In the face of fierce competition in the industry, Haier has accelerated its search for new growth.
On December 14, Haier Smart Home disclosed that it planned to take about 6$400 million (about $45.5.)RMB 5.9 billion) in cash to acquire the commercial refrigeration business (the "Target Business") of Carrier Global Corporation (the "Carrier Group").
Carrier Inc. intends to acquire Carrier Refrigeration Benelux Bv.(hereinafter referred to as the "Target Company") 100% equity and related assets. carrier refrigeration benelux b.v.is a company registered in the Netherlands, and Carrier is in the process of restructuring its target business into a target company.
Along with this transaction, the buyer and seller intend to sign a series of strategic cooperation agreements and trademark licensing agreements before closing. Haier Smart Home will be authorized to use the "Carrier" trademark related to the target business worldwide for a period of 2 years, and will obtain a trademark for the target business that embodies the characteristic elements of "Carrier" and "commercial refrigeration", and the buyer will have the right to use the logo for the target business worldwide free of charge for a total of 16 years.
Regarding the basic situation of both parties, Haier Smart Home has a global home appliance brand cluster, including Haier, Casarte, Leader, GE Appliances, Candy, Fisher&Paykel and Aqua. Carrier's target business is to provide end-to-end commercial refrigeration solutions in the food retail industry, including refrigeration cabinets and refrigeration units used in the food retail industry (e.g., supermarkets), as well as CO2 refrigeration units and ancillary services for use in cold storage.
For the purpose of this transaction, Haier Smart Home said that the company intends to expand from "household refrigeration" to retail refrigeration, cold storage refrigeration and other commercial refrigeration fields to create new growth points.
From the perspective of the industry, Haier Smart Home's move is to quickly enter the high-boom TOB commercial refrigeration track, and then expand the brand's influence in the global refrigeration field.
In fact, in recent years, China's home appliance enterprises are still deepening their global strategic layout, actively expanding their global territory, and opening the road to global harvesting. Haier Smart Home has acquired Sanyo Electric's Southeast Asian white goods business, GE's home appliance business (GEA) in the United States, Fisher & Paykel in Australia, and Candy in Italy. Midea is not limited to the home appliance industry, and has acquired the Egyptian air-conditioning brand Miraco325% stake, acquisition of German KUKA Robot, acquisition of 80% equity of Italian air conditioning brand CLIVET.
Haier is also promoting high-end overseas. In the financial report, the company mentioned that by promoting the high-end brand strategy and in-depth development of the network, the market share has been increasing, and the results in the North American and European markets have been emphasized.
At the AWE 2023 Summit Forum, Li Huagang, Senior Vice President of Haier Group and Chairman of Haier Smart Home Co., Ltd., said that Haier Smart Home's entire overseas revenue accounted for 52% in 2022, which is also the first time that overseas revenue exceeds domestic revenue.
Although the overseas business is well-received, Haier's performance growth has slowed down significantly. In 2022, Haier Smart Home's revenue will increase by 7% year-on-year22%, net profit increased by 12% year-on-year48%；In 2021, Haier Smart Home's revenue increased by 8% year-on-year5%, net profit increased by 47% year-on-year1%。
Compared with the performance of Midea and Gree, Haier's financial performance is not outstanding. According to the financial report, in the first three quarters of this year, Midea Group led Haier Smart Home in terms of revenue performance; In terms of net profit attributable to the parent company, Haier Smart Home is lower than the other two. Looking at the 2022 annual report, the same is true for the ranking of the revenue and net profit of the three companies.
In addition, the intelligence of home appliances is also the key strategic direction of Haier Smart Home. Since the beginning of this year, Haier Smart Home's smart home scene brand, Three-winged Bird, has made frequent moves, including the release of the 10,000-family nesting plan in June, the establishment of the China Home Furnishing TOP Ecological Alliance in July, the first community cultural festival held in September, and the signing of contracts with 61 top enterprises to build a smart community ecology in December, and the appearance of the "Three-winged Bird Partner Platform".
However, the competition in this track is fierce, not only there are old home appliances and home furnishing brands, but also Xiaomi, Huawei, Ali and other giants with strong scientific and technological strength.
Expand TOB business to replenish ammunition
List of high-quality authors distinct mirror
The seller company of this transaction, Carrier Group, is a company listed on the New York Stock Exchange and has a history of more than 120 years. The target business has about 4,000 employees in more than 10 major countries and regions around the world, including about 200 R&D personnel and more than 2,300 technical service engineers.
In terms of performance, Haier Smart Home intends to take about 6The target company acquired by $400 million, with 2021 revenue of 12US$1.8 billion, net profit of US$45.6 million, net operating assets of US$1US$08.8 billion; 2022 revenue 12$27.6 billion, net income of $58.1 million, net assets from operations of $88.4 million.
