机构:招银国际
研究员:Wayne FUNG
1Q24 results highlights. Weichai’s revenue grew 6% YoY to RMB56.4bn. Gross margin expanded 3.4ppt YoY to 22.1% in 1Q24. With limited increase in SG&A and R&D expense ratio, the pre-tax profit surged 58% YoY to RMB4.2bn. Based on our calculation, the pretax profit of Weichai’s core business / KION grew 45% / 93% YoY in 1Q24 (in RMB terms). Operating cash flow in 1Q24 substantially improved to RMB1.6bn, vs outflow of RMB471mn in 1Q23.
Margin recovery of KION Group. KION (46.5% owned by Weichai) reported adjusted EBIT of EUR227mn in 1Q24 (+46% YoY), driven by easing cost pressure. KION guided a full-year adjusted EBIT target of EUR790-940mn (up 0-19% YoY).
Weichai’s engine sales outpaced industry in 1Q24. According to CICEIA, Weichai's multi-cylinder sales (HDT, construction machinery, other engines) grew 13% YoY to 206k units in 1Q24 (vs the industry average of a decline of ~1%), with market share of ~18% (+2.3ppt YoY).
Risk factors: 1) weakness in engine exports; 2) lower-than-expected replacement demand; 3) an increase in component costs.