Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company experienced a significant decline in net profit for 2024, with a decrease of 37.6% year-on-year, primarily due to changes in the fair value of non-operating financial assets and a one-time impact from cross-border income tax [8] - The financial services segment saw a slight revenue decline of 7% to 21.7 billion, while the industrial operations segment achieved a revenue increase of 10% to 16.2 billion, indicating a shift in revenue sources [8] - The company continues to enhance shareholder returns, proposing a total cash dividend of 0.55 HKD per share for 2024, a 10% increase from 2023 [8] - The report projects a recovery in net profit for 2025 and 2026, with expected growth rates of 26.57% and 11.11%, respectively [8] Summary by Sections Financial Performance - Total revenue for 2024 is reported at 37.749 billion, a slight decrease of 0.55% year-on-year [8] - The net profit attributable to shareholders for 2024 is 3.862 billion, down from 6.193 billion in 2023 [8] - The average return on equity (ROE) for 2024 is projected at 7.80%, a decrease of 5.19 percentage points year-on-year [8] Business Segments - Financial services revenue decreased by 7% to 21.7 billion, with interest income down 6% to 21.2 billion [8] - The industrial operations segment's revenue increased by 10% to 16.2 billion, with equipment operations revenue rising by 21% to 11.6 billion [8] - The company’s asset quality remains stable, with a non-performing asset ratio of 1.07% [8] Dividend Policy - The company plans to distribute a total cash dividend of 0.55 HKD per share for 2024, reflecting a commitment to increasing shareholder returns [8] Earnings Forecast - The report revises the earnings forecast, projecting net profits of 4.889 billion for 2025 and 5.432 billion for 2026, with corresponding growth rates of 26.57% and 11.11% [8]

Investment Rating - The investment rating for the company is "Buy" [5][18]. Core Insights - The company reported a slight decrease in revenue for 2024, with total revenue of 37.75 billion, down 0.55% year-on-year, while net profit attributable to shareholders fell significantly by 37.6% to 3.86 billion [3][4]. - The company initiated its first interim dividend in 2024, distributing a total of 1.953 billion, which represents over 55% of the net profit for the year [3]. - The company has adjusted its earnings forecasts for 2025-2026 and introduced a new forecast for 2027, maintaining a "Buy" rating based on expected growth in financing leasing and industrial operations [9]. Financial Data and Profit Forecast - Revenue and profit forecasts for the company are as follows: - 2023: Revenue 37.96 billion, Net Profit 6.19 billion - 2024: Revenue 37.75 billion, Net Profit 3.86 billion - 2025E: Revenue 40.91 billion, Net Profit 4.26 billion - 2026E: Revenue 44.33 billion, Net Profit 4.77 billion - 2027E: Revenue 47.65 billion, Net Profit 5.48 billion [4][10]. - The company’s return on equity (ROE) for 2024 was 7.80%, down 5.2 percentage points year-on-year [3]. Business Segments Performance - The financing leasing segment generated interest income of 21.18 billion in 2024, accounting for 56% of total revenue, while the industrial operations segment contributed 16.18 billion, representing 42.7% of total revenue [9]. - The company’s equipment operation segment has a strong market position, ranking among the top three globally, with significant international expansion efforts yielding a 27-fold increase in overseas revenue [9]. - The hospital operation segment improved its net profit to 0.232 billion, a 34.6% increase year-on-year, with a gross margin recovery to 19.97% [9]. Valuation and Target Price - The target price for the company is set at 7.80 per share, indicating a potential upside of 37% from the current closing price of 6.18 [9]. - The average price-to-book (PB) ratio for comparable companies is 0.65, which has been used to derive the target price [9].

Financial Performance - The total revenue for the year reached RMB 37.749 billion, maintaining stability compared to the previous year, with a net profit attributable to ordinary shareholders of RMB 3.862 billion[21]. - The company's net profit attributable to ordinary shareholders was RMB 3,862,461, down 37.6% from RMB 6,192,972 in the previous year[23]. - Basic earnings per share decreased to RMB 0.92 from RMB 1.47, representing a decline of 37.4%[23]. - The average return on equity for the year was 7.80%, with a diluted earnings per share of RMB 0.92[21]. - The consolidated revenue for 2024 was RMB 37.749 billion, reflecting a slight decline of 0.55%, with traditional financial services down 8.47%[52]. - The company's ordinary shareholders' share of net profit decreased by 37.63% to RMB 3,862,461 thousand, impacted by the dilution effect from the distribution of shares[57]. - The pre-provision profit for 2024 was RMB 9,275,587 thousand, a decrease of 12.62% compared to the previous year[106]. - The effective tax rate increased from 33.7% in 2023 to 43.7% in 2024 due to higher cross-border tax obligations[58]. Asset Quality and Management - The company has maintained stable asset quality and flow in its financial services business[11]. - The non-performing asset ratio was 1.07%, slightly up from 1.04% in the previous year[24]. - The provision coverage ratio for non-performing assets was 227.78%, indicating a stable coverage level compared to 227.59% in 2023[24]. - The total amount of non-performing assets is RMB 2,790,120 thousand, showing stability compared to RMB 2,792,206 thousand in the previous year[153]. - The group has observed a stable asset quality overall, with a low level of deterioration in concern assets due to careful monitoring and management[163]. - The group’s credit cost rate for 2024 was 0.30%, up from 0.13% in 2023, primarily due to increased