FAST NEWS: CIMC Vehicles profit soars on strong North America business
The latest: Container truck manufacturer CIMC Vehicles (Group) Co. Ltd. (1839.HK; 301039.SZ) reported on Wednesday its revenue rose 28.3% to 6.58 billion yuan ($950 million) in the first quarter of this year, while its net profit surged 285% to 480 million yuan.
Looking up: The company said its North American operations maintained robust growth on favorable economic policies and rapid growth in the multimodal transport business. It added its profitability was stable in other overseas markets and in China.
Take Note: The company’s selling expenses rose 30.5% year-on-year to 150 million yuan during the period as it expanded into more emerging markets.
Digging Deeper: CIMC Vehicles designs, manufactures and sells a wide range of semi-trailers to customers in China, North America and Europe. The company achieved two consecutive years of record revenues in 2020 and 2021 despite a difficult environment at the start of the pandemic. But deteriorating global trade due to the Russia-Ukraine conflict, and China’s strict Covid controls last year, hurt demand for and efficiency of logistics, dragging down the company’s revenue by 14.6% to 23.6 billion yuan in 2022. Management said the company will implement a “star chain plan” in the second quarter of this year to accelerate structural reform of its semi-trailer production organization and increase the company’s market share.
Market Reaction: CIMC Vehicles’ Hong Kong-listed shares jumped on Thursday, closing up 10.5% at HK$8.40. It now trades near the upper end of its 52-week range.
Translation by Jony Ho
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