According to the announcement, from the market perspective, the cold storage market in the commercial refrigeration market in Europe, Asia-Pacific and North America will be about $11 billion in 2023 and is expected to grow at a compound annual growth rate of about 13% from 2023 to 2028.
The main growth drivers came from new cold storage capacity, driven by increased consumption of fresh and frozen foods, as well as the growing popularity of the food retail business. The scale of the food retail market in 23 years is about 15 billion US dollars, and the market is relatively stable.
Haier Smart Home believes that the target business has carbon dioxide refrigeration technology based on natural refrigerants, which is in line with the general trend of refrigerant conversion and the growing global demand for sustainable development.
The two sides have been in contact before, and the announcement mentioned that the target business and Haier established a joint venture for the Chinese market in 2001, with the target business holding 51% of the shares and Haier holding 49% of the shares. The joint venture reported a pre-tax margin of 71%。
Zhao Meimei, assistant to the president and general manager of the research and innovation department of Aowei Cloud Network (**c), said that the acquisition of the commercial refrigeration business of Carrier means that Haier will expand from the home refrigeration scenario to the commercial retail refrigeration and cold storage refrigeration scenarios, and use this as a platform to expand to other commercial cold chain scenarios in the future.
From January to October this year, the domestic air conditioning market was affected by factors such as weather assistance and a low base in the same period, and retail sales increased by 8 percent year-on-year2 percentage points, compared with other traditional major appliances categories, it is very eye-catching. In order to better achieve the growth goals of enterprises, enterprises have been looking for new growth points to expand revenue, and the diversification and internationalization of product and service solutions are one of the key ways.
In Zhao Meimei's view, the acquisition of Carrier's commercial refrigeration business will help Haier achieve business expansion and solution panorama in the refrigeration field, and will also help promote the development of Haier's overseas refrigeration business.
As for Haier's choice to acquire the TOB business overseas instead of the TOC business, Major General Ding, an observer of the Sankei Economy, told another mirror that the main reason is that the TOB business is more technical and profitable, and the market potential is huge. Haier, on the other hand, has made considerable achievements in overseas TOC business.
Will intelligence be the way out?
distinct mirror
In recent years, Haier has also been actively promoting its intelligent process.
In June 2019, Qingdao Haier announced that it would be renamed Haier Smart Home, which means that it will fully focus on the construction of the smart home ecological brand from now on.
At that time, the choice made by Haier Smart Home was also in line with the needs of the Internet of Things era. In 2020, Haier Smart Home's smart home scene brand Three-winged Bird was born, opening a new story from selling single products to selling scenes; In 2021, Three-winged Bird will open a new era of one-stop customization of smart homes with ecological layout; In 2022, Three-winged Bird upgraded and released the "1+3+5+N" whole-house smart full-scenario solution.
Since the beginning of this year, the three-winged bird has made frequent moves, releasing the nesting plan of 10,000 homes in June, taking the lead in establishing the China Home Furnishing TOP Ecological Alliance in July, holding the first community cultural festival in September, and signing contracts with 61 top enterprises to build a smart community ecology in December, and debuting on the "Three-winged Bird Partner Platform".
Nowadays, more and more consumers are embracing smart homes and pursuing high-quality, personalized and high-quality solutions. IDC data shows that the global smart home market will reach $151.4 billion in 2022, a year-on-year increase of 162%。
Among them, the Chinese market size was 54.5 billion US dollars, a year-on-year increase of 182%, becoming the world's largest smart home market. It is estimated that by 2025, the size of China's smart home market will reach 87.8 billion US dollars, with a compound annual growth rate of 149%。
At the same time, the current whole-house smart brand is accelerating the layout of offline stores, according to CSIA Rsearch's incomplete statistics on the offline stores of Huawei, Xiaodu, AQARA, Oribo, Morgan and other brands, in October 2023, there will be 3350 whole-house smart stores in China, an increase of 650 over the same period last year, and 46% of the stores are distributed in East China.
According to CSIA Rsearch analysis, in 2023, under the reshaping of products and industrial chains, the smart home industry will officially enter an explosive period, and the new technology of the Internet of Things will be fully integrated into spatial intelligence.
It is worth noting that the domestic smart home system has also followed the iteration, and Midea is continuing to improve the human factors intelligent system; Haier Smart Home connected the large model to the smart home brain and released the first vertical model HomeGPT in the field of smart home; Huawei released Whole Home Smart 50。
However, even if the smart single products and intelligent systems of home appliances and home appliances are implemented on the consumer side, there are still many problems. Some people in the industry have commented that from the perspective of the industry, the current products are uneven, do not fully take care of consumer needs, lack of system-level scenario linkage, and no unified standards are all factors hindering the development of this field.
