Financial Performance - Revenue for the first half of 2024 was RMB 7.926 billion, a decrease of 6.2% compared to the same period in 2023[4] - Service revenue for the first half of 2024 was RMB 7.648 billion, a decrease of 7.8% compared to the same period in 2023[4] - Net profit for the first half of 2024 was RMB 285.353 million, a decrease of 18.6% compared to the same period in 2023[4] - Basic earnings per share for the first half of 2024 were RMB 10.93 cents, a decrease of 12.1% compared to the same period in 2023[4] - Revenue for the first half of 2024 decreased by 6.2% year-on-year to RMB 7,926.183 million[49] - Service income for the first half of 2024 decreased by 7.8% year-on-year to RMB 7,647.920 million[49] - Net profit for the first half of 2024 decreased by 18.6% year-on-year to RMB 285.353 million[49] - The company achieved revenue of RMB 7.926 billion and net profit of RMB 285 million in the first half of 2024[52] - Revenue for the first half of 2024 was RMB 7,926,183 thousand, a 6.2% decrease compared to the same period in 2023[61] - Service revenue for the first half of 2024 was RMB 7,647,920 thousand, a 7.8% decrease year-over-year[61] - Gross profit for the first half of 2024 was RMB 1,831,400 thousand, a 8.5% decrease compared to the same period in 2023[64] - Gross margin for the first half of 2024 was 23.1%, a 0.6% decrease year-over-year[64] - Sales and distribution costs for the first half of 2024 were RMB 425,950 thousand, a 1.2% increase compared to the same period in 2023[67] - Administrative expenses for the first half of 2024 were RMB 1,113,278 thousand, a 8.0% decrease year-over-year[67] - Financial expenses for the first half of 2024 were RMB 99,837 thousand, a 20.2% increase compared to the same period in 2023[68] - Other income for the first half of 2024 was RMB 94,577 thousand, a 34.2% decrease year-over-year[65] - Other gains for the first half of 2024 were RMB 104,890 thousand, compared to a loss of RMB 5,663 thousand in the same period in 2023[66] - Income tax expense for the first half of 2024 was RMB 10,481 thousand, compared to an income of RMB 8,314 thousand in the same period in 2023[68] - The company's available cash balance decreased to RMB 3,937,782 thousand in the first half of 2024, compared to RMB 5,088,641 thousand at the end of 2023[70] - Net current assets decreased to RMB 8,095,537 thousand in the first half of 2024, down from RMB 9,983,119 thousand at the end of 2023[70] - The company's profit for the period decreased by 18.6% to RMB 285,353 thousand in the first half of 2024, compared to RMB 350,687 thousand in the same period last year[71] - Basic earnings per share decreased by 12.1% to RMB 10.93 cents in the first half of 2024, compared to RMB 12.44 cents in the same period last year[71] - Revenue from the Technology Professional Services Group (TPG) decreased by 7.3% to RMB 7,076,954 thousand in the first half of 2024[72] - Revenue from the Internet Information Technology Services Group (IIG) increased by 3.7% to RMB 849,229 thousand in the first half of 2024[72] - Revenue for the six months ended June 30, 2024, was RMB 7,926,183 thousand, a decrease of 6.2% compared to RMB 8,450,060 thousand in the same period of 2023[79] - Gross profit for the six months ended June 30, 2024, was RMB 1,831,400 thousand, down 8.5% from RMB 2,001,135 thousand in the same period of 2023[79] - Net profit attributable to the company's owners for the six months ended June 30, 2024, was RMB 285,720 thousand, a decrease of 18.6% from RMB 351,028 thousand in the same period of 2023[79] - Total assets as of June 30, 2024, were RMB 13,107,051 thousand, a decrease of 7.1% from RMB 14,105,460 thousand as of December 31, 2023[81] - Current assets as of June 30, 2024, were RMB 12,195,876 thousand, down 5.8% from RMB 12,945,329 thousand as of December 31, 2023[81] - Total equity attributable to the company's owners as of June 30, 2024, was RMB 11,379,724 thousand, a decrease of 3.1% from RMB 11,742,461 thousand as of December 31, 2023[83] - Basic earnings per share for the six months ended June 30, 2024, were RMB 10.93 cents, down 12.1% from RMB 12.44 cents in the same period of 2023[79] - Diluted earnings per share for the six months ended June 30, 2024, were RMB 10.56 cents, a decrease of 12.6% from RMB 12.08 cents in the same period of 2023[79] - Non-current assets as of June 30, 2024, were RMB 5,011,514 thousand, an increase of 21.6% from RMB 4,122,341 thousand as of December 31, 2023[81] - Current liabilities as of June 30, 2024, were RMB 4,100,339 thousand, up 38.4% from RMB 2,962,210 thousand as of December 31, 2023[81] - Operating cash flow decreased to RMB -686,433 thousand in 2024 from RMB -731,184 thousand in 2023[87] - Investment cash flow increased to RMB -910,800 thousand in 2024 from RMB -721,980 thousand in 2023[87] - Financing cash flow turned negative to RMB -332,717 thousand in 2024 from RMB 812,612 thousand in 2023[87] - Total revenue decreased to RMB 7,926,183 thousand in 2024 from RMB 8,450,060 thousand in 2023[93] - Revenue from software and hardware sales decreased to RMB 278,263 thousand in 2024 from RMB 154,309 thousand in 2023[94] - Revenue from the Technology Professional Services Group (TPG) decreased to RMB 7,076,954 thousand in 2024 from RMB 7,631,522 thousand in 2023[96] - Revenue from the Internet IT Services Group (IIG) increased to RMB 849,229 thousand in 2024 from RMB 818,538 thousand in 2023[96] - Pre-tax profit decreased to RMB 295,834 thousand