WUHAN,
China, May 14, 2024 /PRNewswire/ -- China
Automotive Systems, Inc. (NASDAQ: CAAS) ("CAAS" or the
"Company"), a leading power steering components and systems
supplier in China, today announced
its unaudited financial results for the first quarter ended
March 31, 2024.
First Quarter 2024 Highlights
- Net sales were $139.4
million
- Gross profit increased by 11.6% to $24.1
million with a gross margin of 17.3%, compared with
$21.6 million of gross profit and a
15.2% gross margin in the first quarter of 2023
- Income from operations increased by 26.0% to $9.7 million compared with $7.7 million in the first quarter of 2023
- Diluted income per share increased by 17.4% to $0.27, compared to diluted income per share of
$0.23 in the first quarter of
2023
- Cash, cash equivalents, and short-term investments were
$135.8 million as of March 31, 2024
- Net cash provided by operating activities was $10.5 million in the first quarter of 2024
compared to net cash used of $1.4
million in the first quarter of 2023.
Mr. Qizhou Wu, chief executive officer of CAAS, commented,
"We are pleased with achieving higher gross profit, income from
operations, diluted income per share and net cash flow from
operating activities in the 2024 first quarter. We remain confident
in our sales growth in 2024, despite a slight decline in the 2024
first quarter. Our electric power steering ("EPS") sales percentage
remained consistent around 34.0% of total sales in the first
quarter of 2024. International sales were mixed as sales in
Brazil continued its growth trend
with a 17.6% year-over-year sales rise, and North American sales
were down by 12.4% year-over-year mainly due to temporary lower
product sales to Stellantis N.V in the 2024 first
quarter."
"We continued to invest in our products as research and
development ("R&D") expenses remained stable. Investments
targeted improving performance of our traditional steering products
continued even as we focus on expanding our EPS portfolio of
products and enhance our Advanced Driver Assistance Systems
("ADAS") program with Sentient AB and our clients."
Mr. Jie Li, chief financial
officer of CAAS, commented, "We had total cash, cash equivalents,
and short-term investments of $135.8
million and our current ratio was 1.6 to 1 as of
March 31, 2024. Cash flow from
operating activities was $10.5
million in the first quarter of 2024 and gross margin
increased primarily due to changes in the product mix sold combined
with our ongoing cost controls."
First Quarter of 2024
Net sales decreased by 2.0% to $139.4
million in the first quarter of 2024, compared to
$142.2 million in the first quarter
of 2023. Net sales of traditional steering products and parts were
$92.0 million compared to
$94.4 million for the first quarter
of 2023. Net sales of electric power steering ("EPS") products and
parts were $47.4 million for the
three months ended March 31, 2024
compared with $47.8 million for the
same period in 2023. EPS product sales for the first quarter of
2024 were approximately 34.0% of total net sales. North American
net export sales were $30.4 million
compared to $34.7 million in the
first quarter of 2023, primarily due to lower demand of passenger
vehicle products by Stellantis N.V. Brazil Henglong's net
product sales increased by 17.6% to $12.7
million in the first quarter of 2024 compared to
$10.8 million for the same period in
2023 due to higher sales to Fiat. Sales volumes to Chery Automobile
Co., Ltd increased, and sales for other entities increased by 31.2%
to $29.0 million mainly due to higher
sales by Wuhan Jielong and Wuhan Hyoseong. Steering product sales
to the commercial vehicle markets of $16.8
million were consistent with the sales in the 2023 first
quarter.
Gross profit increased by 11.6% to $24.1
million from $21.6 million in
the first quarter of 2023. Gross margin in the first quarter of
2024 was 17.3%, compared with 15.2% gross margin in the first
quarter of 2023, primarily due to changes in the product sales mix
and the decrease in sales unit cost for the three months of
March 31, 2024.
Gain on other sales was $0.5
million, compared to $0.7
million in the first quarter of 2023.
Selling expenses increased by 20.6% to $4.1 million from $3.4
million in the first quarter of 2023. This increase in
selling expenses was primarily due to higher office expenses.
Selling expenses represented 2.9% of net sales in the first quarter
of 2024 compared to 2.4% in the first quarter of 2023.
