Investment Rating - The report maintains an "OUTPERFORM" rating for the company [3][9]. Core Insights - In Q1 2024, the company achieved operating revenue of RMB 5.73 billion, representing a year-on-year growth of 6.7% and a quarter-on-quarter growth of 1.5%. The net profit attributable to the parent company was RMB 760 million, with a year-on-year growth of 48.6% [6][9]. - The gross profit margin for Q1 2024 was 21.5%, showing a year-on-year increase of 3 percentage points, primarily due to lower costs from declining prices of soda ash and natural gas [6][9]. - The company expects to ignite new production capacity in 2024, which will support sustained performance growth. The total capacity is projected to reach 30,200 tons per day by the end of 2024 [8][9]. Financial Summary - The company reported a net profit margin of 13.2% in Q1 2024, with a year-on-year increase of 3.7 percentage points [6]. - The forecasted net profit attributable to the parent company for 2024-2026 is RMB 3.936 billion (-5.6%), RMB 4.934 billion (-4.8%), and RMB 5.762 billion (-4.8%) respectively [9]. - The target price has been revised from HKD 27.25 down by 12.3% to HKD 23.91 based on a DCF valuation model [9]. Market Dynamics - The price of photovoltaic glass has declined, while overall inventory continues to grow, indicating significant supply and demand pressures [7][9]. - The company’s production of photovoltaic glass remained stable in Q1 2024, with a slight increase in sales volume and a decrease in inventory by 23.7% compared to the end of 2023 [8][9].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 25.26, indicating a potential upside of 35% from the current price of HKD 18.78 [2][7]. Core Insights - In Q1 2024, the company achieved a net profit of RMB 760 million, representing a year-on-year increase of 48.57%, with total revenue reaching RMB 5.726 billion, up 6.73% year-on-year [4][9]. - The price of photovoltaic glass increased by HKD 0.5-1 per square meter in April, driven by demand from solar module production, and Q2 profits are expected to continue rising [5][10]. - The company is actively expanding its production capacity, with a total capacity of 20,600 tons/day as of the end of 2023, projected to reach approximately 30,200 tons by the end of 2024 [6][11]. Financial Performance - The company reported a significant increase in Q1 2024 profits due to lower soda ash costs, reduced expenses, and the reversal of impairment losses [4][9]. - The projected revenue growth for 2024 is 18%, with net profit expected to grow by 39.8% [8][12]. - The company’s earnings per share (EPS) for 2024 is estimated at RMB 0.99, with a PE ratio of 17.2 based on the current price [8][12]. Market Position and Expansion - The company is a leader in the photovoltaic glass industry, with ongoing domestic and international expansion plans that will support future growth [6][11]. - New production lines in Anhui and Nantong are expected to come online in 2024, contributing to a projected 20-30% increase in actual production volume [6][11]. - Future capacity expansions include additional facilities in Guangxi, Sichuan, and Jiangsu, as well as overseas projects in Vietnam and Indonesia, expected to start operations in 2026 or later [6][11].

Investment Rating - The report maintains a "Buy" rating for the company [4]. Core Insights - The company reported Q1 2024 revenue of 5.726 billion HKD, a year-on-year increase of 7% and a quarter-on-quarter increase of 2%. The net profit attributable to shareholders was 760 million HKD, representing a year-on-year increase of 49% but a quarter-on-quarter decrease of 4% [4]. - The increase in glass sales volume in Q1 was attributed to strong demand for glass components after the Spring Festival. The company's inventory at the end of Q1 was 1.53 billion HKD, down 24% quarter-on-quarter [4]. - The company expects significant improvement in profitability in Q2 due to stable glass prices and effective procurement management, with projected profits of 3.85 billion HKD and 4.66 billion HKD for 2024 and 2025, respectively [4]. Summary by Sections Event Description - The company released its Q1 report, showing better-than-expected performance with a revenue of 5.726 billion HKD and a net profit of 760 million HKD [4]. Event Commentary - The company experienced a slight increase in glass sales volume, driven by strong demand post-Spring Festival. Inventory levels are low, supporting future sales [4]. - Profitability is expected to improve due to stable pricing and effective cost management strategies, including flexible procurement of raw materials [4]. - The company is accelerating capacity expansion, with new production lines expected to come online within the year, which will support market share growth [4].

