Venustech Group (002439) H1 2024 earnings summary

Executive summary

• Revenue for H1 2024 reached ¥1.574 billion, up 3.42% year-over-year, with strong growth in new orders and a significant Q2 gross margin improvement to 64.59%.

• Net loss attributable to shareholders was ¥182 million, a sharp decline from a net profit of ¥185 million in H1 2023, mainly due to investment losses from equity holdings.

• The company became a subsidiary of China Mobile in January 2024, marking a new phase of strategic integration and innovation.

Financial highlights

• Operating income: ¥1.574 billion, up 3.42% year-over-year.

• Net loss attributable to shareholders: ¥182 million, down 198.6% year-over-year.

• Gross margin in Q2 improved by 13.77 percentage points to 64.59%.

• Basic and diluted EPS: -¥0.15, compared to ¥0.20 in H1 2023.

• Operating cash flow: -¥519 million, slightly improved from -¥526 million in H1 2023.

• R&D investment increased by 5.54% year-over-year to ¥536 million.

Outlook and guidance

• The company expects continued growth in cloud security, identity trust, 5G industrial internet, and IoT security, with some segments growing over 150% year-over-year.

• Strategic focus remains on innovation, cost control, and leveraging China Mobile's ecosystem.