(Hong Kong, 27 August 2024) – Intron Technology Holdings Limited ("Intron Technology" or the "Group"; HKEX: 1760), a leading automotive electronics solutions provider in China, delivers an outperforming interim total revenue growth of 8% for the first half of 2024. This comprises a year-on-year high growth of 15.9% in its new energy segment and a year-on-year steady increase of 13.0% in automated & connected vehicles segment.
For six months ended 30 June 2024, total revenue of the Group increased by approximately 8% year-on-year to RMB2.84 billion. It was mainly because China's new energy vehicle market entering a stage of steady improvement, and demand continues to increase, coupled with the Group's strong R&D capabilities and quality product performance, as well as its unique operating model and business advantages. During the Period under review, in view of the continued fierce competition in the automotive industry, the Group adjusted prices correspondingly to tide over the challenging times together with downstream customers, and this has deepened cooperation with upstream and downstream partners as a result. During the Period, the Group recorded a gross profit of RMB452 million, decreased by 16.5% over the same period last year. The Group also actively reduced operating costs during the Period, including optimizing R&D projects and personnel, and cutting operating expenditures and expenses to offset the adverse effects from gross profit margin and finance costs. Profit attributable to shareholders decreased by approximately 37% to RMB97.7 million.
Mr Davy Luk, Chairman, Co-CEO and Executive Director of Intron Technology, said, "In the face of fierce market competition, the Group continued to enhance the competitiveness of its products by capitalizing on its technological advantages; achieving growth in both shipments and performance in the first half of 2024. Leveraging its strong R&D capabilities and quality product performance as well as excellent system integration and testing and verification capabilities, the Group has also helped OEMs to implement highly cost-effective mass production programs and facilitate business penetration. At the same time, it has remained committed to deepening cooperation with upstream and downstream partners, further consolidating R&D technologies, maintaining competitive edges, and stabilizing the Group's leading share of the market."
The Group's new energy vehicle solutions business remained the Group's main growth driver, benefiting from the continued increase in market penetration and total volume of new energy vehicles, which led to the growth of Battery Management System ("BMS"), Microcontroller Unit ("MCU") and other electronic control solutions other than vehicle control units, maintaining a strong growth momentum and bringing desirable performance to the Group's revenue in the first half of 2024. The Group increased its market share of hybrid electric vehicles in addition to its original customer base, which led to the growth of this business segment. For the six months ended 30 June 2024, the revenue from such business segment increased by 15.9% year-on-year to RMB1,452.6 million, accounting for 51.2% of the group's revenue, maintaining rapid growth. The new solutions developed by the Group in 2024, the core component "Motor Control Unit Power Brick", has reached the industry-leading level in key indicators such as power density, integration and reliability, which the Company believes will become a new growth point for future performance.
During the Period under review, the revenue from automated & connected vehicles business amounted to RMB229.9 million, representing an increase of 13% over the same period last year, and the proportion of total revenue increased from 7.7% in the same period last year to 8.1%, mainly due to an increase in the market share of all-in-one machines and L2+ domain controllers, as well as the continuous mass production of self-developed projects led by OEMs. This business segment will play an important part in the future development of the Group.
In terms of Body control, safety and powertrain system solutions business, in the first half of 2024, the body control system business recorded a year-on-year growth of 1.4% to RMB422.7 million, accounting for 14.9% of total revenue. The revenue from powertrain system and safety system solutions decreased by 26.3% and 8.9% respectively, accounting for 5.7% and 12.5% of the Group's total revenue, mainly due to the improvement of the semiconductor shortage in the first half of 2024, and a decline in the overall market share of local customers and international OEM customers. Besides, affected by multiple factors at home and abroad, the commercial vehicle market in China experienced fluctuations and adjustments, although the Group was able to maintain its shares in local clients, the related revenue was inevitably affected.
The Group's cloud server related electronics solutions mainly include power management and electronic control solutions designed for high-performance CPUs and graphic processors used in data centers and cloud servers. In the first half of 2024, the revenue from such business segment increased by 24.9% to RMB108.8 million. With the rapid development of AI technology, cloud server related solutions have increasingly become the focus of the industry. In view of the promising prospect of the global server market in the medium to long term, the Group will continue to optimize the allocation of internal resources and further increase its R&D efforts in core technologies of cloud computing.
Research and development is an integral part of the Group's development strategy. With the development of electrification, intelligence and connection in the global automobile industry, the Group's outstanding technological advantages enable us to further consolidate its market position and increase its market share. In the first half of 2024, adhering to its development policy of "asset-light, research-focus", the Group's optimization of R&D resources and projects to further improve its R&D efficiency and competitiveness. During the Period, R&D expenses decreased by 7.5% year-on-year to RMB215.0 million, accounting for approximately 7.6% of the Group's revenue as compared to 8.9% in the same period last year. During the Period, the Group owned 294 patents and 282 software copyrights, representing an increase of 38 patents and 75 software copyrights respectively as compared with the corresponding period last year.
In the first half of 2024, the Group completed the equipment setup and expansion of test capacity in the first phase of Nantong R&D Center, and added testing and validation capabilities such as power cycle and thermal resistance test system and dynamic high temperature and high humidity reverse bias test system, which had been equipped the capabilities of electrical performance testing and environmental reliability testing, and was in line with the operational requirements of China National Accreditation Service for Conformity Assessment (CNAS). In addition, Pujiang Laboratory passed CNAS expansion and certification, and possessed the qualification for electrical performance testing and environmental reliability testing. The Group will continue to invest in expanding and upgrading test sites, and will further expand the types and capabilities of verification to ensure the quality of final products, improve R&D efficiency and reduce R&D costs.
Mr Eddie Chan, Co-CEO and Executive Director of Intron Technology, said, "As the proportion of localization of the automotive market continues to increase, and the penetration rate of new energy vehicles gradually increases, the prospects for the Chinese automotive market will further improve. The Group will continue to focus on the new energy vehicles and automated and connected vehicles segments. Leveraging its 'asset-light, research-focus' business model, as well as the management's rich experience in electrification and intelligence, and their deep understanding of the market, the Group will strive to strengthen its competitiveness, maintain growth and create greater value for shareholders."
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About Intron Technology Holdings Limited (英恒科技控股有限公司)
Intron Technology Holdings Limited is a leading automotive electronics solutions provider in China focuses on providing solutions targeting critical automotive electronic components applied in New Energy, Automated Driving, Connectivity, Body Control, Safety and Powertrain systems. The Group utilises its research and development and engineering capabilities to provide solutions incorporating advanced semiconductor devices to help OEMs achieve industry leading performance. Intron Technology has been included in the FTSE Global Equity Index Series ("GEIS").
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