Dahua Revenue Grows But Profits Down, Cause Unclear

By Isabella Cheng, Published Oct 20, 2020, 10:56am EDT

While Dahua's overall revenue was up more than 12% in Q3 2020, a significant improvement from the first half of 2020, the company's operating profit is down.

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In this post, we examine Dahua's Q3 2020 financial disclosures and what this means for Dahua going forward, including:

  • Recovery continues as revenue grows
  • Profits attributable to shareholders surge due to chip subsidiary sale
  • Revenue up but operating profits down, reasons unclear
  • Decreasing operating profits partially explained by financial expenses and losses
  • Analysts say government spending recovery contributes to rising revenue
  • Fever camera demand slow down could contribute to stagnating profits
  • Internal management promotions
  • Market reaction

Recovery *********, ******* *****

*****'* ** **** ******* grew **.**% *** ** ~6.3 ******* *** (~$*** million ***). ** *** first **** ** ****, Dahua ***** *.**% ******** ** sales******** ** *** **** time ***** ** ****, but ******* *** ******** performance ** ** ****, its ***** ******* **** now ******* ****** ** to *** *********** ** the ***** * ******** of ****.

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**** ** * *********** recovery **** * ********% *** ******** ** sales ** ** **** and * *.**% ******** in ***** *** ** 2020. ***** ***** *** seen ******* ***** ****** for ** **** *** last *** *****, ** 2020 ******** *** ********.

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Profits ******** ***** ***** ***** ***** *********

*****'* ******* ************ ** shareholders ** ** **** grew ** ********** ***.**% YoY ** ~*.* ******* RMB (~$*** ******* ***), but **** ***** ****** is *** ** *****'* sale ** *** **** subsidiary, ***** ********* ****.* ******* ***(~$*** ******* ***). ***** profited ***** *** ******* RMB (~$*** *******) **** this ****, ***** *** included ** *** ** financials. ********* *** ******* from *****'* *********** ** Huatu, *****'* ******* **** significantly ****.

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Revenues ********** *** ********* ******* ****, ******* *******

*****'* ************ ****** ******** and ********** ********* ******* are ******* ** ****** revenues ******* ******** ******* as ****. *******, **** is *** *** ***** time ***** *** ******** an ******* ******* *** profit ************. ** ** 2020, ***** ******** * decrease ** ***** *** an ******** ** *******, which ** ******* ** declining ***** ******* ***** profits. ***** *** *** provide ** *********** *** this ******* ******* *** profit ******. *****'* ** results **** *** *** present ******** *. ******** revenues *** ***** ******* margins, ***** ***** **** more ******** **** *****'* financial ***********.

Decreasing ********* ******* ********* ********* ** ********* ******** *** ******

*****'* ******* ********* ******* can ********* ** ********* by *** ****** ********* expenses *** ****** ******** in ** ****. *****'* financial ******** ********* ** 320.95% ***. ***** ********* this ** "****** *** to *** ******** ** exchange ****** ** *** period ******** **** *** same ****** ** **** year." ***** **** ******** significant ******* ** ****** impairment ****** ** ** 2020 ******** ** ** 2019, **** ****** ********** losses **** **** ******** from ** ******* *** to *** ******* ***. Credit ********** ****** ***** when ******* ****** ** pay ** *** *** able ** ***. ******** exchange ************ ** ** and ***** ***** **** to ***** ** ********* give **** *********** ** to *** ***** ******** positive ******* ******, *** did *** *** ************* operating ******* **** ** well.

Analysts *** ********** ******** ******** *********** ** ****** *******

******** *** ********* ** China ** ******* ******* growth, ********** ** ********** projects *** **** *** security *** ***** ****** that **** ******* ** the ********* ** **** due ** *****-****** ******* ** ***** since ****. ** ******* ********* ******** ****, ***** ********** *** decrease ** ******* ** H1 **** ********* ** government ******* ****** *** economic ******* ** ****. However, ***** **** ********** project ****** **** **** short-term. ** *** **** few ******, ***** *** largely ********** *** ********, with**** **% ** *** population ****** ******** *********** *** ****** *-*** "Golden ****" *******.

