On April 30, Gree Electric Appliances (000651) disclosed its 2023 annual report that the company achieved a total operating income of 205.018 billion yuan last year, a year-on-year increase of 7.82%, a net profit of 29.017 billion yuan, a year-on-year increase of 18.41%, a non-net profit of 27.565 billion yuan, a year-on-year increase of 14.92%, and a basic earnings per share of 5.22 yuan. The company plans to distribute a cash dividend of 23.80 yuan (tax included) to all shareholders for every 10 shares, with a total cash dividend of 13.142 billion yuan.
At the same time, Gree Electric also announced the first quarter report of 2024, with a total operating income of 36.596 billion yuan in the first quarter, a year-on-year increase of 2.53%, and a net profit of 4.675 billion yuan, a year-on-year increase of 13.77%. Basic earnings per share was 0.8500 yuan.
In terms of a single quarter, Gree Electric Appliances will achieve a net profit of 8.925 billion yuan in the fourth quarter of 2023, a year-on-year increase of 43.90%, while the net profit growth rate in the first three quarters will be 2.65%, 14.75% and 8.50% respectively.
The proportion of air conditioning business increased
According to the annual report, in 2023, Gree Electric's air-conditioning business will achieve revenue of 151.217 billion yuan, accounting for 74.13% of the company's total revenue, which is about 3 percentage points higher than the 70.92% in the 2022 annual report, and the profit of the air-conditioning business will account for 86.99% of the company. In other words, the air conditioning business is still the main driving force for the growth of Gree Electric's performance.
According to the data of Aowei Cloud Network, in 2023, the online retail sales share of Gree brand household air conditioners will be 28.15%, ranking first, among them, the online and offline retail sales shares of Gree brand cabinets will be 30.28% and 34.43% respectively, both of which are the first in the industry. According to the industry online report, the domestic sales of Gree household air conditioners were 29.79 million units, a year-on-year increase of 4.05%.
However, in the 2023 annual report, Gree Electric Appliances continues to emphasize the core development strategy change from "good air conditioning Gree manufacturing" to "good electrical appliances Gree manufacturing", which has been mentioned in the air conditioning business in one stroke, but has paid a lot of attention to the non-air conditioning business segment.
In the household appliances sector, Gree Electric Appliances successively launched new products such as energy storage folding and circulating fans, second-generation series refrigerators for all-for-one fresh raising, steaming and baking dual-energy machines, new 16-liter gas water heaters, and second-generation heat pump washing and care machines last year. According to the data of Aowei Cloud Network in 2023, the market share of Gree electric fans' online retail sales is 18.07%, ranking second in the industry.
In the industrial sector, Gree Electric continues to innovate in the field of compressors, with 16 series and more than 1,000 models of high-efficiency, energy-saving and environmentally friendly products, which are used in household, commercial, automotive, refrigeration, dehumidification and heating and other air conditioning fields. In the field of motors, it has launched 5 categories, 24 series, more than 1,000 varieties and specifications of motor products. In 2023, DunAn Environment, controlled by the company, will rank first in the world in the globe valve market share, rank second in the world in four-way valves, and rank second in the world in electronic expansion valves.
For overseas business development, the annual report shows that the company's overseas business achieved operating income of 24.904 billion yuan, with independent brands accounting for nearly 70%, an increase of 8% year-on-year. The products have been sold to more than 190 countries and regions, including more than 130 typical model projects with a total cooling capacity of more than 450,000 tons, including Luanda New Airport in Angola and Gwadar New Airport in Pakistan.
The new energy sector has achieved a breakthrough
In the new energy sector, Gree Titanium will achieve breakthroughs in the domestic 10-meter and 18-meter bus and logistics vehicle sales markets in 2023, and its products have been successively delivered to Yinchuan, Ningxia, Xining, Qinghai, Linyi, Shandong and other places, and at the same time, it has achieved breakthrough growth in overseas markets, and has reached strategic cooperation with high-end customers in the Middle East market, and has been delivered in batches.
During the reporting period, Gree Titanium also achieved a breakthrough in the lithium titanate market. In the field of power grid frequency regulation, the batch application and transformation of high-rate lithium titanate container system was realized, and the 33 million power plant project in Yuncheng, Shanxi Province was successfully undertaken. In terms of rail transit, Gree Titanium and CRRC Times reached a cooperation, and the high-power pure electric new energy shunning locomotive equipped with high-pressure liquid-cooled lithium titanate power battery system was successfully put into use in Datong, Shanxi. In the battery sector, Gree Titanium has achieved new business breakthroughs in the markets of more than 20 countries such as Europe, America, Southeast Asia, Australia, and Russia, and long-term customer demand has increased by 35% year-on-year.
Gree Electric also introduced the progress of the semiconductor business, and the company has developed a series of products including MCU, AIoTSoC and power semiconductors. The 32-bit series MCU chips have been applied in batches in terminal products such as household air conditioners, commercial multi-connections, wire controllers, remote controls, etc., with an annual usage of more than 30 million pieces, which can be widely used in consumer electronics, wearable devices, household products, health and medical support, commercial large-scale units, industrial sensing, high-performance motor control and other fields.
In addition, Gree Electric power semiconductors FRD, IGBT, IPM, PIM, etc. have been applied in batches on inverter air conditioners, with an annual consumption of more than 20 million, which can be widely used in home appliances, intelligent equipment, new energy and other fields. The artificial intelligence chip developed by the company with the key algorithm of air conditioning energy saving has been verified in mass production, which can achieve energy saving of air conditioning by more than 15%.
Investing heavily in "trade-in"
In March this year, the State Council announced the "Action Plan for Promoting Large-scale Equipment Renewal and Consumer Goods Trade-in", which clearly proposed to carry out the trade-in of household appliances and promote the replacement of home improvement consumer goods.
According to the annual report of Gree Electric Appliances, the company relies on the "old for new" model, combined with its own sales and after-sales system, and launched the "disassembly and assembly" service model, which further opens up the core pain points in reverse logistics recycling, warehousing and collection, and implements the recycling target of 5.4 million sets of units to complete the producer's recycling target responsibility system.
In terms of recycling capacity, since 2010, Gree Electric has successively established 6 renewable resource bases in Changsha, Zhengzhou, Shijiazhuang, Wuhu, Tianjin and Zhuhai, mainly engaged in the recycling of waste electrical and electronic products, scrapped cars, etc., as well as the deep processing and resource business of waste circuit boards and waste plastics, covering the whole industrial chain from production to downstream recycling. At present, it has more than 13 million waste household appliances dismantling qualifications, 75,000 automobile dismantling qualifications, 180,000 tons of recycled plastic processing capacity, and 60,000 tons of waste circuit board processing capabilities.
On April 28, Gree Electric Appliances released information on the WeChat platform, saying that in response to the State Council's "Action Plan for Promoting Large-scale Equipment Renewal and Trade-in of Consumer Goods", the company decided that from now on, Gree Electric Appliances will invest 3 billion yuan to start the trade-in activities for household appliances.
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