Brilliance China Automotive (1114) H1 2024 earnings summary

Executive summary

• Revenue for the six months ended 30 June 2024 rose 2.0% year-over-year to RMB518.0 million, driven by increased orders from electric and hybrid vehicle manufacturers, offset by lower auto financing revenue due to competition.

• Gross profit margin declined to 20.0% from 28.0% year-over-year, mainly due to higher raw material costs and reduced financing margins.

• Profit attributable to equity holders dropped 60.7% to RMB1,473.3 million, with basic EPS at RMB0.29201.

• The Group reconsolidated RBJAC after restructuring and capital contribution, regaining 80.72% control.

• BBA, the major associate, saw a 6.4% decrease in local sales volume and a 27.1% drop in profit contribution.

Financial highlights

• Revenue: RMB518.0 million (+2.0% YoY); Gross profit: RMB103.6 million (-27.2% YoY); Gross margin: 20.0% (vs. 28.0%).

• Profit before tax: RMB2,937.8 million (-27.0% YoY); Net profit: RMB1,473.3 million (-60.7% YoY).

• Income tax expense surged to RMB1,472.1 million from RMB277.2 million, mainly due to withholding tax on dividends.

• Cash and cash equivalents: RMB27,346.1 million (down from RMB30,845.8 million at year-end 2023).

• Special dividends totaling HK$5.8 per share declared and paid in 1H2024.

Outlook and guidance

• BBA to focus on BEV market, with new models and the "Neue Klasse" platform launching in 2026.

• RBJAC to resume production of Haise and Haise King models, including electrified versions, in 2025.

• Auto finance subsidiary BBAFC to expand NEV lending and co-lending partnerships to regain market share.

• The Group is exploring new investments in hydrogen, digitalisation, and NEV manufacturing.

• Management expects continued margin pressure from competition and raw material costs.