Ninestar Corporation’s Q3 2023 financial report reflects a turbulent period marked by declining operating income and net profit. The company grapples with market fluctuations while navigating legal challenges due to its inclusion in the U.S. Xinjiang-related entity list.
Ninestar’s Q3 2023 quarterly report shows that the company recorded an operating income of 5,644,996,471.93 yuan (€731 million / $771 million), marking a 15.49% decline compared to the previous year. Net profit attributable to shareholders of the listed company dropped 128.53%, falling to -138,554,697.19 yuan (-€17.9 million / -$18.9 million). This decline was primarily attributed to non-recurring gains and losses. The company experienced a significant surge in net cash flow from operating activities, increasing by 1,682.07%.
The company faced challenges in earnings per share, with basic earnings per share declining by 128.41% and diluted earnings per share following suit with a decrease of 128.56%.
Despite these financial fluctuations, Ninestar reported a modest increase of 0.40% in total assets compared to the previous year, reaching 46,210,970,148.89 yuan (€5.98 billion / $6.3 billion). The owner’s rights and interests belonging to shareholders of the listed company also saw a 0.70% increase, totalling 15,985,326,868.32 yuan (€2.06 billion / $2.2 billion), signifying resilience in the face of market volatility.
Within Ninestar’s business divisions, Pantum encountered a challenging quarter with a year-on-year decrease of 15.50% in operating income and a significant 37.45% drop in net profit. Excluding non-net gains, the profit decline was somewhat mitigated at 25.39%. Pantum’s printer sales experienced a decrease of 12.96% year-on-year, although overseas market shipments managed to increase by 5.47%. To address these market challenges, Pantum substantially increased its investment in research and development, with a notable uptick of 22.46%, focusing on A3 black and white and colour copiers.
Lexmark faced a 12.30% year-on-year decrease in operating income during the first three quarters, primarily attributed to a slowdown in the OEM business. However, Lexmark’s own brand printing machine sales demonstrated resilience, with a 5.8% increase, leading to a 12.4% growth in revenue. Rising interest rates posed a challenge, resulting in increased interest expenses.
Jihai Micro, Ninestar’s subsidiary specializing in integrated circuits, reported a 7.24% year-on-year shipment increase, albeit with a 27.96% decrease in operating income during the same period. To foster innovation and maintain competitiveness, Jihai Micro significantly boosted its research and development investment by 37.6%. They introduced new high-performance MCU products tailored for various applications, including automotive electronics, and ventured into the ultrasonic sensor chip market.
Ninestar’s general consumables business faced headwinds in the first three quarters of 2023, reporting a 6.99% year-on-year decrease in revenue and a substantial 41.66% drop in net profit. These challenges were attributed to RMB exchange rate fluctuations and the company’s inclusion on the U.S. Xinjiang-related entity list, resulting in economic and reputational losses. In response, Ninestar and its subsidiaries initiated a lawsuit to challenge their inclusion on the list.
Ninestar Corp reaffirmed its commitment to closely monitor and transparently disclose information concerning the progress of this litigation, emphasizing its dedication to safeguarding the interests of shareholders and partners. The company’s ability to adapt to evolving circumstances will play a crucial role as the situation unfolds.
Note: We used AI to translate and summarise this financial report.