provisions in the inclusive finance business[183]. - The coverage ratio for provisions against non-performing assets was 227.78% in 2024, indicating a stable asset quality management strategy[183]. Dividends and Shareholder Returns - The company's annual cash dividend increased to HKD 0.55 per share, with a cash dividend payout ratio exceeding 55%[11]. - The company completed its first interim dividend distribution since its listing, marking a significant return to shareholders[11]. - The company distributed cash dividends of RMB 19.20 billion in the first half of 2024, accounting for 31.00% of the net profit attributable to ordinary shareholders for the previous year[18]. Business Segments and Revenue Sources - The revenue from industrial operation business accounted for over 40% of total income, effectively hedging against industry fluctuations[11]. - The revenue from the industrial operations segment was RMB 16.181 billion, a year-on-year increase of 9.78%, contributing 42.71% to total revenue[15]. - The financial and consulting segment contributed 57.29% of total revenue, amounting to RMB 21,705,654 thousand, which represents a 7.10% decrease from RMB 23,363,434 thousand in the previous year[60]. - The inclusive finance segment experienced a significant growth of 50.90% year-on-year, effectively countering the fluctuations in the main financial business[52]. Strategic Initiatives and Future Plans - The company aims to continue its "Finance + Industry" development strategy, focusing on innovation and adapting to environmental changes[19]. - The company has launched initiatives in technology finance, green finance, inclusive finance, pension finance, and digital finance[12]. - The company plans to adopt a prudent and stable development strategy, anticipating gradual improvement in external conditions and operational efficiency[106]. - The company aims to enhance its service offerings by integrating resources across various sectors, focusing on long-term, comprehensive services for vital clients[42]. Market and Economic Outlook - In 2024, the national general public budget revenue is projected to be RMB 21.97 trillion, a year-on-year increase of 1.3%, with tax revenue decreasing by 3.4% to RMB 17.49 trillion and non-tax revenue increasing by 25.4% to RMB 4.47 trillion[32]. - The broad money supply (M2) is expected to grow by 7.3% year-on-year in 2024, while the total social financing scale is projected to increase by 8.0% year-on-year[32]. - The national industrial added value above designated size is projected to grow by 5.8% year-on-year in 2024[36]. Awards and Recognition - The company has received multiple awards related to ESG, reflecting its commitment to sustainable development[12]. - The company has been recognized in the Fortune China 500 and Forbes Global 2000 rankings[6].

Financial Performance - Total revenue for the six months ended June 30, 2024, was RMB 18,036,339 thousand[8] - Net profit attributable to ordinary shareholders for the six months ended June 30, 2024, was RMB 2,085,076 thousand[8] - Basic earnings per share for the six months ended June 30, 2024, was RMB 0.49[8] - Diluted earnings per share for the six months ended June 30, 2024, was RMB 0.45[9] - Average return on assets for the six months ended June 30, 2024, was 1.30%[9] - Average return on equity for the six months ended June 30, 2024, was 8.49%[9] - Net interest margin for the six months ended June 30, 2024, was 1.30%[9] - Net interest spread for the six months ended June 30, 2024, was 8.49%[9] - Operating cost ratio for the six months ended June 30, 2024, was 3.95%[10] - Total revenue for the first half of 2024 was RMB 18,036,339 thousand, a slight decrease from RMB 18,361,807 thousand in the same period of 2023[11] - Financial services (interest income) contributed RMB 10,699,938 thousand in H1 2024, down from RMB 11,084,837 thousand in H1 2023[11] - Industrial operations revenue increased to RMB 7,244,246 thousand in H1 2024, up from RMB 6,890,244 thousand in H1 2023[11] - Pre-tax profit for H1 2024 was RMB 4,007,621 thousand, compared to RMB 4,990,390 thousand in H1 2023[11] - The net interest margin improved to 4.47% in H1 2024, up from 4.42% in H1 2023[11] - Basic earnings per share for H1 2024 were RMB 0.49, down from RMB 0.73 in H1 2023[11] - Revenue for the first half of 2024 decreased by 1.77% to RMB 18,036.34 million compared to RMB 18,361.81 million in the same period last year[28][30] - Net profit attributable to ordinary shareholders of the company dropped by 32.10% to RMB 2,085.08 million[28] - Financial and consulting segment revenue (before taxes and surcharges) decreased by 6.02% to RMB 10,862.04 million, accounting for 59.99% of total revenue[30][32] - Industrial operations segment revenue increased by 5.14% to RMB 7,244.25 million, contributing 40.01% of total revenue[31][32] - Interest income from financial services declined by 3.47% to RMB 10,699.94 million, representing 59.10% of total revenue[33] - Consulting service revenue plummeted by 65.69% to RMB 162.10 million[31] - The company's interest-bearing assets average balance decreased by 3.91% to RMB 263,959.17 million[29] - Asset provisions surged by 120.49% to RMB 644.11 million[28] - Income from joint ventures and associates plunged by 66.78% to RMB 83.40 million[28] - Tax expenses increased by 13.01% to RMB 1,696.59 million[28] - The average balance of interest-earning assets decreased by 3.91% from RMB 274,693,818 thousand in the first half of 2023 to RMB 263,959,174 thousand in the first half of 2024[36] - The average yield on interest-earning assets improved to 8.11% in the first half of 2024, up from 8.07% in the same period of 2023[37] - The average balance of interest-earning assets in the inclusive finance business increased by 22.20% from RMB 10.817 billion at the end of 2023 to RMB 13.218 billion