Fever ****** ****** **** **** ***** ********** ** ********** *******

******* ***** ****** ****** could **** ** ************ to ********** *******. *****'* Q2 **** ****** *** gross ****** *********** **** both ********** ******. *****'* margins, ********** *** ******** margins, *** *********** ****** in ** **** ******* of *** ****** **** profitability ***** ****** *****. Dahua **********.**% ***** ****** ******* in ** ****, ***** *** * 7 ***** ******** **** H1 ****. ******** ******* were **** ****** ** H1 **** ** **.**%, following ** ** ***** increase ***. **** ********* are *********** *** ****.

** ***** ****** ***** had ********* ** **** in ** ****, ***** would ******** ** *** increased *******. *******, ***** Dahua *** ********* *****, there *** ** ************ rise ** *******, ********* the ***** ****** **** is *** ** ****** as ** *** **** earlier ** ****. ****** into ******* ******* ** China ** *****-** *** general ******* *** ***** products ********, ** ** reasonable ** ******* **** fever ****** ***** ** Q3 **** **** *** as ****** ** **** of **. *******, ***** has *** ******** ******* commenting ** ***** ***** camera ***** ** ** 2020 *** *** ***** provided * ************ ********* for *** ***** ***** would **** **** ***** on *** ******* ***** of ***** ****** ***** and ******.

Dahua ********* *** ****** ********** ************

***** *********** *** ****** ********** appointments***** ********* *** ** 2020 ******. *** ** these ************ **** ******** promotions ****** **** ********** brought ** **** ***** companies. **** ** *** first **** ***** *** announced *********** ********** ***** 3 **** **********, ********* the ***, ******** *** "******** *******" ** ** ****.

Dahua ***** ********* ** ** ************

*****'* ***** *** ******** largely ********* ** *** days ********* *** ** financials ******* ** *******, October **. **** ****** is **** ******** **** and *************.

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Investor ****

** ** ***********, ***** has *** *** **** or ******** ***** ** hold ** ********* **** discussing *** *********** ** Q3 ****. **** **** update **** ****** ** important ******* *** ****** in * ****** ****.

Comments (2)

********* ** *******, ********* Profit ********* **** *** million *** ** *,*** million *** ** ** 2020.

******.** - ******** ***** TECHNOLOGY **., ***. ********** | *******

** **#*,

* *** ***** **** confusion ***** ****. ******* reports *****'* *** ****** attributable ** ************ ** operating ******/******, *******, *** number ******* **** ******** Dahua's ******, ***-**** *********** of ***** ********* ***** inflates *****'* "*******" *************.

** * ********* ** the ******, ***** **** 941 ******* *** **** the ******** **** ** its ********* **********, ***** was ******** ** **'* financial *******. ** *****, companies ****** ***-**** ********** incomes ** ***** ***-**** profit. ** *** **, companies ***'*. ****'* ********* and ******* ** *****'* sales *********** ** ***** net ****** ***** ********* non-recurring ***** *** ****** because ** ***** *** the *****, *** **** sums ** ***** **** a ******* *** ******* from ******* **** ** its ********. ******* **** not ****** **** ****** (446 ******* ***) ********.

******* ******* **** ******* and ********* ***** **** trouble *********** ******* ********* concepts **** ** ***********, completely ********** ******* *********** (for *******, *** *** profit ***** ***-********* ***** and ****** *******), ** it's ****** ** **** at *** ***** *******'* official ********* ******, ***** is **** **** ******** to ** ********. *** can **** ** ******* version ** *****'* **********. *************, *** *** look ** *** ****** companies ** *** ******** stock ******** ** **** issue ******* *** ************* after ****** ** ***********.

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