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Net Profit Growth Exceeds 322% and Hits a Record High as KEDA Industrial Group Continues Deepening its "Globalization" Strategy

loading... 25 Apr 2023
As China's industry ushers in the next phase of high-quality development, signs of which can be observed in advanced, intelligent, and green upgrades, the KEDA Industrial Group Co., Ltd. (600499.SH) (hereinafter referred to as "KEDA" or the "Company") has continued to deepen reforms based on its "Globalization" strategy. In 2022, its performance hit a record high, and was mainly driven by ceramic machinery, building materials, and lithium-ion battery materials and machinery.
Data showed that in 2022, KEDA's net profit attributable to shareholders of the listed company and net profit attributable to shareholders of the listed company after deducting non-recurring profit and loss were RMB 4.251 billion and RMB 4.213 billion respectively, representing growth of 322.66% and 342.46%, respectively. Meanwhile, thanks to the excellent performance of its three main business, its revenue surpassed RMB10 billion for the first time to reach RMB11.157 billion, representing a year-on-year increase of 13.89%.
In 2022, the Company's ceramic machinery business developed rapidly overseas, with the percentage of its orders received in overseas markets exceeding 55% for the first time. The business did particularly well in India, Malaysia and Thailand, the Middle East and North Africa, and South Africa, with the growth rate of orders surpassing 130%, 50%, and 60%, respectively. As a result, the business has become a strong engine for growth in the Company's overseas performance. Since proposing the horizontal cross-over development of general-purpose machinery in 2021, KEDA received orders for 66 aluminium profile extruding machines worth over RMB 0.3 billion in 2022. Concurrently, it has also been focusing on low carbon emissions as part of its efforts to inject more vitality into its machinery business.
In terms of building materials business, KEDA is continuing to expand its production volume and category matrix of ceramic products. The Company currently operates six ceramic plants with 14 production lines in five African countries. In 2022, it produced 0.123 billion square meters of building ceramics, and its revenue climbed from RMB 83 million in 2017 to RMB 3.276 billion today, representing a compound annual growth rate of 108.42%. In just seven years, not only has the Company created a "second curve" of revenue growth, but it has also horizontally extended its ceramic production in Africa to the field of building materials such as sanitary wares and glass. In addition to five ceramic projects that are under construction, it also has two sanitary ware projects and one glass project. Meanwhile, it is considering expanding its building material business into overseas markets such as South America, the Middle East, and Asia as part of its efforts to become a large group overseas in the building materials business.
With regards to lithium-ion battery materials and machinery, KEDA has gradually optimised its integrated layout of anode materials and unlocked its production capacity. At the end of 2022, Phase I of the Fujian base was completed and put into operation, while the construction of Phase II of the Fujian base and Phase III of the Chongqing project also commenced. This will eventually achieve a domestic production capacity of 150,000 tons of artificial graphite. Meanwhile, in 2022 the Company also established a lithium-ion battery machinery research institute as part of its efforts to strategically launch its lithium material and machinery business. The total number of orders it received in 2022 were worth approximately RMB 0.3 billion. The business is showing promising signs of becoming a new pillar of business growth.
It is also worth noting that Qinghai Salt Lake Lanke Lithium Industry Co., Ltd. a strategic investment project of KEDA, delivered nearly RMB 3 billion worth of dividends in 2022, greatly supplementing KEDA's cash flow. In turn, the Company has continued returning these dividends to its investors. A total of RMB 1.304 billion worth of cash dividends will be distributed after a repurchase of RMB500 million worth of shares. The total ratio of repurchases and dividends is expected to reach 42.44%.
For KEDA, the year 2022 was a "strategic year". Based on its revenue of RMB10 billion, the Company formulated a strategic plan of "Three Ten-billion-scale Segments". More specifically, in terms of ceramic machinery it focused on advanced manufacturing and continued striving to become a global service provider in the production of building ceramics. Its building material business has become number one in Africa, and it has also expanded into South America. In terms of new energy, KEDA devoted enormous resources to lithium-ion battery materials and doubled its efforts in lithium-ion battery machinery. Moreover, it is also planning to upgrade its new energy machinery business as it strives to become a comprehensive, leading enterprise in the new energy business.
The above plan demonstrates the Company's confidence in the development of its existing businesses, as well as the clear arrangements it has made to help ensure continued business growth. We are convinced that the Company will continue to rack up many brilliant achievements as it continues to deepen its five-year plan for "peak carbon emissions and carbon neutrality + globalization + industrial upgrades"!
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