in the first half of 2024[35] - Interest income from the East China region accounted for 40.89% of total interest income in the first half of 2024, up from 37.52% in the same period of 2023[38] - Service fee income from the financial and consulting division decreased by 65.69% from RMB 472,509 thousand in the first half of 2023 to RMB 162,101 thousand in the first half of 2024[39] - Industrial operations revenue increased by 5.14% from RMB 6,890,244 thousand in the first half of 2023 to RMB 7,244,246 thousand in the first half of 2024[40] - Equipment operations revenue within the industrial operations division increased by 15.85% from RMB 4,205,971 thousand in the first half of 2023 to RMB 4,872,421 thousand in the first half of 2024[41] - Sales costs for the financial and consulting division decreased by 4.19% from RMB 5,008,769 thousand in the first half of 2023 to RMB 4,799,138 thousand in the first half of 2024[45] - Sales costs for the industrial operations division increased by 4.38% from RMB 4,900,457 thousand in the first half of 2023 to RMB 5,115,071 thousand in the first half of 2024[45] - Total sales costs increased by 0.05% from RMB 9,909,226 thousand in the first half of 2023 to RMB 9,914,209 thousand in the first half of 2024[45] - The average cost rate of interest-bearing liabilities decreased to 4.16% in the first half of 2024, down from 4.26% in the same period of 2023, primarily due to lower domestic financing costs and bond market conditions[47][48] - The company's financial and consulting sales costs decreased by RMB 209.631 million to RMB 4,799.138 million in the first half of 2024, compared to RMB 5,008.769 million in the same period of 2023[48] - The industrial operations segment's costs increased by 4.38% to RMB 5,115.071 million in the first half of 2024, with equipment operation costs rising by 19.61% to RMB 3,313.096 million[50] - The company's gross profit decreased by 3.91% to RMB 8,122.130 million in the first half of 2024, with the gross margin dropping from 46.03% to 45.03%[51] - Net interest income decreased by 2.88% to RMB 5,900.800 million in the first half of 2024, while the net interest spread increased by 14 basis points to 3.95%[53][55] - The industrial operations segment's gross profit increased by 7.01% to RMB 2,129.175 million in the first half of 2024, with hospital operation gross profit rising by 15.43% to RMB 464.530 million[56] - The company's other income/earnings decreased by 11.55% to RMB 608.672 million in the first half of 2024, with a significant 75.48% drop in income from off-balance sheet assets[57] - The company's interest income decreased by 3.47% to RMB 10,699.938 million in the first half of 2024, while interest expenses decreased by 4.19% to RMB 4,799.138 million[53] - Sales and administrative expenses increased by RMB 9.103 million (0.26%) to RMB 3,538.985 million in the first half of 2024, driven by market expansion strategies[59] - Other expenses decreased by 11.15% to RMB 41.997 million in the first half of 2024, mainly due to reduced donation expenses[60] - Financial costs rose by 9.29% to RMB 581.489 million in the first half of 2024, primarily due to financing costs in the industrial operations segment[61] - Pre-provision profit decreased by 11.94% to RMB 4,651.728 million in the first half of 2024, with significant declines in financial and consulting segment revenues[62] - Asset provisions increased by 120.49% to RMB 644.107 million in the first half of 2024, with notable changes in interest-earning asset provisions and receivables provisions[63] - Income tax expenses increased by 13.01% to RMB 1,696.585 million in the first half of 2024, driven by higher cross-border withholding taxes[65] - Net profit attributable to ordinary shareholders decreased by 32.10% to RMB 2,085.076 million in the first half of 2024[66] - Basic earnings per share decreased by 32.88% to RMB 0.49 in the first half of 2024[67] Asset and Liability Management - Asset-liability ratio as of June 30, 2024, was 83.67%[10] - The company's total assets as of June 30, 2024, stood at RMB 361,642,055 thousand, slightly up from RMB 361,362,852 thousand at the end of 2023[12] - The asset-liability ratio was 83.67% as of June 30, 2024, down from 84.38% at the end of 2023[12] - Non-performing asset ratio remained stable at 1.04% as of June 30, 2024, compared to 1.05% at the end of 2023[13] - Provision coverage ratio was 227.21% as of June 30, 2024, down from 234.87% at the end of 2023[13] - Total assets increased by 2.89% to RMB 361,642.055 million as of June 30, 2024, while interest-earning assets decreased by 1.01%[70] - The company's total assets increased by 2.89% to RMB 361.64 billion as of June 30, 2024, compared to RMB 351.48 billion as of December 31, 2023[72] - Interest-earning assets accounted for 71.92% of the company's total assets as of June 30, 2024, with a slight decrease of 1.01% in net interest-earning assets to RMB 266.38 billion[73][74] - The company's cash and cash equivalents increased significantly by 21.71% to RMB 22.95 billion as of June 30, 2024[72] - The cultural tourism sector saw a 21.54% increase in net interest-earning assets to RMB 30.70 billion as of June 30, 2024[78] - The consumer goods sector experienced a 23.95% growth in net interest-earning assets to RMB 28.25 billion as of June 30, 2024[78] - The urban public utilities sector's net interest-earning assets decreased by 11.62% to RMB 94.69 billion as of June 30, 2024[78] - The company's financial assets measured at fair value through profit or loss increased by 85.46% to RMB 16.40 billion as of June 30, 2024[72] - The company's provision for financial assets measured at fair value through profit or loss increased by 62.72% to RMB 50.57 million as of June 30, 2024[74] - The company's inclusive finance business maintained steady growth, with net interest-earning