On the evening of March 22, Foxconn Industrial Internet Co.Ltd(601138) announced that it planned to spend no more than 47.6 billion yuan on financial management and structured deposits. Just six months ago, in August 2021, the company just announced that it planned to use no more than 41.5 billion yuan to buy financial management and structured deposits.
At the performance presentation meeting on March 23, Foxconn Industrial Internet Co.Ltd(601138) CFO Guo Junhong explained that the company’s relevant financial management arrangements were aimed at improving the utilization rate of funds and hedging macro risks.
Foxconn Industrial Internet Co.Ltd(601138) is indeed well funded. In 2021, the company achieved an operating revenue of 439557 billion yuan and a net profit of 20.01 billion yuan attributable to shareholders of listed companies, with a year-on-year increase of 1.8% and 14.8% respectively, both reaching a record high. Total assets increased by 18.22% year-on-year, exceeding 260 billion yuan.
Even so, the aforementioned amount of 47.6 billion yuan is still a considerable expenditure. This is more than twice the net profit of Foxconn Industrial Internet Co.Ltd(601138) 2021, accounting for about 18% of the total assets.
Times finance and economics learned that in the past two years, in addition to financial investment, Foxconn Industrial Internet Co.Ltd(601138) also expanded the industrial layout horizontally through foreign investment, and deepened in the fields of semiconductors, new energy vehicles, metauniverse and industrial Internet, trying to create a second growth curve, but there was no large investment project of 10 billion yuan.
while managing money, dividends at the same time
According to the announcement, on March 22, Foxconn Industrial Internet Co.Ltd(601138) the board of directors agreed that the company and its subsidiaries use idle self owned funds of no more than 47.6 billion yuan to invest in financial products and structured deposits issued by financial institutions such as banks and bank financial subsidiaries. Within the above limit, the funds can be used in a rolling manner.
In addition, Foxconn Industrial Internet Co.Ltd(601138) and its subsidiaries must purchase financial products and structured deposits with high security, good liquidity, medium and short term (no more than one year) and principal guaranteed, and the purchase period is up to the board of directors in 2022.
Foxconn Industrial Internet Co.Ltd(601138) explained in the announcement that the premise of the company’s move is to control risks. The purpose is to make full use of its own funds, improve the use efficiency of funds and increase the company’s income. It will not affect the company’s daily capital turnover needs and the normal development of its main business.
In August 2021, Foxconn Industrial Internet Co.Ltd(601138) also issued an announcement on the use of idle own fund financial products and structured deposits, with a maximum amount of no more than 41.5 billion yuan, and the purchase period is up to the board of directors in 2021.
In March this year, Foxconn Industrial Internet Co.Ltd(601138) held the 2021 annual board of directors, but so far, the specific situation of purchasing financial products and structured deposits has not been announced. The financial report shows that by the end of 2021, Foxconn Industrial Internet Co.Ltd(601138) bank deposits had 82.576 billion yuan, an increase of about 5 billion yuan over the beginning of the year, without mentioning the purchase of financial products.
It is worth noting that the profit distribution plan for Foxconn Industrial Internet Co.Ltd(601138) 2021 has also been released. It is planned to distribute a cash dividend of 0.5 yuan per share (including tax), totaling 9.918 billion yuan, accounting for 49.56% of the net profit attributable to shareholders of Listed Companies in 2021.
the investment in the field of new energy vehicles is less than 400 million yuan, and it is planned to repurchase shares
Although the income continues to rise, the gross profit margin of Foxconn Industrial Internet Co.Ltd(601138) is not optimistic, with an average annual rate of less than 10% from 2018 to 2021.
Foxconn Industrial Internet Co.Ltd(601138) , namely Foxconn Industrial Internet Co.Ltd(601138) , is famous for OEM of iPhone, and its customers include Huawei, Amazon, Google, etc. In 2021, the company’s 3C electronic products realized a revenue of 434345 billion yuan, accounting for more than 99% of the total revenue, but the gross profit margin was only 8.24%.
From 2018 to 2020, the gross profit margin of Foxconn Industrial Internet Co.Ltd(601138) 3c electronic products was 8.54%, 8.35% and 8.29% respectively, all lower than 9%. These products cover two industries: communication and mobile network equipment.
In the industrial Internet industry, Foxconn Industrial Internet Co.Ltd(601138) gross profit margin is relatively high, which was 43.87% in 2021, but the operating revenue is only 1.685 billion yuan, accounting for less than 4% of the total revenue. According to the financial report, the company will optimize its business portfolio and focus on high-end precision mechanism parts, Internet of vehicles and other high-end manufacturing and high gross profit products.
In early September 2021, Foxconn Industrial Internet Co.Ltd(601138) subsidiary signed an agreement to acquire 63% equity of Shenzhen Hengqu Motor Co., Ltd., with an overall transaction amount of about 378 million yuan, so as to quickly enter the new energy vehicle track. Previously, Foxconn Industrial Internet Co.Ltd(601138) also provided parts for new energy vehicles, accounting for a small proportion of the business.
According to the financial report, Foxconn Industrial Internet Co.Ltd(601138) will focus on new energy vehicles and the Internet of vehicles, lay out core components, integrate upstream and downstream supply chains, give play to complementary and linkage advantages, and target the three fields of new energy vehicles – electric drive and electronic control, intelligent vehicle and the Internet of vehicles.
In the 2020 financial report, Li Junqi, chairman of Foxconn Industrial Internet Co.Ltd(601138) group, also mentioned that in 2021, the company will include new energy vehicles in its important strategic direction.
Foxconn Industrial Internet Co.Ltd(601138) also advocated that the meta universe should move from virtual to real, and said that it would build an “industrial meta universe” with the construction scheme of “lighthouse factory” to help accelerate the implementation of predictive maintenance of equipment, remote expert assistance, process guidance and so on.
For Foxconn Industrial Internet Co.Ltd(601138) , it is still far from turning industrial Internet, new energy vehicle track and metauniverse into its main business, and “Apple OEM” is its biggest label.
Foxconn Industrial Internet Co.Ltd(601138) share price has been depressed for a long time. In 2018, the company landed on the Shanghai Stock Exchange at the issue price of 13.77 yuan / share. Since May last year, it has been in a broken state. As of the press release (March 23), it closed at 10.39 yuan / share, up 1.96%.
On March 23, Foxconn Industrial Internet Co.Ltd(601138) issued a share repurchase plan, which plans to speed up the repurchase of the company’s shares by means of centralized competitive trading in the next three months. It is expected that the repurchase amount will not be less than 500 million yuan, and the total repurchase amount will not be less than 800 million yuan.
Previously, in September 2021, Foxconn Industrial Internet Co.Ltd(601138) also issued a share repurchase plan, with a total repurchase fund of no less than 1 billion yuan and no more than 1.5 billion yuan. As of February 8 this year, it had paid a total amount of 314 million yuan (excluding transaction costs).
