Financial Statements and Notes Interim Condensed Consolidated Statement of Comprehensive Income 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 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 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 it9 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 202426 Business Overview and Operations Key Business Operations 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 vehicles2829303132 - 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 ventures3334 Industry Development and Group Operations 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 share36 - The Group achieved total vehicle wholesale of 450,000 units and retail sales of 476,000 units in the first half37 - Breakthroughs were made in overseas markets, with 38,000 vehicles exported during the reporting period, outperforming the overall market growth rate39 - The Group actively promotes technological innovation, with R&D expenditure increasing again, focusing on core technologies such as intelligent driving and electrified off-road vehicles40 - 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 competitiveness44 H2 2024 Outlook 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 products45 - 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 gains45 Management Discussion and Analysis Financial Performance Analysis 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 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 period48 - 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 structure49 - 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 facilities48 Significant Investments and Other Financial Matters 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 platforms50 - Total capital expenditure decreased from RMB 2.37 billion in the prior period to RMB 2.21 billion50 - 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 Euro51 Other Information Dividends and Securities Repurchase 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 202452 - During the reporting period, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities52 Corporate Governance 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 period53 - The term of the fourth Board of Directors expired, and the fifth Board of Directors was appointed by the shareholders' meeting on March 22, 202454 - The Audit Committee has reviewed the Group's unaudited interim financial statements for the first half of 202457
北京汽车(01958) - 2024 - 中期业绩