assets increasing to RMB 13.96 billion as of June 30, 2024[79] - The company decided to no longer invest in long-term infrastructure projects and accelerated the disposal of such assets, with a balance of RMB 7.721 billion as of June 30, 2024[80] - The interest-earning assets in East China accounted for 43.34% of the total, with a balance of RMB 115.46 billion as of June 30, 2024[82] - The interest-earning assets in the city utility sector in East China accounted for 44.27% of the total, with a balance of RMB 41.92 billion as of June 30, 2024[83] - Interest-earning assets due within 1 year increased to 59.54% of the total, with a balance of RMB 158.59 billion as of June 30, 2024[85] - Interest-earning assets due within 1 year accounted for 61.07% of the total, with a balance of RMB 162.67 billion as of June 30, 2024[87] - The proportion of interest-earning assets due in 3 years and above decreased by 49.21%, with a balance of RMB 4.95 billion as of June 30, 2024[87] - Total interest-bearing assets amounted to RMB 266.38 billion as of June 30, 2024, with normal assets accounting for 93.15%[97] - The proportion of special mention assets decreased by 0.16 percentage points to 5.81% compared to the end of 2023[97] - The non-performing asset ratio remained stable at 1.04% as of June 30, 2024[97] - The urban public utilities sector accounted for 38.50% of total special mention assets, with a sector-specific ratio of 6.30%[98] - The company successfully implemented diversified disposal strategies, including collateral and pledge disposal, flexible debt transfer, and legal enforcement[94] - The company restructured its asset management organization to enhance efficiency and risk control, establishing separate departments for customer monitoring and asset disposal[92] - A new asset disposal department was established with specialized teams to maximize risk reduction and recovery[93] - The company optimized its post-lease operation system, integrating disposal strategies, decision-making, execution, data monitoring, and system optimization[93] - The company implemented a refined incentive mechanism to maximize asset disposal value and potential[95] - The company maintained a stable asset quality despite a slight decrease in total assets during the reporting period[91] - The proportion of attention assets in the cultural tourism sector is 20.09%, with the sector's attention asset ratio at 10.13%, higher than the company's overall attention asset ratio[99] - The proportion of attention assets in the engineering construction sector is 14.79%, with the sector's attention asset ratio at 6.78%, slightly higher than the company's overall attention asset ratio[99] - The proportion of attention assets in the healthcare sector is 11.39%, with the sector's attention asset ratio at 9.09%, slightly higher than the company's overall attention asset ratio[100] - The total attention assets as of June 30, 2024, amounted to RMB 15,485,788 thousand, with the healthcare sector accounting for RMB 1,763,291 thousand (11.39%) and the cultural tourism sector accounting for RMB 3,110,590 thousand (20.09%)[101] - The non-performing asset ratio as of June 30, 2024, was 1.04%, with the total non-performing assets amounting to RMB 2.774 billion[102] - The proportion of non-performing assets in the urban public utilities sector is 45.70%, with the sector's non-performing asset ratio at 1.34%[103] - The proportion of non-performing assets in the transportation and logistics sector is 18.90%, with the sector's non-performing asset ratio at 2.53%[104] - The proportion of non-performing assets in the cultural tourism sector is 10.52%, with a sector-specific non-performing asset ratio of 0.95%, showing a significant decrease compared to previous periods[105] - The mechanical manufacturing sector's non-performing assets account for 6.47% of total non-performing assets, with a sector-specific ratio of 1.14%, indicating a slight decline[105] - The healthcare sector's non-performing assets decreased to 174,641 thousand RMB, representing 6.30% of total non-performing assets, down from 11.77% in December 2023[106] - The urban utilities sector holds the largest share of non-performing assets at 45.70%, amounting to 1,267,506 thousand RMB[106] - The total non-performing assets as of June 30, 2024, were 2,773,644 thousand RMB, with a non-performing asset ratio of 1.04%, consistent with the previous period[112] - The non-performing asset generation rate for the period was 0.12%, a decrease from 0.51% in December 2023[112] - The cultural tourism sector's substandard assets decreased to 11,350 thousand RMB, representing 0.86% of total substandard assets, down from 2.61% in December 2023[107] - The urban utilities sector's substandard assets decreased to 684,838 thousand RMB, representing 51.85% of total substandard assets, down from 59.15% in December 2023[107] - The healthcare sector's doubtful assets increased to 105,073 thousand RMB, representing 7.23% of total doubtful assets, up from 4.53% in December 2023[108] - The urban utilities sector's doubtful assets increased to 582,668 thousand RMB, representing 40.11% of total doubtful assets, up from 19.09% in December 2023[108] - Non-performing asset provision ratio decreased to 26.24% as of June 30, 2024, compared to 26.49% at the end of 2023[114] - Provision coverage ratio stood at 227.21% as of June 30, 2024, slightly down from 227.59% at the end of 2023[114] - Credit cost rate remained stable at 0.13% as of June 30, 2024, consistent with the rate at the end of 2023[114] - Write-off ratio for non-performing assets was 11.85% as of June 30, 2024, significantly lower than 49.41% at the end of 2023[116] - Over 30 days delinquency rate decreased to 0.90% as of June 30, 2024, down by 0.01 percentage points from the end of 2023[119] - Urban public utilities accounted for 38.

