Xinyi Glass (0868) H1 2024 earnings summary

Executive summary

• Revenue for 1H2024 decreased by 6.4% year-over-year to HK$11,807.2 million, mainly due to RMB depreciation and lower float glass ASP, while net profit rose 27.1% to HK$2,729.9 million, driven by higher sales in automotive and architectural glass, improved margins, and increased contributions from associates.

• Gross profit increased 10.6% to HK$4,046.7 million, with gross margin improving to 34.3% from 29.0% in 1H2023, mainly due to lower raw material and energy costs.

• Interim dividend of 31.0 HK cents per share declared, up from 26.0 HK cents in 1H2023.

Financial highlights

• EBITDA rose 19.5% year-over-year to HK$4,033.0 million.

• Net profit margin improved to 23.1% from 17.0% in 1H2023.

• Earnings per share (basic and diluted) were 64.6 HK cents, up from 52.1/52.0 HK cents.

• Cash and cash equivalents stood at HK$1,651.9 million as of 30 June 2024.

• Net debt gearing ratio was 15.2%, with a current ratio of 1.08.

Outlook and guidance

• Management is cautiously optimistic for 2H2024, expecting stable raw material and energy costs, and increased demand for float and architectural glass due to PRC government initiatives and the traditional peak season.

• Expansion of production capacity in Indonesia, Yunnan (China), and continued focus on R&D, automation, and energy efficiency to support carbon neutrality goals.

• Ongoing exploration of new markets and vertical integration of raw materials.