General and administrative expenses ("G&A expenses")
increased to $5.5 million, compared
with $4.8 million of the first
quarter of 2023 mainly due to higher payroll related expenses and
maintenance expenses. G&A expenses represented 3.9% of net
sales in the first quarter of 2024 compared with 3.4% of net sales
in the first quarter of 2023.
Research and development expenses ("R&D expenses") decreased
by 17.2% to $5.3 million compared to
$6.4 million in the first quarter of
2023, mainly due to decreased R&D activities for new projects
of the traditional products. R&D expenses represented 3.8% of
net sales in the first quarter of 2024 compared to 4.5% in the
first quarter of 2023.
Other income was $2.4 million for
the first quarter of 2024, compared to $1.5
million for the first quarter of 2023, mainly due to
higher government subsidies in the first quarter of 2024.
Income from operations was $9.7 million in the first quarter of 2024,
compared to income from operations of $7.7
million in the first quarter of 2023. The 26.0% increase in
2024 first quarter income from operations was primarily due to
higher gross profit partially offset by a smaller increase in
operating expenses.
Interest expense was $0.3
million in the first quarter of 2024, compared to
$0.2 million in the first
quarter of 2023.
Financial expense, net was $0.01
million in the first quarter of 2024, compared to
$0.4 million in the first quarter of
2023. This change was primarily due to a decrease in foreign
exchange loss due to foreign exchange volatility.
Income before income tax expenses and equity in earnings of
affiliated companies increased by 37.2% to $11.8 million in the first quarter of 2024
compared to $8.6 million in the first
quarter of 2023. The increase in income before income tax expenses
and equity in earnings of affiliated companies in the first quarter
of 2024 was mainly due to higher income from operations and
increased net other income.
Equity in losses of affiliated companies was $0.8 million in the first quarter of
2024, compared with equity in income of affiliated companies
of $0.1 million in the first quarter
of 2023.
Income tax expense was $1.7
million for the first quarter of 2024 as compared to
$0.8 million for the first quarter of
2023. This higher tax was primarily due to an increase in the
Global Intangible Low-Taxed Income ("GILTI") tax expenses.
Net income attributable to parent company's common shareholders
was $8.3 million in the first quarter
of 2024, compared to $6.8 million in
the first quarter of 2023. Diluted income per share was
$0.27 in the first quarter of 2024,
compared to net income per share of $0.23 in the first quarter of 2023.
The weighted average number of diluted common shares outstanding
was 30,185,702 in the first quarter of 2024 compared to 30,193,082
in the first quarter of 2023.
Balance Sheet
As of March 31, 2024, total cash,
cash equivalents, and short-term investments were $135.8 million, total accounts receivable
including notes receivable were $266.7
million, accounts payable including notes payable were
$243.0 million and short-term
bank loans were $40.5 million. Working capital rose to
$206.7 million as of March 31, 2024, compared to $180.3 million as of December 31, 2023. Total parent company
stockholders' equity was $358.4
million as of March 31, 2024,
compared to $344.5 million as of
December 31, 2023.
Business Outlook
Management has reiterated revenue guidance for the full fiscal
year 2024 of $605.0 million. This
target is based on the Company's current views on operating and
market conditions, which are subject to change.
Conference Call
Management will conduct a conference call on May 14, 2024, at 8:00 A.M.
EDT/8:00 P.M. Beijing Time to
discuss these results. A question and answer session will follow
management's presentation. To participate, please see the dial-in
information below, enter the call 10 minutes before the
aforementioned start time and ask to be connected to the
"China Automotive Systems" conference call with pin number
144876:
Phone Number: +1-888-506-0062 (North
America)
Phone Number: +1-973-528-0011 (International)
Mainland China Toll Free:
+86-400-120-3199
A replay of the call will be available on the Company's website
under the investor relations section.
About China Automotive Systems, Inc.
Based in Hubei Province,
the People's Republic of China,
China Automotive Systems, Inc. is a leading supplier of power
steering components and systems to the Chinese automotive industry,
operating through eight Sino-foreign joint ventures. The Company
offers a full range of steering system parts for passenger
automobiles and commercial vehicles. The Company currently offers
four separate series of power steering with an annual production
capacity of over 8 million sets of steering gears, columns and
steering hoses. Its customer base is comprised of leading auto
manufacturers, such as China FAW Group, Corp., Dongfeng Auto Group
Co., Ltd., BYD Auto Company Limited, Beiqi Foton Motor Co., Ltd.
and Chery Automobile Co., Ltd. in China, and Stellantis N.V. and Ford Motor
Company in North America. For more
information, please visit: http://www.caasauto.com.
