Market Overview - The Hong Kong stock market experienced a significant rise on May 14, with all three major indices increasing by over 2%. The Hang Seng Index rose by 2.3% to 23,640.65 points, the Hang Seng China Enterprises Index increased by 2.47% to 8,593.07 points, and the Hang Seng Tech Index gained 2.13% to 5,381.78 points [2]. Financial Sector Performance - Major financial stocks saw a substantial surge, particularly in the insurance and Chinese brokerage sectors. Notable gains included China Pacific Insurance rising nearly 8%, with China Life and China Taiping both increasing by over 6%. In the brokerage sector, Hongye Futures surged over 12%, while other firms like Xingsheng International and GF Securities rose by 9% and 6%, respectively [4][9]. Technology Sector Performance - Large technology stocks collectively performed well, with Baidu increasing by over 4%, Alibaba and JD.com both rising by over 3%, and Tencent gaining nearly 3%. Internet healthcare stocks also showed strength, with JD Health and ZhongAn Online both rising over 5% [4][6]. Automotive Sector Performance - The automotive sector continued its upward trend, with Leap Motor increasing by over 6% to reach a new high. Other notable gains included BYD and Li Auto, both rising over 4%, while XPeng and NIO increased by over 3% [5][10]. Regulatory Impact - The China Securities Regulatory Commission (CSRC) recently released a plan to promote the high-quality development of public funds, which is expected to drive capital flows towards the brokerage sector. The new regulations may lead fund managers to allocate more resources to sectors with lower current allocations, particularly those with higher benchmark weights [9].

Core Viewpoint - Beijing Automotive's net profit for 2024 has fallen below 1 billion RMB for the first time, marking a ten-year low, with multiple brands under pressure and transformation challenges ahead [2][4][6]. Financial Performance - In Q1 2024, Beijing Automotive reported total revenue of 42.44 billion RMB, a year-on-year decrease of 8.77%, and a net profit of 9.29 billion RMB, down 10.2% year-on-year [2]. - For the full year 2024, total revenue was 192.50 billion RMB, a decline of 2.76%, with fuel vehicle revenue at 184.97 billion RMB (up 1.2%) and new energy vehicle revenue at 7.53 billion RMB (down 50.7%) [4][6]. - The company's gross profit for 2024 was 30.89 billion RMB, a decrease of 19.4%, with fuel vehicle gross profit at 35.33 billion RMB (down 16%) and new energy vehicle gross loss at 4.44 billion RMB [7][19]. Brand Performance - Beijing Automotive's wholesale vehicle sales totaled 946,000 units in 2024, a decline of 9.21% year-on-year [4]. - Beijing Benz's revenue for 2024 was 21.75 billion euros (approximately 177.84 billion RMB), down 3.36%, with a net profit of 2.44 billion euros (approximately 19.98 billion RMB), down 18.54% [8][10]. - The losses from Beijing Modern and Beijing brand are significant contributors to the overall profit decline, with Beijing Modern reporting cumulative losses of 13.08 billion RMB from 2022 to the first nine months of 2024 [15][13]. Market Dynamics - Despite the profit decline, Beijing Automotive's stock price rose by 5.52% on April 30, 2024, following the Q1 earnings release [2]. - The company has seen a significant increase in export sales, with a combined total of 120,000 units exported by Beijing Modern and Beijing brand, marking a year-on-year increase of approximately 103% [17]. Investment and Future Outlook - Capital expenditures for 2024 reached 53.80 billion RMB, up 9.8%, while R&D expenditures increased by 20.2% to 4.29 billion RMB, primarily for new energy vehicle development [19]. - The company maintains a healthy cash flow with cash and cash equivalents of 33.60 billion RMB and unused bank credit of 15.63 billion RMB, indicating manageable debt levels [21]. - The company is at a critical transformation juncture, needing to balance its fuel vehicle base with breakthroughs in new energy vehicles while addressing the losses from its joint venture, Beijing Modern [22].

北京汽车第一季度营收424.4亿元人民币，比上年同期下滑8.8%； 净利润9.29亿元，比上年同期下滑 10%。 ...

