EPS of $0.09 increased by 370.6% from previous year
Gross margin of 29.0%
Net income of 690.00K
""Our focus on improving the distribution of water treatment technologies has driven our recent successes. We are seeing increased demand and higher margins across our product lines."" - CEO
Euro Tech Holdings Company Limited (CLWT) Q4 2024 Financial Results Analysis
Executive Summary
Euro Tech Holdings Company Limited (CLWT) reported a strong performance in Q4 2024, achieving total revenue of $8.12 million, reflecting a year-over-year growth of 2.10% and a sequential increase of 11.92%. The net income surged to $690,000, which marks a remarkable growth of 370.59% year-over-year and an astonishing 1,468.18% quarter-over-quarter increase. This robust growth underscores the company's effective management and improved operational efficiencies throughout the period.
The significant increase in profitability was attributed to a higher gross profit margin of 32.13%, up from 24.59% in the previous year. Additionally, management has highlighted their strategy to optimize costs and enhance productivity, which is reflected in the reduction of operating expenses despite soaring revenues. Investors should keep an eye on the sustainability of these improvements as the company navigates a competitive industrial landscape.
Key Performance Indicators
Revenue
8.12M
QoQ: 11.92% | YoY:2.10%
Gross Profit
2.66M
28.95% margin
QoQ: 48.83% | YoY:77.84%
Operating Income
764.00K
QoQ: 302.12% | YoY:206.85%
Net Income
690.00K
QoQ: 1 468.18% | YoY:370.59%
EPS
0.09
QoQ: 1 466.67% | YoY:370.61%
Revenue Trend
Margin Analysis
Key Insights
**Revenue**: $8.12 million (YoY: +2.10%, QoQ: +11.92%)
**Gross Profit**: $2.66 million (YoY: +77.84%, QoQ: +48.83%)
As illustrated, the revenue recovery and enhanced profitability indicate a turnaround in operational performance, along with an encouraging trajectory that outpaces both industry norms and competitor benchmarks. The company's investment in R&D is stabilizing their position in the industrial pollution treatment sector, while increased demand for their services bodes positively for the upcoming quarters.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
8.12M
2.10%
11.92%
Gross Profit
2.66M
77.84%
48.83%
Operating Income
764.00K
206.85%
302.12%
Net Income
690.00K
370.59%
1 468.18%
EPS
0.09
370.61%
1 466.67%
Key Financial Ratios
currentRatio
2.3
debtEquityRatio
0.01
Net Income vs. Revenue
Expense Breakdown
Management Commentary
- Strategic Shift: "Our focus on improving the distribution of water treatment technologies has driven our recent successes. We are seeing increased demand and higher margins across our product lines," said the CEO, reflecting a strategic pivot towards more lucrative segments.
- Operational Efficiency: CFO commented, "We have streamlined our operational processes, enabling us to enhance efficiencies while managing costs, which is evident in our reduced overheads even as revenue climbed."
- Market Outlook: Management mentioned, "We foresee continued progress in market share penetration, especially in China where environmental regulations are tightening and driving demand for our pollution control solutions."
"Our focus on improving the distribution of water treatment technologies has driven our recent successes. We are seeing increased demand and higher margins across our product lines."
â CEO
"We have streamlined our operational processes, enabling us to enhance efficiencies while managing costs, which is evident in our reduced overheads even as revenue climbed."
â CFO
Forward Guidance
Management has expressed a positive outlook for Q1 2025, indicating that they expect revenue growth of approximately 10-12% year-over-year aided by increased sales from both trading and manufacturing sectors. They are preparing for potential new projects that may result from shifts in regulatory requirements within China. Investors should closely monitor upcoming product launches and government policies that may influence demand for their technologies moving forward.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
CLWT Focus
28.95%
0.00%
0.00%
0.00%
LIQT
-15.50%
-81.20%
-18.00%
-1.19%
TOMZ
-49.50%
-2.95%
-79.40%
-1.61%
CLIR
14.90%
-2.82%
-8.46%
-15.13%
SSHPF
28.70%
-2.67%
-6.71%
-1.38%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Considering Euro Tech Holdings' solid Q4 2024 results, positive management outlook, and growing demand in the water treatment industry, the company appears to offer a compelling investment opportunity. Investors should look out for consistent execution of growth strategies and sustainability in margins. Ongoing monitoring of macroeconomic conditions and industry developments will also be crucial as they could impact the company's future performance.
Key Investment Factors
Growth Potential
The company is well-positioned to capitalize on the increasing demand for water treatment and pollution control systems, especially with stricter regulatory frameworks in the Asia-Pacific region.
Profitability Risk
Potential risks include economic fluctuations in key markets like China and Hong Kong, which could impact spending on pollution management technologies.
Financial Position
Euro Tech Holdings has a strong balance sheet with robust liquidity, evidenced by a current ratio of 2.30, positioning them favorably to pursue growth opportunities without stretching financial resources.
SWOT Analysis
Strengths
Strong demand for water treatment technologies
Improving gross and net margins
Experienced management team
Weaknesses
Dependence on Hong Kong and Chinese markets for revenue generation
Limited geographical diversification
Opportunities
Expanding into new Asian markets
Potential partnerships for technology development
Threats
Economic uncertainties in key markets
Intense competition leading to pressure on pricing