Intron Technology Announces 2019 Annual Results - Continues Business Growth in 2019, Total Revenue Rises 15%, NEV Solutions Business Revenue Grows 42%

2020.03.26


(26 March 2020, Hong Kong) – Intron Technology Holdings Limited (“Intron Technology” or the “Group”; HKEX: 1760), a fast-growing automotive electronics solutions provider in China, has announced its annual results for the year ended 31 December 2019 (the “Year”). During the year, within the severe market conditions, the Group accomplished continual business growth with sizable expansion in new energy vehicle (“NEV”) business, benefiting from its leading technology in the NEV related business and better-than-market performance in the overall traditional vehicle business segments.

For the year ended 31 December 2019, leveraging its leading technology level and market position, the Group’s revenue continued to grow 15% year-on-year to RMB2,309.3 million. Gross profit increased by 4% to RMB466.1 million. Gross profit margin was maintained at 20.2%. During the year, R&D expenses increased by 27% year-on-year to RMB151.9 million, accounting for 6.6% of revenue. Net profit was RMB118.7 million and net profit margin was 5.1%.

The Group continued to maintain healthy liquidity position. As at 31 December 2019, cash and cash equivalents amounted to RMB497.3 million. The Board has resolved to recommend the payment of a final dividend of 3.8 HK cents per share for the year ended 31 December 2019.

R&D has always been an important part of the Group’s business model. As at 31 December 2019, the Group had secured 66 patents and 102 software copyrights, an increase of 17 patents and 13 software copyrights respectively. The Group had 547 full-time R&D-related professionals, making up 65% of its total employees. During the year, with a view to provide timely and professional services to the OEMs, the Group has completed R&D expansion projects in Shanghai, Nanjing, Guangzhou, Chengdu, Wuhan and Chongqing, adhering to its principle of “staying close to customers with multi-location R&D facilities”. Meanwhile, the Group expects to complete the first phase construction of a brand new R&D Testing and Validation Centre in Shanghai in the second half of 2020. Upon the launch of the centre, it will strengthen the Group’s delivery capabilities to facilitate mass production in addition to testing and validation functions. This will further solidify the implementation of the Group’s strategy and deepen its ability to support its customers and market penetration. In addition, outside the PRC, the Group has commenced setting up an operation base in Europe to strengthen communication and cooperation with top automotive electronics enterprises in the world. The Group expects to complete the establishment of an office in Germany in the first half of 2020.

Mr. Davy Luk, Chairman, Co-CEO and Executive Director of Intron Technology, said, “Despite the automotive industry of China has been weak since the second half of 2018 and the challenging overall business environment in 2019, the Group maintained leading position in the NEV market during the year, and successfully captured market share with advanced solutions. NEV business continued to be the major driver of the Group’s revenue growth, and enabled the Group to deliver better-than-market performance.

In 2019, the Group further expanded its market share in the NEV business, driving the segment revenue to grow 42% year-on-year, reaching RMB 1,011.8 million. In 2019, the Chinese government adjusted the subsidy level for NEVs and lifted the technological threshold. Given that the Group is well-positioned in the market with its advanced technology and R&D capabilities as well as outstanding NEV solutions, the Group continued to deliver growth in this business segment amidst weak market conditions. For the Safety and Powertrain businesses, the Group achieved revenue growth of 3% and 5%, reaching RMB373.7 million and RMB230.1 million respectively. For the Body Control business, the Group recorded a revenue decrease of 17% to RMB318.1 million, in line with the weak overall automotive market performance. The revenue of the Industrial solutions business rose by 34% to RMB310.8 million during the year, as the demand picked up strongly with strong global investment momentum for data centres and cloud servers in the second half of 2019.

Mr. Eddie Chan, Co-CEO and Executive Director of Intron Technology, said, “Advanced driver assistance system (“ADAS”) is the next growth engine in the automotive market. The Group has increased resources for R&D in this area and made progress in developing a variety of related products, working with customers to conduct quality and safety tests. The Group expects customers’ mass production of its ADAS-related product solutions in 2021. Looking ahead, with the electrification and intelligent development of automotive vehicles, increasing popularity of ADAS and the investment in data centres and cloud servers driven by technological development, there will be considerable development opportunities in every business area of the Group. With years of operating experience, leading position in the industry and substantial investment in R&D to strengthen its technological advantages, the Group is confident to achieve long-term sustainable growth and generate satisfactory returns 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 fast-growing automotive electronics solutions provider in China focuses on providing solutions targeting critical automotive electronic components applied in New Energy, 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.

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