Financial Performance - In 2024, the company achieved consolidated revenue of RMB 192.5 billion and a net profit of RMB 9.83 billion[10]. - Revenue for 2024 was $192.496 million, down 2.3% from $197.949 million in 2023[18]. - Gross profit for 2024 was $30.887 million, a decline of 19.3% compared to $38.298 million in 2023[18]. - Net profit attributable to equity holders for 2024 was $956,000, a significant drop of 68.4% from $3.030 million in 2023[18]. - Vehicle sales for 2024 reached 945,593 units, a decrease of 9.3% from 1,042,005 units in 2023[18]. - The group's revenue decreased from RMB 197,949.2 million in 2023 to RMB 192,495.6 million in 2024, a year-on-year decline of 2.8%, primarily due to a drop in sales of new energy vehicles[81]. - The net profit attributable to equity holders fell from RMB 3,030.3 million in 2023 to RMB 955.8 million in 2024, a decrease of 68.5%[81]. - Gross profit decreased from RMB 38,298.6 million in 2023 to RMB 30,887.0 million in 2024, a decline of 19.4%, mainly due to reduced sales and increased promotional activities[82]. Vehicle Sales and Market Trends - The total vehicle sales for the year reached 946,000 units, with retail sales at 983,000 units[12]. - The Chinese automotive market saw a total sales volume of 31.44 million vehicles in 2024, a year-on-year increase of 4.5%[11]. - In 2024, the group achieved wholesale sales of 946,000 vehicles and retail sales of 983,000 vehicles across its brands[62]. - The sales volume of new energy vehicles reached 12.87 million units, with a market share of 40.9%, reflecting a 35.5% year-on-year growth[61]. - The company is focusing on key segments such as off-road and mid-to-high-end hybrid vehicles, aiming for stable growth in overseas markets[15]. - The new energy vehicle market is projected to continue its rapid growth, becoming a core driver of the overall automotive market[79]. Product Development and Innovation - The company launched several new electric and hybrid models, including the BJ60 and new E-class hybrid vehicles, as part of its commitment to full electrification[14]. - New product lines include electric off-road vehicles and hybrid models under the Beijing brand, enhancing the product portfolio[25]. - The group launched several new energy vehicles, including the BJ30, BJ60, and the new E-Class L plug-in hybrid, enhancing its product matrix in the new energy sector[63]. - The collaboration with Mercedes-Benz resulted in the launch of four new energy models, including the EQA and EQB, with plans for further joint development in smart and new energy vehicles[68]. - The group emphasized R&D innovation, achieving domestic production of key components like the turbocharger and 48V battery, enhancing self-sufficiency[69]. - The company aims to enhance its core technology and smart technology applications to lead its development[14]. Strategic Partnerships and Collaborations - The company is deepening its collaboration with partners like Mercedes-Benz and Hyundai to enhance sustainable development initiatives[14]. - The company aims to deepen cooperation with Hyundai to promote long-term development and enhance competitive strength[77]. - The company is actively pursuing strategic partnerships to strengthen its R&D capabilities and expand its market presence[38]. Financial Position and Investments - Total assets as of December 31, 2024, were $172.044 billion, an increase of 1.9% from $168.723 billion in 2023[20]. - Total liabilities for 2024 were $93.563 billion, up 4.9% from $89.340 billion in 2023[20]. - Equity attributable to equity holders increased to $57.315 billion in 2024, compared to $57.009 billion in 2023[20]. - The company will invest approximately RMB 2 billion to acquire shares in BAIC New Energy, enhancing its position in the new energy vehicle sector[75]. - The company and Hyundai Motor agreed to inject a total of $1,095,466,000 into Beijing Hyundai, with each party contributing $547,733,000 to support capital stability and strategic development[77]. Corporate Governance and Compliance - The company has established a management system that aligns with the requirements for listed companies, enhancing corporate governance[121]. - The company has confirmed the independence of all non-executive directors in accordance with listing rules, ensuring compliance with governance standards[124]. - The company has maintained strict adherence to applicable rules, laws, and industry standards, with no known violations reported for the fiscal year 2024[121]. - The board recommends not to distribute profits for the year 2024[111]. Employee and Talent Management - The company has a total of 31,705 employees as of the end of 2024[195]. - The company has established a comprehensive performance evaluation management system to link annual operational goals with departmental and employee performance assessments[196]. - The company has implemented a strategic talent development program to enhance organizational effectiveness and employee vitality[197]. - The company has a competitive compensation standard based on job value and employee performance, referencing salary levels in the Beijing area and related industries[199]. Environmental and Social Responsibility - The company is committed to social responsibility and has launched the "West Xinjiang" plan to support economic development in western regions[14]. - The company is committed to sustainable development, with plans to upgrade the Beijing Benz smart factory in 2024, incorporating green and low-carbon principles into production[71]. - The company has been recognized as a "leader" in carbon peak initiatives and is actively promoting green supply chain management[71]. - The company aims to enhance energy efficiency and reduce carbon emissions as part of its transition towards becoming a carbon-neutral enterprise[117]. Risks and Challenges - The group faces risks from fluctuating prices of key raw materials, including lithium and cobalt, which could impact production costs[97]. - The automotive industry is undergoing significant technological changes, including electrification and smart connectivity, which intensifies market competition[96]. - The company will continue to monitor market conditions and implement measures to maintain and enhance its market position[96].

