TMTPost -- BYD Co. Ltd. gets ready for dividends of hundreds of thousands of dollars after the leading electric vehicle (EV) maker posted record high annual net income.

Credit：BYD

BYD said Tuesday it plans to distribute a cash dividend of RMB30.96 per ten shares, or RMB9.004 billion (US$1.25 billion) in total based on total share capital of 2.911 billion shares. The dividends underscore BYD’s robust financial performance as the automaker reported results of the year 2023. BYD’s net income surged 80.72% from the previous year to  RMB30.04 billion (US$4.16 billion), in the mid of its guidance range of RMB29 billion to RMB31 billion. The basic earnings per share (EPS) stood at RMB10.32, with a year-over-year (YoY) increase of 80.74%, and annual revenue rose 42.04% YoY to RMB602.315 billion.

BYD’s profit set the highest ever annual record, representing a profit of approximately RMB82.30 million on a daily basis. However, the new record slowed down significantly compared with 2022, when BYD net income had a jump of 446%. Based on the annual figure, BYD reported net income of RMB8.67 billion for the quarter ended December 31 with a 19% YoY growth, compared with an 82.16% YoY increase in profit for the previous quarter, when the company for the first time raking more than RMB10 billion in a quarter. It recorded revenue of RMB180.04 billion for the fouth quarter with an 18.6% YoY growth, its slowest since the first quarter of 2022.  

Despite slowdown of both top and bottom line, BYD maintained leadership of profitability, and kept widening its gap of gross margin between its arch-rival Tesla, Inc. For the year 2023, BYD’s gross profit margin of vehicles popped 2.63 percentage points YoY to 23.02%, beating Tesla’s annual margin of 18.2%. In the fourth quarter, BYD once again topped Tesla with vehicle margin of 25.1%, better than the analysts’ estimated 24.5%, while Tesla’s margin of 17.6% down to the lowest in four years, falling short of the projection of 18.3%.This is the third straight quarter that Tesla was overtaken by BYD in terms of margin. In the June quarter, BYD posted gross margin of 18.72%, up 4.33 points YoY, for the first time triumphing Tesla, while the latter’s margin dropped 6.8 points YoY to 18.2%, highlighting the profit was severely dented by major price cuts.

BYD’s elevated gross margin mainly resulted from  strong sales and in-house batteries that naturally reduce the cost. The Shenzhen-based company said at the beginning of this month it sold 341,043 new energy vehicles (NEVs) , including battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs), in December.That month was the eighth straight month for BYD to set new record after sales first topped a 300,000-unit milestone in October. Sales in December climbed 45% YoY, accelerating from the previous month’s growth of 31%. Sales for the fourth quarter reached the record of 945,000 units, up 38% YoY. Sales from January to December totaled 3.0244 million units, consolidating BYD’s leadership in China. The data suggested BYD managed to meet its annual target of 3 million NEVs. BYD chairman Wang Chuanfu said in March 2022 that his company aimed to sell at least 3 million vehicles in 2023.

Analysts gneratlly anticipated BYD would sell around 4 million vehicles in the year 2024, about 17.3% from last year. Looking forward this year, BYD expected at its annual report of 2023 that 2024 will witness the NEV industry in China remain stellar growth, sales top 100 million units and  penetration rate further increases. It said it would strengthen the research and development (R&D) and independent control of core technologies in the auto industry, continue to enhance product competitiveness, keep up with consumption trends, continue to promote multi-brand matrix layout, accelerate overseas expansion business overseas, and help China's auto industry lead the global wave of new energy vehicles.