Intron Technology : achieves record high revenue and net profit in 2021 annual results Revenue surge 59% to RMB 3,200 million Net profit leaps 111% to RMB 200 million Revenue of new energy vehicle solutions business soars 132% Sets to be future growth driver of the Group

Intron Technology achieves record high revenue and net profit in 2021 annual results Revenue surge 59% to RMB 3,200 million Net profit leaps 111% to RMB 200 million
Revenue of new energy vehicle solutions business soars 132% Sets to be future growth driver of the Group 2022.03.30

Financial Highlights

(30 March 2022, Hong Kong) - Intron Technology Holdings Limited ("Intron Technology" or the "Group"; HKEX: 1760), a fast-growing automotive electronics solutions provider in China, announced today its annual results for the year ended 31 December 2021 (the "Year"), with both revenue and net profit reaching record high, and its new energy vehicle (NEV) solutions business managing outstanding performance and recording a 132% year-on-year growth in revenue.

Mr. Davy Luk, Chairman, Co-CEO and Executive Director of Intron Technology, said, "The year 2021 was indeed a harvesting year, with our business growing strength to strength, thanks to the rebound of China's automotive market. The Group, having over 20 years of experience and leading position in the industry, with its stable and close long-standing partnership with semiconductor suppliers, not only achieved top performance in the industry during difficult market conditions, but also succeeded in seizing opportunities leveraging its strengths in the industry. During the Year, we further consolidated our market share with increasing number of products and solutions acquired by the Chinese automotive makers and entering the stages of mass production successively."

The Group achieved impressive results in its NEV Solutionsbusiness during the Year. The revenue from this business surged 132% year-on-year to RMB1,082.1 million. The outstanding performance of this business was mainly attributable to the Group's extensive knowledge and experience and domestically leading position in the core technology areas of kernel Electronic Control Unit (ECU) for new energy vehicle, functional safety, power electronics technology and embedded software. At the same time, the Group maintained strong and long-standing strategic partnership with all NEV manufacturers in China.

In 2021, the Group continued to enter into a number of joint projects with multiple customers, including the top ten NEV makers, laying a sound foundation for the Group's results for the upcoming years. The Group's efforts in electrification have attained good progress. Currently, the Group has invested more resources in the smart vehicle related area focusing on improving the application of Artificial Intelligence (AI), big data and automotive embedded software to satisfy the need of NEV manufacturers for fast model updates.

The Group took the lead years ago in strategic planning for the research and development in Advanced Driver-assistance System (ADAS) solutions, which now covering all major areas, including electric vehicles, fuel cell vehicles and commercial vehicles. In 2021, the Group has entered into development agreements with multiple enterprises in relation to ADAS. The related mass production projects will be delivered in batches from 2022 or 2023, securing future revenue.

Regarding the Body Control, Safety and Powertrain Solutions businesses, revenue from Body Control Solutions business reached RMB578.5 million last year, representing an increase of 37% year-on-year. The growth in segment revenue was mainly benefited from the low power consumption and intelligent technological requirements of LED vehicle light control. The growth of the Group's Body Control Solutions business was also driven by a number of favourable factors, including an increase in matching rate of body domain controllers at automotive makers, rising product unit prices and increased coverage of body control solutions for commercial vehicles.

As for Safety and Powertrain Solutions businesses, segment revenue amounted to RMB577.6 million and RMB308.9 million, respectively, representing year-on-year increase of 18% and 27%, respectively. The revenue growth in Safety Solutions business was mainly attributed to the wide recognition and increased number of product orders supplied by the Group to component manufacturers, which gained popularity and orders from OEMs. The growth has also benefited from the continual rise in the installation of automated driving systems by OEMs for their new car models. As for powertrain segment, the Group benefitted from its improved market share in smart motor control solutions (e.g. electric water pump) and engine control system solutions during the Year.

For the Year, the Group achieved revenue of RMB3,176.2 million, up by a significant 59% as compared with last year. Gross profit amounted to RMB625.2 million, an increase of 75% and net profit was RMB200.2 million, representing a year-on-year surge of 111%. Its gross profit margin increased by 1.7 percentage points to 19.7%, and net profit margin increased, by 1.5 percentage points, to 6.3%. The Group continued to maintain a healthy financial position. As at 31 December 2021, its cash and cash equivalents amounted to RMB571.7 million. The Board has resolved to recommend payment of a final dividend of 6.8 HK cents per share for the year ended 31 December 2021, with dividend payout ratio at 30%.

Revenue from the Industrial Solutions business of the Group amounted to RMB549.8 million, representing a significant 81% increase against the previous year. During the Year, the segment continued to benefit from the popularity of home offices under the epidemic situation. Driven by the continual increase in demand for data centres and cloud computing, the overall scale and market share of the key customers of the Group expanded, and in-turn the share of the Group's solutions and business had also increased as a result.

During the Year, the Group continued to invest in the areas of new energy, semiconductor applications and ADAS to further strengthen its R&D capabilities and facilitate its business development. R&D expenses was RMB206.0 million, accounting for 6.5% of the Group's revenue. As at the end of December last year, The Group has secured 171 patents and 142 software copyrights, representing an increase of 55 patents and 13 software copyrights. In addition, the Group's new large-scale R&D Testing and Validation Centre in Shanghai has commenced full operation. During the Year, the R&D Testing and Validation Centre supported the Group in more than 450 projects. The investment commitment in phase two construction of EMC at the Centre has been confirmed and is expected to be available for use in the first half of 2022, and the Group also plans to expand the Centre's testing capability in 2022.

With achieving "carbon emission peak" and "carbon neutrality" at the core of China's energy policies, there is demand for hydrogen fuel cells in the automotive industry. To seize such opportunities, in December 2021, the Group established a subsidiary named Shanghai Qingheng Automotive Electronics Co., Ltd. that focuses on development and commercialisation of core electronic control system for hydrogen fuel cells. In line with promoting green energy development and the country achieving its carbon neutrality goal, the subsidiary will reinforce the Group's R&D and technological advantages in the NEV control sector, giving the Group added momentum to achieve future business development.

Mr Eddie Chan, Co-CEO and Executive Director of Intron Technology, said, "With the increasing popularity and adoption of electric and intelligent vehicles solutions, we expect the automotive market demand to continue to rebound. Coupling with industrial business growth on public demand for data centres and cloud servers, and our long-standing focus on R&D projects and investments, we are confident in achieving sustainable growth. We will continue to consolidate our technological strengths and leading position in the market with an R&D focused strategy and keep expanding our business footprint by actively exploring potential strategic acquisition and alliances, with a view to capture the huge market growth opportunities, driving sustainable long-term business and bringing satisfactory returns to our shareholders."

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About Intron Technology Holdings Limited(英恒科技控股有限公司)

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