Core Insights - Beijing Off-road's BJ40 extended range model has gained significant consumer interest, achieving over 10,000 orders within 48 hours of its launch, showcasing its strong product capabilities and innovative technology [1][9] Product Launch and Features - The BJ40 extended range model, particularly the "Chitu" version, is priced at 299,800 yuan and focuses on aesthetics, performance, and safety, with over 200,000 yuan in upgrades [3] - Key upgrades include a striking visual design, enhanced off-road capabilities with specialized tires and shock absorbers, and advanced safety features such as a 360-degree driving assistant [3] Performance and Testing - The BJ40 extended range is equipped with a 40.3 kWh battery and an 82L fuel tank, theoretically offering a range of 1,200 kilometers; real-world tests showed a range of 972 kilometers under full load and air conditioning [5] - A "Thousand-Mile Challenge" event has been launched to allow users to experience the vehicle's capabilities firsthand, with rewards available for participants [5] Safety Standards - The BJ40 extended range model has surpassed the new national safety standards for electric vehicle batteries, achieving compliance 16 months ahead of schedule [7] - The vehicle features a three-layer protective structure designed to enhance passenger safety [7] Market Performance - Since its launch on April 7, the BJ40 extended range has captured 81% of the extended range box market, ranking first in the new energy box segment [9] - The company has introduced attractive purchasing policies, including significant discounts and user care initiatives to enhance the buying experience [11] Future Developments - Beijing Off-road plans to release six new products over the next three years, focusing on diverse user needs and market innovation [14] - The company emphasizes its commitment to redefining the standards for new energy off-road vehicles through technological advancements and user-centric approaches [14]

Core Viewpoint - Beijing Automotive's performance in 2024 shows a significant decline in net profit and revenue, primarily driven by the poor performance of its luxury brand Beijing Benz and the ongoing losses of Beijing Hyundai [2][5][10]. Group 1: Beijing Automotive's Financial Performance - In 2024, Beijing Automotive reported a revenue of 192.5 billion yuan, a decrease of 2.8% year-on-year, with a net profit of 9.56 billion yuan, down 68.5% from the previous year [2]. - The revenue from fuel vehicles increased slightly by 1.2% to 184.97 billion yuan, while revenue from new energy vehicles plummeted by 50.7% to 7.53 billion yuan [2]. - Overall gross profit fell by 19.4% to 30.89 billion yuan, with a significant drop in gross profit from fuel vehicles and continued losses in the new energy sector [2][3]. Group 2: Beijing Benz's Impact - Beijing Benz, a key profit contributor, experienced a revenue decline of 3.36% to 21.75 billion euros, with net profit dropping by 18.5% to 2.44 billion euros, resulting in a loss of over 2 billion yuan in net profit contribution to Beijing Automotive [6][11]. - The sales volume of Beijing Benz fell by 7.3% to 683,600 units, significantly exceeding the global decline of 3% for the Mercedes-Benz brand [7]. - The price war in the market led to substantial discounts on key models, which did not translate into increased sales, damaging the brand's reputation [7][8]. Group 3: Beijing Hyundai's Performance - Beijing Hyundai has faced continuous losses, with a cumulative loss of 13.08 billion yuan over three years, and a significant drop in sales from 300,000 units to just 154,200 units in 2024, a decline of 36.02% [10][13]. - The company has not launched any electric vehicles, contributing to its declining market presence and financial struggles [12][13]. Group 4: Increased Expenditures - Despite declining profits, Beijing Automotive's capital expenditures rose by 9.8% to 53.8 billion yuan, and R&D expenditures increased by 20.2% to 4.29 billion yuan, attributed to investments in new energy vehicle development [14].

