Tongwei (600438) H2 2024 earnings summary

Executive summary

• Operating revenue for 2024 was ¥91.99 billion, down 33.87% year-over-year, mainly due to a sharp decline in photovoltaic (PV) product prices despite expanded operational scale.

• Net profit attributable to shareholders was a loss of ¥7.04 billion, compared to a profit of ¥13.57 billion in 2023, impacted by PV sector price drops and asset impairments.

• Cash flow from operating activities remained positive at ¥1.14 billion, despite the net loss.

• The company repurchased over 101 million shares for more than ¥2 billion, and the controlling shareholder increased its stake by about ¥1.3 billion.

Financial highlights

• Gross profit margin for PV segment dropped by 28.2 percentage points year-over-year, while agriculture and animal husbandry gross margin increased by 1.57 percentage points.

• Basic earnings per share was -¥1.5790, down from ¥3.0151 in 2023.

• Weighted average return on net assets was -12.77%, compared to 22.59% in 2023.

• Total assets increased 19.2% year-over-year to ¥195.92 billion, while net assets attributable to shareholders fell 21.25% to ¥48.46 billion.

• R&D expenses rose 26.96% to ¥1.51 billion, with 5,277 R&D employees, up 1,120 from the previous year.

Outlook and guidance

• The company remains optimistic about long-term prospects in green energy and food, despite short-term losses and industry overcapacity.

• Strategic focus will remain on technological innovation, cost reduction, and efficiency improvement in both PV and agriculture segments.

• Plans to further expand market share in PV modules and maintain leadership in polysilicon and solar cells.