NIO's rapid battery swap station construction has brought benefits to its supplier.
Shandong Weida Machinery Co Ltd expects net profit attributable to shareholders to reach RMB150 million ($23.2 million) to RMB180 million in the first half of the year, an increase of 81.32 percent to 117.58 percent over the same period of the previous year, the battery swap station supplier of NIO said in its earnings preview on July 9.
That implies basic earnings per share of RMB 0.35 to RMB 0.43, the Shenzhen-listed company said.
Weida said the power tool industry maintained a high boom in the first half of this year, with strong market demand.
The company focused on quality customers, gave full play to the company's competitive advantages in the industry, and actively developed new products to seize orders, it said.
The company's power tool accessories product line, battery swap station product production and sales are robust, full capacity utilization, comprehensive competitiveness, and profitability have been further enhanced, it said.
Weida achieved operating revenue of about RMB 2.165 billion last year, up 37.45 percent year-over-year. It achieved a net profit attributable to owners of the parent company of RMB 254 million last year, up 315.79 percent from the previous year.
The company's main businesses include power tool parts business, high-end intelligent equipment manufacturing business and new energy business, with the former contributing major operating revenue and operating profit last year.
At present, the company's battery swap station products are mainly supplied to NIO, Weida said recently in response to investor questions, adding that the battery swap station business is the company's focus on cultivating new projects, at this stage, there are sufficient orders and good capacity utilization.
At the end of last year, Weida agreed to acquire an 8.88 percent stake in Wuhan Weineng, a battery asset management company under NIO, by increasing its capital by RMB 150 million.
It is worth noting that NIO recently announced ambitious battery swap station construction goals.
On July 9, NIO co-founder and president Qin Lihong said at the company's first NIO Power Day event that NIO's previous goal of building 500 battery swap stations this year was raised to more than 700.
In addition to raising this year's target significantly, NIO also announced aggressive goals for the next few years.
By the end of 2025, NIO will have more than 4,000 battery swap stations worldwide, including 1,000 in overseas markets.
From 2022 to 2025, NIO will add 600 battery swap stations per year in the Chinese market, Qin said.