【True Insight Hong Kong Stock Trends】Continental Aerospace Technology Holdings Limited (00232.HK): Continental Aerospace signs new agreement with AVIC General Aircraft to jointly expand the market

Zhenzhuo Financial News October 18, 2024) - Leading general aviation aircraft piston engine manufacturer and service provider – $CON AERO TECH(00232.HK) announced that it has entered into a 2024 sales framework agreement with AVIC General Aircraft Co., Ltd. ("AVIC General Aircraft"). According to the agreement, Continental Aerospace Technologies will sell engines, engine components, and related services to AVIC General Aircraft for the manufacture of new aircraft; AVIC General Aircraft will also resell components to the parts market to provide maintenance, repair, and overhaul services. The term of this agreement runs from January 1, 2025, to December 31, 2026, a total of 2 years, and marks the third such agreement signed by the two parties since their collaboration began in 2021.

AVIC General Aircraft was established in 2009 in mainland China as a large state-owned enterprise group under the Aviation Industry Corporation of China (AVIC). Its core businesses include general aircraft development, general aviation operations and services, aviation components, and non-aviation manufacturing. AVIC General Aircraft also indirectly owns 85% of Cirrus Design Corporation, the world's largest manufacturer of piston-engine-driven aircraft and one of the group's major customers. With the signing of this new sales framework agreement, the group has not only enhanced the controllability of future orders but also strengthened its business relationship with AVIC General Aircraft, enabling both parties to jointly capture growth opportunities in China's general aviation market.

Mr. Yu Xiaodong, Executive Director and CEO of Continental Aerospace Technologies Holdings Limited, stated: "We are delighted to continue our close collaboration with AVIC General Aircraft. Since 2021, we have signed multiple sales agreements, with both the annual transaction caps and actual transaction amounts steadily increasing. This agreement raises the transaction cap to $57.0 million by 2026, a significant increase of approximately 48.8% compared to the initial $38.3 million in 2022. This demonstrates our customers' confidence in our product quality and service capabilities. Moving forward, we will continue to optimize our operational systems to meet customer demands with higher production efficiency and delivery capacity. We will also intensify product R&D to further consolidate our product advantages and market position."