On April 28, Changan Automobile (000625. SZ) announced its 2021 annual report, the company achieved operating income of 105.142 billion yuan, an increase of 24.33% year-on-year; net profit of 3.552 billion yuan, an increase of 6.87%; deduction of non-net profit of 1.653 billion yuan, an increase of 150.85% year-on-year.
Changan Automobile also disclosed its 2022 first quarter report. During the reporting period, the company achieved operating income of 34.576 billion yuan, an increase of 7.96% year-on-year; net profit of 4.536 billion yuan, an increase of 431.45% year-on-year, exceeding the whole of last year. Among them, the sale of part of the equity of Avita Technology Co., Ltd. (hereinafter referred to as "Avita"), a subsidiary, contributed a net profit of 2.13 billion yuan to Changan Automobile, accounting for nearly 50% of the company's net profit in the first quarter.
Changan Automobile also announced the progress of Avita's capital increase and share expansion, CATL (300750. SZ) became Avita's second-largest shareholder with a 23.99% stake, and Avita's new round of valuation increased nearly 7 times to 6.26 billion yuan.
Affected by this news, on April 29, Changan Automobile rose and stopped, closing at 10.47 yuan, with a total market value of 79.91 billion yuan.
After deducting non-net profit for the first time after three consecutive years of losses
Changan Ford contributed 64% of net profit
In 2021, Changan Automobile achieved operating income of 105.142 billion yuan, an increase of 24.33% year-on-year, breaking through the scale of 100 billion yuan for the first time; net profit of 3.552 billion yuan, an increase of 6.87% year-on-year; deduction of non-net profit of 1.653 billion yuan, an increase of 150.85% year-on-year, which is the first time that Changan Automobile has reversed its loss after deducting non-net profit loss for three consecutive years. Basic earnings per share were RMB0.47; it is proposed to distribute a cash dividend of RMB2.33 (including tax) per 10 shares to increase by 3 shares.
In 2021, Changan Automobile achieved sales of 2.301 million units, an increase of 14.8% year-on-year, and its market share increased by 0.8 percentage points year-on-year, returning to the fourth place of the automobile group; Changan's Chinese brand vehicles sold 1.755 million units, an increase of 16.7% year-on-year, ranking second in the industry.
By product, last year, The Changan Passenger Brand and auchan Brand achieved sales of 966,000 units and 228,000 units, respectively, an increase of 20.0% and 49.0% year-on-year, respectively. Sales of new energy vehicles exceeded 100,000 units for the first time, an increase of more than 200% year-on-year.
However, Red Star Capital Bureau noted that Changan Automobile's new energy sales mainly come from the micro-electric vehicle Changan Benben E-Star. According to the data of the Association, the sales volume of Changan Benben E-Star will reach 76,400 vehicles in 2021. However, affected by the fluctuation of subsidy policies, in 2021, Changan New Energy's losses expanded to 2.772 billion yuan, compared with a loss of 1.16 billion yuan in the previous year.
The contribution of Changan New Energy is mainly reflected in the "double integral". Zhang Deyong, chief accountant of Changan Automobile, said at the performance briefing that with the company's new energy vehicle sales in 2021, the company's realized points can cover the joint venture car sector in addition to the points gap in the autonomous sector. By the first quarter of 2022, the company's new energy vehicle sales of 32,300 units, a substantial increase year-on-year, the company no longer has the burden of integral costs, which also constitutes a major support for the company's significant improvement in profitability this year.
The joint venture brand Changan Ford achieved sales of 305,000 vehicles in 2021, an increase of 20.3% year-on-year, of which the Lincoln brand sold 89,000 vehicles that completed the landing in that year, an increase of 109.1% year-on-year. Changan Ford has once again become the profit cow of Changan Automobile, with a net profit of 2.283 billion yuan in 2021, accounting for 64% of Changan Automobile's total profit.
By 2022, Changan Automobile aims to produce and sell more than 2.45 million vehicles. According to the plan, Changan Automobile plans to achieve a total sales volume of 4 million vehicles by 2025, of which 3 million are Changan's own brands, including 1.05 million new energy sales.
Changan Automobile's gross profit margin also improved, with the gross profit margin of the automotive business in 2021 being 16.64%, up 1.9 percentage points year-on-year. The other two of the top three autonomous cities (601633. SH), Geely Automobile (00175. HK) 16.16% and 17.14% respectively.
