brand achieved significant market share expansion and maintained a strong brand presence through innovative product strategies[8] - FLEX brand experienced over 50% growth in 2024, launching over 50 new products, including nine new nailers[11] - SKIL brand continued to grow despite industry challenges, enhancing its social media influence[12] - DEVON brand successfully launched a new 12V product line and built a strong digital marketing presence on social media platforms[13] - R&D expenses grew by 18.0% from $70.7 million in 2023 to $83.4 million in 2024, reflecting continued investment in research and product development, particularly in commercial and robotic technologies[25] - Research and development expenses increased to $83,410,000 from $70,673,000, reflecting ongoing investment in innovation[62] Financial Position and Cash Flow - As of December 31, 2024, the company had cash and cash equivalents of $328.8 million, an increase from $296.3 million in 2023[33] - The company's bank loans decreased to $295.6 million in 2024 from $323.6 million in 2023, with a capital debt ratio of 0.3, unchanged from the previous year[35] - Inventory increased to $608.3 million in 2024 from $531.0 million in 2023, with inventory turnover days improving to 180 days from 209 days[36] - Total assets as of December 31, 2024, were $1,513,530,000, an increase from $1,315,211,000 in 2023[64] - Current assets net value improved to $730,562,000 from $651,786,000 year-over-year[65] - Net cash used in investing activities was $70.415 million in 2024, compared to $57.960 million in 2023, indicating increased investment efforts[66] Corporate Governance and Strategy - The company plans to enhance global manufacturing capacity, including expanding the capacity of its Vietnam factory and relocating production from Germany to China to optimize its global production layout[14] - The company aims to optimize its strategic focus by divesting non-core and non-operational assets to allocate resources more effectively to high-potential core businesses[15] - The company expects to mitigate risks associated with macroeconomic fluctuations and U.S.-China tariff policies through strategic capacity diversification and adaptive pricing strategies[15] - The company has adopted the 2024 Share Plan to align the interests of shareholders, the company, and employees, aiming to enhance long-term incentives and attract top talent[56] - The company remains committed to maintaining high standards of corporate governance, adhering to the applicable code provisions[53] - The company plans to continue evaluating the separation of the roles of Chairman and CEO to ensure effective decision-making and governance[53] Employee and Compensation - As of December 31, 2024, the total number of employees in the group was 6,481, an increase from 6,173 as of December 31, 2023, with total employee costs amounting to $240.2 million compared to $208.9 million in 2023[47] - The gender ratio of employees as of December 31, 2024, was approximately 1.55:1, slightly down from 1.56:1 in 2023, reflecting the nature of the business which employs a higher proportion of male engineers and frontline workers[47] - The company has provided competitive compensation packages to retain top talent, including salaries, bonuses, and long-term incentive plans[47] Dividends and Shareholder Returns - The board has proposed a final dividend of $0.0802 per share for the year ending December 31, 2024, compared to zero in 2023, pending shareholder approval at the annual general meeting on May 22, 2025[50] - The company plans to distribute a special dividend of HKD 1.1905 per share, contingent upon the completion of a share transfer agreement[57] - The company paid dividends of $18.091 million in 2024, down from $36.691 million in 2023, suggesting a shift in capital allocation strategy[66] Other Financial Metrics - Other losses increased to $14.8 million in 2024 from $8.3 million in 2023, primarily due to realized and unrealized gains and losses from derivative financial instruments[22] - Foreign exchange gains for 2024 were $2.1 million, down from $4.9 million in 2023, with net gains from derivative financial instruments at $4.1 million compared to a loss of $12.2 million in 2023[44] - The company recorded a net loss from foreign exchange of $4.040 million in 2024, compared to a gain of $183 thousand in 2023[66] - Total income tax expense for the year ended December 31, 2024, is $20,055,000, compared to an expense of $(11,706,000) for 2023[79]

