Global Battery Market Overview - The global lead acid and lithium battery market size was estimated at USD 104.31 billion in 2023, with a projected CAGR of 15.8% from 2024 to 2030[1] - The global lead-acid and lithium battery market size was estimated at USD104.31 billion in 2023, with a projected CAGR of 15.8% from 2024 to 2030, driven by industries reliant on UPS equipment[36] - Lead-acid batteries accounted for the second-largest share of the global battery market in 2023, with the automobile sector holding over 50% of the lead-acid battery market share[78] - Industrial batteries held the largest market share of 35.85% in 2023, driven by the growing need for energy storage and backup systems, while automotive batteries ranked second with a 34.62% market share[79] - Industrial batteries accounted for the largest market share at 35.85%, followed by automotive batteries at 34.62%[97] Regional Market Performance - Asia Pacific held the largest revenue share of over 65% in 2023, driven by rapid industrial expansion and energy efficiency needs in major countries like China, India, and Australia[8] - Overseas markets contributed RMB 5,313 million, accounting for 40% of the company's revenue share, with North America and EMEA being primary contributors[9] - China region contributed RMB8,158 million in revenue, representing 60% of total revenue, supported by the integration and expansion of the Tianjin joint venture with GS Yuasa[31] - Overseas market revenue reached RMB5,313 million, representing 40% of total revenue, with strong contributions from North America and EMEA regions[117] - China dominates the global battery market with nearly 900 gigawatt-long periods of assembling capacity, representing 77% of the global total, and is home to six of the world's top 10 battery manufacturers[116] Company Revenue and Profitability - The company's sales of reserve power batteries increased by 4.6% to RMB 6,284.4 million in 2023, representing 54.9% of total battery sales revenue[21] - Battery sales revenue increased by 28.6% in the second half of 2023 compared to the first half, with PRC and overseas markets growing by 30.1% and 27.0% respectively[19] - The company's revenue from batteries and related items in the second half of 2023 was RMB 6,440.6 million, a 28.6% increase from the first half[19] - The company's gross profit for 2023 was RMB 1,594,774 thousand, with a net profit attributable to owners of the parent company of RMB 535,372 thousand[23] - Group revenue reached RMB13,471 million, representing a 4.9% growth, driven by Start Battery's market expansion in the EMEA region and strong performance in Backup Power and Motive Battery product lines[28] - Revenue for the year ended 31 December 2023 increased to RMB 13,471,235,000, up 4.9% from RMB 12,845,859,000 in 2022[176] - Gross profit for 2023 was RMB 1,943,707,000, a 21.9% increase from RMB 1,594,774,000 in 2022[176] - Profit before tax for 2023 was RMB 643,854,000, up 10.4% from RMB 583,392,000 in 2022[176] - Profit for the year 2023 was RMB 567,836,000, a 12.9% increase from RMB 502,744,000 in 2022[176] Product Line Performance - Start Battery product line generated RMB3,687 million in sales, accounting for 27.4% of the company's revenue, with growth fueled by the development of auto start-stop technology[30] - Motive power batteries business recorded sales revenue of RMB1,209.4 million, a decrease of 3.9% compared to the previous year, accounting for 10.6% of total battery sales revenue[34] - Recycling Battery product line reported revenue of RMB2,024 million, representing 15% of the portfolio, with growth expected due to increasing demand for EV and renewable energy storage systems[45] - Backup battery sales amounted to RMB6,284.4 million, a 4.6% increase from the previous year, accounting for 54.9% of total battery sales revenue[54] - The Start Battery Product Line generated sales revenue of RMB3,687 million, representing 27.4% of the company's total revenue, driven by demand for start-stop technology to reduce CO2 emissions[82] - Motive battery product line's 2023 revenue reached RMB1,209 million, accounting for 9% of the company's total revenue[83] - SLI battery sales increased by 28.9% to RMB3,687.0 million in 2023, representing 32.2% of total battery sales revenue[93] - Backup power product line reported sales revenue of RMB6,284 million, contributing 46.6% to the company's total portfolio[98] Expansion and Strategic Initiatives - The company is expanding its battery plant in New Mexico and increasing production capacity in Malaysia and Vietnam to address