Zoomlion Announces 2020 Interim Report: Net Profit Increases 55.97% YoY

Rhea-AI Summary

Zoomlion Heavy Industry Science & Technology Co., Ltd. reported strong financial results in its 2020 interim report, with operating income rising to CNY 28.827 billion (USD 4.178 billion), a 29.49% increase YoY. The net profit attributable to shareholders surged to CNY 4.018 billion (USD 582.361 million), marking a 55.97% YoY increase. Despite COVID-19 challenges, the construction machinery sector thrived, supported by China's new infrastructure initiatives. The company's expense ratios improved due to effective cost controls and digital management enhancements.

Positive

• Operating income increased 29.49% YoY to CNY 28.827 billion (USD 4.178 billion).
• Net profit attributable to shareholders rose 55.97% YoY to CNY 4.018 billion (USD 582.361 million).
• Expense ratio fell by more than 3.7% YoY due to strict cost controls.
• Sales of core products, especially mobile cranes and concrete machinery, significantly increased.
• Zoomlion is the world's leading tower crane manufacturer by sales volume.

Negative

• None.

CHANGSHA, China, Sept. 1, 2020 /PRNewswire/ -- Zoomlion Heavy Industry Science & Technology Co., Ltd. (Zoomlion) released its 2020 interim report on August 21. 

Key Highlights:

• Operating income equaled CNY 28.827 billion (USD 4.178 billion), an increase of 29.49% YoY.
• Net profit attributable to shareholders of the company was CNY 4.018 billion (USD 582.361 million), an increase of 55.97% YoY.

"Though affected by COVID-19, the construction machinery industry in China experienced sustained growth due to China's macroeconomic regulations, New Infrastructure projects and the rebound of smart manufacturing," said Yang Duzhi, Secretary of the Board of Zoomlion. "During the reporting period, we focused on scale, profit, operating cash flow and sustainable growth. We will continue to implement an end-to-end business management model, accelerate digital transformation, control business risks, and improve management efficiency."

During the reporting period, the sales volume of core products increased significantly year-on-year, with a higher gross profit margin.

- Mobile Cranes: sales continue to dominate the domestic market with steady growth. Meanwhile, revenue from crawler cranes doubled.

- Concrete Machinery: experience a significant increase in sales. Long Boom Truck Mounted Pumps and City Pumps continue to dominate the first position for market share, while the market share of mixer trucks jumped to the top three.

- Tower Cranes: Zoomlion remains the world's leading tower crane manufacturer by sales volume, hitting a record high. The launch of the latest intelligent W series tower cranes has further expanded Zoomlion's market share.

- Earth-moving Machinery: sales witness substantial growth year-on-year due to product innovation, sales model, market layout, and service network. Aerial Work Platform recorded a 100% improvement in sales and holds one of the largest market shares.

Expense ratio fell by more than 3.7% YoY, thanks to strict cost and expense controls, which contributed to an increase in the company's net profit margin. 

Sales expense ratio dropped significantly as a result of the implementation of a new "end-to-end" management model supported by digitalization. 

Financial expenses have been reduced considerably due to the efficient use of funds and reducing the level of debt.

As a result of China's promotion of new infrastructure and urbanization projects, it is expected that the construction machinery industry will maintain a high rate of growth. Zoomlion will continuously enhance market competitiveness, make full preparations for global market demands, and support long-term, high-quality development

About Zoomlion

Founded in 1992, Zoomlion Heavy Industry Science & Technology Co., Ltd. (01157.HK) is a high-end equipment manufacturing enterprise that integrates engineering machinery, agricultural machinery, and financial services. The company now sells more than 600 cutting-edge products from 55 product lines covering ten significant categories.

View original content:http://www.prnewswire.com/news-releases/zoomlion-announces-2020-interim-report-net-profit-increases-55-97-yoy-301121796.html

SOURCE Zoomlion

FAQ

What were Zoomlion's financial results for the first half of 2020?

Zoomlion's operating income for H1 2020 was CNY 28.827 billion (USD 4.178 billion), a 29.49% YoY increase, with a net profit of CNY 4.018 billion (USD 582.361 million), up 55.97% YoY.

How did COVID-19 impact Zoomlion's performance in 2020?

Despite the challenges posed by COVID-19, Zoomlion's performance was bolstered by China's macroeconomic regulations and new infrastructure projects.

What is the outlook for Zoomlion in the construction machinery industry?

The construction machinery industry is expected to sustain high growth, supported by China's promotion of new infrastructure and urbanization projects.

What strategies did Zoomlion implement to improve profitability?

Zoomlion focused on controlling business risks, enhancing management efficiency, and adopting a digital 'end-to-end' business management model.