Financial Performance - Total revenue for the year ended December 31, 2024, was RMB 192,495.606 million, a decrease of 2.3% compared to RMB 197,949.177 million in 2023[8] - Gross profit for the year was RMB 30,887.049 million, down 19.2% from RMB 38,298.560 million in the previous year[8] - Operating profit decreased to RMB 17,180.983 million, a decline of 24.0% from RMB 22,569.113 million in 2023[8] - Net profit attributable to equity holders of the company was RMB 955.839 million, a significant drop of 68.4% from RMB 3,030.346 million in the prior year[9] - The company reported a total comprehensive income of RMB 10,074.864 million, a decrease of 30.0% from RMB 14,453.684 million in the previous year[9] - Basic and diluted earnings per share for the year were RMB 0.12, down from RMB 0.38 in 2023[9] - The company reported a decrease in the impairment provision for other receivables from RMB 776,052 thousand in 2023 to RMB 676,876 thousand in 2024, a decline of 12.8%[34] - The profit attributable to equity holders of the company for 2024 was RMB 955,839 thousand, a significant decrease of 68.4% from RMB 3,030,346 thousand in 2023[52] Assets and Liabilities - Total assets as of December 31, 2024, amounted to RMB 172,044.268 million, an increase of 1.9% from RMB 168,723.153 million in 2023[6] - Total liabilities increased to RMB 93,562.795 million, up 4.9% from RMB 89,339.535 million in the previous year[7] - As of December 31, 2024, the group's current liabilities exceeded current assets by RMB 2,604 million, indicating sufficient funding sources for ongoing operations[14] - The total accounts receivable as of December 31, 2024, was RMB 12,518,966 thousand, down from RMB 16,722,343 thousand in 2023, with a provision for impairment of RMB (1,457,105) thousand[29] - The company's total accounts payable increased to RMB 39,308,419 thousand in 2024, up 9.1% from RMB 35,847,709 thousand in 2023[43] Cash Flow and Financial Position - Cash and cash equivalents rose to RMB 33,598.355 million, an increase of 7.9% compared to RMB 31,124.229 million in 2023[4] - The company recorded a net cash generated from operating activities increase of 20.2%, rising from RMB 24,248.9 million in 2023 to RMB 29,148.5 million in 2024[82] - The company's debt-to-asset ratio increased from 53.0% at the end of 2023 to 54.4% at the end of 2024, an increase of 1.4 percentage points[83] - The company's borrowings decreased from RMB 13,274,941 thousand in 2023 to RMB 8,589,379 thousand in 2024, a reduction of approximately 35.5%[35] Revenue Sources and Segments - Total revenue for the year ended December 31, 2024, was RMB 192,495,606 thousand, with fuel vehicles contributing RMB 184,969,173 thousand and new energy vehicles contributing RMB 7,526,433 thousand[22] - The gross profit for the group was RMB 30,887,049 thousand, with a gross loss of RMB 4,441,525 thousand from the new energy vehicle segment[22] - The group’s operational segments include fuel vehicles and new energy vehicles, with the performance evaluated based on gross profit[22] - The company generated approximately 97.5% of its revenue from external customers located within China for the year ended December 31, 2024[26] Market and Sales Performance - In 2024, the company achieved a total wholesale of 946,000 vehicles and retail sales of 983,000 vehicles across its brands[67] - The Beijing brand sold 173,000 vehicles in 2024, with a growing proportion of off-road vehicle sales, emphasizing the launch of the "electric off-road" strategy and the introduction of the Magic Core Electric Drive solution[70] - The group achieved an export volume of 120,000 vehicles during the reporting period, significantly exceeding industry growth rates, with a year-on-year increase of over 200% in exports from Beijing Hyundai, totaling 55,000 vehicles[69] Strategic Initiatives and Future Outlook - The company is focusing on a dual strategy in domestic and international markets, emphasizing multi-technology product lines including fuel, electric, hybrid, and off-road vehicles[67] - The group will focus on key segments such as off-road, SUV, and mid-to-high-end hybrid vehicles to enhance product matrix and market position[99] - The group anticipates a continued stable growth in the passenger car market, with a projected increase of approximately 5% in 2025[96] - The group aims to deepen joint ventures and promote major projects to support strategic transformation towards electrification and digitalization[99] Accounting and Compliance - The group adopted the new accounting standard "Interpretation No. 18" effective January 1, 2024, which reclassified warranty costs from distribution expenses to cost of sales[16] - The implementation of "Interpretation No. 18" is expected to impact the classification of income and expenses in the income statement, potentially affecting operating profit calculations[20] - The group plans to adopt several new accounting standards by January 1, 2027, which may require restatement of comparative information for the fiscal year ending December 31, 2026[19] - The group’s management is currently assessing the specific impacts of the new accounting standards on the consolidated financial statements[20] Corporate Governance and Shareholder Value - The board of directors recommended not to pay a final dividend for the fiscal year ending December 31, 2024, compared to a final dividend of RMB 0.13 per share for the previous year[54] - The group is committed to high standards of corporate governance to protect shareholder interests and enhance corporate value[103]