Investment Rating - The report maintains a "Buy" rating for the company, citing strong performance and growth potential [2][5] Core Views - The company reported a net profit of $100 million for the first nine months of 2024, representing a year-on-year growth of over 335% [5] - Full-year revenue for 2024 is expected to exceed expectations, with a projected growth rate of over 20% [5] - The company's EGO brand has shown strong performance, contributing significantly to profit growth [5] - Online channel revenue is growing rapidly, with Amazon driving significant growth, and is expected to reach double-digit revenue share in 2024 [5] - The company is expanding its distributor network in North America and adjusting distribution policies in Europe, which is expected to improve gross margins [5] - Q3 2024 gross margin is expected to improve year-on-year due to the strong performance of the high-margin EGO brand, production scale recovery, and low raw material costs [5] - Downstream retailer inventories have returned to healthy levels, supporting growth in shipments [5] Financial Projections - Revenue for 2024-2026 is projected to be $1.655 billion, $1.922 billion, and $2.198 billion, respectively, with year-on-year growth rates of 20.4%, 16.1%, and 14.4% [5] - Adjusted net profit for 2024-2026 is expected to be $131 million, $150 million, and $178 million, with year-on-year growth rates of 15.1% and 18.3% for 2025 and 2026, respectively [5] - Gross margin is expected to improve to 32.7% in 2024, compared to 28.1% in 2023 [4][5] - Adjusted net profit margin is projected to be 7.9%, 7.8%, and 8.1% for 2024-2026, respectively [4][5] - ROE is expected to increase to 12.3%, 12.7%, and 13.4% for 2024-2026, respectively [4][5] Market Data - The company's closing price on October 17, 2024, was HKD 21.3, with a total market capitalization of HKD 10.9 billion [3] - Total assets were $1.94 billion, with net assets attributable to the parent company at $982 million [3] - Earnings per share (EPS) for 2024-2026 are projected to be $0.28, $0.32, and $0.38, respectively [4][5] Operational Highlights - The company is focusing on optimizing operational efficiency and controlling management expenses while steadily investing in marketing and R&D [5] - The company's OPE and power tools are benefiting from downstream retailers' restocking cycles, which are expected to align with POS growth rates in Q4 2024 [5] - The EGO brand is expected to outperform industry averages despite weak downstream demand [5]

Investment Rating - Maintain "Overweight" rating [1] Core Views - The company issued a positive profit warning, expecting a net profit of approximately USD 100 million for the first nine months, a year-on-year increase of over 300% [2] - The flagship brand EGO performed strongly, driving accelerated revenue growth in Q3 [2] - The company is confident in achieving its full-year revenue growth target of over 20%, with H2 revenue growth expected to reach 30% [2] - Q3 performance exceeded expectations, leading to an upward revision of full-year earnings [3] - The company's gross margin continues to improve due to cost dilution, driven by product structure optimization, scale effects, and declining lithium battery costs [3] - Channel destocking has ended, and interest rate cuts are expected to catalyze sustained high revenue growth in H2 [3] - The company's valuation is attractive, with projected revenues of USD 1.67 billion, USD 1.97 billion, and USD 2.24 billion for 2024-2026, and net profits of USD 130 million, USD 150 million, and USD 170 million, respectively [3] Financial Performance - Q3 net profit is expected to be approximately USD 38 million, following a net profit of USD 62 million in H1 2024 [2] - The company's revenue growth is accelerating, driven by strong terminal sales of the EGO brand, a low base in 2023, and restocking orders after channel destocking [2] - The company's gross margin improved in H1, benefiting from product structure optimization, scale effects, and lower lithium battery costs [3] - The company's revenue growth is expected to remain strong in H2, supported by year-end promotions, preparations for 2025 inventory, and improved channel inventory health [3] - The company's PE ratios for 2024-2026 are projected at 11x, 9x, and 8x, respectively [3] Industry Outlook - The OPE (Outdoor Power Equipment) industry has significant upward potential, with the company well-positioned to benefit from this trend [3] - Federal