Investment Rating - The report maintains a "Neutral" rating for the company with a target price of HKD 19.50, indicating a potential upside of 0.5% from the current closing price of HKD 19.40 [1][7]. Core Insights - The company's Q1 performance slightly exceeded expectations, with a revenue growth of 6.7% year-on-year and 1.5% quarter-on-quarter, reaching RMB 5.73 billion. Net profit increased by 48.6% year-on-year but decreased by 3.9% quarter-on-quarter to RMB 758.6 million, which was 5% higher than forecasts due to lower expenses and a reversal of impairment losses [1][2]. - In April, glass prices rose by 3% following a rapid inventory reduction in March, although inventory levels began to increase again in the latter half of the month due to reduced production rates from some component manufacturers [2]. - The report anticipates a significant increase in profit margins in Q2, but a decline in the second half of the year is expected due to limited valuation attractiveness at present [2]. Financial Overview - Q1 2023 revenue was RMB 5.73 billion, with a net profit of RMB 758.6 million, reflecting a net profit margin of 13.2% [1][5]. - The company’s financial projections indicate revenue growth from RMB 21.52 billion in 2023 to RMB 34.81 billion by 2026, with net profit expected to rise from RMB 2.76 billion to RMB 5.35 billion over the same period [4][8]. - The gross margin is projected to improve from 22.4% in 2023 to 23.5% in 2024, while the net profit margin is expected to increase from 12.8% in 2023 to 15.4% in 2026 [6][8]. Market Dynamics - The industry is experiencing a rapid increase in new production capacity, with 8,300 tons coming online since March, leading to an expected oversupply in the second half of the year [2]. - The report notes that the average prices for photovoltaic glass have decreased by 9% and 3% for 2.0mm and 3.2mm glass respectively, although cost reductions from lower soda ash prices have helped maintain margins [1][2].

香港交易及結算有限公司和香港證券交易有限公司不對本公告的內容負責，不對本公告的準確性 或完整性做任何聲明，也明確不對依賴本公告全部或任何部分內容而產生任何損失負擔任何責 任。 福萊特玻璃集團股份有限公司 Flat Glass Group Co., Ltd. （於中華人民共和國註冊成立的股份有限公司） （股份代號：6865） 截至2024年3月31日止三個月第一季度報告 本公告由福萊特玻璃集團股份有限公司（「本公司」及其附屬公司統稱「本集團」）根據香港聯合交易所 有限公司證券上市規則第13.09條及13.10B條及證券及期貨條例（香港法例第571章）第XIVA部項下 內幕消息條文而刊發。 根據中國證券監督管理委員會的規定，本公司需刊發第一季度和第三季度報告。本季報根據中國 證券監督管理委員會發佈的上市公司季報信息披露相關要求所編製。 本季度報告內所載的財務數據均未經審計，並根據中國企業會計準則而編製。 本公司審核委員會已審閱本集團截至二零二四年三月三十一日止第一季度未經審計業績。 季報內容與上海證券交易所發佈的公告保持一致。本季度報告最初是用中文編寫的。如中英文版 本有不一致之處，以中文版本為準。 1 一、重要 ...

Financial Performance - For the fiscal year ending December 31, 2023, the group's revenue reached approximately RMB 21,523.71 million, representing a 39.21% increase compared to RMB 15,460.84 million for the fiscal year ending December 31, 2022[5]. - The net profit attributable to shareholders for the fiscal year ending December 31, 2023, was RMB 2,759.69 million, a 30.00% increase from RMB 2,122.78 million for the fiscal year ending December 31, 2022[5]. - The basic earnings per share for the fiscal year ending December 31, 2023, was RMB 1.24, compared to RMB 0.99 for the previous fiscal year[10]. - The revenue from photovoltaic glass was RMB 19,676.53 million, up 43.82% from RMB 13,681.80 million in the previous fiscal year[44]. - The gross profit for the fiscal year ending December 31, 2023, was RMB 4,692.99 million, a 37.52% increase from RMB 3,412.65 million in the previous year[49]. - The operating cost for the fiscal year ending December 31, 2023, was RMB 16,830.72 million, an increase of 39.70% from RMB 12,048.19 million in the previous year[48]. - The group’s EBITDA for the year ended December 31, 2023, was RMB 5,384.93 million, an increase of RMB 1,640.37 million or 43.8% from RMB 3,744.56 million for the year ended December 31, 2022, with an EBITDA margin of 25.02%[59]. - The financial expenses for the year ended December 31, 2023, amounted to RMB 482.89 million, an increase of 100.84% compared to RMB 240.43 million for the year ended December 31, 2022[54]. - The income tax for the year ended December 31, 2023, was RMB 288.78 million, up 859.40% from RMB 30.10 million for the year ended December 31, 2022, with the effective tax rate rising from 1.40% to 9.46%[55]. Assets and Liabilities - Total assets amounted to RMB 42,981.998 million, with current assets at RMB 16,832.972 million and non-current assets at RMB 26,149.026 million[11]. - Total liabilities were RMB 20,691.088 million, consisting of current liabilities of RMB 9,184.980 million and non-current liabilities of RMB 11,506.108 million[11]. - The company's equity attributable to shareholders was RMB 22,215.074 million, indicating a strong financial position[11]. - Total assets increased to RMB 42,982.00 million as of December 31, 2023, from RMB 32,381.72 million as of December 31, 2022[57]. - The debt-to-asset ratio decreased to 48.14% as of December 31, 2023, down from 56.67% as of December 31, 2022, a reduction of 8.53 percentage points[60]. - Bank loans increased to RMB 