China Automotive Inc. (NASDAQ: CAAS) stock soars by 9.83% during current market trading after CAAS released its first-quarter 2021 financial results. China Automotive Systems based in Hubei Province, People’s Republic of China, is a major provider of power steering products and parts to the Chinese automotive industry, with ten Sino-foreign joint ventures.
Financial Results
On May 11, 2021, CAAS announced its first-quarter 2021 financial results. Given below is the summary:
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- From $73.6 million in the first quarter of 2020 to $130.3 million in the first quarter of 2021, net revenue increased by 77.0 percent. The rise in net sales was mostly attributed to the improvement of the Chinese economy and post-COVID-19 Chinese vehicle production.
- Gross profit rose 75.9% to $19.7 million in the first quarter of 2021 from $11.2 million in the first quarter of 2020, while gross margin increased to 15.1 percent from 15.2 percent in the first quarter of 2020.
- Selling costs in the first quarter of 2021 were $5.6 million, compared to $2.1 million in the first quarter of 2020. Higher revenue rates and higher air freight costs accounted for the majority of the growth in selling expenses.
- In the first quarter of 2021, from $1.0 million in the first quarter of 2020, income from operations rose 320.0 percent to $4.2 million.
- In the first quarter of 2021, net profits attributable to common shareholders of the parent company was $3.2 million, or adjusted income of $0.10 per share, opposed to a net loss attributable to common shareholders of the parent company of $0.03 million in the first quarter of 2020.
- As of March 31, 2021, currency and cash equivalents, as well as pledged cash, totaled $122.0 million.
Mr. Qizhou Wu, the CEO commented:
CAAS is pleased to announce growing demands in each of their main markets – Chinese OEM passenger vehicles, Chinese OEM commercial vehicles, and exports to North and South America – resulting in accelerated top-line growth in the first quarter. Automobile sales in China increased by 75.6 percent year on year in the first quarter of 2021, according to figures from the China Association of Automobile Manufacturers, with passenger vehicle sales up 75.1 percent and commercial vehicle sales up 77.3 percent.