理想汽车(02015) - 2024 - 中期财报

Company Information The report details the company's core management, board members, and committee structures, with PwC as the auditor - The report lists the company's core management, board members, and committee structures, with executive directors including founder Li Xiang (Chairman and CEO), Li Tie, and Ma Donghui, and independent non-executive directors leading the audit, remuneration, nomination, and corporate governance committees, with PricewaterhouseCoopers as the company's auditor[3] - The company's stock codes are 2015 in Hong Kong and LI on Nasdaq[4] Financial Performance Summary This section provides a concise overview of the company's financial results for the six months ended June 30, highlighting key revenue and profit metrics Financial Performance Summary for the Six Months Ended June 30 | Metric | H1 2023 (RMB thousands) | H1 2024 (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 47,439,780 | 57,312,056 | 20.8% | | Gross Profit | 10,065,384 | 11,461,247 | 13.9% | | Operating Profit/(Loss) | 2,031,073 | (116,873) | N/A | | Net Profit | 3,243,935 | 1,692,066 | (47.8)% | | Non-GAAP Net Profit | 4,141,605 | 2,779,406 | (32.9)% | Reconciliation of GAAP to Non-GAAP Net Profit | Item | H1 2023 (RMB thousands) | H1 2024 (RMB thousands) | | :--- | :--- | :--- | | Net Profit (GAAP) | 3,243,935 | 1,692,066 | | Add: Share-based compensation expenses | 897,670 | 1,087,340 | | Non-GAAP Net Profit | 4,141,605 | 2,779,406 | Business Review and Outlook This section provides an overview of the company's operational performance, product developments, and strategic outlook Business Review for the Reporting Period In H1 2024, the company achieved sustained growth in a dynamic market, increasing deliveries and revenue while maintaining a leading position in China's NEV market above RMB 200,000 Key Operating Data for H1 2024 | Metric | Value | | :--- | :--- | | Deliveries | 188,981 vehicles (35.8% YoY growth) | | Total Revenue | RMB 57.3 billion (20.8% YoY growth) | | Cumulative Deliveries (as of 2024/6/30) | 822,345 vehicles | | Market Share (NEV market above RMB 200k) | 14.1% (No. 1 among Chinese auto brands) | Products The company expanded its product portfolio in H1 2024 with new models and upgrades, strengthening its market position, particularly with the rapid sales growth of the Li L6 - The Li MEGA, based on an 800V high-voltage pure electric platform with a Qilin 5C battery, achieves a 500 km range with a 12-minute charge[9] - The Li L6, a family five-seat luxury SUV priced under RMB 300,000, achieved over 50,000 cumulative deliveries within three months of launch and over 20,000 deliveries in June alone[9] Supply Chain, Manufacturing, and Network The company enhanced supply chain management, operates highly automated self-built manufacturing bases, and continues to expand its sales, service, and supercharging networks across China - The company operates self-built manufacturing bases in Changzhou and Beijing, China, featuring highly automated, intelligent, and digitized production lines[11] Sales and Service Network Scale (as of June 30, 2024) | Network Type | Quantity | | :--- | :--- | | Retail Centers | 497 locations (covering 148 cities) | | After-sales Service and Authorized Body & Paint Centers | 421 locations (covering 220 cities) | | Li Auto Supercharging Stations | 614 stations | | Charging Piles | 2,726 units | R&D and ESG The company continuously invests in R&D for product, platform, and system optimization through frequent OTA updates, achieving high intelligent driving user penetration, and published its 2023 ESG report - Through OTA 5.1 and OTA 5.2 updates, the company introduced new features and optimized experiences, including full-screen mode for the central display, enhanced AEB recognition, highway NOA with zero disengagements per thousand kilometers, and urban LCC detouring and lane selection[13] - As of June 30, 2024, Li Auto's intelligent driving user cumulative usage penetration reached 99.9%, with cumulative mileage for full-scenario NOA reaching 860 million kilometers[13] Recent Developments Subsequent to the Reporting Period Post-reporting period, the company continued its delivery growth in July 2024, expanded its retail and supercharging networks, and introduced advanced autonomous driving technology updates - In July 2024, 51,000 vehicles were delivered, representing a 49.4% year-over-year increase[15] - A new autonomous driving technology architecture based on end-to-end (E2E) and visual language models (VLM) was released, with early bird testing commencing at the end of July[16] Business Outlook For H2 2024, the company aims to consolidate the Li L series' sales leadership, actively plan for the pure electric series, and expand its market share in China's NEV market above RMB 200,000 - The company plans to solidify the Li L series' leading sales position in H2 2024 while actively planning for the pure electric series[18] - The company will enhance synergy across R&D, supply, manufacturing, and sales, and expand and upgrade its