in 2024 from RMB 342,373 thousand in 2023[97] - Interest on borrowings increased to RMB 96,377 thousand in 2024 from RMB 77,399 thousand in 2023[98] - Earnings per share decreased to RMB 285,720 thousand in 2024 from RMB 351,028 thousand in 2023[99] - The weighted average number of ordinary shares for calculating basic earnings per share in 2024 was 2,614,104,739, a decrease from 2,821,509,612 in 2023[101] - The weighted average number of ordinary shares for calculating diluted earnings per share in 2024 was 2,706,115,049, down from 2,905,709,398 in 2023[101] - Trade and other receivables (net of provisions) increased to RMB 6,282,802 thousand in 2024 from RMB 5,304,724 thousand in 2023[103] - Receivables within 90 days accounted for RMB 4,162,887 thousand in 2024, up from RMB 4,019,768 thousand in 2023[105] - Trade and other payables decreased to RMB 1,555,845 thousand in 2024 from RMB 1,662,625 thousand in 2023[106] - Total borrowings increased to RMB 3,605,110 thousand in 2024 from RMB 3,016,817 thousand in 2023[108] - The company prepaid HKD 1.65 billion of loans in February 2024, with the remaining HKD 1.35 billion due in December 2025[109] - The average annual interest rate for borrowings in the first half of 2024 was 2.12%, down from 2.19% in 2023[109] - The company's issued and fully paid shares decreased from 3,027,011,358 to 2,809,753,358 between January 1, 2023, and June 30, 2024, with a corresponding reduction in share value from HKD 151,350,569 to HKD 140,487,669[110] - Capital commitments for property, plant, and equipment amounted to RMB 492,657,000 as of June 30, 2024, compared to RMB 542,091,000 at the end of 2023[110] - The company has committed to additional funding of RMB 246,708,000 for equity method investments as of June 30, 2024, down from RMB 276,408,000 in 2023[110] - Revenue from IT outsourcing services to related parties increased to RMB 4,604,000 in the first half of 2024, up from RMB 1,273,000 in the same period of 2023[112] - Employee compensation for the first half of 2024 totaled RMB 6,526,599,000, including director remuneration of RMB 22,389,000, compared to RMB 7,199,889,000 and RMB 11,995,000 respectively in 2023[113] - Amortization of intangible assets and depreciation expenses for the first half of 2024 were RMB 44,638,000 and RMB 130,436,000 respectively, compared to RMB 38,083,000 and RMB 198,267,000 in 2023[113] AI and Technology Transformation - The company focused on AI-driven transformation, establishing AI consulting, industry model training fields, and model factories[5] - The company developed a multi-heterogeneous large model operation management system to optimize computing resource allocation and scheduling[6] - The company launched HR.ai and Fin.ai models to enhance productivity through AI digital employees[11] - The company has achieved deep cooperation with top clients in industries such as finance, energy, and steel for AI pilot projects[12] - The company has successfully implemented NLP and CV training and inference projects, collaborating with leading clients in finance, energy, steel, and pharmaceutical industries[16] - The company has established partnerships with over 100 enterprises and institutions in fields such as scientific research, smart manufacturing, and healthcare, completing more than 100 projects[17] - The company's AI Agent product solutions, including "Ask Data," "Ask Strategy," "Ask Service," and "Ask Vision," have been upgraded and implemented in industries like finance, transportation, and manufacturing[18] - The company has developed the LMBSS system for managing diverse large models, successfully deploying it in projects such as Gui'an Development Group and Nanjing Big Data Bureau[17] - The company has integrated deep learning and data mining technologies to enhance AI support for the oil and gas pipeline industry[16] - The company launched the "Model Factory" service, offering end-to-end large model application R&D services, including model migration, training, and deployment[15] - The company has achieved compatibility certification for its "Ask" series integrated products with Huawei's training servers and AI framework[18] - The company has been selected for the "2023 Computing Power Network Industry Map" at the 2024 Computing Network Integration Development Conference[17] - The company established the Zhongsoft International AIGC Research Institute, focusing on AI model empowerment and data innovation[52] - The company became a partner in the Ascend AI ecosystem, providing AI computing power services across multiple industries[52] - The company is focusing on AI-related solutions and services, promoting local intelligent upgrades, and building cloud intelligence business capabilities in key regions such as Asia-Pacific[54] - The company is strengthening its organizational structure with a "Spearhead-Army-Base Camp" model, focusing on technology IP incubation and AI team formation[54] HarmonyOS Ecosystem - The company collaborated with over 300 application vendors in various fields for HarmonyOS native applications and services[7] - The company served over 500 categories and 400 brand customers in HarmonyOS chip southbound adaptation, with device access reaching tens of millions[7] - KaihongOS achieved full ecosystem connectivity with HarmonyOS Next, solidifying its leading position in the OpenHarmony ecosystem[23] - Upgraded OpenHarmony edge intelligent products, with 17 models and 13 self-developed products currently