Haier Smart Home Q3 2024 Report: Sustained Growth Driven by Innovative Smart Products

QINGDAO, SHANGHAI, HONG KONG and FRANKFURT - October 29, 2024 -?Haier Smart Home Co., Ltd. ("Haier Smart Home" or "the Company"), a global leader in smart home solutions (D-share 690D.DE, A-share 600690.SH, H-share 06690.HK), today announced its financial results for the first three quarters of 2024. Haier Smart Home achieved revenue of RMB 202.97 billion during the first 9 months of 2024, representing a YoY growth of around 2.2%. The net profit attributable to the parent company amounted to RMB 15.15 billion in the reporting period. This represents a YoY growth of around 15.3%.

Seizing the opportunity of trade-in domestic market

The implementation of the trade-in policy in China and the increasing demand for air conditioning driven by hot weather in August led to an increase by 7.5% of retail sales of the home appliance industry in the third quarter of 2024. In this context,?Casarte's?retail sales in the month of September increased by close to 20% YoY. The Chinese premium brand, which has been the TOP1 in the high-end market for 8 years in a row, continued to expand its domestic market share and strengthen its presence also internationally in the reporting period, also participating in relevant overseas exhibitions such as the Germany's?IFA?and Milan's?International Kitchen & Furniture?Exhibition.

Also, the brand?Leader?reported a steady growth in the first 9 months of 2024, targeting the consuming habits of younger customers:?Leader's?retail sales increased by 31% YoY in the month of September and increased by 22% YoY in Q3 2024.

Haier refrigerators and washing machines continued to rank first in the domestic industry in terms of market share. Water heaters ranked first in different sales channels. Moreover, Haiers air conditioning global market competitiveness has been further enhanced with export sales volume in Q3 2024 increasing by 45.7% YoY. Meanwhile, Haier's sales of high-end kitchen hoods increased by more than 20% YoY in the first 9 months of 2024, of which 35% YoY only in the third quarter.

Targeting more sustainability also for home appliances, Haier's Recycling Factory supports the sustainable goal of environmental protection by promoting the recycling of white goods. Also in the reporting period, the Recycling Factory continued to collect old, unused home appliances from Haier customers, disassemble them for material recycling and reuse. The factory can achieve 100% recycling and reuse of used appliances in China and gained more popularity because of the national program in China "exchange old for new".

Successful growth strategies in overseas countries

In the first 9 months of the year, the dynamics of market development differed in the various overseas markets. On the one hand, demand in developed markets such as Europe, the United States was weak due to macroeconomic conditions, while on the other hand emerging markets such as Southeast Asia, South Asia, the Middle East and Africa maintained a sound growth. Haier Smart Home decided to adopt different strategies to continue to increase its market share. Specifically, in the European and American markets, Haier Smart Home continued to offer innovative products, industry breakthroughs, and to deepen supply chain deployment. In the North American market, Haier Smart Home launched special air conditioning products such as saddle inverter air conditioners, achieving rapid growth in the first 9 months of 2024 in special air conditioners. In the European market, Haier Smart Home comprehensively deployed?New Candy?series products, launching more marketing activities, improving the brand image and customer conversion rate with product price index further increased. In emerging markets, Haier Smart Home achieved rapid growth by deepening the construction of localized supply chains and upgrading product structure. For instance, Haier Smart Home's sales revenue grew over 30% in South Asia in the third quarter of 2024. Haier Smart Home announced among others the successful completion of its acquisition of Carrier Commercial Refrigeration (CCR), expanding its business from home refrigeration to the commercial refrigeration market. This acquisition further enriches Haier Smart Home's diverse product portfolio and signifies an enhanced strategic positioning in the global commercial refrigeration market.

Improvement of offering in the SAN YI NIAO stores and No. 1 Smart Buildings

SAN YI NIAO provides retail customers with one-time solutions for a smart life. In 2024, SAN YI NIAO focused on the integration of smart home appliances and home furnishings to carry out strategic upgrading and achieved continuous growth in terminal stores and number of daily active users, leveraging its strengths in customization of products. During the first three quarters of 2024, SAN YI NIAO achieved store retail sales of RMB 8.6 billion, with a YoY increase of 10%. Meanwhile, the number of monthly active users of Smart Home App reached 10 million, with an increase of over 35% YoY.

Regarding the B2B-business,?Haier Smart Building?ranked No.1 in terms of market share in three major markets in China through smart energy-saving products such as magnetic levitation, air levitation, and loT multi-split air conditioner. For example, Haier ranked No.1 in China with 58.2% share in magnetic levitation air conditioners. Compared to traditional central air-conditioning, the magnetic levitation units are more energy-efficient.

Improved profitability led by digital transformation

Haier Smart Home's expense ratio further optimized by 0.8 pct in the first three quarters of 2024. With domestic opportunities seized and overseas continuous growth, Haier Smart Home's performance maintained steady growth. The net profit ratio hit a "new high": increased from 6.31% in the first three quarters of 2022 to 6.62% in the first three quarters of 2023, and then to 7.47% in the first three quarters of this year.

The continuous improvement of profitability is also inseparable from the digital transformation, continuously internally promoted at Haier. Focusing on user experience, Haier Smart Home has built end-to-end digital capabilities in fields such as research, production, supply, sales, and service. Platform design shortens the R&D cycle. Intelligent manufacturing achieves low-cost and efficient production. Intelligent warehouse layout and vehicle dispatch empower timely delivery of orders. AI empowers instant perception of users' needs.

Haier brand helps consumers to reach a new level of life-quality through smart innovative products and services. At the same time, as a company that focuses on sustainable and high-quality development, Haier Smart Home also actively engage in ESG practices. In the latest ESG rating released by MSCI, Haier Smart Home was rated with a score of AA (previous year, with an A), ranking as the highest in the industry in China. From domestic to overseas markets, Haier Smart Home achieved steady growth during the first three quarters of 2024. Haier wants to continue to expand its global brand portfolio by opening up new growth chances and reducing its costs by improving efficiency with digital transformation.

For the full report, please visit: https://smart-home.haier.com/en/ ?

About Haier Smart Home Co., Ltd.:

Haier is one of the world's leading manufacturers of household appliances with a focus on smart home solutions and customized production. Haier Smart Home Co., Ltd. develops, produces and distributes a wide range of household appliances. These include refrigerators, freezers, washing machines, air conditioners, water heaters, kitchen appliances, small household appliances, and an extensive range of intelligent household appliances. The Company distributes its products through leading household brands such as Haier, Casarte, Leader, Candy, GE Appliances, AQUA and Fisher & Paykel. Haier Smart Home Co., Ltd. has launched Smart Home Experiential Cloud in the Chinese market, which connects homes, users, enterprises and ecosystem partners, and facilitates the integration of Haier's online, offline and micro-store businesses and supports user interaction to further optimize the user experience.