Reserve interest rate cuts are expected to boost demand for post-real estate cycle products and enhance consumer purchasing power for big-ticket items, particularly in the OPE category [3] Financial Projections - The company's revenue is expected to grow by 21.19% in 2024, 18.13% in 2025, and 13.87% in 2026 [4] - Net profit attributable to the parent company is projected to grow by 14.51% in 2025 and 12.46% in 2026 [4] - The company's gross margin is expected to be 33.35% in 2024, 32.53% in 2025, and 32.38% in 2026 [6] - ROE is projected to be 11.11% in 2024, 10.61% in 2025, and 10.04% in 2026 [6] - The company's EPS is expected to be USD 0.25 in 2024, USD 0.29 in 2025, and USD 0.33 in 2026 [6]

Investment Rating - The report assigns a "Buy" rating for the company [2]. Core Views - The company is expected to achieve a revenue growth exceeding 20% for the full year, driven by strong terminal sales performance and improved operational efficiency [2][3]. - The net profit for the first three quarters of 2024 is projected to be approximately $100 million, reflecting a year-on-year increase of over 300% compared to $2.3 million in the same period last year [2]. Summary by Sections Earnings Performance - The company has ended its destocking cycle, which has contributed to profit growth through scale recovery and cost control [2]. - Key factors supporting profit growth include strong terminal sales of EGO, the end of the destocking cycle, optimized operational expenses, and improved gross margins due to enhanced operational efficiency [2]. Outlook - Based on the growth momentum observed in the first nine months of 2024, the company is confident in achieving its revenue growth target of over 20% for the full year [2]. - The earnings forecast has been adjusted, with expected revenues for 2024-2026 projected at $1.68 billion, $2.02 billion, and $2.36 billion, respectively. The net profit attributable to the parent company is expected to be $134 million, $170 million, and $204 million for the same period [2][3]. Financial Summary - The company reported total revenue of $1.37 billion in 2023, with a year-on-year decline of 30.89%. However, a recovery is anticipated with a projected revenue of $1.68 billion in 2024, reflecting a growth of 22.19% [3][4]. - The gross margin is expected to improve to 32.08% in 2024, up from 28.14% in 2023 [3][4].

Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of HKD 32.30, up from the previous target of HKD 30.88 [1][7]. Core Views - The company is expected to achieve a net profit of approximately USD 100 million for the first three quarters of 2024, representing a significant year-on-year increase of about 335% compared to USD 23 million in the same period last year. The net profit for Q3 alone is projected to increase by approximately 247% to USD 38 million [1]. - The company is benefiting from strong sales growth and improved profitability, with Q3 revenue growth accelerating due to channel replenishment and recovery in sales [2]. - The industry is experiencing sustained high demand, with China's electric tool exports increasing by 18.6% year-on-year to USD 7.045 billion in the first eight months of 2024, indicating a positive outlook for 2025 [3]. - The company is positioned as a leading brand in the overseas market and is actively expanding its overseas production capacity to enhance its risk resilience [4]. Summary by Sections Financial Performance - The company reported a net profit of USD 139.37 million in 2022, which is expected to decline to a loss of USD 37.14 million in 2023, followed by a recovery to USD 130.71 million in 2024, USD 165.70 million in 2025, and USD 197.63 million in 2026 [5][11]. - The projected earnings per share (EPS) are USD 0.28 in 2022, a loss of USD 0.07 in 2023, and expected to recover to USD 0.26 in 2024, USD 0.32 in 2025, and USD 0.39 in 2026 [5][11]. Market Outlook - The company is expected to benefit from a favorable industry environment, with continued demand growth driven by overseas interest rate cuts and product replacement cycles [3]. - The company is enhancing its global production capabilities, particularly in Vietnam, to mitigate potential trade risks and strengthen its competitive advantage in the lithium battery outdoor power equipment (OPE) sector [4]. Valuation Metrics - The company is currently valued at a market capitalization of HKD 9.863 billion, with a price-to-earnings (PE) ratio of 8.69 in 2022, expected to decline to 6.39 by 2026 [7][11].