Investment Rating - The report maintains a "Recommended" investment rating for the company [3][8]. Core Views - The company has announced an interim cash dividend of HKD 0.25 per share, with a payout ratio of approximately 47%, reflecting a commitment to shareholder returns [4][8]. - The company is recognized as a leading independent financing leasing group in China, with strong asset quality and stable interest margins, expected to maintain its industry-leading position and steady performance [8]. - The report highlights a decline in revenue and net profit for the first half of 2024, with operating income at CNY 18.036 billion (down 1.8% YoY) and net profit at CNY 2.085 billion (down 32.1% YoY) [4][5]. Financial Performance Summary - For the first half of 2024, the company reported total assets of CNY 361.6 billion (up 2.9% from the beginning of the year) and net assets of CNY 48.2 billion (down 3.8% from the beginning of the year) [4]. - The financial segment generated revenue of CNY 10.9 billion (down 6% YoY), while the industrial segment achieved revenue of CNY 7.2 billion (up 5% YoY) [4][5]. - The company’s annualized ROE for the first half of 2024 was 8.5%, down 4.8 percentage points YoY [5]. Business Segment Analysis - The equipment operation segment reported revenue of CNY 4.87 billion (up 16% YoY), while the hospital operation segment generated revenue of CNY 2.13 billion (adjusted for base effects, up 0.34% YoY) [7]. - The company’s asset quality remains stable, with a non-performing loan ratio of 1.04% and a coverage ratio of 227% as of the end of the first half of 2024 [7]. Future Outlook - The report projects a downward revision of the company's net profit expectations for 2024-2026, with forecasts of CNY 5.684 billion, CNY 6.095 billion, and CNY 6.574 billion respectively [8]. - The company’s current stock price corresponds to a 2024 PB ratio of approximately 0.4 times, indicating potential value for investors [8].

Investment Rating - The report maintains an "Accumulate" rating for the company [3][5]. Core Insights - The company's revenue for the first half of 2024 decreased by 1.77% year-on-year, primarily due to pressure on financial services, while contributions from industrial operations continued to improve [3][5]. - The net profit attributable to shareholders fell by 32.10% year-on-year, but the company demonstrated operational resilience by implementing a mid-term dividend for the first time, amounting to HKD 0.25 per share, with a cash dividend payout ratio of 47% [3][5]. - The report projects a target price of HKD 11.96, corresponding to a P/E ratio of 9.04x for 2024 [5]. Financial Performance Summary - The company achieved a revenue of RMB 18.04 billion in the first half of 2024, down from RMB 18.61 billion in the same period of 2023, reflecting a decline of 1.77% [8]. - Financial services revenue, which includes interest income, decreased by 3.47% year-on-year, contributing to the overall revenue decline [8]. - Industrial operations revenue increased to RMB 7.24 billion, showing a year-on-year growth of 5.14% [8]. - The net interest margin (NIM) improved to 4.47%, up by 0.05 percentage points year-on-year, indicating a stable financial performance despite the challenges [5][8]. - The company reported a non-performing asset ratio of 1.04%, which remained stable compared to the previous year [8]. Business Segment Analysis - The financial segment's net interest-earning assets totaled RMB 266.85 billion, a decrease of 1.01% from the end of the previous year, reflecting a more prudent strategy [5][8]. - The industrial operations segment's revenue contribution increased from 37.52% to 40.16%, effectively offsetting the impact of the financial services decline [5][8]. - The company continues to expand its market presence, with a focus on both domestic and international markets, including Southeast Asia and the Middle East [5][8].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性 或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部份內容而產生或因倚 賴該等內容而引致的任何損失承擔任何責任。 （於香港註冊成立的有限公司） （股份代號：3360） 截至二零二四年六月三十日止六個月中期業績公告 | --- | --- | |--------------------|------------------------------------------------------------------------| | | | | 附載的資料之要求。 | 報告全文，並符合香港聯合交易所有限公司證券上市規則有關中期業績初步公告 | | | 承董事局命 | | | 遠東宏信有限公司 主席、行政總裁及執行董事 | | | 孔繁星 | | | | 香港，二零二四年八月九日 於本公告日期，本公司的執行董事為孔繁星先生（主席）、王明哲先生及曹健先 生；本公司非執行董事為陳樹民先生、衛濛濛女士、劉海峰先生、郭明鑑先生及 羅強先生；以及本公司獨立非執行董事為韓小京先生、劉嘉凌先生、葉偉明先生 及黃家輝先生。 →◇γγ ...

Investment Rating - The investment rating for the company is "Buy" [4] Core Views - The company achieved a total revenue of 38 billion yuan in 2023, representing a year-on-year growth of 3.8%. The net profit attributable to ordinary shareholders was 6.2 billion yuan, with a growth of 1.0% year-on-year. The weighted average ROE was 13.0%, a decrease of 1.1 percentage points year-on-year [1][2] - The total assets at the end of 2023 grew by 1.3% year-on-year to 351.5 billion yuan, with loans and receivables increasing by 1.4% to 270.8 billion yuan. The company performed slightly better than the overall industry, which saw a 3.6% decline in financing lease contract balances [1] - The average yield on interest-earning assets rose to 8.24%, an increase of 24 basis points year-on-year, while the average cost of interest-bearing liabilities increased to 4.26%, up 20 basis points year-on-year. The net interest margin slightly decreased to 4.58%, down 9 basis points year-on-year [1] - The industrial operation segment saw a revenue increase of 11.4% to 14.7 billion yuan, with a stable gross margin of 32% [1] - Sales and administrative expenses rose significantly by 19.6% to 8.1 billion yuan, outpacing revenue growth and accounting for 21.4% of total revenue [1] - Asset quality improved, with a non-performing loan ratio of 1.04%, a decrease of 0.01 percentage points from the beginning of the year. The coverage ratio was 228%, down 12 percentage points year-on-year [1] Financial Forecasts - The company expects net profit attributable to ordinary shareholders to be 6.3 billion yuan in 2024, 6.5 billion yuan in 2025, and 6.7 billion yuan in 2026, with year-on-year growth rates of 1.8%, 3.5%, and 2.3% respectively. The diluted EPS is projected to be 1.46 yuan in 2024, 1.51 yuan in 2025, and 1.55 yuan in 2026 [2][5] - The current stock price corresponds to a PE ratio of 3.9 for 2024, 3.8 for 2025, and 3.7 for 2026, with a PB ratio of 0.45, 0.42, and 0.39 respectively. The company offers a relatively high dividend yield [1][5]

