On December 15, Alt (300825) announced that its holding subsidiary had terminated major contracts for daily operations.
The announcement shows that the company's controlled subsidiary Sichuan Alt New Energy Automobile Co., Ltd. (referred to as Sichuan Alt or the seller) signed the "Contract By and BetweenSichuan IAT New Energy Automobile Co., Ltd. And HDI TRADING" with HDITRADING CO., LIMITED (referred to as HDI or the buyer) on August 26, 2024. CO., LIMITED", HDI plans to purchase special hybrid transmission products (DHT) from Sichuan Alt. The total contract amount is expected to be no less than 1.451 billion yuan (excluding tax).
On December 15, Sichuan Alt and HDI signed a "Termination Agreement". Affected by the market environment in the region where HDI's final customer is located, the buyer and the seller agreed to terminate the original contract in accordance with the original contract through friendly negotiation.
According to Alt's announcement in August last year, HDI hopes to purchase dedicated hybrid transmissions (DHT) from Sichuan Alt for use in its operations and supply to its OEM customers. Sichuan Alt has relevant R&D and production capabilities and agrees to supply DHT products to HDI in accordance with the terms and conditions stipulated in the contract.
Alt said that the termination of the contract was the result of careful study by the company and its holding subsidiaries and consensus with the other party.
Up to now, except for the manpower investment in the early stage of the project plan production, the company has not purchased raw materials and other productive investments, which will not have a significant impact on the company's current operating results and financial status, and there will be no harm to the interests of the company and all shareholders.
According to the data, Alt is a forward-looking technology-driven technological innovation enterprise focusing on full-process R&D of complete vehicles and vehicle platforms, development of new energy intelligent platforms, and R&D and manufacturing of core components. It is the only independent automobile design company listed on A-shares.
In the first three quarters of this year, the company achieved operating income of 736 million yuan, a year-on-year increase of 19.30%; net profit attributable to the parent company was a loss of 151 million yuan, a year-on-year decrease of 12246.62%, and the loss amount has exceeded the 133 million yuan for the whole of 2024.
Looking at the third quarter alone, Alt's net loss was 92.64 million yuan, a further increase of 22.05 million yuan from the previous quarter.
Regarding the reasons for the substantial losses, Alt explained in its third quarter report: "Affected by factors such as the current development status of the domestic automobile industry, pressure to reduce automobile prices has been transmitted to the upstream automobile R&D and design links; the company's profit margin on orders on hand in the past two years has been low, and its gross profit margin has declined."
Alt also disclosed an announcement on December 15 that in order to further optimize the company's resource allocation, reduce management costs, and improve operational efficiency, Chongqing Alt New Energy has completed the deregistration procedures in accordance with relevant procedures.