Revenue Growth - Revenue increased by 10.5% to $815.745 million in the first half of 2024 compared to $738.545 million in the same period of 2023[12] - Revenue increased by 10.5% from US$738.5 million to US$815.7 million during the Reporting Period[14] - The company's revenue increased by 10.5% from $738.5 million in H1 2023 to $815.7 million in H1 2024, driven by strong point-of-sales performance and higher customer orders[35] - Revenue from OPE products grew by 10.2% from $445.2 million in H1 2023 to $490.4 million in H1 2024, supported by accelerated destocking and increased customer orders[36] - Revenue from power tools increased by 9.5% from $286.3 million in H1 2023 to $313.5 million in H1 2024, driven by the recovery and growth of the ODM business[36] - Revenue from power tools sales increased to $313.5 million in H1 2024, up from $286.3 million in H1 2023[177] - Revenue from outdoor power equipment sales rose to $490.4 million in H1 2024, compared to $445.2 million in H1 2023[177] - Total revenue from contracts with customers reached $815.7 million in H1 2024, up from $738.5 million in H1 2023[177] - Power tools segment revenue for the six months ended June 30, 2024, was $313.5 million, compared to $286.3 million in the same period in 2023[190][192] - Outdoor power equipment segment revenue for the six months ended June 30, 2024, was $490.4 million, up from $445.2 million in the same period in 2023[190][192] - Total revenue from external customers for the six months ended June 30, 2024, was $815.7 million, compared to $738.5 million in the same period in 2023[190][192] Profitability - Gross profit rose by 13.2% to $268.676 million in H1 2024 from $237.296 million in H1 2023[12] - Profit before taxation grew by 24.1% to $71.814 million in H1 2024 compared to $57.851 million in H1 2023[12] - Net profit increased by 25.6% to $61.619 million in H1 2024 from $49.051 million in H1 2023[12] - Adjusted net profit rose by 24.4% to $61.619 million in H1 2024 compared to $49.547 million in H1 2023[12] - Basic earnings per share increased by 20.0% to $0.12 in H1 2024 from $0.10 in H1 2023[12] - Diluted earnings per share grew by 20.0% to $0.12 in H1 2024 compared to $0.10 in H1 2023[12] - Net profit grew by 25.6% compared to the same period in 2023, reaching US$61.6 million[14] - Gross profit margin improved from 32.1% to 32.9%[15] - Gross profit increased by 13.2% from $237.3 million in H1 2023 to $268.7 million in H1 2024, with gross profit margin rising from 32.1% to 32.9% due to operational efficiency and favorable raw material costs[41] - The company achieved a net gain of $2.3 million in H1 2024, compared to a net loss of $4.7 million in H1 2023, primarily due to gains on financial assets and derivative instruments[44] - Profit before taxation grew by 24.1% from $57.9 million to $71.8 million[55][57] - Income tax expense increased from $8.8 million to $10.2 million, with the effective tax rate decreasing from 15.2% to 14.2% due to tax benefits for R&D activities[56][57] - Profit for the period increased from $49.1 million to $61.6 million, with the net profit margin improving from 6.6% to 7.6%[58][59] - Adjusted net profit for the period was $61.6 million, compared to $49.5 million in the prior year[62] - Total comprehensive income for the period reached $40.795 million, significantly higher than $20.744 million in H1 2023[154] - Gross profit from external customers and reportable segment profit for the six months ended June 30, 2024, was $268.7 million, up from $237.3 million in the same period in 2023[190][192] Cash Flow and Financial Position - Net cash generated from operating activities was $119.138 million in H1 2024, a significant improvement from a net cash used of $86.581 million in H1 2023[12] - Total assets increased by 8.0% from US$1,796.385 million at December 31, 2023 to US$1,939.523 million at June 30, 2024[13] - Cash and cash equivalents stood at $387.1 million as of June 30, 2024, with 34.1% in RMB, 58.5% in USD, 3.5% in Euro, and 3.9% in other currencies[64] - The company maintained a strong financial position with cash and cash equivalents of $387.1 million as of June 30, 2024, up from $296.3 million as of December 31, 2023[66] - Cash and cash equivalents were denominated in RMB (34.1%), USD (58.5%), EUR (3.5%), and other currencies (3.9%) as of June 30, 2024[66] - The company's bank loans totaled $329.0 million as of June 30, 2024, primarily denominated in RMB, with fixed-rate and floating-rate loans accounting for 60.3% and 39.7% respectively[68] - Inventory