9,740.91 million as of December 31, 2023, up RMB 1,496.84 million or 18.16% from approximately RMB 8,244.07 million as of December 31, 2022[61]. Projects and Investments - The company is currently in the installation and commissioning phase of its Anhui Phase IV project, with plans to commence production soon[7]. - The Nantong project is under construction and is expected to start production in the third quarter of this year[7]. - The company is investing in a photovoltaic component cover glass project in Indonesia to enhance product quality and service[7]. - The group plans to invest in photovoltaic glass furnace construction in Indonesia to meet regional demand[42]. - The company aims to enhance its production capacity to meet the growing market demand in the photovoltaic industry[152]. Market and Industry Trends - In 2023, China's newly installed photovoltaic capacity reached 216.88 GW, a year-on-year increase of 148.1%[6]. - The global photovoltaic market is experiencing diverse growth, with significant demand in regions such as Brazil, India, and Saudi Arabia, alongside traditional markets in Europe and the U.S.[6]. - The photovoltaic glass market is gradually moving towards balance, with production expansion slowing down in 2023 compared to previous years due to stricter government approvals and financing difficulties[41]. - The new installations in China's centralized PV power stations grew by 232.2% year-on-year, totaling 120.59 GW, while distributed PV power stations added 96.29 GW, an increase of 88.4%[40]. - In 2023, global photovoltaic (PV) installations reached a new high, with significant growth in overseas markets, particularly in Europe and the US, where demand continues to grow[39]. Corporate Governance - The company emphasizes the importance of good corporate governance to ensure compliance with applicable laws and regulations[87]. - The board of directors consists of five executive directors and three independent non-executive directors, with a focus on maintaining a clear distinction between the roles of the chairman and the CEO[88]. - The company has independent non-executive directors who serve on various committees, including audit, remuneration, and nomination committees, ensuring governance and oversight[79][80]. - The company has adopted the corporate governance code as per the Hong Kong Stock Exchange listing rules, ensuring adherence to best practices[87]. - The audit committee is composed of independent non-executive directors, ensuring unbiased oversight of the financial reporting process[100]. Shareholder Information - The company proposed a final dividend of RMB 0.38 per share (pre-tax) for the year 2023, subject to approval at the annual general meeting[66]. - The company aims to enhance communication with shareholders and investors through various channels, including annual general meetings and timely performance announcements[123]. - Shareholders holding more than 10% of voting shares can request a special general meeting, and the board must respond within ten days[121]. - Shareholders with more than 3% of shares can submit written proposals to be discussed at the annual general meeting, with a notice issued within two days of receipt[122]. Employee and Management Information - The total number of employees as of December 31, 2023, was 8,240, with total employee compensation reaching RMB 852.37 million, accounting for 3.96% of total revenue[64]. - The company has a management team with extensive experience in the glass industry, with key members having over 24 years of experience each[81][82][84]. - The company provides mandatory social security benefits for its employees, including pension, work injury insurance, maternity insurance, medical insurance, and unemployment insurance[140]. Environmental and Social Responsibility - The company has installed environmental protection and energy-saving equipment, including flue gas desulfurization and denitrification devices, to minimize the impact of nitrogen oxides and sulfur dioxide emissions from production activities[139]. - The company has received the "National Green Factory" title from the Ministry of Industry and Information Technology in November 2023, recognizing its contributions to environmental protection and energy conservation[139]. - The environmental, social, and governance report is scheduled for release on March 26, 2024[125]. Audit and Compliance - The external auditor, Deloitte, has reviewed the consolidated financial statements for the year ending December 31, 2023[114]. - The audit committee confirmed that the internal control system is effective and sufficient after reviewing the financial performance for the year ending December 31, 2023[101]. - The company has established a sound internal control system to effectively manage operational risks[186]. - The audit report emphasizes the importance of communication with governance regarding significant audit findings and independence requirements[198].

