Hangzhou First Applied Material (603806) H2 2024 earnings summary

Executive summary

• Revenue for 2024 was ¥19.15 billion, down 15.23% year-over-year due to price declines in core products despite higher sales volumes in some segments.

• Net profit attributable to shareholders was ¥1.31 billion, a 29.33% decrease year-over-year, mainly due to lower profitability in photovoltaic (PV) products.

• Cash dividend proposed at ¥2.60 per 10 shares, totaling ¥677.56 million, representing 51.82% of net profit.

• The company maintained a strong market position in PV encapsulation materials, with global market share for PV film around 50%.

Financial highlights

• Operating income: ¥19.15 billion, down 15.23% year-over-year.

• Net profit attributable to shareholders: ¥1.31 billion, down 29.33% year-over-year.

• Operating cash flow: ¥4.39 billion, a significant increase from the previous year due to improved collections and lower raw material costs.

• Basic and diluted EPS: ¥0.50, down 29.58% year-over-year.

• Gross margin for PV film: 14.72%; for electronic materials: 23.90%.

Outlook and guidance

• The company will continue to expand overseas PV film capacity, especially in Thailand and Vietnam, to address international trade barriers and support global customers.

• Focus on R&D and product upgrades in both PV and electronic materials to capture growth in high-end markets such as AI, automotive, and advanced PCB.

• Plans to further develop functional film materials for lithium batteries and water treatment, leveraging technology and customer base.