turnover days improved to 178 days for the six months ended June 30, 2024, compared to 209 days for the same period in 2023, reflecting improved operational efficiency[68] - Trade and bills receivables turnover days increased to 89 days for the six months ended June 30, 2024, from 63 days in 2023, driven by strong sales performance in Q2 2024[68] - Capital expenditures for the six months ended June 30, 2024, amounted to $22.1 million, primarily for upgrading smart manufacturing systems and advancing digital transformation[69][71] - Capital commitments for plant construction and machinery acquisition totaled $87.8 million as of June 30, 2024, mainly for expanding production capacity in Vietnam[70][72] - The company pledged assets worth $87.3 million as of June 30, 2024, including plant and buildings ($31.1 million), leasehold land ($21.4 million), and inventories ($16.2 million)[74] - The company issued guarantees of $9.2 million as of June 30, 2024, to financial institutions in China for indebtedness of independent third-party customers[76][77] - The company plans to continue investing in expanding its manufacturing plant in Vietnam, including building production facilities on a land lot exceeding 130,000 square meters[80][82] - Net foreign exchange loss for the six months ended June 30, 2024 amounted to US$0.7 million, compared to a net gain of US$7.2 million in the same period in 2023[84][86] - Net realized and unrealized gain on derivative financial instruments for the six months ended June 30, 2024 was US$0.8 million, compared to a loss of US$12.3 million in the same period in 2023[84][86] - Cash and cash equivalents stood at $387.090 million as of June 30, 2024, up from $296.337 million at the end of 2023[155] - Inventories increased to $550.121 million, compared to $530.951 million at the end of 2023[155] - Trade and bills receivables grew to $453.993 million, up from $359.011 million at the end of 2023[155] - Current liabilities increased to USD 819,416 thousand as of June 30, 2024, compared to USD 663,425 thousand at the end of 2023, driven by higher bank loans and trade payables[157] - Bank loans under current liabilities rose to USD 240,009 thousand in June 2024, up from USD 198,185 thousand in December 2023, reflecting a 21.1% increase[157] - Trade and bills payables surged to USD 296,547 thousand in June 2024, a 31.8% increase from USD 224,954 thousand in December 2023[157] - Net current assets decreased slightly to USD 644,408 thousand in June 2024 from USD 651,786 thousand in December 2023[157] - Total assets less current liabilities stood at USD 1,120,107 thousand in June 2024, down from USD 1,132,960 thousand in December 2023[157] - Non-current liabilities decreased to USD 138,556 thousand in June 2024 from USD 172,339 thousand in December 2023, primarily due to a reduction in bank loans[157] - Net assets increased to USD 981,551 thousand in June 2024, up from USD 960,621 thousand in December 2023[157] - Total equity attributable to equity shareholders rose to USD 981,561 thousand in June 2024, compared to USD 960,725 thousand in December 2023[158] - Retained profits grew to USD 365,477 thousand in June 2024, reflecting a 3.4% increase from the previous period[160] - Share capital remained stable at USD 601,859 thousand in June 2024, unchanged from December 2023[158] - Total equity for the six months ended June 30, 2024, was USD 960,621 thousand, with a net change of (68,734) thousand compared to the previous period[161] - Non-controlling interests amounted to USD 55 thousand, showing no significant change from the previous period[161] - Retained profits stood at USD 287,416 thousand, with a decrease of (86,256) thousand compared to the previous period[161] - Fair value reserve (non-recycling) increased by USD 241 thousand, reaching a total of USD 241 thousand[161] - Exchange reserve showed a significant increase of USD 17,226 thousand, totaling USD 17,226 thousand[161] - Cash generated from operations for the six months ended June 30, 2024, was USD 125,280 thousand, a significant improvement from the previous year's (77,261) thousand[165] - Net cash generated from operating activities was USD 119,138 thousand, compared to (86,581) thousand in the previous year[165] - Net cash used in investing activities was USD (22,309) thousand, primarily due to payments for property, plant, and equipment[165] - Net cash used in financing activities was USD (4,439) thousand, mainly due to payments for share award schemes[165] - Cash and cash