AECC AERO-ENGINE CONTROL (000738) Q4 2024 earnings summary

Executive summary

• Achieved record revenue and net profit in 2024, with revenue up 2.95% and net profit up 3.26% year-over-year, driven by increased orders and deliveries in core aviation engine control systems and international cooperation.

• Maintained industry leadership in aviation engine and gas turbine control systems, with strong R&D and manufacturing capabilities, and expanded patent portfolio with 71 new invention patents in 2024.

• Focused on high-quality growth, cost control, and efficiency, with labor productivity up 11.04% and asset-liability ratio down 2 percentage points to 20.65%.

Financial highlights

• 2024 revenue: ¥5.48 billion, up 2.95% year-over-year; net profit attributable to shareholders: ¥750 million, up 3.26%.

• Gross margin for aviation engine and gas turbine control systems: 29.16%; overall manufacturing gross margin: 28.11%.

• Basic and diluted EPS: ¥0.57, up from ¥0.55 in 2023.

• Net cash flow from operating activities: -¥262 million, down from ¥983 million in 2023, mainly due to lower cash receipts from customers and higher tax payments.

• Total assets at year-end: ¥16.32 billion, up 3.41%; net assets attributable to shareholders: ¥12.35 billion, up 4.46%.

Outlook and guidance

• 2025 revenue target set at ¥5.3 billion, reflecting challenges from maturing product lines and gradual ramp-up of new products.

• Strategic focus on innovation, digital transformation, and high-end equipment, with continued investment in R&D and supply chain optimization.

• Plans to accelerate development in general aviation, unmanned aerial vehicle control, and technology derivative products.