available[24] - Collaborated with 300+ application manufacturers in the HarmonyOS ecosystem, covering smart travel, life services, finance, government, healthcare, and cultural tourism[25] - Awarded "HarmonyOS Ecosystem Excellent Development Service Provider" and "HarmonyOS Ecosystem Pioneer Partner Award" at Huawei HDC 2024[25] - Cumulative service of 500+ categories and 400+ brand clients in the HarmonyOS chip adaptation business, with device access reaching tens of millions[25] - Approximately HKD 244 million of the net proceeds were used for the development of HarmonyOS and OpenHarmony products and solutions[76] - Secured multiple large-scale Hongmeng application development projects for state-owned banks, joint-stock banks, and leading insurance institutions[33] - Assisted in the release of HarmonyOS 4.2 and the beta launch of HarmonyOS NEXT, enhancing Huawei's smart ecosystem[42] - Collaborated with Huawei to develop the HiCar integrated solution, supporting the release of ADS 3.0 and the launch of AITO M9 and M7 series[42] ERP and Digital Transformation - The company accelerated the layout of the state-owned enterprise ERP application service market, aiming to become a leading provider of digital transformation solutions[8] - The company partnered with SAP to provide customized consulting solutions based on commercial AI technology[8] - The company has aggregated over 6,000 ecosystem partners and provided digital solutions and services to more than 20,000 customers[9] - The company expanded its ERP consulting and implementation services, securing projects with major clients like CNPC, Sinochem Group, and Southern Power Grid[20] - The company has provided data asset services to key clients in the manufacturing sector, including Changan Automobile and Chutian Technology, promoting data assetization and businessization[21] - The company is accelerating its layout in the ERP application service market for central state-owned enterprises, focusing on high-quality solutions and market expansion[54] - The company has established partnerships with over 100 local enterprises for digital transformation services through the Tangshan RPA demonstration center, replicating the model in Xiangyang[29] - The company has successfully implemented smart audit projects for CNOOC and Shandong Energy, and secured the China Postal Savings Bank's new audit project[40] Cloud and Ecosystem Partnerships - The company has established R&D and delivery centers in multiple countries including Thailand, Japan, Singapore, Saudi Arabia, and the UAE[10] - The company has been awarded the "Huawei Cloud Ecosystem Rock Award" twice, ranking first in Huawei Cloud ecosystem partner capability certifications[13] - The company focuses on industries like energy, finance, and government, serving major clients such as Huawei, HSBC, and China Mobile[14] - Business scale with Huawei Cloud grew over 30 times in seven years, winning the "Huawei Cloud Ecosystem Rock Award" in 2022 and 2023[26] - Certified with 8 primary and 10 secondary labels in CTSP cloud services, maintaining the top position among partners[27] - Successfully implemented 40+ CTSP projects in industries such as energy, steel, and pharmaceuticals, collaborating with leading customers on scenario-based applications of large models[27] - Successfully implemented over 20 advanced cloud integration projects in areas such as RPA, big data, and cloud services, including a data base project for a data group company and a cloud RDS project for an energy technology company[28] - Awarded "Annual Service Partner" by Huawei Cloud in the Asia-Pacific region, supporting smart city projects in Malaysia and Saudi Arabia's NEOM digital infrastructure[30] - The company has been the top partner of Huawei Cloud for seven consecutive years and has won the "Huawei Cloud Ecosystem Rock Award" twice[54] - The company is actively participating in open-source database communities and collaborating with ecosystem partners to achieve independent control of key basic software[54] Industry-Specific Solutions - The company launched the first "Fire Hong" solution in collaboration with Huawei, integrating big data, AI, and IoT technologies for smart fire prevention and control[36] - Developed the first water conservancy solution based on KaihongOS, achieving efficient data collection and remote control, winning the "2024 China Enterprise Digital Innovation Solution" award[36] - Released the first gas industry open-source Hongmeng solution "Ran Hong," enabling unified device communication and reducing manual intervention[37] - Introduced the Hongmeng-based smart station solution for urban rail transit, enhancing operational efficiency and passenger experience[38] - Launched four refined product solutions for aluminum industry clients, covering energy management and MES systems, serving over 10 major aluminum enterprises[39] - Promoted AI golden scenarios such as government hotline 12345, grassroots burden reduction, and industrial investment, completing POC verification and case studies in multiple cities[35] - Invested in the "One Field, Three Centers" project in Changping Energy Valley, providing infrastructure and development platform support for AI models and scenario applications in the power industry[34] Shareholder and Corporate Governance - Chairman and CEO Chen Yuhong holds 340,138,144 shares, representing approximately 12.11% of the company's issued share capital as of June
中国软件国际(00354) - 2024 - 中期财报