Summary of China Hongqiao's 1H25 Earnings Call Company Overview - Company: China Hongqiao (1378.HK) - Period: 1H25 Key Financial Metrics - Net Profit: Rmb12.4 billion, up 35% YoY, down 6% HoH [1] - Total NPAT: Rmb13.6 billion, up 35% YoY [1] - Total Revenue: Up 10% YoY, down 2% HoH [1] - Gross Profit Margin: 26%, up 1ppt YoY, down 4ppt HoH [1] - Operating Profit: Rmb18.1 billion, up 21% YoY, down 16% HoH [1] - Recurring Net Income: Rmb14.7 billion, up 30% YoY [1] - Interim Dividend: No dividend declared, compared to HK$0.59/share in 1H24 [1] Aluminum Segment Performance - Aluminum Revenue: Up 5% YoY [2] - Aluminum Sales Volume: 3.3 million tons, up 3% YoY, down 3% HoH [2] - Average Selling Price (ASP): Rmb18,178/ton, up 3% YoY, up 1% HoH [2] - Unit Cost: Rmb13,639/ton, up 2% YoY, up 1% HoH [2] - Gross Profit per ton: Rmb4,540/ton, up 6% YoY, up 1% HoH [2] - Total Aluminum Gross Profit: Rmb15.0 billion, up 9% YoY, down 2% HoH [2] Alumina Segment Performance - Alumina Revenue: Up 28% YoY [3] - Alumina Sales Volume: 6.4 million tons, up 16% YoY, up 18% HoH [3] - Average Selling Price (ASP): Rmb3,244/ton, up 10% YoY, down 17% HoH [3] - Unit Cost: Rmb2,310/ton, up 5% YoY, up 4% HoH [3] - Gross Profit per ton: Rmb934/ton, up 25% YoY, down 45% HoH [3] - Total Alumina Gross Profit: Rmb5.9 billion, up 44% YoY, down 35% HoH [3] Cash Flow and Gearing - Net Gearing: 28%, down 3ppt YoY, up 6ppt HoH [4] - Operating Cash Flow (OCF): Rmb22 billion, up 56% YoY, up 13% HoH [4] - Free Cash Flow (FCF): Rmb12.4 billion, up 43% YoY, down 2% HoH [7] Shareholder Returns and Valuation - Share Repurchase Plan: Proposed total amount not less than HK$3 billion, reflecting confidence in long-term value [7] - Current Trading Metrics: 8.7x 2025E P/E, 1.7x 2025E P/B [7] - Target Price: HK$25.20, implying a 7.8% expected share price return and 7.4% expected dividend yield [5][14] Risks - Major Risks: 1. Cost and capex overruns [15] 2. Higher-than-expected capacity addition in the industry [15] 3. Significant slowdown in the Chinese economy [15] Conclusion - Investment Recommendation: Maintain as a Top Pick, with further insights expected post-results presentation on 18th Aug [1][7]
中国宏桥：2025 年上半年净利润同比增长 35%，维持首选评级-China Hongqiao (1378.HK)_ 1H25 NI Up 35% YoY, Maintain Top Pick