BOE VARITRONIX(00710)2025-04-11 03:09Financial Performance - The company reported a revenue of HKD 13,449 million for the year ended December 31, 2024, representing a 25% increase from HKD 10,760 million in 2023[15]. - EBITDA for the year was HKD 686 million, a decrease of 11% compared to HKD 771 million in 2023[15]. - Shareholders' profit attributable to the company was HKD 391.3 million, down 18% from HKD 475.3 million in the previous year[15]. - Basic earnings per share were HKD 0.496, compared to HKD 0.604 in 2023[13]. - The company declared a final dividend of HKD 0.17 per share, down from HKD 0.19 per share in the previous year[13]. - Operating profit for the same period was HKD 437,000,000, a decrease of HKD 132,000,000 or approximately 23%, attributed to product structure changes, price adjustments, and increased inventory costs[65]. - The group proposed a final dividend of HKD 0.17 per share, down from HKD 0.19 per share in 2023, with a full-year payout ratio of 34% compared to 32% in 2023[19]. - Net profit attributable to shareholders decreased to HKD 391,300,000 from HKD 475,300,000, with basic earnings per share dropping to HKD 0.496 from HKD 0.604[67]. Cash and Debt Management - As of December 31, 2024, the company had total cash resources of HKD 4,122 million, an increase from HKD 3,572 million at the end of 2023[16]. - Bank loans decreased by 39% to HKD 376 million from HKD 620 million at the end of 2023[16]. - The current ratio as of December 31, 2024, was 1.41, down from 1.61, primarily due to investments for future business expansion[70]. - Cash resources increased to HKD 4,122,000,000 from HKD 3,572,000,000, reflecting strict control over working capital[71]. - The net cash generated from operating activities reached HKD 1,457,000,000, an increase from HKD 1,186,000,000 in 2023, primarily due to a decrease in inventory contributing HKD 136,000,000[73]. - The net cash used in investing activities was HKD 1,783,000,000, significantly higher than HKD 224,000,000 in 2023, mainly for property, plant, and equipment purchases totaling HKD 568,000,000[73]. Market Position and Growth - The company is positioned as a leading provider of automotive smart cockpit display solutions, focusing on automotive and industrial display solutions[5]. - The company aims to expand its market share in the automotive TFT display product and large and medium-sized display module markets globally[5]. - The group's revenue growth was primarily driven by the sales increase of TFT products, touch screen display modules, and automotive systems, benefiting from a significant rise in demand for new energy vehicles[17]. - Automotive display business revenue reached HKD 12,660,000,000, a 30% increase compared to HKD 9,710,000,000 in 2023, accounting for approximately 94% of the group's total revenue[20]. - The group maintained the largest market share in the global automotive display market, particularly for displays of 8 inches and above, according to Omdia data[20]. - The group successfully expanded its overseas business, achieving significant revenue growth in the U.S. despite macroeconomic challenges, supported by strategic investments in R&D and marketing[21]. - Revenue from China reached HKD 8,350,000,000, a 35% increase from the previous year, accounting for 62% of total revenue, primarily driven by the automotive display business[90]. - Revenue from the Americas reached HKD 838 million, representing a 47% increase compared to the previous year, driven by orders for TFT display modules from multiple automotive clients[98]. - The European business recorded revenue of HKD 2.444 billion, a decrease of approximately 4% year-on-year, accounting for about 18% of total group revenue, impacted by geopolitical conflicts and economic downturns[97]. - Revenue from Japan reached HKD 1,157,000,000, an increase of approximately 50% year-over-year, accounting for about 9% of the group's total revenue[100]. - Revenue from South Korea amounted to HKD 376,000,000, representing a year-over-year increase of approximately 24%, contributing around 3% to the group's total revenue[101]. Research and Development - The company is investing heavily in R&D to maintain its competitive edge in AI and smart cockpit technologies[37]. - R&D expenditure increased from HKD 237 million in 2023 to HKD 284 million in 2024, with the number of R&D personnel rising from approximately 410 to 450[44]. - The company plans to establish more laboratories in Europe and the US to meet diverse automotive R&D needs[35]. - The company is actively developing a dual-view display technology expected to produce a proof of concept (POC) prototype for market promotion in the first half of 2025[53]. - The company launched the first integrated display group standard for smart cockpits in the Chinese market in 2024, showcasing its technological expertise[36]. - The advanced super dimension switch technology (ADS-PRO) has been recognized for its superior display quality, with multiple projects secured from well-known automotive manufacturers[48]. - Multiple vehicle-mounted f-OLED displays have entered mass production, and the company is developing Tandem OLED technology for improved efficiency and longevity[50]. Environmental, Social, and Governance (ESG) - The company aims to achieve carbon neutrality by 2050 and has set targets for reducing carbon emissions, energy, water usage, and waste by 2025[43]. - The board has emphasized the importance of ESG management and will continue to assess sustainability trends and risks[106]. - The company has set a target for carbon neutrality by 2050 and is developing a roadmap and strategies to achieve this goal[107]. - The company is committed to improving its ESG performance by integrating sustainability factors into all business decision-making processes[114]. - The company has established a comprehensive ESG risk management and reporting mechanism, with the board overseeing the preparation and approval of the annual ESG report[120]. - The company is actively pursuing energy-saving projects and enhancing the use of green energy, including the establishment of photovoltaic power generation projects[117]. - The company emphasizes the importance of integrating ESG into its operations and management, aiming for long-term stability in environmental, social, and corporate value[113]. - The company has identified key sustainability performance indicators to enhance its ESG rating and corporate image, while also reducing operational costs[116]. - The company is committed to regular training for employees on anti-corruption policies and the importance of ethical behavior[131]. - The company has established a whistleblowing channel to report any suspected corruption, ensuring thorough and fair investigations of all allegations[132]. Production and Operational Efficiency - The establishment of a Quality Management Committee (QCC) in 2024 aims to enhance quality control and supplier performance monitoring across different manufacturing plants[24]. - Inventory turnover days improved from 67 days in 2023 to 55 days in 2024, effectively managing procurement delivery times to meet production needs[25]. - The Chengdu factory, established at the end of 2022, has increased production efficiency and capacity to enhance profitability in the automotive display business[25]. - The company maintains a light asset model, leveraging existing production and R&D capabilities to meet market demand with moderate investment[41]. - The company is focused on optimizing supply chain management and enhancing quality control processes to improve overall operational efficiency and customer trust[92]. - The company has implemented various measures to enhance environmental performance, including energy management systems and regular maintenance of equipment to ensure operational efficiency[156]. Sustainability Initiatives - The company is committed to developing green energy resources to effectively reduce carbon emissions and respond to national carbon neutrality policies[179]. - The company has implemented photovoltaic power generation projects in its factories to mitigate climate change risks and enhance sustainable development strategies[141]. - The company encourages employees to use public transportation and direct flights to reduce carbon emissions during business travel[142]. - The company has seen a reduction in direct carbon equivalent emissions to 11,138.60 tons for the Heyuan plant in 2024, with a revenue impact of 828.21 million HKD[145]. - The company has implemented rigorous internal controls to ensure that all related party transactions comply with listing rules and are conducted on fair terms[133]. - The company actively participates in environmental initiatives, such as Earth Hour, to promote energy conservation awareness[191]. - The factory encourages employee participation in environmental activities, fostering a culture of sustainability[192].