Financial Performance and Growth - The company achieved steady growth in revenue and profitability in 2023, with financial business remaining stable and asset quality improving[10] - The company's total assets reached RMB 3,514.83 billion at the end of 2023, a year-on-year increase of 1.29%, with annual revenue of RMB 379.60 billion, up 3.76% year-on-year, and net profit attributable to ordinary shareholders of RMB 6.193 billion, a year-on-year increase of 1.04%[13] - Total revenue for 2023 reached RMB 37,959,798 thousand, a 3.8% increase from RMB 36,585,722 thousand in 2022[19] - Net profit attributable to ordinary shareholders was RMB 6,192,972 thousand in 2023, slightly up from RMB 6,128,954 thousand in 2022[19] - The company's average return on equity was 12.99% in 2023, with a proposed dividend of HKD 0.50 per share[13] - The company's diluted earnings per share were RMB 1.33 in 2023, with an average return on assets of 1.98% and an average return on equity of 12.99%[17] - The company's asset-liability ratio decreased from 84.89% in 2022 to 83.62% in 2023, with net assets per share increasing from RMB 10.49 in 2022 to RMB 11.61 in 2023[18] - The group's revenue for 2023 reached RMB 37,959.798 million, a 3.76% increase compared to the previous year[36][38] - Net profit attributable to ordinary shareholders of the company for 2023 was RMB 6,192.972 million, a 1.04% increase compared to the previous year[36] - The company's total assets increased by 1.29% to RMB 351.48 billion as of December 31, 2023, compared to RMB 346.99 billion in the previous year[80] - The company's cash and cash equivalents increased significantly by 18.54% to RMB 18.85 billion as of December 31, 2023[80] - The company's total liabilities decreased by RMB 640.439 million (0.22%) to RMB 293,913.636 million as of December 31, 2023, with interest-bearing bank and other financing accounting for 86.98% of total liabilities, an increase of 1.65 percentage points compared to the previous year[141][142] - The company's property, plant, and equipment balance was RMB 23,513.055 million, including RMB 18.2 billion for equipment operations and RMB 3.3 billion for hospital buildings and medical equipment[139] - The company's investment in joint ventures and associates amounted to RMB 9,105.237 million, including RMB 5,093.862 million in equity investments in provincial asset management companies[139] - The company's financial assets measured at fair value through profit or loss totaled RMB 8,841.595 million, including RMB 3.22 billion in interest-bearing assets and RMB 2.85 billion in other debt investments[140] - The company's total assets under asset-backed securities/notes decreased by 71.83% to RMB 1,649 million as of December 31, 2023, compared to RMB 5,853 million in the previous year[137] - The company's self-held portion of asset-backed securities/notes decreased by 58.55% to RMB 369.172 million as of December 31, 2023, compared to RMB 890.572 million in the previous year[137][138] - The company's deferred tax assets amounted to RMB 6,052.352 million, primarily due to timing differences between accounting and tax treatments[139] - The company's prepayments and other receivables stood at RMB 4,374.919 million, mainly consisting of prepayments to suppliers for machinery and equipment[139] - The company's restricted deposits amounted to RMB 3,149.062 million as of December 31, 2023[139] - The total interest-bearing bank and other financing of the company amounted to RMB 255,636,145 thousand as of December 31, 2023, an increase of 1.71% compared to the end of the previous year[144] - The proportion of current interest-bearing bank and other financing increased to 51.79% as of December 31, 2023, up from 49.12% at the end of the previous year, mainly due to a reduction in the issuance scale of long-term bonds overseas[145][146] - The proportion of unsecured interest-bearing bank and other financing decreased to 82.13% as of December 31, 2023, down from 84.95% at the end of the previous year, as the company obtained more low-cost funds through asset pledges[147] - Bank loans accounted for 60.87% of the total interest-bearing bank and other financing as of December 31, 2023, an increase of 15.91% compared to the end of the previous year, reflecting the company's deepening cooperation with banks[149] - Domestic financing accounted for 84.59% of the total interest-bearing bank and other financing as of December 31, 2023, an increase of 3.73% compared to the end of the previous year, as the company balanced domestic and overseas financing channels[150][151] - RMB-denominated financing accounted for 81.35% of the total interest-bearing bank and other financing as of December 31, 2023, an increase of 4.56% compared to the end of the previous year, as the company actively promoted RMB financing both domestically and internationally[152][153] - Indirect financing accounted for 69.67% of the total interest-bearing bank and other financing as of December 31, 2023, an increase of 15.73% compared to the end of the previous year, as the company optimized its financing structure and increased indirect financing[155] - The total equity of the company amounted to RMB 57,569,600 thousand as of December 31, 2023, an increase of 9.78% compared to the end of the previous year, driven by steady profit growth and the successful listing of Hongxin Construction[156] - Total equity increased by 9.78% to RMB 57.57 billion in 2023, compared to RMB 52.44 billion in 2022[157] - The company's ordinary shareholders' equity rose by 10.72% to RMB 50.10 billion in 2023, up from RMB 45.25 billion in 2022[157] - Non-controlling interests surged by 43.39% to RMB 5.90 billion in 2023, compared to RMB 4.11 billion in 2022[157] - Perpetual