equivalents at the end of the period increased to USD 387,090 thousand, up from USD 296,337 thousand at the beginning of the period[165] Regional Performance - North America revenue grew by 13.8% from $485.3 million in H1 2023 to $552.4 million in H1 2024, while China revenue increased by 18.2% from $54.2 million to $64.1 million[37] - North America accounted for $552.4 million of revenue in the six months ended June 30, 2024, compared to $485.3 million in the same period in 2023[199] - Europe accounted for $172.3 million of revenue in the six months ended June 30, 2024, compared to $174.9 million in the same period in 2023[199] - China accounted for $64.1 million of revenue in the six months ended June 30, 2024, compared to $54.2 million in the same period in 2023[199] - North America revenue decreased to $14.483 million from $16.091 million, a decline of approximately 10%[200] - Europe revenue decreased to $31.000 million from $34.133 million, a decline of approximately 9.2%[200] - China revenue increased to $290.787 million from $285.195 million, a growth of approximately 2%[200] - Total revenue across all regions slightly increased to $336.270 million from $335.419 million, a growth of approximately 0.25%[200] Expenses and Costs - Selling and distribution expenses increased by 13.5% from $94.0 million in H1 2023 to $106.7 million in H1 2024, driven by higher marketing expenses and investments in expanding dealer channels[46] - Administrative and other operating expenses increased by 4.8% from $40.3 million to $42.3 million, primarily due to higher employee remuneration[48][49] - Research and development costs rose by 11.8% from $33.5 million to $37.4 million, driven by continued investment in product development, especially for commercial applications[50][52] - Net finance costs increased from $1.5 million to $2.0 million[51][53] - Share of loss from an associate (Nanjing Chervon Auto Precision Technology) increased from $8.2 million to $13.6 million, reflecting a 24.74% equity interest[53][54] - Research and development costs for the six months ended June 30, 2024, were $37.4 million, up from $33.5 million in the same period in 2023[195] - Selling and distribution expenses for the six months ended June 30, 2024, were $106.7 million, compared to $94.0 million in the same period in 2023[195] - Administrative and other operating expenses for the six months ended June 30, 2024, were $42.3 million, compared to $40.3 million in the same period in 2023[195] Product Development and Innovation - Over 100 new products were introduced during the Reporting Period, with lithium-ion battery powered products accounting for over 90%[16] - EGO launched two lithium-ion battery tractor products in Europe and North America, expanding its product range for riding lawn mowers[18] - FLEX launched or planned more than 60 new products, including the cordless benchtop range and nailer range, and acquired FLEX Scandinavia AB on May 31, 2024[22] E-commerce and Distribution Channels - SKIL revenue growth on Amazon.com was close to 20% during the Reporting Period[23] - DEVON's e-commerce revenue grew by over 20% compared to the same period in 2023[24] - SKIL's revenue growth on Amazon increased by nearly 20%, demonstrating its ability to penetrate new distribution channels[26] - DEVON's e-commerce revenue grew by over 20% year-over-year during the reporting period, driven by the successful launch of its new 12V product line on the lithium platform[27] Corporate Governance and Shareholding - Mr. Pan Longquan holds a 50.92% shareholding interest in the Company through a controlled corporation as of June 30, 2024[96] - Ms. Zhang Tong holds a 19.18% shareholding interest in the Company through a controlled corporation as of June 30, 2024[96] - Mr. Ke Zuqian holds a 5.31% shareholding interest in the Company through a controlled corporation as of June 30, 2024[96] - Total number of issued shares as of June 30, 2024, is 511,053,811[97] - Mr. Pan holds a 66.72% interest in Chervon Global Holdings Limited[99] - Ms. Zhang holds a 24.66% interest in Chervon Global Holdings Limited[100] - Mr. Ke holds a 6.85% interest in Chervon Global Holdings Limited[101] - Chervon Auto Precision Technology has a 52.29% interest, with 27.55% held indirectly by Mr. Pan, Ms. Zhang, and Mr. Ke, and 24.74% held through the company[102][103] - Chervon Assets Management Holdings Limited is 85.00% owned by Mr. Pan, Ms. Zhang, and Mr. Ke[99][100][101] - Chervon Investment Limited is 100.00% owned by Mr. Pan, Ms. Zhang, and