Hello, everyone. Today, the weather isn't really ideal, but thank you for coming to our physical meeting. As usual, today we will have our IR to report the financial numbers to you in the first part, and then we will have the Q&A session. Today, we are going to report the full year consolidated numbers to you. The cumulative consolidated numbers have been audited by CPA. Attributable to the lackluster macro demand, the Q4 revenue stood at TWD 100 billion, marking a 5% year-on-year contraction and a 7% seasonal decline from the previous quarter. In Q4, Gross Profit achieved a 3% year-on-year increase, but moderated by 5% quarter-on-quarter, as a combined result of less impact from inventory provisions and reduced dilution from the EVS business.
The gross margin in Q4 improved to 30.4% from 29.6% in Q3, and 28.0% a year ago. Q4 expenses increased by 6% year-on-year and remained flattish from the previous quarter. The wage increases for engineers had led to R&D expenses continuing to grow at a faster rate than SG&A expenses. R&D expenses as a percentage of sales were 9.9% compared to 8.9% in Q3 and 8.3% a year ago. SG&A expenses as a percentage of sales were 10.1% compared to 9.6% in Q3 and a year ago. With an unfavorable scale, the OPEX ratio in Q4 expanded to 20% compared to 18.5% in Q3 and 17.8% a year ago.
OP margin as a result was 10.4% compared to 11% in Q3 and 10.2% a year ago. So, owing to the lackluster macro demand, we saw sequential sales declines in several divisions in Q4, including cooling fans, EV solution, IA/BA networking, and various power supply applications. Conversely, demand for our AI-related power products and energy storage system business remained robust in Q4. Earnings-wise, while we found year-on-year and sequential profit expansion in the infrastructure segment, we saw profit contractions in the power electronics and automation segments due to sluggish demand across many business divisions, such as industrial automation, building automation, cooling fans, and AI power businesses.
So Q4 net operating profit was TWD 2.6 billion, Substantially increased from TWD 1.9 billion in Q3 and around TWD 0.7 billion a year ago. Investment gains provided the most increase. For the investment gains, nearly half of the net operating income came from the conversion of convertible bonds from Lanner Electronics into shares, with market prices far exceeding our holding costs, recognized as an investment gains according to the accounting standards. However, this is not considered disposal income and will be adjusted with fluctuations in the investments market price. So in Q4, we had TWD 12.9 billion profit before tax, and Q4 EBITDA was TWD 19 billion. Q4 tax expense was about TWD 2.6 billion, representing a 20% effective tax rate.
Net profit after tax was about TWD 9 billion, and the Q4 EPS was 3.46. So now we will have a look. Now we are going to have a look at the accumulated numbers for the whole year. So the revenue was TWD 401.2 billion in 2023, up 4% from a year ago. Gross profit was up 6% year-on-year, with a gross profit margin of 29.2% versus 28.8% a year ago. So in Q, I mean, in 2023, R&D expenses increased by 13%, while SG&A expenses grew by 7% over the same period. Consequently, the OPEX ratio expanded to 19%, up from 18% a year ago, and the OP margin was 10.2% compared to 10.8% a year ago.
Segment-wise, given the high comparison base in the previous year, we saw a 9% growth in power electronics, flattish performance in automation, and a small decline in the infrastructure segment. As for the profit contributions, except for the power electronics, where we found a 12% profit improvement, we suffered profit contractions for the other two segments due to the sluggish macro demand. Again, we provide a revenue breakdown by quarter for your reference. We had about TWD 7.7 billion net operating profit. In total, we had TWD 48.6 billion pre-tax income, and our EBITDA was TWD 71.4 billion, and the tax expense was around TWD 9.8 billion, representing a 20% effective rate.
Non-controlling interest increased by over TWD 1 billion as a result of Delta Thailand's earnings expansion compared to a year ago. The EPS of 2023 was 12.86. Yesterday, the board has approved the proposed cash dividend for the year. The proposed cash dividend this year is TWD 6.43 per share. Given the recent noises in the EV market, have our guidance for this year changed? I think, indeed, the EV market is facing some headwinds at the moment. But as mentioned, as we previously talked about, in order to see the increase in the penetration rate of the EVs, I think one of the most critical factors is still the prices, I mean, the of the electric vehicles.
So if you look at the selling prices of the electric vehicles, especially compared to the selling prices of the traditional vehicles, which are still higher than the traditional, I mean, the traditional cars prices. And I do believe that this is actually kind of quite natural for a new business in the market. But I think the increasing penetration, the penetration of electric vehicles in the market is still going to be structural, especially if you consider the carbon emissions, I mean, the issues of carbon emissions around the globe. And one of the good things or the good news is the materials, the raw materials of the electric vehicles or for the batteries are actually becoming lower than, I mean, than they used to be. So that is also going to be helpful.
