HYC(SH:688001) Zheng Quan Zhi Xing·2025-06-24 17:25Core Viewpoint - The company received an inquiry letter from the Shanghai Stock Exchange regarding its 2024 annual report, prompting a detailed analysis of its business performance and financial metrics, particularly focusing on revenue changes and gross margin fluctuations across different product segments [1][2]. Group 1: Business Performance Analysis - The company's revenue from testing equipment decreased by 18.27% in 2024, while revenue from fixtures and accessories increased by 40.18%, and assembly equipment revenue surged by 90.85% [2][8]. - The sales volume of testing equipment dropped by 52.46%, but the revenue decline was only 18.72%, indicating a potential increase in average selling prices [2][8]. - The company primarily serves the consumer electronics sector, with a significant portion of its revenue derived from major clients in this industry, particularly Company A [2][3]. Group 2: Market Trends and Client Performance - The global consumer electronics market is projected to grow by approximately 5.40% in 2024, reaching a size of $815.2 billion, although major clients like Company A are experiencing a decline in product shipments [3][4]. - Company A's capital expenditure for the fiscal year 2024 is estimated at $9.447 billion, down 13.80% from the previous year, reflecting a broader trend of reduced capital spending in the consumer electronics sector [4][5]. Group 3: Gross Margin Analysis - The overall gross margin for the company decreased, with testing equipment gross margin at 42.12%, fixtures and accessories at 40.89%, and assembly equipment at 49.78%, all showing declines compared to the previous year [1][9]. - The decline in gross margins is attributed to increased competition, rising fixed costs from new capacity, and higher raw material costs, which collectively exert pressure on profitability [12][15][16]. - The company’s gross margin decline aligns with industry trends, as similar companies in the sector also reported reduced margins due to similar challenges [12][13][16]. Group 4: Raw Material Cost Dynamics - The total raw material costs for the company increased significantly, with a 148.41% rise in 2024, driven by higher production volumes and changes in product structure [20][21]. - The average procurement prices for key raw materials, including electronic components and mechanical parts, have shown varied changes, complicating cost management [21][22]. - The company’s procurement strategy involves sourcing from multiple suppliers, with a focus on maintaining competitive pricing despite fluctuations in raw material costs [22][23].