Financial Performance - In the first half of 2024, BAIC achieved vehicle sales of 450,189 units, a decrease from 507,326 units in the same period of 2023, representing a decline of approximately 11.3%[11] - The consolidated revenue for the first half of 2024 was RMB 94.32 billion, down from RMB 99.05 billion in the first half of 2023, reflecting a decrease of about 4.5%[11] - The net profit attributable to equity holders of the company for the first half of 2024 was RMB 1.98 billion, compared to RMB 2.85 billion in the same period of 2023, indicating a decline of approximately 30.4%[11] - The company reported a gross profit of RMB 18.69 billion for the first half of 2024, down from RMB 20.57 billion in the first half of 2023, which is a decrease of around 9.2%[11] - The company's revenue decreased from RMB 99,047.1 million in the first half of 2023 to RMB 94,322.3 million in the first half of 2024, representing a decline of 4.8% year-on-year, primarily due to reduced income from both fuel and new energy vehicles[55] - Gross profit fell from RMB 20,566.1 million in the first half of 2023 to RMB 18,686.8 million in the first half of 2024, a decrease of 9.1%, mainly attributed to lower gross profit from fuel vehicles[55] - Net profit attributable to equity holders decreased from RMB 2,845.7 million in the first half of 2023 to RMB 1,978.0 million in the first half of 2024, a decline of 30.5%[55] - The profit for the six months ended June 30, 2024, was RMB 6,866,298 thousand, a decrease of 19.7% compared to RMB 8,551,305 thousand for the same period in 2023[66] - The total comprehensive income for the period was RMB 8,350,835 thousand, down 4.7% from RMB 8,764,885 thousand in the previous year[66] Assets and Liabilities - BAIC's total assets as of June 30, 2024, were RMB 170.36 billion, an increase from RMB 168.72 billion at the end of 2023[11] - Total assets as of June 30, 2024, amounted to RMB 170,361,142 thousand, an increase from RMB 168,723,153 thousand at the end of 2023, representing a growth of about 1.0%[64] - Total liabilities decreased to RMB 88,654,790 thousand from RMB 89,339,535 thousand, indicating a reduction of approximately 0.8%[64] - Total equity increased to RMB 81,706,352 thousand from RMB 79,383,618 thousand, reflecting a growth of about 2.9%[64] - The company's debt-to-asset ratio decreased from 53.0% at the end of 2023 to 52.0% as of June 30, 2024, reflecting a 1.0 percentage point decline[57] - The net debt-to-equity ratio improved from -29.0% at the end of 2023 to -33.5% as of June 30, 2024, due to an increase in total equity and a decrease in total borrowings[57] Product Development and Market Strategy - The company has launched several new products, including the BJ40 Blade Hero and BJ60 Magic Core Electric Drive, as part of its strategy to optimize its product matrix[4] - BAIC is focusing on both domestic and international markets, with steady improvements in export sales during the reporting period[4] - The company has introduced its first Magic Core Electric Drive technology and is continuing to deepen its layout in the new energy sector[4] - The product matrix is continuously enriched to meet diverse consumer demands, reflecting the company's commitment to innovation and market responsiveness[15] - The company launched several new products, including the BJ30 electric off-road vehicle and the 11th generation Sonata, enhancing its product matrix[26] - The company is actively pursuing strategic collaborations, including partnerships with Huawei, to enhance its technological capabilities[21] - The company is investing in R&D for electric vehicles, with a budget allocation of RMB 500 million for the upcoming fiscal year[127] - Market expansion efforts include entering two new international markets, aiming for a 5% market share in each by the end of 2025[127] Operational Efficiency and Cost Management - The company is committed to innovation and transformation, combining long-term and short-term measures to unlock growth channels[37] - The group is enhancing its operational efficiency and competitiveness through the integration of production and finance, as well as industry cooperation[36] - The company has set a target to reduce operational costs by 10% through efficiency improvements in the supply chain[127] Marketing and Customer Engagement - The company is enhancing its marketing strategies through new media and fan engagement, aiming to improve brand exposure and customer service[33] - New marketing strategies are being implemented, focusing on digital channels, which are expected to increase brand engagement by 25%[127] Corporate Governance and Management Changes - The fifth supervisory board was formed on March 19, 2024, with five members, including Zhang Ran as the chairman[40] - On March 22, 2024, Song Wei was elected as the president of the company, effective immediately[41] - The company has appointed Zhang Kai as the vice president effective April 26, 2024[47] Environmental and Sustainable Development - BAIC is committed to green development and is enhancing its product quality system while exploring sustainable development paths[4] - The company is implementing green initiatives in its manufacturing processes, including solar energy management and rainwater recycling[30] Future Outlook - The automotive industry is expected to experience stable growth in the second half of 2024, driven by policy effects that will release consumer potential[37] - The future outlook includes a projected revenue growth of 10% for the second half of 2024, driven by new product launches and market expansion strategies[127]