direct sales and service networks while accelerating supercharging network construction to support multi-platform and multi-model development[18] Management Discussion and Analysis This section provides an in-depth analysis of the company's financial performance, liquidity, and human resources for the reporting period Financial Performance Analysis In H1 2024, total revenue grew by 20.8% to RMB 57.3 billion, but gross margin declined to 20.0%, and significant increases in R&D and SG&A expenses led to an operating loss and a 47.8% decrease in net profit Key Financial Metric Changes for H1 2024 | Metric | H1 2023 (RMB billions) | H1 2024 (RMB billions) | Reason for Change | | :--- | :--- | :--- | :--- | | Total Revenue | 47.4 | 57.3 | Increase in vehicle deliveries | | Gross Margin | 21.2% | 20.0% | Decrease in vehicle gross margin (from 20.5% to 19.0%) | | R&D Expenses | 4.3 | 6.1 | Expansion of product portfolio and increase in employee headcount | | Sales, General & Administrative Expenses | 4.0 | 5.8 | Increase in employee headcount and expansion of sales network | | Operating Profit/(Loss) | 2.0 | (0.117) | Expense growth exceeding gross profit growth | | Net Profit | 3.2 | 1.7 | Operating loss and increase in effective tax rate | Liquidity and Financial Position As of June 30, 2024, the company's cash position decreased to RMB 97.3 billion, with a slightly lower debt-to-asset ratio of 56.4%, and capital commitments primarily for production facility construction - Cash position (including cash, cash equivalents, restricted cash, time deposits, and investments) decreased by 6.2% from RMB 103.7 billion as of December 31, 2023, to RMB 97.3 billion as of June 30, 2024[28] - As of June 30, 2024, the debt-to-asset ratio was 56.4%, a decrease from 57.8% at the end of 2023[31] - As of June 30, 2024, capital commitments totaled RMB 5.6 billion, primarily for the construction and purchase of production facilities, equipment, and tools[33] Employees and Remuneration Total employee compensation expenses significantly increased to RMB 7.1 billion in the reporting period, with 30,899 employees as of June 30, 2024, predominantly in sales, production, and R&D Employee Headcount by Function (as of June 30, 2024) | Function | Employee Headcount | | :--- | :--- | | R&D | 5,373 | | Production | 11,095 | | Sales | 12,083 | | General & Administration | 2,348 | | Total | 30,899 | - Total employee compensation expenses (including share-based compensation expenses) for the reporting period were RMB 7.1 billion, representing an approximate 47.9% year-over-year increase[34] Corporate Governance This section outlines the company's corporate governance framework, including its Weighted Voting Rights (WVR) structure and compliance with governance codes Weighted Voting Rights (WVR) The company operates under a WVR structure, granting founder Li Xiang significant voting control through his B shares, enabling long-term strategic implementation, with detailed disclosures on his shareholding and voting power - The Weighted Voting Rights beneficiary is founder Mr. Li Xiang, who beneficially owned and controlled 355,812,080 Class B ordinary shares and 108,557,400 Class A ordinary shares (CEO award shares) as of June 30, 2024[37][39] - Without considering specific assumptions, Mr. Li's equity interest accounted for approximately 21.88% of the company's issued shares, but he held approximately 68.46% of the voting rights in shareholder resolutions concerning non-reserved matters[39] Compliance with Corporate Governance Code The company complied with all applicable code provisions of the Corporate Governance Code during the reporting period, with the only deviation being the combined roles of Chairman and CEO, which the board believes ensures consistent leadership - The company deviated from Corporate Governance Code provision C.2.1, which states that the roles of Chairman and Chief Executive Officer should be separate, as Mr. Li Xiang holds both positions[41] - The Board believes that Mr. Li Xiang's dual role as Chairman and Chief Executive Officer ensures consistent leadership within the company and enhances the efficiency of overall strategic planning[41] Board Committees The Board has three committees—Audit, Remuneration, and Nomination & Corporate Governance—primarily composed of independent non-executive directors, ensuring independence and professionalism in governance Composition of Board Committees | Committee | Chairman | Members | | :--- | :--- | :--- | | Audit Committee | Mr. Zhao Hongqiang | Mr. Jiang Zhenyu, Professor Xiao Xing, Mr. Zhao Hongqiang | | Remuneration Committee | Mr. Zhao Hongqiang | Mr. Jiang Zhenyu, Mr. Li Xiang, Mr. Zhao Hongqiang | | Nomination and Corporate Governance Committee | Mr. Jiang Zhenyu | Professor Xiao Xing, Mr. Zhao Hongqiang, Mr. Jiang Zhenyu | Other Information This section provides details on director and major shareholder equity interests, share incentive plans, and the utilization of proceeds from past offerings Directors' and Major Shareholders' Interests This section details