The "shovel seller" in the heterojunction sector struggles to maintain its glory: Maxwell Technologies faces high inventory and accounts receivable, with impairment provisions exceeding 500 million yuan

At a time when the growth of new PV capacity has significantly slowed down, equipment manufacturers that once achieved rapid performance growth are now facing the risk of product backlogs. Maxwell Technologies (300751.SZ), a leading player in HJT (heterojunction) battery equipment, saw revenue growth without corresponding profit growth in 2024.

The company announced in the evening that in 2024, it achieved operating revenue of 9.83 billion yuan, up 21.53% YoY, and net profit attributable to shareholders of publicly listed firms of 926 million yuan, up only 1.31% YoY.

HJT technology boasts advantages such as high conversion efficiency, low attenuation rate, and low-temperature processes. According to information, Maxwell Technologies' independently developed solar cell screen printing equipment and HJT battery production line equipment have broken the monopoly of foreign manufacturers, achieved import substitution, and been successfully exported to overseas markets. As a "shovel seller" in the PV industry, in 2023, when HJT technology was being vigorously promoted, the company achieved operating revenue of 8.089 billion yuan, a substantial increase of 94.99% from the previous year.

However, as the PV industry began to experience a temporary supply-demand imbalance, Maxwell Technologies' performance growth rate started to slow down. The company stated in its financial report that, affected by the overall industry situation, some downstream customers faced operational difficulties, leading to a slowdown or halt in the execution of some of the company's orders. Consequently, the company conducted impairment tests on inventories and receivables in 2024 and made provisions for asset impairment of 524 million yuan, mainly including bad debt provisions for accounts receivable of 388 million yuan and inventory write-down losses of 136 million yuan. A significant amount of asset impairment provisions were made in 2024. Affected by this, the company's net profit growth rate slowed down in 2024.

It is worth noting that the impact is ongoing. As of year-end 2024, the book value of the company's inventories was 8.923 billion yuan, accounting for 37.43% of the total assets for the period. The company stated that the high book value of inventories was mainly related to the company's product acceptance cycle. Due to the relatively long acceptance period for the company's products, the ending balance of goods in transit in the company's inventory structure was relatively large.

Maxwell Technologies further stated that a large inventory scale, on the one hand, occupies the company's working capital, and on the other hand, since revenue has not yet been realized for goods in transit, there is a risk of inventory write-downs and losses if the products fail to meet acceptance standards, which could have a negative impact on the company's production and operation.

In terms of accounts receivable, the book value of the company's current accounts receivable was 3.95 billion yuan, accounting for 40.18% of the current operating revenue. High accounts receivable, on the one hand, reduce the company's capital utilization efficiency and will affect the company's sustained and rapid business growth. On the other hand, if the company's customers experience difficulties in payment collection or a deterioration in their financial conditions, it may bring bad debt risks to the company.

In the first quarter of this year, the company continued to make provisions for asset impairment of 180 million yuan, mainly for bad debt provisions for accounts receivable. The company stated that these provisions were mainly for receivables that were in dispute with the other party or involved in litigation or arbitration, as well as receivables for which there were clear indications that the debtor was likely to be unable to fulfill repayment obligations.

Affected by this, the company achieved operating revenue of 2.229 billion yuan in Q1 of this year, up slightly by 0.47% YoY, and net profit attributable to shareholders of publicly listed firms of 162 million yuan, down 37.69% YoY. The net cash flow generated from operating activities was -352 million yuan. The company stated that this was mainly due to the slow payment collection speed of the company's customers during the reporting period, resulting in a significant decrease in cash received from the sale of goods, which led to a substantial decline in the net cash flow generated from the company's operating activities.

Some analysts told a reporter from Cailian Press that, compared with the mainstream TOPCon technology and the strong-momentum BC technology products, the shipment proportion of HJT products is not high. The production scale of major manufacturers is relatively small, and their ability to withstand risks during a downturn in the industry cycle is limited. Although the efficiency advantages and low-carbon characteristics of HJT are clear, the industrialisation process still needs to overcome cost barriers, capacity expansion bottlenecks, and technical stability challenges.

According to Maxwell Technologies, the company has upgraded the annual production capacity of its single-line equipment for high-efficiency bifacial microcrystalline HJT batteries to the GW level, reducing operating costs in terms of unit labor, equipment footprint, and energy consumption. In addition, the company has developed the second-generation No-Busbar (NBB) technology and its stringing equipment, which removes all busbars from the battery and can reduce silver paste consumption by 30%, further promoting cost reduction and efficiency improvement for HJT batteries.