Forward-Looking Statements
This press release contains statements that are "forward-looking
statements" as defined under the Private Securities Litigation
Reform Act of 1995. Forward-looking statements represent our
estimates and assumptions only as of the date of this press
release. Our actual results may differ materially from the results
described in or anticipated by our forward-looking statements due
to certain risks and uncertainties. As a result, the Company's
actual results could differ materially from those contained in
these forward-looking statements due to a number of factors,
including those described under the heading "Risk Factors" in the
Company's Annual Report on Form 10-K as filed with the Securities
and Exchange Commission on March 28,
2024, and in documents subsequently filed by the Company
from time to time with the Securities and Exchange Commission. Any
of these factors and other factors beyond our control, could have
an adverse effect on the overall business environment, cause
uncertainties in the regions where we conduct business, cause our
business to suffer in ways that we cannot predict and materially
and adversely impact our business, financial condition and results
of operations. A prolonged disruption or any further unforeseen
delay in our operations of the manufacturing, delivery and assembly
process within any of our production facilities could continue to
result in delays in the shipment of products to our customers,
increased costs and reduced revenue. We expressly disclaim any duty
to provide updates to any forward-looking statements made in this
press release, whether as a result of new information, future
events or otherwise.
For further information, please contact:
Jie Li
Chief Financial Officer
China Automotive Systems, Inc.
jieli@chl.com.cn
Kevin Theiss
Awaken Advisors
+1-212-510-8922
Kevin@awakenlab.com
-Tables Follow –
|
China Automotive Systems, Inc. and
Subsidiaries
|
|
Condensed Unaudited Consolidated Balance
Sheets
|
|
(In thousands of USD unless otherwise
indicated)
|
|
|
|
March
31, 2024
|
|
December 31, 2023
|
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
112,557
|
|
$
|
114,660
|
|
Pledged cash
|
|
|
44,028
|
|
|
40,534
|
|
Accounts and notes
receivable, net - unrelated parties
|
|
|
255,119
|
|
|
261,237
|
|
Accounts and notes
receivable, net - related parties
|
|
|
11,599
|
|
|
8,169
|
|
Inventories
|
|
|
109,082
|
|
|
112,392
|
|
Other current
assets
|
|
|
38,047
|
|
|
27,083
|
|
Total current
assets
|
|
|
570,432
|
|
|
564,075
|
|
Non-current
assets:
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
|
99,395
|
|
|
101,359
|
|
Land use rights,
net
|
|
|
9,151
|
|
|
9,233
|
|
Long-term
investments
|
|
|
59,278
|
|
|
60,173
|
|
Other non-current
assets
|
|
|
32,416
|
|
|
31,600
|
|
Total assets
|
|
$
|
770,672
|
|
$
|
766,440
|
|
|
|
|
|
|
|
|
LIABILITIES, MEZZANINE
EQUITY AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Short-term
loans
|
|
$
|
40,471
|
|
$
|
48,005
|
|
Accounts and notes
payable-unrelated parties
|
|
|
228,705
|
|
|
240,739
|
|
Accounts and notes
payable-related parties
|
|
|
14,265
|
|
|
12,839
|
|
Accrued expenses and
other payables
|
|
|
44,839
|
|
|
44,771
|
|
Other current
liabilities
|
|
|
35,409
|
|
|
37,385
|
|
Total current
liabilities
|
|
|
363,689
|
|
|
383,739
|
|
Long-term
liabilities:
|
|
|
|
|
|
|
|