研究报告Research Report 10 Apr 2024 福莱特玻璃 Flat Glass Group (6865 HK) 盈利稳步提升，产能扩张稳固龙头地位 Profitability Increases Steadily, Production Capacity Expansion Consolidates Leading Position [观Ta点bl聚e_焦yem Inevie1s] tment Focus [Tab维le_持Inf优o] 于大市Maintain OUTPERFORM (Please see APPENDIX 1 for English summary) 评级 优于大市OUTPERFORM 公司盈利能力稳步提升，全年归母净利润+30%。2023 年，公 现价 HK$20.15 司实现营业总收入人民币 215.24 亿元，同比增长 39.21%，主要由 目标价 HK$27.25 于 2023 年度太阳能组件价格的大幅下跌刺激了下游组件装机需求 HTI ESG 2.3-2.5-4.0 大幅增长，公司受益于新增产能释放，营业收入再创新高。同时由 E-S-G: 0-5, (Please ...

%% research.95579.com %% 丨证券研究报告丨 港股研究丨公司点评丨福莱特玻璃（ ） 6865.HK [QT4ab盈le利_T水it平le]超预期，当前库存降至中低水平 报告要点 [公Ta司bl发e_布Su2m0m23ar年y]年报，2023年公司实现收入215.24亿元，同比增长39.21%；归母净利27.6 亿元，同比增长30%；其中，2023Q4实现收入56.39亿元，同比增长32.8%，环比下降9.14%； 归母净利7.91亿元，同比增长27.91%，环比下降10.48%。 ...

Investment Rating - The report assigns a "Neutral" rating to the company 福莱特玻璃 (6865 HK) with a target price of HKD 19.50, indicating a potential downside of 1.0% from the current closing price of HKD 19.70 [1][2][8]. Core Insights - The valuation recovery for 福莱特玻璃 has largely been completed, and short-term inventory reduction is expected to be challenging, leading to a downgrade to a neutral stance [1]. - The company's Q4 performance showed a slight decline in revenue and net profit compared to the previous quarter, with Q4 revenue at RMB 5.639 billion and net profit at RMB 791.8 million, reflecting a year-on-year growth of 32.8% and 28.0%, respectively [1][6]. - The company plans to distribute a dividend of RMB 0.38 per share, with an annual dividend of RMB 0.618, representing a payout ratio of 53%, up 30 percentage points year-on-year [1]. Financial Overview - For the fiscal year ending December 31, 2023, 福莱特玻璃 reported revenues of RMB 21.524 billion, a 39.2% increase year-on-year, and a net profit of RMB 2.760 billion, an 18.7% increase [4][9]. - The company’s core business, photovoltaic glass, saw a revenue increase of 44% year-on-year, with sales volume up by 50% despite a 4% decline in unit price [1][5]. - The projected financials for 2024E show revenues expected to reach RMB 23.844 billion, with a net profit forecast of RMB 3.532 billion, indicating a growth rate of 10.8% and 28.0%, respectively [4][9]. Production and Capacity - The company added only 1,200 tons of photovoltaic glass capacity last year, significantly below the 7,200 tons added in 2022 and the initial guidance of 6,000 tons, with total capacity at 20,600 tons by year-end [1]. - Plans for 2024 include an additional 9,600 tons of capacity, but delays in production ramp-up are anticipated, with no new domestic capacity approved as of now [1][5]. Market Dynamics - The photovoltaic glass market is expected to see a significant increase in supply in the second half of the year, driven by rapid inventory depletion and a recovery in profit margins, although the potential for continued high component production remains limited [1][6]. - The report notes that the industry has a substantial amount of capacity that is nearly complete, which could lead to oversupply conditions in the latter part of the year [1].