Mr. Ke[99][100][101] - Chervon Precision Technology Holdings Company Limited is 100.00% owned by Mr. Pan, Ms. Zhang, and Mr. Ke[99][100][101] - Chervon Auto Precision Technology (Europe) Limited Liability Company is 100.00% owned by Mr. Pan, Ms. Zhang, and Mr. Ke[99][100][101] - Chervon (China) Investment Co., Ltd is 100.00% owned by Mr. Pan, Ms. Zhang, and Mr. Ke[99][100][101] - Panmercy holds 260,226,344 shares, representing 50.92% of the total issued shares[106] - Green Hope holds 97,637,750 shares, representing 19.11% of the total issued shares[106] - Klamm holds 27,118,822 shares, representing 5.31% of the total issued shares[106] - FMR LLC holds 49,198,208 shares, representing 9.63% of the total issued shares[106] - The total number of issued shares as of June 30, 2024, is 511,053,811[107] - The company received net proceeds of approximately HK$3,470.1 million from its global offering in December 2021[110] - As of June 30, 2023, the balance of 2021 net proceeds was approximately HK$1,930.5 million, with 66.5% initially planned for expanding and upgrading production facilities

Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [1][4]. Core Insights - The company has shown significant performance improvement, with a 2024H1 revenue increase of 11% year-on-year to $820 million and a net profit increase of 25.6% to $62 million [2]. - The gross margin improved by 0.8 percentage points to 32.9%, while the net profit margin increased by 1 percentage point to 7.6% [2]. - The company is expanding its product portfolio and diversifying its offerings, particularly in the lithium battery-powered outdoor power equipment (OPE) sector [2]. Summary by Sections Financial Performance - In 2024H1, revenue from the OPE segment increased by 10.2% to $490 million, driven by accelerated inventory destocking and increased customer orders [2]. - Revenue from the electric tools segment rose by 9.5% to $314 million, attributed to the recovery of the company's ODM business [2]. - The company reported a strong sales performance across regions, with North America seeing a 13.8% revenue increase to $552 million, while Europe experienced a slight decline of 1.5% to $172 million [2]. Profitability Metrics - The company’s gross margin improved due to enhanced operational efficiency and favorable raw material costs [2]. - The selling, general, and administrative expenses as a percentage of revenue were 13.1%, 5.2%, and 4.6% respectively, with a slight increase in sales expenses due to marketing and channel expansion investments [2]. Future Projections - The company is projected to achieve revenues of $1.66 billion, $1.95 billion, and $2.25 billion for the years 2024, 2025, and 2026 respectively, with corresponding net profits of $117 million, $156 million, and $183 million [4][5]. - The report anticipates a significant recovery in profitability, with a projected return on equity (ROE) of 10.7% in 2024, increasing to 12.5% by 2026 [6].

Investment Rating - The report maintains a "Recommended" rating for the company with a target price of 23 HKD, while the current price is 19.3 HKD [1]. Core Views - The company reported a revenue of 820 million USD for the first half of 2024, representing a year-on-year increase of 10.6%, and a net profit of 62 million USD, up 25.3% year-on-year [1]. - The revenue growth is driven by downstream customer order replenishment, with the OPE and power tools segments generating revenues of 490 million USD and 310 million USD, respectively, reflecting year-on-year growth of 10.2% and 9.5% [1]. - The gross margin improved to 32.9%, an increase of 0.8 percentage points year-on-year, attributed to scale effects, operational efficiency improvements, and favorable raw material costs [1]. - The company expects continued strong growth in the second half of 2024 as inventory depletion in downstream channels nears completion [1]. Financial Summary - The company forecasts total revenue of 1.654 billion USD for 2024, with a year-on-year growth rate of 19.9% [2]. - The projected net profit for 2024 is 122 million USD, showing a significant recovery from a loss of 37 million USD in 2023, with a growth rate of 429% [2]. - The earnings per share (EPS) is expected to be 0.24 USD in 2024, with a price-to-earnings (P/E) ratio of 10.3 [2]. Company Overview - The company holds a 24.7% stake in an associate company, which reported a loss impacting the net profit by 14 million USD [1]. - The total market capitalization of the company is 9.7 billion HKD, with a debt-to-asset ratio of 49.39% [4].