According to the Zhitong Finance APP, SITONG (603838.SH) released its performance report for 2024, achieving a total operating revenue of 285.2386 million yuan for the year, an increase of 53.52% compared to the same period last year, demonstrating a strong revenue growth trend. Although the net profit attributable to shareholders of the listed company was still -23.0359 million yuan, it represented a year-on-year reduction in losses of 38.35%, indicating significant performance improvement. This substantial revenue growth and notable reduction in losses are particularly eye-catching in the current fiercely competitive market environment, raising high market attention regarding the reasons behind its growth and future development direction.
Business Growth Path: Dual Drive of Endogenous and Exogenous Growth
1. Endogenous Growth: Traditional Main Business Revitalized
In the traditional household ceramic sector, SITONG has achieved steady business growth through a series of strategic measures, stabilizing its operational fundamentals. SITONG actively participates in well-known domestic and international exhibitions such as the Canton Fair, Frankfurt Exhibition, and Dubai BIG5 Exhibition, fully showcasing its product advantages and capturing market demand dynamics. Leveraging the exhibition platform, the company has established connections with numerous international clients, effectively expanding its overseas market, resulting in a significant increase in overseas order volume.
At the same time, it has intensified the development of bulk business for corporate clients, successfully collaborating with several large enterprises by providing customized ceramic products, further enhancing sales. In the expansion of its aviation ceramic business, SITONG has also made positive progress. With exquisite craftsmanship and strict quality control, it has gained recognition from multiple airlines, providing aviation-specific ceramic tableware and establishing a good brand image in the aviation sector.
From specific data, the revenue from daily-use ceramics reached 130.0265 million yuan in 2024, a year-on-year increase of 30.64%; the revenue from sanitary ceramics was 68.3851 million yuan, a year-on-year increase of 14.58%; and the revenue from artistic ceramics was 39.9456 million yuan, a year-on-year increase of 78.95%. This series of growth data fully demonstrates its deep foundation and strong market competitiveness in the traditional main business field.
2. Exogenous Development: New Materials Business as a New Engine
To seek new business growth points, SITONG decisively expanded into the upstream new materials business in the second half of 2024, launching the zircon-titanium ore refining business. This business mainly involves importing zircon-titanium ore from countries such as the United States, Australia, and Indonesia, using comprehensive process technologies and equipment such as wet magnetic separation, dry magnetic separation, gravity separation, electric separation, dehydration, and drying to sort and refine zircon-titanium ore, producing various concentrate products like titanium concentrate, zircon sand, and rutile. These products are widely used in precision casting, casting coatings, refractory materials, and various ceramics, with strong market demand.
The zircon-titanium ore refining business launched in the second half of 2024 achieved operating revenue of 39.7592 million yuan in the same year. As the business continues to advance, with ongoing maturation of process technology and continuous accumulation of customer resources, this business is expected to achieve greater breakthroughs in the future, bringing more substantial profit returns to the company, helping it establish a foothold in the new materials field and achieve diversified development
<h2>Cost Reduction and Efficiency Improvement: Multi-Dimensional Optimization of Cost Structure</h2>
I. Production Stage: Technological Transformation and Process Optimization
In the production stage, SITONG actively engages in the transformation of production lines and process technologies, aiming to reduce energy consumption and material costs. A significant amount of resources has been invested to upgrade production equipment, introducing advanced automated production devices to enhance production efficiency and product quality stability. At the same time, continuous research and development of raw material recycling technologies have been conducted to recycle and reuse waste generated during the production process, which not only reduces the procurement costs of raw materials but also lowers waste emissions, achieving efficient resource utilization and environmentally friendly protection.
In terms of process technology transformation, through in-depth research and analysis of production processes, parameters and operating methods of various production stages have been optimized, making the production process smoother and more efficient. For example, in the ceramic firing stage, improvements in kiln structure and combustion methods have increased energy utilization efficiency and reduced energy consumption during the firing process, significantly lowering the energy costs per unit product. In the raw material processing stage, new raw material processing technologies have been developed to enhance raw material utilization and reduce costs arising from raw material waste.
II. Operational Management: Refined Management and Cost Control
At the operational management level, SITONG implements refined management and has established standardized operating procedures to strictly control expenses in all aspects, including procurement, office operations, and travel. Additionally, by actively revitalizing existing assets and reasonably disposing of idle assets, the efficiency and return rate of asset usage have been improved. Through optimizing asset allocation, assets have been directed towards more promising business areas, achieving preservation and appreciation of assets. While controlling costs, there is also a focus on enhancing operational efficiency. Through information technology construction, information sharing and collaborative work among departments have been realized, reducing communication costs and delays in work processes, thereby improving overall operational efficiency.
<h2>2025 Outlook: Full of Confidence, Striving for Delisting</h2>
Looking ahead to 2025, SITONG is full of confidence in achieving its delisting goal and has formulated a series of effective strategies.
I. Market Expansion: Dual Approach in Domestic and International Markets
