Guangzhou Automobile Group (2238) Q2 2024 earnings summary

Executive summary

• Revenue for H1 2024 was RMB181.142 billion (aggregated), down 22.42% year-over-year, with consolidated revenue at RMB46.255 billion, down 25.29%.

• Net profit attributable to shareholders was RMB1.516 billion, a 48.88% year-over-year decrease; basic EPS was RMB0.14, down 49.07%.

• Vehicle sales volume reached 863,000 units, down 25.79% year-over-year; NEV sales were 164,100 units, down 30.61%.

• Overseas sales surged to 68,000 vehicles, up 190% year-over-year, with self-developed brands contributing 54,000 units (up 144%).

• Interim dividend of RMB0.03 per share declared.

Financial highlights

• Gross profit was RMB2.152 billion, up RMB177 million year-over-year; gross margin increased by 1.46 percentage points to 4.65% due to higher-margin exports.

• Selling and distribution costs rose 10.16% to RMB2.83 billion, mainly from increased investment in internationalization, branding, and NEV transformation.

• Net cash inflow from operating activities was RMB1.85 billion, reversing a net outflow last year.

• Cash and cash equivalents at period end were RMB27.54 billion, down from RMB34.60 billion a year ago.

• Share of profits from joint ventures and associates dropped 62.06% to RMB2.01 billion.

Outlook and guidance

• Focus on enhancing product, brand, marketing, sales, service, and execution strengths to boost end-consumer sales.

• Plans to accelerate international expansion, targeting over 100 new overseas outlets in H2 2024 and accelerating localised production.

• Continued investment in R&D, especially in solid-state batteries, new energy, and intelligent driving, with mass production of all-solid-state batteries targeted for 2026.