order backlogs and enhance lithium output capacity[10] - The company's five-year expansion program includes strategic projects aimed at capturing untapped opportunities in the US and Europe, leveraging proximity and improved logistics[10] - The company is positioning itself as a key industrialization partner in the global battery market, with ongoing discussions for global footprint partnership projects[10] - The company is implementing a five-year expansion plan, including commissioning a new battery plant in New Mexico and expanding production capacity in Malaysia and Vietnam[88] - The company aims to produce clean and affordable batteries to accelerate the decarbonization of global energy and transportation systems, focusing on energy storage systems (ESS) and commercial mobility[39] - The company is focusing on sustainability and energy optimization, with plans to revolutionize the energy and automotive industries through cleaner energy ecosystems[86] Market Challenges and Risks - The company faces challenges in the domestic industry, including lopsided supply chain development, supply-demand imbalance, local protectionism, and quality inconsistencies[116] - The company's reliance on lead-acid battery technology poses a risk if the market does not grow as expected or if the technology is replaced by alternatives[138] - Fluctuations in raw material prices, particularly lead, could materially and adversely affect the company's operations[140] - The company derives a significant portion of its income from major customers, particularly in UPS and telecommunications, with no long-term sales contracts, posing a risk if orders are reduced or cease[140] - The Group's inventory balance amounted to RMB2,749 million, representing 20% of the total assets, with significant risk of obsolescence due to rapid technological developments in the lead-acid battery industry[164] Financial Performance and Dividends - The Group recommended a final dividend of HK7 cents per share for the year ended 31 December 2023, compared to HK10 cents per share in 2022[142] - The Group paid an interim dividend of HK4 cents per share for the six months ended 30 June 2023, compared to no interim dividend in the same period of 2022[142] - Research and development costs for 2023 were RMB 371,868,000, a 2.9% decrease from RMB 382,868,000 in 2022[176] - Selling and distribution expenses increased to RMB 464,279,000 in 2023, up 19.3% from RMB 389,151,000 in 2022[176] - Administrative expenses rose to RMB 446,084,000 in 2023, a 33.7% increase from RMB 333,676,000 in 2022[176] - Finance costs increased to RMB 223,554,000 in 2023, up 43.1% from RMB 156,222,000 in 2022[176] - Other income and gains decreased to RMB 240,766,000 in 2023, down 17.7% from RMB 292,494,000 in 2022[176] - The company reported a net reversal of impairment losses on assets of RMB 4,134,000 in 2023, compared to impairment losses of RMB 27,516,000 in 2022[176] Environmental and Compliance Initiatives - The Group installed wastewater treatment facilities at its production facilities, achieving "zero discharge" by reusing purified water in the production process at Zhaoqing and Anhui facilities[144] - The Group maintained high standards of quality control and compliance with applicable laws, rules, and regulations, ensuring timely updates to procedures and operations in response to any changes[146] - The Group had no material or significant disputes with its suppliers and/or customers during the year ended 31 December 2023, maintaining strong relationships to support long-term goals and development[147] Market Recovery and Growth Prospects - The Group reversed a sales decrement of RMB92.2 million in H1 2023, driven by a 17% increase in lead-acid battery shipping tonnage in the PRC and a 10% increase overseas in H2 2023[62] - Year-over-year shipping tonnage growth in the PRC exceeded 30%, with overseas shipping tonnage in H2 2023 nearly doubling compared to H1 2023, resulting in a 40% growth compared to the same period last year[63][64] - Overseas demand for motive power battery declined by 30% in H1 2023 compared to the previous year, but the decline narrowed to 10% in H2 2023, indicating a potential market recovery[68] - The company's reserve power batteries business is expected to benefit from global economic recovery and stimulus in China's high-tech industry, supporting growth in 2024[123] - The company expects a healthy CAGR driven by strong demand from emerging markets, particularly for smart storage, decentralized networks, and intelligent automation[83]
理士国际(00842) - 2023 - 年度财报