securities decreased by 48.91% to RMB 1.57 billion in 2023, down from RMB 3.08 billion in 2022[157] - The company proposed a special dividend in the form of a distribution of approximately 160 million Hongxin Construction shares, representing about 5% of the total issued shares of Hongxin Construction as of December 6, 2023[160] - The total dividend payable for the special dividend in kind was approximately RMB 664 million, based on the closing price of Hongxin Construction shares on December 29, 2023[160] - The listing of Hongxin Construction on the Hong Kong Stock Exchange on May 25, 2023, resulted in an increase of approximately RMB 870 million in the equity attributable to ordinary shareholders of the company[161] - The company updated its medium-term note and perpetual securities program on July 24, 2023, allowing for the issuance of up to USD 4 billion in notes and/or perpetual securities[165] - The company issued and outstanding convertible bonds as of December 31, 2023, include a $300 million bond due in 2025 with a 2.5% annual interest rate, and a $250 million zero-coupon bond due in 2026[166][167] - The net proceeds from the $300 million bond issuance were approximately $296.6 million, with a net conversion price of approximately HK$8.24 per share[166] - The net proceeds from the $250 million bond issuance were approximately $246 million, with a net conversion price of approximately HK$10.01 per share[167] - As of December 31, 2023, the outstanding principal amount of the $300 million bond was $290 million after redeeming $10 million in July 2023[166] - The outstanding principal amount of the $250 million bond remained at $250 million as of December 31, 2023[167] - If all convertible bonds were fully converted, the company would issue 569,336,712 shares, representing approximately 13.19% of the issued share capital as of December 31, 2023[170] - The conversion of all convertible bonds would dilute the shareholding percentage of major shareholders, with China National Chemical Corporation's stake decreasing from 21.31% to 18.83%[171] - The company's credit ratings remained unchanged in 2023, and it has sufficient cash flow and bank credit lines to fully repay the convertible bonds at maturity[173] - The implied internal rate of return for the convertible bonds issued on July 8, 2020, and June 15, 2021, indicates that bondholders will receive equally favorable economic returns whether they choose to convert or redeem the bonds by the end of 2023 to 2025. The corresponding stock prices are HKD 6.59 for 2023 and 2024, and HKD 8.94, 9.12, and 9.30 for 2023, 2024, and 2025, respectively[174] - The conversion prices for the convertible bonds issued in July 2020 and June 2021 were adjusted to HKD 6.48 and HKD 8.35 per share, respectively, due to the payment of special dividends on January 22, 2024. If all conversion rights are exercised, the company will issue 579,227,090 shares[175] - The company's asset-liability ratio was 83.62% as of December 31, 2023, compared to 84.89% in the previous year, reflecting a slight improvement in capital management[177][178] - The risk asset-to-equity ratios for the company's financing leasing subsidiaries were 4.58, 3.49, 1.57, and 4.34 as of December 31, 2023, all of which comply with regulatory requirements[179][180][181][182] - The company's capital expenditure for 2023 was RMB 2,880.915 million, primarily used for property, plant, and equipment additions, as well as external equity investments[183] Credit Ratings and ESG Performance - Far East Horizon's credit rating was confirmed as "BBB-" by S&P Global Ratings with a "stable" outlook, and its standalone credit profile (SACP) was upgraded to "bbb-"[10] - The company received an "A" rating from MSCI for ESG for two consecutive years, with its sustainable financing framework achieving the highest score among Asian financial institutions by Moody's and Fitch[10] Industrial Operations and Market Expansion - Far East Horizon's industrial operations saw breakthroughs, with Hongxin Construction successfully spinning off and listing, and continued expansion in overseas markets[10] - The company's healthcare business, Hongxin Health, returned to normal operating conditions, with operational efficiency continuously improving[10] - Far East Horizon operates in multiple sectors including healthcare, tourism, construction, machinery, chemicals, electronics, consumer goods, logistics, and urban utilities[7] - The company has established a nationwide service network with offices in major cities such as Beijing, Shanghai, Shenzhen, and Chengdu[8] - The company's headquarters is located in Hong Kong, with business operation centers in Shanghai, Tianjin, and Guangzhou[8] - Far East Horizon was listed on the Hong Kong Stock Exchange on March 30, 2011, under the stock code 03360[8] - Far East Horizon has been recognized in the Fortune China 500 and Forbes Global 2000 rankings[7] - The industrial operation segment achieved a total revenue of RMB 14.739 billion in 2023, a year-on-year increase of 11.38%, with its revenue contribution ratio rising from 36.02% to 38.68%[12] - Hongxin Jianfa, a leading equipment operation service provider in China, expanded its overseas market and increased its total revenue to RMB 9.611 billion in 2023, a year-on-year growth of 22.00%, with adjusted annual profit reaching RMB 1.043 billion, up 10.65% year-on-year[12] - Hongxin Jianfa's aerial work platform management scale reached 177,600 units by the end of 2023, ranking first in Asia and top three globally, with material asset management scale of approximately 2.28 million tons, maintaining domestic leadership[12] - Hongxin Health achieved a total revenue of RMB 4.238 billion in 2023, a year-on-year increase of 15.53%, with annual profit surging 252.75% year-on-year to RMB 172 million[12] - The company expanded its overseas market with new outlets in Malaysia and Indonesia, steadily advancing its international business[33] - The company's financial services (interest income) increased by 3.64% to RMB 22,467.103 million, while consulting services (fee income) decreased by 50.82% to