However, Haier lacks the traffic and platform advantages of Internet technology giants, and the stores that are vigorously laid are also too "heavy", making it difficult for it to win in this track.
However, in the view of Liang Zhenpeng, an observer of the industrial economy, the most important thing for smart home is that the product line should be complete. He told another mirror that Haier is a brand in the home appliance manufacturing industry, with its own factory, and a considerable proportion of its smart home products are produced by itself, which is more conducive to the grasp of smart home quality and product control, and it will be closer to consumers.
The opponent is in hot pursuit.
distinct mirror
Haier's accelerated search for new growth points and large-scale acquisitions may be inseparable from the pressure on its performance, sluggish stock price, and the situation of rivals chasing after it.
In the first three quarters of 2023, Haier Smart Home's revenue will be 19865.7 billion yuan, an increase of 75%。Net profit attributable to the parent company was 1314.9 billion yuan, an increase of 127%。
In the first three quarters of 2022, Haier Smart Home's revenue was 18474.9 billion yuan, an increase of 89%。Net profit attributable to the parent company was 1166.6 billion yuan, an increase of 173%。
Haier Smart Home's revenue and net profit increased in the first three quarters of this year, but its performance is slowing down. Looking back at the performance of the past two years, Haier Smart Home's revenue in 2022 will be 24351.4 billion yuan, an increase of 72%。The net profit attributable to the parent company was 1471.1 billion yuan, a year-on-year increase of 125%。Revenue in 2021 is 22755.6 billion yuan, an increase of 85%。Net profit attributable to the parent company 1306.7 billion yuan, a year-on-year increase of 471%。
Compared with the latest financial reports of the other two white power giants, in the first three quarters of 2023, Midea's revenue was 2911100 million yuan, a year-on-year increase of 767%。Net profit attributable to the parent company was 277200 million yuan, a year-on-year increase of 1327%；Gree's revenue was 155 billion yuan, a year-on-year increase of 51%；Net profit attributable to the parent company is 200900 million yuan, a year-on-year increase of 977%。
Midea Group leads Haier Smart Home in terms of revenue performance. In terms of net profit attributable to the parent company, Haier Smart Home is lower than the other two.
It is worth noting that on the evening of October 30, the three major white power giants released their financial reports for the third quarter of 2023. As of October 31, the stock price of Midea Group was **290%, Haier Smart Home fell by 089%, Gree Group fell 035%。
In order to stabilize the stock price, home appliance companies have recently made large purchases, such as the chairman of Hisense Household Appliances, who threw out 12.5 billion yuan-2500 million yuan of repurchase proposals, Gree Electric Appliances and Haier Smart Home and other intensive disclosure of repurchase progress; Midea Group adopted a "write-off repurchase" to officially announce the cancellation of about 70 million shares to increase the level of earnings per share.
In addition, in recent years, Midea Group, Haier Smart Home, and Gree have different strategies, and they are all exploring new growth points, including building high-end home appliance brands, going overseas and cross-border development.
Unlike Haier, which focuses on expanding in the field of home appliances, Midea is more diversified. In 2021, Midea Group repositioned its five major business segments, established the four strategic axes of leading technology, driven by digital intelligence, direct access to users and global breakthroughs, and achieved the simultaneous development of TOB and TOC businesses. With the adjustment of business, Midea Group has made frequent investment moves, and has successively crossed over to new energy vehicles, elevators, semiconductors, medical devices and other businesses.
At present, Midea Group has deepened the transformation of its TOB business model and has formed a business structure of "1+3+N" ("1" is the smart home business group, "3" is industrial technology, building technology and robotics and automation, and "N" is a number of innovative businesses).
At the beginning of 2023, Fang Hongbo, chairman and president of Midea Group, said that this year, Midea will start the second engine while stabilizing the core business of home appliances, and focus on strategic emerging industries such as robotics and automation, building technology, new energy auto parts, and advanced energy storage in Guangdong, so as to build a second curve to drive growth.
On the evening of October 24, Midea Group submitted a listing application to the Hong Kong Stock Exchange. If the listing is successful, Midea Group will be listed on the Hong Kong stock market and the A-share market at the same time. In this regard, Midea Group said that it is mainly based on the need to deepen the global strategic layout.
The diversification of Gree Group has been relatively slow, but it has also shifted to other fields since 2016. In recent years, it has accelerated the improvement of the industrial chain layout, in addition to the layout of household appliances related to ice washing, small household appliances and other household appliances, and even entered the medical, mobile phones, renewable resources, prefabricated dishes, industrial parts and other fields.
The competition between the three giants of white electricity has never stopped. However, in the face of today's market competition environment and macro environment, it is particularly important for Haier to form its own advantages in overseas markets and high-end and intelligent markets.
Author |Dawn
Edit|Chen Qiu
Operations|Chen Xiaoyan
Another mirror (ID: DMS-012).