Financial Statements and Notes [Interim Condensed Consolidated Statement of Comprehensive Income](index=2&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E7%B6%9C%E5%90%88%E6%94%B6%E7%9B%8A%E8%A1%A8) The Group experienced a decline in total revenue, gross profit, and net profit attributable to equity holders in H1 2024, with basic earnings per share at RMB 0.25 Key Income Statement Data for H1 2024 | Metric | For the six months ended June 30, 2024 (RMB '000) | For the six months ended June 30, 2023 (RMB '000) | YoY Change | | :--- | :--- | :--- | :--- | | **Revenue** | 94,322,292 | 99,047,066 | -4.8% | | **Gross Profit** | 18,686,757 | 20,566,103 | -9.1% | | **Operating Profit** | 10,750,177 | 12,585,178 | -14.6% | | **Profit for the Period** | 6,866,298 | 8,551,305 | -19.7% | | **Profit Attributable to Equity Holders of the Company** | 1,978,021 | 2,845,716 | -30.5% | | **Basic Earnings Per Share (RMB)** | 0.25 | 0.36 | -30.6% | [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E5%90%88%E4%BD%B5%E8%B3%87%E7%94%A2%E8%B2%A0%E5%82%B5%E8%A1%A8) As of June 30, 2024, the Group's total assets slightly increased to **RMB 170.36 billion**, total liabilities slightly decreased, and total equity rose to **RMB 81.71 billion**, optimizing the capital structure with a debt-to-asset ratio reduction from 53.0% to 52.0% Key Balance Sheet Items | Metric | As of June 30, 2024 (RMB '000) | As of December 31, 2023 (RMB '000) | Change | | :--- | :--- | :--- | :--- | | **Total Assets** | 170,361,142 | 168,723,153 | +1.0% | | **Total Liabilities** | 88,654,790 | 89,339,535 | -0.8% | | **Total Equity** | 81,706,352 | 79,383,618 | +2.9% | | **Cash and Cash Equivalents** | 31,375,177 | 31,124,229 | +0.8% | [Notes to the Financial Statements](index=6&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) The notes detail significant events, accounting policies, and financial item breakdowns, highlighting that while the fuel vehicle business remains the primary revenue source despite a 2.6% decline, the new energy vehicle business saw a 34.7% revenue drop and remains unprofitable, with no interim dividend proposed - The company entered into a trusteeship agreement with its controlling shareholder, BAIC Group, to manage voting rights of BAIC BluePark, but as of the reporting period, the company has not gained control and thus has not consolidated it[9](index=9&type=chunk) Segment Performance (For the six months ended June 30) | Segment | Item (RMB '000) | 2024 | 2023 | YoY Change | | :--- | :--- | :--- | :--- | :--- | | **Fuel Vehicles** | **Total Revenue** | 89,961,975 | 92,364,754 | -2.6% | | | **Segment Gross Profit** | 20,162,718 | 21,983,175 | -8.3% | | **New Energy Vehicles** | **Total Revenue** | 4,360,317 | 6,682,312 | -34.7% | | | **Segment Gross Loss** | (1,475,961) | (1,417,072) | -4.2% | - The Board did not propose an interim dividend for the first half of 2024, while the 2023 final dividend of approximately **RMB 1.042 billion** (RMB 0.13 per share) was approved by shareholders in June 2024[26](index=26&type=chunk) Business Overview and Operations [Key Business Operations](index=14&type=section&id=%E4%B8%80%E3%80%81%E4%B8%BB%E8%A6%81%E6%A5%AD%E5%8B%99%E6%83%85%E6%B3%81) The Group's core business involves R&D, manufacturing, and sales of passenger vehicles, encompassing whole vehicles, core components, auto finance, and international operations through four key brands covering both fuel and new energy vehicle models - The Group operates its passenger vehicle business through four key brands: - **Beijing Brand**: An independent brand covering fuel and new energy vehicle models - **Beijing Benz**: A 51% owned subsidiary producing Mercedes-Benz passenger vehicles - **Beijing Hyundai**: A 50% owned joint venture producing Hyundai passenger vehicles - **Fujian Benz**: A 35% owned joint venture with concerted action, producing Mercedes-Benz multi-purpose passenger vehicles[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk)[31](index=31&type=chunk)[32](index=32&type=chunk) - In addition to whole vehicles, the Group also produces core components such as engines, powertrains, and power batteries, and conducts auto finance business through associates and joint ventures[33](index=33&type=chunk)[34](index=34&type=chunk) [Industry Development and Group Operations](index=17&type=section&id=%E4%BA%8C%E3%80%81%E4%BA%8C%E9%9B%B6%E4%BA%8C%E5%9B%9B%E5%B9%B4%E4%B8%8A%E5%8D%8A%E5%B9%B4%E8%A1%8C%E6%A5%AD%E7%99%BC%E5%B1%95%E6%83%85%E6%B3%81) In H1 2024, despite market growth driven by new energy vehicles and exports, the Group achieved **450,000 wholesale** and **476,000 retail** vehicle sales, actively pursuing multi-technology product strategies, expanding overseas markets with **38,000 exports**, increasing R&D investment, and deepening new energy vehicle presence through strategic trusteeship of BAIC BluePark - Industry Background: In H1 2024, China's passenger vehicle sales reached **11.979 million units**, with new energy vehicles accounting for **35.2%** of the market and Chinese brands holding **61.9%** market share[36](index=36&type=chunk) - The Group achieved total vehicle wholesale of **450,000 units** and retail sales of **476,000 units** in the first half[37](index=37&type=chunk) - Breakthroughs were made in overseas markets, with **38,000 vehicles exported** during the reporting period, outperforming the overall market growth rate[39](index=39&type=chunk) - The Group actively promotes technological innovation, with R&D expenditure increasing again, focusing on core technologies such as intelligent driving and electrified off-road vehicles[40](index=40&type=chunk) - A trusteeship agreement was signed with BAIC Group for BAIC BluePark, aiming to deepen the new energy industry layout, enhance comprehensive resource utilization, and improve industry competitiveness[44](index=44&type=chunk) [H2 2024 Outlook](index=22&type=section&id=%E5%9B%9B%E3%80%81%E4%BA%8C%E9%9B%B6%E4%BA%8C%E5%9B%9B%E5%B9%B4%E4%B8%8B%E5%8D%8A%E5%B9%B4%E5%B1%95%E6%9C%9B) For H2 2024, the Group plans to focus on off-road, SUV, mid-to-high-end hybrid, and overseas markets to boost high-value product sales, with each brand aiming to enhance competitiveness, consolidate market position, stabilize sales, expand exports, and improve efficiency - In the second half, the focus will be on key segments (off-road, SUV, mid-to-high-end hybrid) and overseas opportunity markets to expand sales of high-value, high-volume products[45](index=45&type=chunk) - Key development priorities for each brand include: - **Beijing Brand**: Focusing on new products and off-road vehicle competitiveness - **Beijing Benz**: Accelerating high-quality project implementation and consolidating market leadership - **Beijing Hyundai**: Stabilizing sales pace and continuously expanding exports - **Fujian Benz**: Maintaining stable operations and promoting quality improvement and efficiency gains[45](index=45&type=chunk) Management Discussion and Analysis [Financial Performance Analysis](index=23&type=section&id=%E6%94%B6%E5%85%A5%E5%8F%8A%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%AC%8A%E7%9B%8A%E6%8C%81%E6%9C%89%E4%BA%BA%E6%87%89%E4%BD%B5%E6%B7%A8%E5%88%A9%E6%BD%A4) Influenced by declining sales and changes in vehicle mix, the Group's H1 revenue decreased by 4.8% to **RMB 94.32 billion**, and net profit fell by 30.5% to **RMB 1.98 billion**, with both fuel and new energy vehicle segments experiencing revenue and gross profit declines, and new energy vehicle gross loss expanding by 4.2% Revenue and Net Profit YoY Change | Item | H1 2024 (RMB millions) | H1 2023 (RMB millions) | YoY Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | 94,322.3 | 99,047.1 | -4.8% | | - Fuel Vehicle Related Revenue | 89,962.0 | 92,364.8 | -2.6% | | - New Energy Vehicle Related Revenue | 4,360.3 | 6,682.3 | -34.7% | | **Net Profit Attributable to Equity Holders** | 1,978.0 | 2,845.7 | -30.5% | Gross Profit YoY Change | Item | H1 2024 (RMB millions) | H1 2023 (RMB millions) | YoY Change | | :--- | :--- | :--- | :--- | | **Total Gross Profit** | 18,686.8 | 20,566.1 | -9.1% | | - Fuel Vehicle Gross Profit | 20,162.7 | 21,983.2 | -8.3% | | - New Energy Vehicle Gross Profit | (1,476.0) | (1,417.1) | -4.2% | [Liquidity and Capital Structure](index=24&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) The Group maintains a robust financial position with its debt-to-asset ratio decreasing from 53.0% to 52.0%, holding **RMB 31.38 billion** in cash and equivalents and **RMB 24.85 billion** in unused bank facilities, despite a 15.9% YoY decline in net cash from operating activities to **RMB 11.53 billion** due to reduced revenue - Net cash generated from operating activities decreased by **15.9%** to **RMB 11.53 billion** from **RMB 13.71 billion** in the prior period[48](index=48&type=chunk) - The debt-to-asset ratio decreased from **53.0%** at the end of 2023 to **52.0%**, and the net debt-to-equity ratio improved from **-29.0%** to **-33.5%**, indicating an optimized capital structure[49](index=49&type=chunk) - As of June 30, 2024, the Group held **RMB 31.38 billion** in cash and cash equivalents, with **RMB 10.89 billion** in outstanding borrowings and **RMB 24.85 billion** in unused bank credit facilities[48](index=48&type=chunk) [Significant Investments and Other Financial Matters](index=24&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87) In H1, capital expenditure slightly decreased to **RMB 2.21 billion**, while R&D expenditure significantly increased by 74.2% to **RMB 1.80 billion**, primarily for off-road vehicles and next-generation EV platforms, alongside a **RMB 0.32 billion** foreign exchange loss due to RMB-Euro fluctuations - Total R&D expenditure increased by **74.2%** to **RMB 1.80 billion** from **RMB 1.03 billion** in the prior period, primarily due to increased investment in off-road vehicle