Long-term tax
payable
|
|
|
8,781
|
|
|
8,781
|
|
Other non-current
liabilities
|
|
|
5,360
|
|
|
5,498
|
|
Total
liabilities
|
|
$
|
377,830
|
|
$
|
398,018
|
|
|
|
|
|
|
|
|
Mezzanine
equity:
|
|
|
|
|
|
|
|
Redeemable
non-controlling interests
|
|
|
621
|
|
|
613
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
Common stock, $0.0001
par value – Authorized – 80,000,000 shares; Issued – 32,338,302
and
32,338,302 shares as of March 31, 2024 and December
31, 2023, respectively
|
|
$
|
3
|
|
$
|
3
|
|
Additional paid-in
capital
|
|
|
69,722
|
|
|
63,731
|
|
Retained
earnings-
|
|
|
|
|
|
|
|
Appropriated
|
|
|
12,174
|
|
|
11,851
|
|
Unappropriated
|
|
|
292,776
|
|
|
284,832
|
|
Accumulated other
comprehensive income
|
|
|
(8,558)
|
|
|
(8,258)
|
|
Treasury stock –
2,152,600 and 2,152,600 shares as of March 31, 2024 and
December 31, 2023,
respectively
|
|
|
(7,695)
|
|
|
(7,695)
|
|
Total parent company
stockholders' equity
|
|
|
358,422
|
|
|
344,464
|
|
Non-controlling
interests
|
|
|
33,799
|
|
|
23,345
|
|
Total stockholders'
equity
|
|
|
392,221
|
|
|
367,809
|
|
Total liabilities,
mezzanine equity and stockholders' equity
|
|
$
|
770,672
|
|
$
|
766,440
|
|
China Automotive
Systems, Inc. and Subsidiaries
|
|
Condensed Unaudited
Consolidated Statements of Operations and Comprehensive
Income
|
|
(In thousands of
USD, except share and per share amounts)
|
|
|
|
Three Months Ended
March 31,
|
|
|
2024
|
|
2023
|
|
Net product sales
($11,360 and $13,576 sold to related parties for the three months
ended
March 31, 2024 and 2023)
|
|
$
|
139,394
|
|
$
|
142,243
|
|
Cost of products sold
($6,968 and $7,015 purchased from related parties for the three
months
ended March 31, 2024 and 2023)
|
|
|
115,325
|
|
|
120,625
|
|
Gross profit
|
|
|
24,069
|
|
|
21,618
|
|
Gain on other
sales
|
|
|
514
|
|
|
653
|
|
Less: Operating
expenses
|
|
|
|
|
|
|
|
Selling
expenses
|
|
|
4,073
|
|
|
3,384
|
|
General and
administrative expenses
|
|
|
5,547
|
|
|
4,753
|
|
Research and
development expenses
|
|
|
5,312
|
|
|
6,390
|
|
Total operating
expenses
|
|
|
14,932
|
|
|
14,527
|
|
Income from
operations
|
|
|
9,651
|
|
|
7,744
|
|
Other income,
net
|
|
|
2,403
|
|
|
1,502
|
|
Interest
expense
|
|
|
(258)
|
|
|
(249)
|
|
Financial expense,
net
|
|
|
(12)
|
|
|
(422)
|
|
Income before income
tax expenses and equity in earnings of affiliated
companies
|
|
|
11,784
|
|
|
8,575
|
|
Less: Income
taxes
|
|
|
1,743
|
|
|
829
|
|
Add: Equity in
(losses)/earnings of affiliated companies
|
|
|
(777)
|
|
|
137
|
|
Net income
|
|
|
9,264
|
|
|
7,883
|
|
Less: Net income
attributable to non-controlling interests
|
|
|
989
|
|
|
1,055
|
|
Accretion to redemption
value of redeemable non-controlling interests
|
|
|
(8)
|
|
|
(8)
|
|
Net income attributable
to parent company's common shareholders
|
|
$
|
8,267
|
|
$
|
6,820
|
|
Comprehensive
income:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
9,264
|
|
$
|
7,883
|
|
Other comprehensive
income:
|
|
|
|
|
|
|
|
Foreign currency
translation (loss)/income, net of tax
|
|
|
(348)
|
|
|
4,554
|
|
Comprehensive
income
|
|
|
8,916
|
|
|
12,437
|
|
Less: Comprehensive
income attributable to non-controlling interests
|
|
|
941
|
|
|
1,321
|
|
Accretion to redemption
value of redeemable non-controlling interests
|
|
|
(8)
|
|
|
(8)
|
|
Comprehensive income
attributable to parent company