In terms of market expansion, SITONG plans to further increase marketing investments and actively explore new markets and new customers for its core business in household ceramics. In export business, it will continue to actively participate in internationally renowned exhibitions such as the Canton Fair, Frankfurt Exhibition, and Dubai BIG5 Exhibition, leveraging these platforms to gain deeper insights into international market demands and dynamics, and establish cooperative relationships with more overseas customers. At the same time, it will continue to strengthen the development of major clients in supermarkets and airlines, providing personalized product solutions and high-quality services to meet diverse customer needs, consolidating and expanding market share in these areas.
In the domestic market, SITONG will continue to intensify the development of bulk procurement business for chain supermarkets, hotels, and corporate clients. By establishing long-term stable cooperative relationships with chain supermarkets, it aims to expand product distribution and increase market exposure; for hotel clients, customized ceramic products will be offered to meet unique hotel needs and enhance brand image; for corporate bulk procurement, it will leverage high product quality and price advantages to win more orders. Additionally, there will be increased efforts in new product development, exploring sales channels for gift ceramics and souvenirs, and meeting the needs of different consumers through innovative product design and marketing strategies
Further expand the domestic sales market.
II. Cost Control: Continuously Deepen Cost Reduction Strategies
In terms of cost control, SITONG aims to reduce costs, improve quality, and increase efficiency through multiple measures to control expenses and costs. In procurement management, the company will further optimize the procurement process, strengthen in-depth cooperation with suppliers, and strive for more favorable procurement prices and payment terms through centralized purchasing and long-term cooperation agreements. At the same time, it will continuously improve the supplier evaluation system, regularly conduct comprehensive assessments of suppliers' product quality, delivery times, prices, etc., eliminate unqualified suppliers, and ensure the stability and efficiency of the supply chain.
In terms of production cost control, the company will continuously optimize production processes, introduce advanced production technologies and equipment, improve production automation levels, and reduce labor costs and waste in production links. By streamlining personnel configuration, reasonably arranging employee work positions, and improving employee work efficiency, the company aims to achieve optimal allocation of human resources. In asset management, the company will continue to actively revitalize existing assets, reasonably dispose of idle assets, and improve the efficiency and return rate of asset use. By optimizing asset allocation, the company will invest assets in more promising business areas to achieve the preservation and appreciation of assets.
III. New Business Development: Breakthrough in New Materials Business
In the zircon-titanium ore product refining business, with the continuous advancement of the business, the maturation of process technology, and the continuous expansion of customers, this business is expected to achieve greater breakthroughs by 2025. The company will increase investment in this business, introduce advanced production equipment and technical personnel, and improve production efficiency and product quality. By optimizing production processes, the company aims to reduce production costs and enhance the market competitiveness of its products. At the same time, it will actively expand customer resources, establish cooperative relationships with more downstream enterprises, increase product market share, and achieve rapid revenue growth and sustained profit increases, providing strong support for the company to lift restrictions.
Summary and Outlook: Bright Prospects, Yet Challenges Remain
Looking back at 2024, SITONG achieved significant revenue growth and a notable reduction in losses driven by both endogenous growth and external development. The cost reduction and efficiency enhancement measures have also achieved phased results. In 2025, the company has formulated comprehensive and targeted development strategies, actively laying out in market expansion, cost control, and new business development, demonstrating strong determination and confidence in development.
However, the company also faces numerous challenges. Market competition remains fierce, the competition landscape in the ceramics industry is highly fragmented, and some small and medium-sized enterprises face survival pressure. SITONG needs to continuously enhance product competitiveness and brand influence to cope with competitive pressures from peers. Industry technology is constantly innovating, with new ceramic materials and production processes emerging. Only by keeping pace with technological development trends can the company maintain a leading position in the market. Additionally, uncertainties in the macroeconomic environment and fluctuations in raw material prices may also impact its operating performance.
In the future, SITONG needs to continue deepening its strategic layout and strengthening its core competitiveness. Based on consolidating the advantages of traditional main businesses, the company should accelerate the expansion of its new materials business to achieve diversified development. At the same time, it should continuously optimize internal management, promote cost reduction and efficiency enhancement, and improve operational efficiency and profitability. Only in this way can the company achieve sustainable development in a complex and changing market environment, create greater value for shareholders, steadily advance in the wave of development, achieve the goal of lifting restrictions, and move towards a new stage of development

603838

SITONG released its 2024 performance preliminary report, with total operating revenue reaching 285.2386 million yuan, a year-on-year increase of 53.52%. Although the net profit was -23.0359 million yuan, it represented a year-on-year reduction in losses of 38.35, indicating significant performance improvement. The company actively expanded its market by participating in international exhibitions and developing bulk business, with revenue from daily-use ceramics, sanitary ceramics, and artistic ceramics all showing growth, demonstrating strong business growth potential

SITONG's 2024 report card is out: Revenue surged, performance improved, where are the future highlights?