the equity interests of the company's directors, chief executive, and major shareholders as of June 30, 2024, identifying founder Li Xiang and Wang Xing (via controlled entities) as the largest individual shareholders Directors' and Chief Executive's Shareholding (as of June 30, 2024) | Name | Share Class | Number of Shares | Approximate Percentage of Class | | :--- | :--- | :--- | :--- | | Mr. Li Xiang | Class A Ordinary Shares | 108,557,400 | 6.15% | | | Class B Ordinary Shares | 355,812,080 | 100.00% | | Mr. Wang Xing | Class A Ordinary Shares | 380,210,577 (Total) | 21.53% (Total) | Share Incentive Plans The company implemented three share incentive plans (2019, 2020, 2021) to incentivize and retain key personnel, with the report detailing changes in options and RSUs, including grants, exercises, forfeitures, and outstanding amounts - The company has 2019, 2020, and 2021 share incentive plans, with 2,595,050 restricted share units granted under the 2019 plan during the reporting period[54] - The 2021 plan primarily involves an award of 108,557,400 Class B ordinary shares (later converted to Class A ordinary shares) to CEO Mr. Li Xiang, contingent on achieving specific future delivery milestones, which had not been met as of the end of the reporting period[72][166] Use of Proceeds This section details the utilization of net proceeds from the 2021 global offering and US ATM offering, with the HKD 13.3 billion from the global offering fully utilized, and approximately 68% of the USD 529 million from the ATM offering used for R&D and working capital - The net proceeds of approximately HKD 13.3 billion from the 2021 global offering were fully utilized as of June 30, 2024[76][77] - The net proceeds from the US ATM offering were USD 529 million, with approximately 68% utilized as of June 30, 2024, and the remaining funds expected to be fully used by the end of 2025[78] Interim Financial Information Review Report PricewaterhouseCoopers reviewed the company's interim financial information in accordance with International Review Standards, concluding no material issues regarding US GAAP compliance - PricewaterhouseCoopers, the auditor, has reviewed the company's interim financial information in accordance with International Review Standards[84] - The auditor concluded that nothing came to their attention to suggest that the company's interim financial information was not prepared, in all material respects, in accordance with US Generally Accepted Accounting Principles (US GAAP)[85] Unaudited Condensed Consolidated Financial Statements and Notes This section presents the company's unaudited condensed consolidated financial statements, including balance sheets, income statements, and cash flow statements, along with explanatory notes Key Financial Statements As of June 30, 2024, total assets were RMB 145.1 billion, total liabilities RMB 81.8 billion, with H1 revenue of RMB 57.3 billion, but net profit decreased to RMB 1.7 billion due to rising costs and expenses, and operating cash flow turned negative Balance Sheet Summary (as of June 30, 2024, RMB billions) | Item | Amount | | :--- | :--- | | Total Assets | 145.11 | | Current Assets | 109.81 | | Total Liabilities | 81.80 | | Current Liabilities | 62.46 | | Total Shareholders' Equity | 63.31 | Cash Flow Statement Summary (H1 2024, RMB billions) | Item | Amount | | :--- | :--- | | Net Cash Provided by/(Used in) Operating Activities | (3.77) | | Net Cash Provided by/(Used in) Investing Activities | (6.94) | | Net Cash (Used in)/Provided by Financing Activities | 0.08 | | Cash, Cash Equivalents and Restricted Cash at End of Period | 80.79 | Selected Notes to Financial Statements These notes detail accounting policies and financial item compositions, including revenue recognition, convertible debt, share-based compensation, and a reconciliation of US GAAP to IFRS net profit - Inventory increased from RMB 6.87 billion at the end of 2023 to RMB 8.31 billion as of June 30, 2024, primarily due to an increase in finished goods (vehicles)[130] - As of June 30, 2024, the company had convertible debt with an aggregate principal amount of USD 862.5 million due in 2028, with holders having the right to require the company to repurchase on May 1, 2024, and May 1, 2026[142] - Share-based compensation expenses totaled RMB 1.087 billion in H1 2024, higher than RMB 898 million in the prior year period[158] - According to Note 26, under IFRS, net profit for H1 2024 would be adjusted to RMB 4.47 billion due to factors like fair value changes in convertible debt, significantly higher than the RMB 1.69 billion under US GAAP[190] Definitions This section provides precise definitions for specific terms used throughout the report, ensuring clear and accurate understanding for the reader - This section provides detailed definitions for specific terms used in the report, such as "Share Incentive Plans," "Class A/B Ordinary Shares," "Consolidated Affiliated Entities," and "Weighted Voting Rights Structure," to ensure accurate understanding of the report's content[198][199][200]