振江股份20240710

Summary of the Earnings Call for Zhenjiang Co., Ltd. Company Overview - Company: Zhenjiang Co., Ltd. - Date of Call: July 11, 2024 - Key Speaker: CEO Li Key Points Financial Performance - The company issued a profit forecast indicating a net profit attributable to shareholders between 11 million to 14 million, representing a year-on-year growth of 40.7% to 79.08% [2][45] - The forecast also noted potential non-recurring gains in the upcoming semi-annual report [2] Business Directions - The company is focusing on two main business directions: 1. Expanding its overseas business in photovoltaic (PV) mounting structures. 2. Collaborating with Siemens on large offshore wind turbines [2][10] Operational Challenges - Shipping Delays: The company faced shipping schedule issues due to geopolitical factors, particularly in the Red Sea, which extended delivery times by over half a month [5][10] - Underperformance in U.S. PV Installations: The expected U.S. PV installations were revised down from 50 GW to between 30 GW and 40 GW, impacting the delivery volume of PV mounting structures [6][7] - Offshore Vessel Business: The offshore vessel business experienced delays in project settlements, affecting revenue recognition [9][10] Production and Capacity - The company shipped 6,000 tons of PV mounting structures in Q2, below expectations of 10,000 tons [8] - Anticipated total shipments for the year are projected at 45,000 to 50,000 tons, with a significant portion expected in Q4 [7][8] - The new Nantong factory, which began operations on June 26, 2024, is expected to significantly contribute to revenue in the following year [11][12] Future Outlook - The company is preparing for a ramp-up in production for Siemens' 14 MW offshore wind turbines, with expectations of substantial contributions to revenue starting next year [10][12] - The Nantong Phase II project, focusing on casting components, is expected to commence production by mid-2025, contributing to profits in subsequent years [13] - The company is optimistic about the European offshore wind market, anticipating increased demand and project completions in the coming years [14] Strategic Partnerships - The company is in the final stages of certification with new clients in the U.S. and is optimistic about securing new orders [21] - A new factory in Saudi Arabia, in collaboration with GCS, is expected to produce 3 GW of capacity, translating to approximately 50,000 tons of output [22][30] Cost Management - Shipping costs account for about 15% of production costs, and the company has managed to keep these costs relatively stable despite fluctuations in freight rates [4][26] - The company is actively engaging in hedging strategies for raw materials, particularly steel, to mitigate cost volatility [40] Conclusion - Despite facing challenges in Q2, the company remains confident in its long-term growth trajectory, particularly in the offshore wind and PV sectors, and is well-positioned to capitalize on upcoming opportunities in the market [45]