Tire factory net profit fell 71.46%

AEOLUS TIRE

Recently, Aeolus Tire released the main accounting data from January to June:

Operating income was 3.016 billion yuan, a year-on-year increase of 13.19%.

The net profit attributable to shareholders of the listed company was RMB 25,194,300, a year-on-year decrease of 71.46%.

Aeolus Tire’s explanation of the reasons for changes in operating income: In the first half of 2021, revenue increased by 13.19% year-on-year, of which main business revenue increased by about 11% year-on-year, sales volume increased by about 13% year-on-year, but prices were basically the same.

From the perspective of sub-markets:

(1) Domestic market: The domestic supporting market sales increased by about 19%, but because most of the prices were determined through bidding and competitive negotiation at the end of last year, the prices failed to increase in time with the increase in costs; The replacement market sales and prices have both increased year-on-year, but since the sales of OEM market accounted for approximately 72% of the domestic market, the replacement market has limited overall pull on the domestic market.

(2) Export market: Sales volume increased by about 11% year-on-year, but due to the appreciation of the RMB, exchange rate fluctuations reduced the company's export revenue by about 8%, offsetting the positive growth in sales. Explanation of reasons for changes in operating costs: The cost of main operations increased by about 17% year-on-year, which was much higher than the growth rate of revenue. Mainly due to the adverse effects of rising prices of main raw materials such as natural rubber, carbon black, and steel cord. In the first half of the year, the overall average warehousing price of raw materials increased by about 18% year-on-year.