Financial reporter Lu Hua
Being in a fast-growing industry, but not increasing profits for a long time, Hitech's financial situation is still facing great challenges.
Recently, Qingdao Hitech Mould & Plastic Technology Co., Ltd. (hereinafter referred to as "Hitech") released the first quarter report of 2024, during the reporting period, Hitech increased revenue but did not increase profits, the company's total operating income was 140 million yuan, an increase of 34.51% year-on-year, and the net profit attributable to the parent company was 238,400 yuan, a year-on-year decrease of 97.31%.
Since its listing in 2021, Hitech has been in a downward trend in net profit, and in 2020, Hitech's net profit reached a high of 68.37 million yuan in recent years, and in 2021, it fell to 60.32 million yuan, a year-on-year decrease of 11.77%. The net profit in 2022 will be 54.37 million yuan, a year-on-year decrease of 9.88%. The net profit in 2023 will be 23.29 million yuan, a year-on-year decrease of 57.17%.
High growth in the market
Industry giants have increased their revenues but not profits
Hitech is mainly engaged in the research and development, design, manufacturing and sales of injection molds and plastic parts, is one of the important manufacturers of automotive injection molds at home and abroad, and is also the only Xiaomi automobile supply chain enterprise in Shandong, and has BYD, Wei Xiaoli, Huawei and other popular high-quality customers, enjoying a high market reputation.
In the process of automobile manufacturing, injection molds are the key tools used to manufacture body, interior, exterior and other components, and about 500 sets of automotive injection molds are needed in a new car. In recent years, with the further tightening of global emission and fuel consumption regulations, automobile weight reduction has become a realistic goal, which has further increased the market share of plastics in the field of automotive materials, and the automotive injection mold industry has also benefited.
According to statistics, the total output value of the automotive injection mold market in mainland China has exceeded 50 billion yuan, and it is expected to continue to maintain rapid growth in the next few years.
However, it is such a company that does not lack heat and market, but its performance has been unsatisfactory.
Regarding the reasons for the decline in performance in the first quarter, Liang Tingbo, secretary of the board of directors of Haitaike, said to the wind outlet finance that due to the fact that the initial fundraising and investment of the "large-scale precision injection mold project" has not yet generated sufficient income to cover the new operation and management expenses, the implementation of the equity incentive plan, and the company's impairment and price decline in accounts receivable and inventory, the company's net profit attributable to the parent company in 2023 will decrease by 57.17% year-on-year, and some of the impact will have a continuation process, resulting in the net profit in the first quarter continuing to decline before.
Liang Tingbo told reporters that at present, Hitech's "large-scale precision injection mold" project has been put into production one after another, the production capacity has been gradually released, and the gross profit margin is in the growth stage, but the revenue generated is still small, which is not enough to cover the new operation and management expenses, so it will continue to be the main factor affecting performance.
Accounts receivable far outstrip revenue
There may be a risk of bad debts
From the perspective of asset quality, the problem of high accounts receivable has been with Hitech since its IPO.
According to the data of the first quarterly report, Hitech's accounts receivable in the first quarter were 323 million yuan, an increase of 36.86% over the first quarter of last year, 2.3 percentage points higher than the revenue growth rate in the first quarter (34.51%), and the accounts receivable have far exceeded the total revenue (140 million yuan) and the net profit attributable to the parent company (238,400 yuan).
From 2020 to 2023, Hitech's accounts receivable will be 147 million yuan, 207 million yuan, 221 million yuan, and 341 million yuan respectively, accounting for 32%, 35%, 44%, and 59.6% of the current operating income respectively, and the proportion is increasing year by year.
Generally speaking, high accounts receivable means that after the company sells goods or provides services, customers have not paid the corresponding amount, which may lead to insufficient cash flow of the enterprise in the short term, and if the performance of accounts receivable far exceeds the net profit, it means that the enterprise may have hidden dangers such as bad debt risk.
The net cash flow generated by the company's operating activities in the first quarter was -3.0694 million yuan, and the net cash flow generated by operating activities in 2023 was -42.8764 million yuan, a year-on-year decrease of 344.39%, and in 2022, it was -9.6484 million yuan, a year-on-year decrease of 115.97%.
Liang Tingbo gave two explanations for the reasons for the high accounts receivable of Hitech: "One is that with the growth of sales scale, accounts receivable will definitely increase, and the other is due to the slow collection of some customers, resulting in a longer account period. ”
Previously, Hitech stated in the 2023 performance forecast that because the customer Human Horizons (Shandong) Technology Co., Ltd. (Gaohe Automobile) informed the company on February 26, 2024 that it would suspend work and production (no more than 6 months) and suspend all payments, the company made an impairment and decline in the price of accounts receivable and inventory involving the company, which led to a difference from the previous performance judgment and triggered the disclosure of the performance forecast of the GEM listed company.
Specifically, Hitech made an impairment and decline in the accounts receivable and inventory involving Human Horizons (Shandong), of which the single provision for inventory decline loss was about 9.85 million yuan, and the single provision for credit impairment loss was about 4.03 million yuan, which had an impact on net profit of about 11.8 million yuan.
"We are still more cautious about the matter of Gaohe Automobile, and according to the accounting standards, there is no need to make so much provision, but we still make full provisions. Liang Tingbo explained, "Our customers are mainly fuel vehicle OEMs or multinational companies, which are still relatively high-quality. ”