In terms of the assembling process of electric vehicles, it's actually also going to be much simpler, especially compared to the traditional vehicles. So those are the reasons why I believe that the costs of the electric vehicles are going to be lower, I mean, continuously to be lower. So that supports my positive beliefs, I mean, to the long-term electric vehicle market. So previously, we gave this guidance of the growth rate for our EV solution business this year was 50%. But considering the current headwinds in the market, I think that the growth rate for this year is going to be lower than our previously expected. But the outlook for the market is still, I mean, for the near-term market, is still quite uncertain.
But even, I mean, under these circumstances, we still expect this business continue to be profitable this year, considering the current scale, economics of scale, it is, it has. So last year, we had, like, around 80% year-on-year growth for our EV solution business. And then we will also continue to invest into the equipment, I mean, the production lines. So, my question is related to the purpose of your bond issues. I think that the proposed number approved by the board yesterday is just the maximum that we can issue, but it's not necessary equivalent to the final amounts or numbers we will issue.
I would like to share with you that part of our CapEx plans this year, or CapEx investments for this year, is actually related to the constructions of two new buildings, new office buildings in Neihu. We first came to this place in 1999. After we completed our new building, I think just one year ago, I mean next to the headquarters. Then we pretty lucky that we got the opportunities to acquire another—I mean, new lands nearby our headquarters. So because we still, I mean, are expanding our office capacity. So that's the reason why we acquired the lands, and then are going to build up another two new buildings, office buildings in Neihu.
Can you share your guidance or your views for each segment or business divisions for this year? And I think you previously mentioned you have double-digit growth target for every year, at least for the next five years. Given the sluggish demand in industrial automation market, do you think this target is still achievable? I think even though the automation segment, I mean, in terms of the demand or the performance, isn't really looking great. But I don't think it's going to deteriorating. And for the most of businesses within power electronics, will continue to grow this year. And then for the infrastructure, I think last year, because of due to the weakness in the telecom power market, so our telecom power business was under some pressure.
So I think for this year, we still expect stable growth for the whole company. Can you give us more color, I mean, regarding your plans for your industrial automation business? I think traditionally, for our IA business, we focus on the machine automation. So for the IA segment, I think that we used to focus more on the factory automation, but we are actually planning to shift more focus to the process automation. And production automation as well. And then we are also going to offer more solutions, and then developing more software, especially for the electronics sector. And then for the process automations, I think as usual, we will be focusing on the heavier application, I mean, heavier application sectors. So the definition, I mean, for the process automation and production automation.
So for example, if you look at electronic sector, so the machine automation is actually non-continuous and non-process. So for the process automation, is mainly related to the continuous, I mean, nonstop production. So can you share some details, some colors for your AI server powers? So I think the AI server powers accounts for around 2% of our overall revenues. And then we do, I mean, expect, we do expect substantial growth potential for this product business. So do you expect the consumer electronics is going to recover this year?
So I think for the electronic consumer markets, our products or our businesses, where we have the exposures, to this electronic consumer electronics are mainly the game console powers, smartphones, I mean, the power tools for smartphones and our products, our powers and cooling fans for notebooks. I think last year we actually had pretty decent growth for the game console powers, but it's actually getting to the end, I mean, the end of the product cycle for this generation of game consoles. So this year, with a very high comparison base, we actually expect a weaker demand and weaker performance for our game powers, game console power supplies. And for a new generation of game console, I think it's highly unpredictable, highly uncertain.
Very difficult to predict. I think that all companies or the markets, they are still going to seek for the breakthroughs in the consumer applications. Otherwise, I think even with the upgrade, I mean, or the new generation upgrade every year, but we don't think there is going to be very significant change or improvements or even the recovery in terms of the markets. So for this year, I think - I mean, according to our own, I mean, internal budget, we think this - I mean, the first half is likely to be slightly better than the previous year - I mean, the first half of previous year. But we actually have higher expectation for the second half of this year.
So with Chinese EV OEMs actively expanding their market share, do we have a new strategy for the mainland market? So currently, our major customers are still the western OEMs, but we also just started to, I mean, seeking the opportunities to working with the Chinese OEMs. So can you talk about your strategy in response to growing competition in China? As I always said, I think it's very difficult to compete against the Chinese or the local players with only, I mean, discrete product. So we have to compete against the Chinese companies with the solutions. So we have to, I mean, to find out and identify the sectors where we believe that we have some advantages. And then we develop the corresponding solutions for the sectors and for the customers.
And then, we not only actually set up the solution teams, I mean, in China, but also at a corporate level, we also recently set up a new team called Corporate Solution Office. So we actually recruited very experienced experts from other companies to expand our solution teams. And then, I think we are really committed to this direction. So next question is, what are the next growth drivers after successful development in electronics in IA and your EV businesses? I think speaking of the electric vehicle sector, even, I mean, even though there are some headwinds in the market right now, but the current penetration rate in the market is only around 15%. So I think the growth potential for the electric vehicles is still very high.
