Financial Performance - For the six months ended June 30, 2025, the Group's turnover was RMB8,438.4 million, representing an increase of 11.9% compared to RMB7,542.9 million for the same period in 2024[14]. - Gross profit for the same period was RMB864.4 million, a decrease of 18.6% from RMB1,061.8 million in 2024[14]. - Profit for the period was RMB69.5 million, down 71.3% from RMB241.7 million in the previous year[14]. - Profit attributable to owners of the parent was approximately RMB93.7 million, a decline of 61.7% compared to RMB244.8 million in 2024[14]. - Basic earnings per share decreased to RMB0.07 from RMB0.18 in the prior year[16]. - The Group's revenue for the period reached RMB8,438.4 million, an increase of 11.9% compared to RMB7,542.9 million in the same period of 2024[61]. - Profit for the period was RMB69.5 million, a significant decrease from RMB241.7 million in the prior year, with profit attributable to owners of the parent at RMB93.7 million, down 61.7%[93]. - Basic and diluted earnings per share dropped to RMB0.07, compared to RMB0.18 and RMB0.17 for the six months ended June 30, 2024, primarily due to a lower gross profit margin[61]. - Total comprehensive income for the period was RMB94,931, down 59.3% from RMB233,041 in 2024[184]. Sales and Revenue Breakdown - The network power battery business accounted for 40.6% of total sales, generating RMB3,428.8 million, a 9.4% year-on-year growth[24]. - The sales revenue from the network energy battery business was RMB3,428.8 million, representing a year-on-year growth of 9.4% driven by increased demand from data centers[26]. - The SLI battery business recorded sales revenue of RMB3,115.3 million, a 9.6% increase year-on-year, primarily due to higher vehicle production in emerging markets[28]. - The motive power battery business saw a decline in sales revenue to RMB621.8 million, down 9.5% year-on-year, attributed to weak demand in Mainland China[29]. - The recycled lead business reported sales revenue of RMB1,089.5 million, a significant increase of 46.4% year-on-year, driven by strong sales efforts in Mainland China[32]. - Revenue from the power solutions business increased by 8.1% to RMB7,348.9 million, while revenue from the recycled lead business surged by 46.4% to RMB1,089.5 million[62]. - Sales revenue in Mainland China rose by 9.2% to RMB4,764.8 million, accounting for 56.5% of total revenue[69]. - Sales revenue in EMEA increased by 31.7% to RMB1,534.7 million, driven by strong demand for network power batteries[70]. - Revenue in the Americas grew by 4.7% to RMB1,412.4 million, supported by expansion in emerging markets, particularly Brazil[70]. Economic and Market Conditions - The overall economic environment remains unpredictable, influenced by structural issues and fiscal conditions across nations[23]. - The demand for lead-acid batteries in UPS applications is expected to grow significantly as global dependence on digital infrastructure expands[24]. - The International Energy Agency predicts that global electricity demand for data centers will double to approximately 945 terawatt-hours by 2030, accounting for about 3% of total global electricity consumption[33]. Strategic Initiatives and Future Plans - The Group plans to strengthen its presence in high-growth regions such as Southeast Asia, Africa, and South America to meet rising demand for SLI batteries[28]. - The Group is expected to achieve significant growth in performance due to increased energy storage demand and digital infrastructure upgrades[38]. - The advancement of clean energy technologies and the integration of renewable energy sources are expected to drive demand for efficient battery management systems[34]. - The Group aims to leverage its technological advantages to provide stable and efficient energy solutions, particularly in critical backup power systems[40]. - The Group is strategically increasing investment in high-end lead-acid battery business for data centers and communications, aiming to drive sustainable growth through technological iteration and market penetration[43]. - The after-sales channel market is identified as a key opportunity for growth, with a focus on full lifecycle service to enhance market competitiveness[45]. - The Group is developing smart energy storage solutions, integrating battery management systems and IoT technologies to deliver reliable lithium battery energy storage solutions[48]. - A new production base in Mexico is expected to commence in Q4 2023, enhancing service capabilities for the American market and ensuring close-range supply chain coverage[52]. - The Group plans to expand localized production in response to market feedback, aiming to support business growth in the Americas[57]. - The Group aims to create stable and growing returns for shareholders by expanding its product range through technological innovation[58]. - A proposed spin-off and separate listing of Leoch Energy Inc. is intended to unlock market value for both the spin-off group and the remaining group[59]. - The Group is conducting feasibility studies for capacity expansion in Mexico and local manufacturing in the U.S. to strengthen its supply chain and support business growth in the Americas[60]. Financial Position and Assets - As of June 30, 2025, the Group's net current assets were RMB640.3 million, down from RMB1,296.2 million at the end of 2024[99]. - The Group's gearing ratio improved slightly to 34.6% from 35.3% at the end of 2024, indicating a stable financial position[101]. - The group's bank borrowings stood at RMB5,342.0 million as of June 30, 2025, compared to RMB5,121.5 million as of December 31, 2024, with an interest rate range of 2.00% to 8.25%[104]. - Employee benefit expenses totaled RMB835.9 million for the period, up from RMB714.0 million for the six months ended June 30, 2024[113]. - The group had 17,957 employees as of June 30, 2025[113]. - The group maintains a healthy level of cash reserves and bank borrowings to ensure smooth business operations[105]. - The company's total equity as of June 30, 2025, was RMB5,044,478,000, an increase from RMB5,018,780,000 at the end of 2024[193]. - The retained profits increased to RMB2,687,860,000 as of June 30, 2025, compared to RMB2,685,523,000 at the end of 2024[193]. Governance and Compliance - The Company has confirmed compliance with the Model Code for Securities Transactions by Directors during the Period[160]. - The Board believes the Company has adhered to the Corporate Governance Code, with the exception of the chairman's absence at the annual general meeting due to other commitments[161]. - The Audit Committee, consisting of three independent non-executive Directors, reviewed the unaudited financial statements and discussed accounting principles and internal controls[165]. - The Company has maintained a high standard of corporate governance to safeguard shareholder interests and enhance corporate value[161]. - The independent review report was prepared by Ernst & Young, confirming the financial information's compliance with relevant standards[179]. Cash Flow and Investments - Cash generated from operations was RMB566,171,000, significantly improved from a cash used of RMB558,948,000 in the prior year[197]. - The net cash flows generated from operating activities amounted to RMB502,775,000, contrasting with a net cash outflow of RMB599,191,000 in 2024[197]. - Cash flows used in investing activities for the six months ended June 30, 2025, amounted to RMB707,639,000, an increase of 89.9% compared to RMB372,469,000 in 2024[199]. - The company reported a net decrease in cash and cash equivalents of RMB91,432,000 for the six months ended June 30, 2025, compared to a decrease of RMB705,575,000 in 2024[200]. - Cash and cash equivalents at the end of the period were RMB653,539,000, down from RMB856,868,000 in 2024, indicating a decline of 23.7%[200].
理士国际(00842) - 2025 - 中期财报