Abstract: Sales in 2021 only basically outperformed the market (welcome to pay attention to the leverage game)
Written by | Zhang Yinyin & Editor| was pleased
After BYD, another cruel man.
GAC Motor Group plans to electrify all models by 2025.
On April 25, 2022, GAC Group held its first online social responsibility report press conference.
The electrification of all models does not mean that only electric vehicles will be produced in 2025.
The most attractive lever game is, of course, not the performance of GAC Group in 2021, but the electrification plan.
The automotive industry is the sankei field that leverage games have long liked and paid attention to, so much so that every week I put on a column called "Leverage Car Viewing".
It also happens to be the earnings season, and Lever Game has launched the corporate financial report dismantling as usual this year - the "Yearbook" column. The two columns continue to kill two birds with one stone and work together, using GAC Group's vision of 2025, talk about its 2021 performance, and issues related to electrification, and look forward to future goals.
Pole friends have a special desire to see the company's annual report, especially welcome to leave a message to tell me.
1. The performance is good, but the net cash flow generated by operating activities has negative growth and negative number, and the indicator has been negative for 3 consecutive years
GAC Group's sales and profit performance in 2021 can be said to be very good.
In the chart below, excellent results have been achieved in terms of sales volume, revenue and attributable profit indicators.
For an established car company, it is a bit of a spring feeling.
Specific indicators, leverage games will not be listed one by one, look at the chart.
Interestingly, however, despite the improvement in revenue and profit indicators, the net cash flow from operating activities has been negative.
Not only negative growth, but also negative numbers. In 2021, the indicator was -5.589 billion yuan, down 93.59% compared with 2020.
Not only negative growth, negative numbers, this indicator has been negative for 3 consecutive years.
In the chart below, the figure is -381 million yuan in 2019 and -2.887 billion yuan in 2020.
Looking at it quarterly, there are more interesting details.
As shown in the figure below, in the first and second quarters of 2021, the indicator of GAC Group was negative.
The negative number in the first quarter is larger, and the second quarter has decreased, but it is still negative.
The third and fourth quarters finally returned to normal. In the third quarter, the indicator was more than 200 million yuan, and finally increased to more than 1.7 billion yuan in the fourth quarter.
Throughout the year, there have been cases listed above in the leverage game.
What happened and why?
The Annual Report explains:
The increase in net cash outflow of approximately RMB2.887 billion from the same period last year was rmb2.702 billion, mainly due to the increase in cash received from the sale of goods due to the increase in sales volume during the reporting period, the decrease in net deposits of non-consolidated enterprises in GAC Finance year-on-year, and the increase in expenditure on the purchase of goods for financial leasing business.
Automobile companies are often local leaders, and some directions also have certain support.
So to receive subsidies, this is for sure, and GAC Group is naturally no exception. For example, the government subsidies included in the profit and loss of the current period (but closely related to the normal operation of the company's business, except for government subsidies that meet the provisions of national policies and are continuously enjoyed in accordance with certain standards and quotas), which are close to 1 billion yuan in 2021, nearly 1.3 billion yuan in 2020, and more than 2.9 billion yuan in 2019.
It seems that these years have been declining year by year.
This perspective also seems to be interesting for us to think about profit indicators.
2, sales basically outperformed the market, and some inventory increased more
According to data released by the China Association of Automobile Manufacturers (CAAM), China's auto sales resumed growth in 2021, ending three consecutive years of decline since 2018.
In 2021, mainland new vehicle sales increased by 3.8% y/y to 26.275 million units.
Passenger car (PV) sales increased 6.5% y/y to 21.482 million units.
According to the data disclosure of the Federation of Passenger Vehicles, the retail sales of passenger cars in the mainland in 2021 totaled 20.146 million units, an increase of 4.4% year-on-year, down 1.7 percentage points from the growth rate from January to November 2021.
In 2021, GAC Group completed production and sales of 2,138,100 units and 2,144,400 units, an increase of 5.08% and 4.92% respectively year-on-year.
Among them, passenger car production and sales were 2,135,400 units and 2,141,700 units, up 5.13% and 4.97% year-on-year, respectively.
Overall, from the perspective of sales, GAC Group can only say that it barely outperformed the market.
The performance of new energy vehicles is to lose the market.
According to the disclosure of the annual report, leveraged games saw that the production and sales of GAC Group were 144,700 units and 142,900 units, an increase of 88.68% and 77.35% year-on-year.
In this way, the indicator is actually not bad.
It's better than not knowing.
According to the data disclosed by the Association, in December 2021, the retail sales of new energy passenger cars in the mainland reached 475,000 units, an increase of 128.8% year-on-year and 25.4% month-on-month. In 2021, the retail sales of new energy vehicles were 2.989 million units, an increase of 169.1% year-on-year.
By the way, the annual report also discloses the production, sales and inventory segmentation of GAC Passenger Vehicles and GAC Aegean.
As shown in the figure above, the leverage game found that the inventory of cars and MPVs increased by 54.72% and 298.76% respectively.
Of course, GAC Group has worked hard, and the annual report also discloses a series of plans, especially new energy.
3. Will the road of transformation be smooth and how to balance it?
For example, GAC Toyota New Energy has a production capacity of 200,000 units per year and will be completed and put into operation in July 2021. As of 2021
At the end of the year, the total production capacity of automobiles was 2.933 million units per year.
At the same time, as shown in the following figure, there are a number of new energy-related projects in progress, or put into production.
In terms of layout and trend, GAC Group should be said to be very clear.
However, in the end, it depends on the product and sales.
Although GAC Group's latest plan is to electrify all models by 2025, both the social responsibility report and the annual report say that the sales volume of its own brand new energy performance in 2025 will account for 50%.
As shown in the following figure.
This is also what the leverage game just said, the electrification of the whole series of models is not the same as only the production and sale of electric vehicles.
Not only that, new energy is actually very broad, hydrogen energy and so on.
It is worth saying that the transformation and upgrading of GAC Group and the changes in industry prices are reflected in many aspects, such as cost.
Especially in terms of automobile manufacturing, as the main cost of the group, more than 45.5 billion yuan in 2021, a little more than 35.7 billion yuan in 2020, the leverage game to say, mainly not this increment, behind and production and marketing, I want to say the cost ratio of the change.
As shown in the figure above, direct materials, labor, and manufacturing costs increased from 60.79% in 2020 to 65.73%.
The reasons are certainly manifold.
At the same time, there has been a certain increase in sales expenses and management expenses, as shown in the following figure.
Of course, there is not much growth.
Specific indicators, data to see the chart, leverage game is not much to say.
In addition, the leverage game noted that as of the end of 2021, the accounts receivable, long-term receivables, non-current liabilities due within one year, and other current liabilities of THE GAC Group are not small in total and the growth is not low.
Mainly because of factors such as production and sales growth and financial leasing.
Facing the "14th Five-Year Plan", GAC Group established the overall development strategy of "1615", that is, to achieve one goal (and strive to produce and sell 3.5 million vehicles by the end of the "14th Five-Year Plan").
Looking ahead, GAC Group aims to produce and sell 5 million vehicles by 2035.
The goal is ambitious, and there are bound to be many thorns in the journey of new energy transformation and the realization of development goals. How to balance the stability of the company's various indicators, and whether GAC Group can find its own way, we slowly observe.
All financial charts not attributed in this article are derived from the 2021 social responsibility report and annual report of GAC Group, which are hereby explained and acknowledged
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