So, the only things we, I mean, as a supplier or a tier one supplier, we should do it, is we will need to continue to improve our product efficiency and also help our customers to lower down the costs, the overall costs. In order to further, I mean, improve the competitiveness in the market. And then I think, except, I mean, besides the EV business, I think the micro, we also believe there is actually great potential for the microgrid, for the development of the microgrid. But there are definitely going to, I mean, maybe have, I mean, to see some bottlenecks, I mean, along the way. But we do have pretty high confidence, I mean, in the long-term development of the microgrid market.
So competition in AI server power supplies compared to other power supply products, I mean, is even more, I mean, the more competitive for the AI server powers, supplies. I think even the high specs required by the AI servers, there are actually not many competitors. So I think, last week, I actually just paid a visit to our own factories. I was actually surprised by the new configurations of our new, I mean, the new products for the AI servers. So in terms of the production and also in terms of the, product spec, AI servers, I mean, the powers for AI servers are very, very different, from the traditional power supplies. So that's the reason why there are actually not so many competitors in the market.
Besides the front-end AC to DC power supplies, we think there is actually a greater potential for DC-DC converter products. So I would probably say there are probably only two companies in the world are able to produce such products, and one is Delta. So can you share the revenue contributions of your cooling fans and powers and passive components? So last year, that in terms of the revenue contributions, I think power supplies actually accounted for like 30% of our total revenues. And cooling fans accounted for another 9%-10% of our sales. And the passive components was contributing, I mean, like about 11%-12% of our overall sales. So how do you see the demand for general purpose servers this year?
I think it's going to be stable for the general purpose servers this year, with probably maybe not much growth. So what is the reason, I mean, behind the recent recovery in Cyntec's performance? I think the main reason is we actually had some significant breakthroughs in the automotive products recently, I mean, for our passive component business. So how do you see your opportunities, I mean, in the energy storage system market? I think that we have, I mean, a range of solutions and products for the energy storage system market. And then in order to further improve our expertise in this power industry, so we actually also hired a senior expert from Taip ower to help us.
So how do you see the OPEX increase, I mean, for 2024? I think that, in terms of the numbers, for the OPEX, it's going to... I mean, it's likely to increase, maybe around 15%, for 2024, compared to, the previous year. So given the sluggish demand in the American commercial building automation market, can you share the split between the commercial buildings? I mean, your revenue contributions from the commercial buildings versus non-commercial buildings. I think we only focus on the commercial buildings. We don't have any revenue contributions from the non-commercial buildings market. So, the next question is regarding to the dividend payout ratio. So this year, in terms of the payout ratio, it's actually lower than the historical level.
So what is the reasons behind, and is it going to be a new norm, the new norm, I mean, for the next couple of years? I think, we just shared our plans, I mean, to, in terms of the new office buildings, and also, we are going to acquire, to—I mean, to, to build up the new office buildings and also to expand our production capacity in different regions. So in order to, I mean, prepare for the future needs. So that's the reason why we, I mean, retain some cash for the investments, the CapEx investment plans.
But maybe after a couple of years, and then when we have—I mean, when we have done the most of our globalization plans, and then if, I mean, we have more cash at hand, maybe we will distribute more dividend. But for now, I think we are going to, I mean, just distribute around maybe 50%. So what is your strategy on hydrogen energy? We recently just signed a technology licensing contract with Ceres Power in the U.K., planning to start producing fuel cell stacks and hydrogen fuel production equipment within a few years. I think the reason for the hydrogen energy, I mean, the new technology transfer, I think it's going to be part of our microgrid solutions, our solutions for the microgrid market.
So how do you see the growth, potential or the growth rate for your AI server powers? I think for the DC-DC converters for the AI powers, I think it's going to be maybe around, a 100% , growth, I mean, for this year. And then speaking of the, supply, supply situation, for the graphic chips, I think we are not in a position to comment on the supply of graphic chips directly. So can you give us some updates on your EV charger business? Last year, we had around, 20% year-on-year growth, I mean, for our EV charger business. So I think for the EV chargers, There are actually two issues. One is, even though, the, I mean, the, governments, especially the U.S. governments, they provide, some subsidy.
The federal governments provide subsidy, I mean, to the installations of the EV chargers. But in terms of the days, I mean, getting this subsidy from the governments, I mean, for our customers, it's actually can be pretty lengthy. And also, the safety issues for the installations of EV chargers can become another concern because the DC chargers with very high output actually requires pretty high techniques and expertise to install the DC, the high-power DC chargers. So it takes some times to overcome. So in terms of the orders, I think that we couldn't really, I mean, be able to share too many details regarding the orders with you.
But maybe probably the reasons why you don't really see many news, I mean, regarding our AI development, I mean, the products for the AI, I mean, that much compared to other peers, is probably because if you look at our portfolio, and at the scale, the AI-related contribution, sales, contributions as a percentage of our overall sales, is only around 2% of our sales. But as our CEO just mentioned, that we actually expect pretty decent growth for our AI-related products this year. So I think that we are almost running out of time. So thank you for coming today. Thank you.