At present, the basic disclosure of the semi-annual report of LED lighting companies has been completed. Despite the increasing penetration of LED lighting to replace traditional lamps, the industry is in a period of growth. However, due to fierce competition in the industry and the prevalence of price wars, the performance of industry giants Foshan Lighting and NVC Lighting has fallen sharply.
In the face of declining performance, companies have planned to transform or even escape the LED lighting industry. Among them, NVC Lighting continues to deploy the Internet O2O business, and Foshan Lighting optimizes product structure and plans for mergers and acquisitions.
Buddha photo, NVC net profit
According to the statistics of CSAResearch (National Semiconductor Lighting Engineering R&D and Industry Alliance), from January to May this year, the overall scale of China's semiconductor lighting industry reached 179.3 billion yuan, an increase of 22.7% over the same period of last year. However, the price of LED products has gradually declined due to fierce competition in the industry. The export price index of LED lighting products released by CSAResearch shows that the average price of LED lighting products has dropped by about 75% in the three years from the beginning of 2012 to the end of June this year.
On August 28, Foshan Lighting disclosed the semi-annual report. The company achieved operating income of 1.52 billion yuan, down 1.21% year-on-year. The net profit attributable to shareholders of listed companies was 100 million yuan, down 46.9% year-on-year. “The performance of the first half of the year has fallen so much, which is related to the bad market environment. The competition in the industry is fierce and the price of products has fallen sharply.†Huang Yufen, representative of Foshan Lighting Securities Affairs, told reporters.
According to the financial report, the gross profit margin of Foshan Lighting's traditional lighting products was 27.86%, an increase of 0.98% over the first half of the year. The gross profit margin of LED lighting products was 18.44%, down 1.93% year-on-year.
Foshan Lighting, which is known as the “price butcherâ€, is still suffering from price wars, and other small and medium-sized listed companies are losing money. Wei Wei shares were affected by the LED price war, resulting in the first loss since the listing in 2012.
On August 29, Weiwei achieved operating income of 406 million yuan in the first half of the year, a year-on-year increase of 18.2%, and a net profit loss of 6.55 million yuan, a sharp drop of 125% year-on-year. "The LED lighting industry has low capital and technology thresholds, and a large number of small and medium-sized enterprises are influx, especially small enterprises that are not listed. They are relatively unregulated, engage in vicious price competition, and the industry prices are affected, affecting listed companies." A person from the stock securities department said.
The performance of another NVC lighting company, which is in the process of rectifying the recovery period, also experienced a sharp decline. On August 28th, NVC's semi-annual report showed that the total operating income in the first half of the year was 1.772 billion yuan, an increase of 4.1%; the net profit was 17.073 million yuan, a decrease of 70.6%.
Enterprises are seeking transformation
In the face of increasingly fierce competition in the market, LED lighting companies have planned to transform, and some companies have even directly withdrawn from the LED lighting business. “The transformation of Foshan Lighting is mainly to adjust the product organization, especially in the field of commercial lighting,†said Huang Yufen, the company’s securities affairs representative.
Foshan Lighting also said in the report that the company will seize the full opportunity of LED lighting and vigorously develop LED lighting business. In addition to the development in the traditional light source, civil and office lighting fields, it will also develop in the relatively weak commercial lighting field. A series of products have been produced and the product structure has been further optimized.
On August 26, Foshan Lighting also announced that the company is planning major mergers and acquisitions with Bain Capital (Hong Kong) Co., Ltd. Wu Yulin, president of Foshan Lighting Association, said that LED lighting products have fallen sharply in the first half of the year, but this can quickly replace traditional lighting fixtures. Under the price war, the industry is facing shuffling. Enterprises need to quickly reflect and provide cost-effective advantages. Products also need to be adjusted accordingly. “The company has expanded its photovoltaic field and will be a two-wheel drive for LED lighting and photovoltaic business in the future.†The staff of Weiwei Securities Department said that in the face of increasingly fierce competition in the LED industry, the company is also constantly strengthening its strategic adjustments, in addition to stabilizing LEDs. The lighting business, through capital market mergers and acquisitions, quickly cut into the photovoltaic power station business with good profit prospects.
NVC Lighting said that the company has implemented a series of measures to strengthen the company's industry position, such as accelerating the transition to the Internet. The company has established e-commerce and O2O business units to carry out online sales business, and comprehensively open online and offline channels.
In addition, some companies that dig deep into LED lighting have directly withdrawn from the lighting business. On August 24, Abbyson disclosed the semi-annual report, achieving operating income of 455 million yuan, an increase of 3.36% year-on-year, and net profit of 44.16 million yuan, down 43% year-on-year. Abbyson said that in recent years, the company's LED lighting business has not improved, and it is in a loss all the year round. It can't achieve profit in the short term. The company decided to terminate the LED lighting business and focus on the LED display field.
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