Financial Performance - For the fiscal year ending December 31, 2023, the group's revenue reached approximately RMB 21,523.71 million, a 39.21% increase compared to RMB 15,460.84 million for the fiscal year ending December 31, 2022[8]. - The net profit attributable to shareholders for the fiscal year was RMB 2,759.69 million, reflecting a 30.00% growth from RMB 2,122.78 million in the previous fiscal year[8]. - The total assets of the company as of December 31, 2023, amounted to RMB 42,981.998 million, up from RMB 32,381.723 million in 2022, indicating a growth of 32.5%[17]. - The company's total liabilities increased to RMB 20,691.088 million in 2023 from RMB 18,349.275 million in 2022, representing an increase of 12.7%[17]. - The company's basic earnings per share for 2023 was RMB 1.24, compared to RMB 0.99 in 2022, marking a 25.25% increase[17]. - The total equity attributable to shareholders reached RMB 22,215.074 million in 2023, up from RMB 14,032.447 million in 2022, an increase of 58.5%[17]. - EBITDA increased by RMB 1,640.37 million to RMB 5,384.93 million, with an EBITDA margin of 25.02% compared to 24.22% in the previous year[80]. - The gross profit for the fiscal year was RMB 4,692.99 million, a 37.52% increase from RMB 3,412.65 million, with a gross margin of 21.80%[68]. - Operating costs for the year were RMB 16,830.72 million, an increase of 39.70% from RMB 12,048.19 million, primarily due to increased sales volume[65]. - Financial expenses increased by 100.84% to RMB 482.89 million, attributed to higher bank borrowings and interest from convertible bonds[73]. - The effective tax rate increased significantly to 9.46% from 1.40% in the previous year, with income tax expenses rising to RMB 288.78 million[74]. Production and Capacity - The global photovoltaic installed capacity reached a new high in 2023, with China's new installations totaling 216.88 GW, a year-on-year increase of 148.1%[9]. - The company is enhancing manufacturing processes and optimizing furnace technology to reduce energy consumption and improve the yield of photovoltaic glass products[12]. - The Anhui Phase IV project is currently in the installation and commissioning stage, with plans to commence production soon[12]. - The Nantong project is under construction and is expected to start production in the third quarter of this year[12]. - As of December 31, 2023, the total capacity of the group is 20,600 tons per day, with projects in Anhui and Nantong expected to contribute an additional 9,600 tons per day, projected to commence operations this year[57]. - The photovoltaic glass segment generated revenue of RMB 19,676.53 million, up 43.82% from RMB 13,681.80 million year-over-year[60]. - The company plans to invest in building photovoltaic glass furnaces in Indonesia to meet the demand in various countries and regions[57]. Research and Development - Research and development expenses rose to RMB 596.75 million, a 14.05% increase from RMB 523.23 million, driven by new projects including large furnace technology and ultra-thin glass[72]. - The company will continue to increase R&D investment in furnace scale, product quality, and type expansion to enhance competitiveness in the global photovoltaic glass market[57]. - The company is investing in a photovoltaic component cover glass project in Indonesia to better meet downstream market demands[12]. Corporate Governance - The company has a strong management team with extensive experience in the glass industry, including over 31 years of experience held by Mr. Wei Zhiming[119]. - The company has implemented a clear separation of roles between the chairman and the CEO, in line with corporate governance best practices[123]. - The board currently consists of five executive directors and three independent non-executive directors, ensuring a diverse governance structure[124]. - The company has established an Audit Committee, Remuneration Committee, Nomination Committee, Strategic Development Committee, and Risk Management Committee to ensure effective governance[141]. - The board has adopted a diversity policy to ensure appropriate balance in skills, experience, and perspectives, enhancing effective operation and high standards of corporate governance[150]. - The company emphasizes the importance of good corporate governance to ensure compliance with applicable laws and regulations[123]. Shareholder Engagement and Dividends - The company proposed a final dividend of RMB 0.38 per share, subject to approval at the annual general meeting[87]. - The board proposed a final dividend of RMB 0.38 per share (pre-tax), subject to approval at the annual general meeting, with a commitment to distribute no less than 20% of distributable profits as dividends[185]. - The company encourages shareholder participation in annual general meetings, providing at least 21 days' notice for annual meetings and 15 days for extraordinary meetings[169]. - Shareholders holding more than 10% of voting shares can request the board to convene a special general meeting within ten days of submitting a written request[170]. Market Outlook and Strategy - The company has outlined a positive outlook for the upcoming year, projecting a revenue growth of 10% to 12%[107]. - New product launches are expected to contribute to revenue, with an estimated additional 100 million from the introduction of innovative glass products[107]. - The company is considering strategic acquisitions to enhance its market position, with a focus on companies that complement its existing product lines[107]. - The management team emphasized the importance of sustainability in their new strategies, aiming for a 30% reduction in carbon emissions by 2025[107]. Risk Management - The company faces significant risks related to the photovoltaic glass industry, including potential decreases in demand and pricing due to macroeconomic factors and market conditions[188]. - The company must comply with various Chinese environmental laws and regulations, which could impact production capacity and increase operational costs if there are adverse changes[191]. - The company has established a risk management and internal control system to safeguard assets and shareholder interests, ensuring reasonable assurance against errors or losses in operations[165][168]. Tax Compliance - The company ensures compliance with tax regulations for all shareholders regarding dividend taxation[101]. - The company is subject to tax policies outlined by the Ministry of Finance and the State Administration of Taxation[4]. - The company has implemented measures to facilitate tax treaty benefits for eligible shareholders[96]. - The company is committed to maintaining transparency in its tax practices and shareholder communications[102].