products and next-generation pure electric platforms[50](index=50&type=chunk) - Total capital expenditure decreased from **RMB 2.37 billion** in the prior period to **RMB 2.21 billion**[50](index=50&type=chunk) - Foreign currency exchange shifted from a gain of **RMB 0.102 billion** in the prior period to a loss of **RMB 0.32 billion** in the current period, mainly due to fluctuations in the RMB against the Euro[51](index=51&type=chunk) Other Information [Dividends and Securities Repurchase](index=26&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board did not recommend an interim dividend for H1 2024, and neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities during the reporting period - The Board did not propose an interim dividend for the first half of 2024[52](index=52&type=chunk) - During the reporting period, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities[52](index=52&type=chunk) [Corporate Governance](index=26&type=section&id=%E9%BC%8E%E5%AE%88%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%89%87) The company complied with the Corporate Governance Code during the reporting period, with the fifth Board of Directors and Supervisory Committee established in March 2024 following elections, and the Audit Committee having reviewed the unaudited interim financial statements - The company consistently complied with the provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules during the reporting period[53](index=53&type=chunk) - The term of the fourth Board of Directors expired, and the fifth Board of Directors was appointed by the shareholders' meeting on March 22, 2024[54](index=54&type=chunk) - The Audit Committee has reviewed the Group's unaudited interim financial statements for the first half of 2024[57](index=57&type=chunk)

Financial Performance - For Q1 2024, total operating revenue was RMB 46.52 billion, a decrease of 2.46% from RMB 47.70 billion in Q1 2023[6] - Total operating costs for Q1 2024 were RMB 41.19 billion, down 1.4% from RMB 41.77 billion in Q1 2023[6] - Net profit attributable to shareholders for Q1 2024 was RMB 1.03 billion, a decline of 29.0% compared to RMB 1.46 billion in Q1 2023[6] - The total comprehensive income for Q1 2024 reached RMB 4,500,727,691.00, an increase from RMB 4,150,950,680.63 in Q1 2023, representing a growth of approximately 8.5%[7] - The net cash flow from operating activities for Q1 2024 was RMB 5,050,662,212.16, down from RMB 6,994,882,684.54 in Q1 2023, indicating a decrease of about 27.9%[9] - The company reported sales revenue from goods and services received in Q1 2024 of RMB 49,216,508,611.04, down from RMB 53,714,090,823.97 in Q1 2023, a decline of about 8.3%[9] - The company reported a total comprehensive income of RMB 193,926,473.27 for Q1 2024, compared to RMB (670,009,903.01) in Q1 2023[16] Cash and Liquidity - Cash and cash equivalents increased to RMB 35.23 billion as of March 31, 2024, up from RMB 33.14 billion at the end of 2023, representing a growth of 6.35%[2] - Cash and cash equivalents at the end of Q1 2024 totaled RMB 33,919,103,169.67, compared to RMB 37,415,555,427.99 at the end of Q1 2023, reflecting a decrease of approximately 9.5%[10] - The company’s cash and cash equivalents at the end of Q1 2024 were RMB 4,313,848,501.81, an increase from RMB 2,015,018,543.81 at the end of Q1 2023[18] Assets and Liabilities - Total assets reached RMB 173.65 billion as of March 31, 2024, compared to RMB 168.72 billion at the end of 2023, marking an increase of 2.77%[5] - Total liabilities amounted to RMB 89.63 billion as of March 31, 2024, slightly up from RMB 89.34 billion at the end of 2023, reflecting a growth of 0.33%[5] - Total liabilities decreased to RMB 19,925,491,964.64 from RMB 20,134,219,409.30 year-over-year[14] - The company's total liabilities as of March 31, 2024, amounted to RMB 12,777,351,334.39, a decrease from RMB 13,004,281,788.54 as of December 31, 2023[13] Strategic Focus and Future Plans - The company plans to focus on market expansion and new product development in the upcoming quarters to drive future growth[6] - Future strategies may involve market expansion and potential mergers and acquisitions[19] - The company is committed to developing new products and technologies to drive growth[19] - Emphasis on user data analysis to inform decision-making and strategy[19] - The company aims to improve operational efficiency through strategic initiatives[19] - Financial performance metrics will be closely monitored to ensure alignment with growth objectives[19] Governance and Board Composition - The board of directors includes Chairman Chen Wei and several non-executive directors[19] - The executive director is Song Wei, with additional non-executive directors including Liu Guanjiao and Ye Qian[19] - The board also comprises independent non-executive directors such as Yin Yuanping and Xu Xiangyang[19] - The company is focused on enhancing its governance structure with a diverse board composition[19] - The board is dedicated to maintaining transparency and accountability in its operations[19] Research and Development - The company reported a decrease in research and development expenses to RMB 165.21 million in Q1 2024 from RMB 186.01 million in Q1 2023, a decline of 11.14%[6]