China Hongqiao Group (1378) H1 2024 earnings summary

Executive summary

• Revenue for the six months ended 30 June 2024 rose 12.0% year-over-year to RMB73.6 billion, driven by higher sales prices and volumes for aluminum alloy and alumina products.

• Net profit attributable to shareholders surged 272.7% year-over-year to RMB9.15 billion, with basic EPS at RMB0.966, up from RMB0.259.

• Gross profit margin expanded to 24.2% from 9.0% a year earlier, driven by higher sales prices, volumes, and lower raw material costs.

• Interim dividend of HK59.0 cents per share declared, up from HK34.0 cents per share in 2023.

• The group advanced its green and low-carbon initiatives, expanded R&D, and strengthened its integrated industrial chain, especially in high-end and lightweight aluminum applications.

Financial highlights

• Revenue: RMB73.6 billion (+12.0% YoY); Net profit: RMB9.15 billion (+272.7% YoY); Gross profit: RMB17.8 billion (+202.1% YoY).

• Gross profit margin: 24.2% (up from 9.0% YoY); Net profit margin: 13.5% (+9.1 p.p. YoY).

• Basic EPS: RMB0.966 (+273.0% YoY); Cash and cash equivalents: RMB37.5 billion (+25.9% YoY).

• Gearing ratio: 48.5% (up from 47.0% at end-2023); Net current assets: RMB20.5 billion.

• Interim dividend: HK59.0 cents/share (2023: HK34.0 cents/share).

Outlook and guidance

• Management expects continued stable and positive economic development in China, with ongoing volatility in global markets and commodity prices.

• The group will focus on high-quality, green, and innovative growth, further integrating the industrial, innovation, and talent chains.