Net profit increased 4.3 times in the first quarter
There is a shortage of chips, and executives are squatting on the spot to grab goods
Changan Automobile also announced the first quarter report of 2022, the operating income during the reporting period was 34.575 billion yuan, an increase of 7.96% year-on-year, the net profit attributable to the shareholders of the listed company was 4.536 billion yuan, an increase of 431.45% year-on-year; the deducted non-net profit attributable to the shareholders of the listed company was 2.26997 billion yuan, an increase of 215.24% year-on-year, and the basic earnings per share were 0.59 yuan.
Changan Automobile's net profit in the first quarter of 2022 exceeded that of the whole of last year, which was largely due to the sale of part of the equity of its subsidiary Avita, and the valuation results on March 11, 2022 were used as the basis for accounting, increasing Changan Automobile's net profit in the first quarter of 2022 to 2.13 billion yuan.
Even after deducting the impact of Avita, Changan Automobile's gross profit margin in the first quarter increased from 16.64% last year to 18.21%. Changan Automobile said in a quarterly report that in the face of the pressure caused by the sharp rise in raw material prices, the company continued to promote the work of reducing costs and increasing efficiency throughout the region, while strengthening the optimization of resource allocation in all links and actively coordinating the supply of scarce chips.
According to data from the Association of Automobile Manufacturers, Changan Automobile sold 650,000 units in the first quarter, an increase of 1.63% year-on-year; Changan's own brand vehicles sold 529,000 units in the first quarter, an increase of 1.3% year-on-year; and sales of autonomous passenger cars were 363,000 units, down 1.34% year-on-year. Among the joint venture brands, Changan Ford's cumulative sales in the first three months reached more than 60,000 units, down 6.39% year-on-year; Changan Mazda sold 41,000 units, an increase of 39.90% year-on-year.
It is worth mentioning that in the face of difficulties such as the shortage of chips and other materials in the first quarter, Changan Automobile launched the company's high-level on-site squatting and grabbing mechanism, arranged for the company's leaders to ensure on-site office supply, and coordinated the shortage of chip supply. At the same time, we will actively carry out material reserves, quickly carry out chip replacement and generation research and development work, and make every effort to minimize the impact of supply chain fluctuations on production.
Avita's valuation increased by nearly 7 times
CATL is the second largest shareholder
At the same time, Changan Automobile disclosed the progress announcement of the holding subsidiary Avita's capital increase and share expansion in the form of public listing.
Avita is a high-end intelligent pure electric brand jointly built by Changan Automobile, CATL and Huawei, and is the first high-end SEV brand with Huawei HI (Huawei Inside) full-stack intelligent vehicle solutions in the whole series. In November last year, the Avita brand was released globally, and the first model, the Avita 11, has rolled off the production line with more than 100 test vehicles. Avita said that Avita 11 will be released in the second quarter of this year, with mass production and the first deliveries completed in the third quarter.
According to the announcement, since February 22 this year, Avita obtained the approval of the Anti-Monopoly Bureau of the State Administration for Market Regulation on the capital increase and share increase, and on March 8, all the capital increase funds were paid in place; on March 11, Avita held the first board of directors after the capital increase and share increase, completed the approval of the new charter and signed it into force; on March 25, Avita completed the industrial and commercial changes on the capital increase and share increase.
After the completion of the closing, Avita changed from a subsidiary of Changan Automobile holdings to an associated enterprise, which is no longer included in the scope of the consolidated statements, and the equity method is used for subsequent accounting.
Avita evaluated all shareholders' equity on the closing date, and according to the latest valuation results, the value of all shareholders' equity of Avita increased to 6.26 billion yuan, an increase of 6.94 times from the previous valuation of 788.2 million yuan.
On November 5 last year, Avita announced that it had introduced three new investors in its first round of strategic financing, with investors investing in a consortium with a total of $2.42 billion.
After the completion of the capital increase and share expansion transaction, Changan Automobile's shareholding ratio was diluted from 95.38% to 39.02%; Ningde Times held 23.99% of the shares, becoming the second largest shareholder; Chongqing Cheng'an held 19.01%; Southern Assets held 8.73%; Fujian Mindong held 5%; LiangjiangXi Securities held 1.87%; Southern Industrial Fund held 1.25%; Shanghai Weilai Automobile Co., Ltd. did not participate in the capital increase, and the shareholding ratio was diluted from 4.62% to 1.13%.
Avita said that at present, the company is promoting the A round of financing in an orderly manner, and there are independent listing plans in the future. Sources say Avita expects to achieve an IPO in 2024-2025.
Red Star News reporter Wu Danruo
Edited by Tao Yueyang
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