FREEWON(SH:688678) Zheng Quan Zhi Xing·2025-07-11 16:26Core Viewpoint - The company received an inquiry letter from the Shanghai Stock Exchange regarding its 2024 annual report, prompting a detailed response about its operating performance and financial metrics [1]. Group 1: Operating Performance - The company reported a significant increase in revenue, with a growth rate of 29.60% in 2024 compared to the previous year, reaching a total revenue of 128,518.14 million yuan [6]. - The net profit for the years 2022 to 2024 was 162 million yuan, indicating a decline despite rising revenues [1]. - The company highlighted the impact of the recovery in the consumer electronics sector, which led to increased orders from downstream customers [4]. Group 2: Customer Analysis - The company provided a detailed breakdown of its top five customers by product type, showing significant revenue changes, such as a 67% increase in sales to customer D [2]. - Customer J became a major client in the electric tool business, contributing to rapid revenue growth as the product range expanded from components to complete machines [4]. - The company noted that customer O's revenue growth was driven by increased demand for safety airbag components, while customer P's growth was linked to sunroof drive tube components [4]. Group 3: Product Revenue and Margin Analysis - The revenue from 3C precision metal components increased significantly, benefiting from a recovery in the consumer electronics market, with a reported revenue of 79,288.15 million yuan in 2024 [15]. - The automotive precision metal components segment also saw growth, with revenue reaching 22,327.27 million yuan, supported by the overall growth in the Chinese automotive market [7]. - The electric tool precision metal components experienced a revenue increase of 68.71%, attributed to the expansion into small household appliances [8]. Group 4: Margin Trends - The overall gross margin for the company has been declining, with specific segments like the electric tool precision metal components seeing a drop of 15.83 percentage points in 2023 [11]. - The gross margin for the diamond wire business decreased significantly by 62.59 percentage points in 2024, primarily due to increased competition and reduced prices in the photovoltaic industry [20]. - The company indicated that the decline in gross margins was influenced by changes in product mix and the cyclical downturn in the photovoltaic sector [22]. Group 5: Financial Metrics and Comparisons - The company reported a significant increase in financial expenses due to interest from convertible bonds issued in 2023, amounting to 11.32 million yuan in 2023 and 30.01 million yuan in 2024 [23]. - The net profit attributable to the parent company showed a downward trend, with a notable decrease in 2024 due to increased financial costs and impairment provisions [24]. - Compared to industry peers, the company's revenue growth was slightly positive, while net profit trends were more negative, indicating a need for strategic adjustments [25].