China Automotive Systems (CAAS) Tops Q3 EPS by 12c, Revenues Miss; Reaffirms FY19 Revenue Outlook

November 12, 2019 6:05 AM EST
Get Alerts CAAS Hot Sheet
Price: $4.21 -0.71%

Revenue Growth %: +77.0%

Financial Fact:
Gross profit: 19.99M

Today's EPS Names:
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China Automotive Systems (NASDAQ: CAAS) reported Q3 EPS of $0.13, $0.12 better than the analyst estimate of $0.01. Revenue for the quarter came in at $100.5 million versus the consensus estimate of $104.41 million.

Third Quarter 2019 Highlights

  • Net sales were $100.5 million compared to $112.1 million in the third quarter of 2018;
  • Gross profit increased to $17.3 million from $15.4 million, and the gross margin rose to 17.2% from 13.7% in the third quarter of 2018;
  • Income from operations was $4.3 million, with an operating margin of 4.3%, compared with Income from operations of $1.8 million, or a 1.6% operating margin in the same quarter last year;
  • Net income attributable to parent company's common shareholders was $4.2 million, or diluted earnings per share of $0.13, compared to net income attributable to parent company's common shareholders of $0.4 million, or diluted earnings per share of $0.01 in the third quarter of 2018;
  • Approximately 96,000 shares of common stock were repurchased.

Mr. Qizhou Wu, the Chief Executive Officer of CAAS, commented, "Our sales reflected the continuing slow growth in the economy as China's gross domestic product grew by 6.0% in the quarter ended September 30th, the slowest quarterly growth rate since 1992. In the automobile sector, the sales of Chinese-branded cars were down 13.2% year-on-year in the month of September and accounted for 18.5% of the total car sales. This market share represented a decline of 1.2% in market share compared with September 2018. For the first nine months of 2019, total sales of Chinese-branded passenger cars were 18.5% lower than the same period in 2018. The sales of Chinese-branded SUVs declined by 8.0% year-on-year with a decrease of 2.6 percentage points in market share over the previous year. The sales of Chinese brand MPVs were down 10.5% year on year. As a leading supplier of steering products to Chinese-branded vehicles, our sales reflect the current market conditions. However, government stimulus measures including tax cuts and infrastructure investments, have started to improve the economy and if necessary, there may be more infrastructure spending to stabilize economic growth."

"In addition, we are positive about the prospects for our developmental projects. Our electric power steering ("EPS") joint venture with KYB (China) Investment Co., Ltd. will add more resources to quickly improve our products and market share. Our new electric motor product development for power steering systems with Hyoseong Electric Co. Ltd. and our new recirculating-ball steering system development for a global client's autonomous vehicle development offer new avenues for future growth."

Mr. Jie Li, the Chief Financial Officer of CAAS, commented, "We continue to focus on building our financial strength to offer customers advanced products as well as develop new products to enhance our global presence. During the 3rd quarter, we purchased approximately 96,000 shares of common stock in the open market. We are committed to enhancing long-term shareholder value."


China Automotive Systems sees FY2019 revenue of $430 million, versus the consensus of $430.58 million.

For earnings history and earnings-related data on China Automotive Systems (CAAS) click here.

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