|
|
$
|
7,967
|
|
$
|
11,108
|
|
|
|
|
|
|
|
|
Net income attributable
to parent company's common shareholders per share -
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.27
|
|
$
|
0.23
|
|
Diluted
|
|
$
|
0.27
|
|
$
|
0.23
|
|
|
|
|
|
|
|
|
Weighted average number
of common shares outstanding -
|
|
|
|
|
|
|
|
Basic
|
|
|
30,185,702
|
|
|
30,185,702
|
|
Diluted
|
|
|
30,185,702
|
|
|
30,193,082
|
|
China Automotive
Systems, Inc. and Subsidiaries
|
|
Condensed Unaudited
Consolidated Statements of Cash Flows
|
|
(In thousands of USD
unless otherwise indicated)
|
|
|
|
Three Months Ended
March 31,
|
|
|
2024
|
|
2023
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
9,264
|
|
$
|
7,883
|
|
Adjustments to
reconcile net income from operations to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
5,114
|
|
|
4,856
|
|
Reversal of credit
losses
|
|
|
(114)
|
|
|
(217)
|
|
Deferred income
taxes
|
|
|
136
|
|
|
1,019
|
|
Equity in
losses/(earnings) of affiliated companies
|
|
|
777
|
|
|
(137)
|
|
Loss on disposal of
property, plant and equipment
|
|
|
670
|
|
|
15
|
|
(Increase)/decrease
in:
|
|
|
|
|
|
|
|
Accounts and notes
receivable
|
|
|
2,335
|
|
|
(17,383)
|
|
Inventories
|
|
|
3,109
|
|
|
8,285
|
|
Other current
assets
|
|
|
1,091
|
|
|
(1,206)
|
|
Increase/(decrease)
in:
|
|
|
|
|
|
|
|
Accounts and notes
payable
|
|
|
(10,157)
|
|
|
1,360
|
|
Accrued expenses and
other payables
|
|
|
96
|
|
|
(2,868)
|
|
Other current
liabilities
|
|
|
(1,870)
|
|
|
(3,023)
|
|
Net cash provided
by/(used in) operating activities
|
|
|
10,451
|
|
|
(1,416)
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Increase in demand
loans included in other non-current assets
|
|
|
—
|
|
|
(14)
|
|
Cash received from
disposal of property, plant and equipment sales
|
|
|
108
|
|
|
31
|
|
Payments to acquire
property, plant and equipment (including $1,615 and $2,376 paid to
related
parties for the three months ended March 31, 2024 and
2023, respectively)
|
|
|
(4,493)
|
|
|
(3,160)
|
|
Payments to acquire
intangible assets
|
|
|
(18)
|
|
|
—
|
|
Investments under the
equity method
|
|
|
—
|
|
|
(5,841)
|
|
Purchase of short-term
investments
|
|
|
(14,534)
|
|
|
(34,795)
|
|
Proceeds from
maturities of short-term investments
|
|
|
2,370
|
|
|
26,541
|
|
Cash received from
long-term investments
|
|
|
84
|
|
|
557
|
|
Net cash used in
investing activities
|
|
|
(16,483)
|
|
|
(16,681)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Proceeds from bank
loans
|
|
|
34,347
|
|
|
20,135
|
|
Repayments of bank
loans
|
|
|
(41,866)
|
|
|
(20,534)
|
|
Cash received from
capital contributions of a non-controlling interest
|
|
|
15,504
|
|
|
—
|
|
Net cash provided
by/(used in) financing activities
|
|
|
7,985
|
|
|
(399)
|
|
Effects of exchange
rate on cash, cash equivalents and pledged cash
|
|
|
(562)
|
|
|
2,428
|
|
Net increase/(decrease)
in cash, cash equivalents and pledged cash
|
|
|
1,391
|
|
|
(16,068)
|
|
Cash, cash equivalents
and pledged cash at beginning of the period
|
|
|
155,194
|
|
|
158,951
|
|
Cash, cash equivalents
and pledged cash at end of the period
|
|
$
|
156,585
|
|
$
|
142,883
|
View original
content:https://www.prnewswire.com/news-releases/china-automotive-systems-reports-17-4-increase-in-earnings-per-share-in-the-first-quarter-of-2024--302144303.html
SOURCE China Automotive Systems, Inc.