Recently, Xinyi Glass announced its performance in 2022, recording a revenue of HK $25.746 billion, down 15.5% year-on-year; gross profit of HK $8.686 billion, down 44.9% year-on-year; gross profit margin down 18.1 percentage points year-on-year to 33.7%; net profit of HK $5.127 billion, down 55.6% year-on-year; The company's performance is in line with the previous forecast. Under the pressure of the industry as a whole, Xinyi Glass maintained its leading position in the industry in terms of gross profit margin and net profit margin through its advantages in scale and product differentiation, and continued to maintain sound operation and actively explore overseas markets.
Main contents
The industry as a whole is under pressure, waiting for repair
this year. In 2022, Xinyi Glass recorded an operating income of HK $25.75 billion, down 15.5% year-on-year, and a gross profit of HK $8.69 billion, down 44.9% year-on-year; Gross profit margin decreased by 18.1 percentage points year-on-year to 33.7%; net profit decreased by 55.6% year-on-year to HK $5.127 billion; and net profit margin decreased by 18 percentage points to 19.9%. The main reason for the decline in profits is that the capital chain of downstream real estate enterprises in the mainland is broken, resulting in a decrease in the completed area and a decrease in the demand for float glass, which leads to a decrease in the sales price of float glass, combined with the high prices of raw materials and fuels in the upstream, the company's gross profit and net profit are under pressure. Basic earnings per share was HK126.6 cents, representing a year-on-year decrease of 55.9%. The performance of
Greater China market is under pressure, and the performance of overseas market is outstanding
. According to the regional classification, the operating income of Greater China region decreased by 25.9%, reaching HK $17.56 billion, accounting for 68.2% of the total income; the performance of Greater China market is still the main market despite pressure. In the overseas market, the Company achieved outstanding results; the operating income in North America increased by 12.3% to HK $2.51 billion, and the operating income in other regions increased by 25.3% to HK $5.67 billion. In addition, the continuous reduction of shipping costs and the landing of the company's Indonesian projects will further enhance the competitiveness of the company's overseas development. The gross profit of
float glass is under pressure, and it is expected that with the continuous repair
of real estate in 2023, due to the pressure of real estate completion data, the demand for float glass in the downstream market will be limited, the sales price will be under pressure, and the profit performance will be poor due to the high cost. The float glass business recorded a turnover of HK $16.59 billion, representing a year-on-year decrease of 24.3% and accounting for 64.4% of the overall revenue. The gross profit of the business decreased by 62.4% to HK $4.42 billion, with a gross profit margin of 26.7%. It is expected that in 2023, with the gradual recovery of the real estate market and the end of the epidemic, the start-up and completion rate of real estate projects will continue to increase, and the demand for float glass will also be released. Under the asymmetric supply-demand relationship, the price of float glass is expected to rise; the soda ash production tap is expected to release output in May and June this year, and the cost of glass will be alleviated. We expect the company's float business to continue to repair. New growth
in the
automotive glass business The automotive glass business recorded a turnover of HK $6.08 billion, representing a year-on-year increase of 11.4% and accounting for 23.6% of the total revenue. The gross profit of the business increased by 18.9% to HK $3.06 billion, with a gross profit margin of 50.3%. The company is mainly engaged in the automotive glass replacement market, accounting for more than 25% of the global automotive glass replacement market. The company has more than 65000 automotive glass products to meet the various needs of different customers, and high value-added glass accessories will improve the gross profit margin of automotive glass products. In addition, China's car ownership has exceeded 1.45 billion vehicles and maintained sustained growth, and the demand for replacement market will also grow in the future. We expect that the company's business will continue to bring bright profits. The
architectural glass
business recorded a turnover of HK $3.08 billion, a slight decrease of 0.6%, accounting for 12% of the total revenue. The gross profit of the business decreased by 15.6% to HK $1.21 billion, with a gross profit margin of 39.2%. Affected by the real estate industry, the revenue of building glass business declined slightly. With the landing of "guaranteed delivery" and "three arrows", real estate companies have received financial support, and industry demand has a policy underpinning. At the same time, benefiting from the promotion of energy-saving building glass in China's policies and the higher requirements of residents for glass quality, more high value-added building glass will be used in future buildings, and the future growth space is considerable. In addition, the area of uncompleted real estate projects in China can provide glass demand for 6 years, and the company will continue to benefit from it.
The Company has a stable operation and abundant cash in hand, and continues to pay dividends
. As of December 31, 2022, the Company has a cash in hand of HK $8.167 billion. At the same time, the board of directors of the company recommended a final dividend of HK22 cents. If the interim dividend of HK40 cents already paid is added, a total dividend of HK62 cents will be paid for the year, with a dividend payout ratio of 49.1% for the year.
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