On February 26th, Red Star Capital Bureau reported that Ideal Automobile (02015. HK; LI. US) released its financial reports for the fourth quarter and full year of 2023. Ideal Automobile stated that thanks to its rapid expansion in scale and continuous improvement in operational efficiency, the company has achieved its best financial performance in history, becoming the first new force automobile enterprise in China to exceed 100 billion yuan in annual revenue. Affected by this news, Ideal Automobile's US stock market surged by 7% before the market closed.
In the fourth quarter of 2023, Ideal Automobile delivered a total of 131800 new cars, a year-on-year increase of 184.6%; The annual delivery volume was 376000 vehicles, a year-on-year increase of 182.2%.
The significant increase in sales has driven the soaring performance. In the fourth quarter of 2023, Ideal Automobile achieved a revenue of 41.73 billion yuan, a year-on-year increase of 136.4% and a month on month increase of 20.3%; The net profit was 5.75 billion yuan, an increase of 2068.2% year-on-year; The quarterly gross profit margin is 23.5%, 20.2% in the fourth quarter of 2022, and 22.0% in the third quarter of 2023.
In 2023, Ideal Automobile achieved a revenue of 123.85 billion yuan, a year-on-year increase of 173.5%; The net profit reached 11.81 billion yuan, with a net loss of 2.03 billion yuan in 2022, achieving full year profitability for the first time. The gross profit margin of Ideal Automobile in 2023 is 22.2%, and in 2022 it is 19.4%. The free cash flow in 2023 was 44.19 billion yuan, an increase of 1861.8% year-on-year. As of the end of 2023, the company's cash reserves reached 103.67 billion yuan.
Ideal Automobile continues to increase its R&D investment, with R&D expenses in the fourth quarter reaching 3.49 billion yuan, a year-on-year increase of 68.6% and a month on month increase of 23.9%; The annual R&D expenses reached a record high of 10.59 billion yuan, with a year-on-year increase of 56.1%.
In addition, Ideal Automobile strictly controls costs, with sales, general and administrative expenses of 3.27 billion yuan in the fourth quarter, accounting for 7.8% of the total expenses, further decreasing compared to the same period last year; The annual sales, general and administrative expenses were 9.77 billion yuan, accounting for 7.9% of the total expenses. As of December 31, 2023, Ideal Automobile has a total of 31591 employees.
Li Xiang, Chairman of Ideal Automobile, said, "The significant growth in scale, continuous deepening of research and development, and continuous improvement in operational efficiency have driven us to achieve our historical best financial performance in 2023, and have also laid a solid foundation for Ideal Automobile to enter a more diverse product matrix and market demand in 2024."
Li Tie, CFO of Ideal Automobile, said, "2023 is the first year for the company to turn losses into profits and achieve healthy profits, with a net profit of 11.81 billion yuan for the whole year. As of the end of 2023, our cash reserves have increased to 103.67 billion yuan."
Looking ahead to the first quarter of 2024, Ideal Automobile expects to deliver 100000 to 103000 vehicles, a year-on-year increase of 90.2% to 95.9%; The total revenue was 31.25 billion yuan (4.40 billion US dollars) to 32.19 billion yuan (4.53 billion US dollars), a year-on-year increase of 66.3% to 71.3%.
It is worth mentioning that the sales forecast for Ideal Automobile in the first quarter of this year has significantly decreased, with a month on month decrease of 21.85% -24.13%. The delivery volume of Ideal Automobile in January this year was 31165 units. Due to the Spring Festival holiday, sales in February were at a low point, with only 10100 vehicles as of February 18th. That is to say, in the remaining six weeks of the first quarter, the sales of Ideal Automobile are expected to reach 58700 to 61700 units.
On March 1st, the family technology flagship MPV Ideal MEGA and the 2024 Ideal L series will be launched. The first model of Ideal Automobile, Ideal L6, priced below 300000 yuan, will be launched in April this year, with a sales target of 30000 units per month, bearing the important task of Ideal Automobile's annual target of 800000 units.