RMB 896.331 million[39][40] - Industrial operations revenue increased by 11.38% to RMB 14.739 billion, with Hongxin Construction contributing RMB 9.611 billion (up 22.00%) and Hongxin Health contributing RMB 4.238 billion (up 15.53%)[41] - Non-leasing business accounted for 46.51% of total revenue (pre-tax), with new business directions like inclusive finance and commercial factoring contributing 5.48% of interest income[41] - Interest income from financial services increased by 3.64% to RMB 22.467 billion, accounting for 58.97% of total revenue (pre-tax)[42] - The average yield on interest-earning assets rose to 8.24% in 2023, up 0.24 percentage points from 8.00% in 2022[46] - Interest income from new business directions (inclusive finance, commercial factoring, and asset business) increased by 12.09% to RMB 2.087 billion, with an average yield showing steady growth[44] - Service fee income from consulting services decreased by 50.82% to RMB 896.331 million, accounting for 2.35% of total revenue (pre-tax)[48] - Sales costs increased by 10.10% to RMB 19.959 billion, with financial and consulting division costs rising by 10.82% to RMB 9.982 billion[52] - Hongxin Construction's operating costs increased by 23.28% to RMB 5.849 billion, while Hongxin Health's operating costs rose by 13.13% to RMB 3.473 billion[52] - Financial and consulting division costs increased by 10.82% to RMB 9,982,081 thousand in 2023, accounting for 50.01% of total sales costs[54][57] - Industrial operations division costs rose by 9.39% to RMB 9,976,734 thousand in 2023, with equipment operation costs surging 23.28% to RMB 5,849,180 thousand[54][59] - The company's gross profit decreased by 2.48% to RMB 18,000,983 thousand in 2023, with gross margin dropping from 50.45% to 47.42%[60] - Net interest income declined by 1.46% to RMB 12,485,022 thousand in 2023, while net interest spread increased by 4 basis points to 3.98%[62][64] - Industrial operations division gross profit grew 15.80% to RMB 4,762,537 thousand in 2023, with hospital operations gross profit surging 27.83% to RMB 765,180 thousand[65] - The company's average cost rate for interest-bearing liabilities increased to 4.26% in 2023, up from 4.06% in 2022[56][57] - Interest expense rose 10.82% to RMB 9,982,081 thousand in 2023, outpacing the 3.64% growth in interest income[62] - Equipment operation gross profit increased 20.06% to RMB 3,761,401 thousand in 2023, accounting for 78.98% of industrial operations gross profit[65] - Other income/earnings decreased by 21.55% to RMB 1,559,591 thousand in 2023, with gains from equity and debt investments surging 163.97% to RMB 507,929 thousand[66] - The company's average balance of interest-bearing liabilities increased to RMB 234,089,521 thousand in 2023, up from RMB 221,672,148 thousand in 2022[56] - Government subsidies for the period amounted to approximately RMB 160 million, including VAT deduction benefits, enterprise development subsidies, and government support funds[67] - Sales and administrative expenses increased by 19.59% to RMB 8,121,968 thousand, driven by market expansion strategies[68] - Other expenses decreased by 86.43% to RMB 55,090 thousand, with significant reductions in exchange losses and bank fees[69] - Financial costs decreased slightly by 1.59% to RMB 1,037,956 thousand, primarily related to financing costs for the industrial operations division[70] - Pre-provision profit decreased by 14.66% to RMB 10,614,851 thousand, impacted by rising financing costs and reduced gains from off-balance sheet assets[71] - Asset provisions decreased by 91.05% to RMB 189,591 thousand, with significant reversals in fixed asset provisions due to improved market conditions[72] - Income tax expenses decreased by 5.66% to RMB 3,508,237 thousand, mainly due to a reduction in cross-border withholding taxes[74] - Net profit attributable to ordinary shareholders increased by 1.04% to RMB 6,192,972 thousand, with basic earnings per share rising by 0.68% to RMB 1.47[75][76] - Total assets increased by 1.29% to RMB 351,483,236 thousand, while interest-earning assets decreased by 0.56% to RMB 269,084,739 thousand[79] - The company's total assets increased by 1.29% to RMB 351.48

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected relative increase of over 15% compared to the CSI 300 index in the next six months [1][6]. Core Insights - The company reported a revenue of 37.96 billion yuan for 2023, a year-on-year increase of 3.76%, and a net profit attributable to shareholders of 6.19 billion yuan, up 1.04% year-on-year [2][4]. - The financial segment showed stability, while new business expansions helped mitigate declines in consulting revenue, which fell by 50.82% year-on-year [2]. - The company is focusing on expanding its inclusive finance, commercial factoring, and asset management businesses, which contributed 2.09 billion yuan in interest income, a 12.09% increase year-on-year [2]. - The average balance of interest-earning assets was 271.02 billion yuan, a 0.67% increase year-on-year, while the average balance of interest-bearing liabilities rose by 5.60% to 234.09 billion yuan [2]. - The company maintained strong pricing power, with the yield on interest-earning assets increasing by 24 basis points to 8.24%, supporting a 3.64% rise in interest income to 22.47 billion yuan [2]. - The company announced a special dividend and plans to distribute a cash dividend of 0.50 HKD per share, maintaining a payout ratio above 30%, resulting in a dividend yield of 8.24% based on the closing price of 6.07 HKD [2][4]. Financial Projections - Revenue projections for 2024-2026 are 41.23 billion yuan, 43.96 billion yuan, and 46.35 billion yuan, with growth rates of 8.63%, 6.61%, and 5.43% respectively [4]. - Net profit projections for the same period are 6.78 billion yuan, 7.30 billion yuan, and 7.63 billion yuan, with growth rates of 9.53%, 7.55%, and 4.56% respectively [4]. - The diluted earnings per share (EPS) are expected to be 1.57, 1.69, and 1.77 yuan for 2024, 2025, and 2026, respectively, with corresponding price-to-earnings (PE) ratios of 3.55, 3.30, and 3.16 [4].