Neusoft (600718) Q2 2024 earnings summary

Executive summary

• Achieved revenue of RMB 4.30 billion in H1 2024, up 10.52% year-over-year; net profit attributable to shareholders reached RMB 98.28 million, up 3.39% year-over-year; adjusted net profit (excluding non-recurring items) up 28.67% year-over-year.

• Strategic transformation towards intelligent solutions and digital value creation drove growth in core business segments, with new product launches and contract wins in healthcare, automotive, and smart city sectors.

• Gross margin and profitability improved across all major business lines, with notable margin expansion in the smart city segment.

• Cash flow from operating activities improved significantly, narrowing the outflow by over RMB 339 million year-over-year.

Financial highlights

• Revenue: RMB 4.30 billion, up 10.52% year-over-year.

• Net profit attributable to shareholders: RMB 98.28 million, up 3.39% year-over-year.

• Adjusted net profit (excluding non-recurring items): RMB 40.27 million, up 28.67% year-over-year.

• Basic and diluted EPS: RMB 0.08, up 5.07% and 5.23% year-over-year, respectively.

• Operating cash flow: outflow of RMB 182.51 million, a significant improvement from RMB 521.69 million outflow in the prior year.

Outlook and guidance

• Management expects continued growth in digital transformation, healthcare, and automotive software, leveraging AI and big data technologies.

• Strategic focus remains on intelligent solutions, data-driven services, and international expansion.