Financial Performance - For the six months ended June 30, 2024, the Group's turnover was RMB 7,542.9 million, representing a year-on-year increase of 25.6%[9] - Gross profit for the same period was RMB 1,061.8 million, with a gross margin of 14.1%, up from 13.6% in 2023, reflecting a growth of 29.9%[9] - Profit attributable to owners of the parent increased by 5.6% to RMB 244.8 million, while the basic earnings per share was RMB 0.18[10] - The Group's revenue for the period reached RMB 7,542.9 million, a 25.6% increase compared to RMB 6,003.4 million in the same period of 2023[38] - Profit for the period was RMB 241.7 million, representing a decrease of 5.3% from the previous year, while profit attributable to owners of the parent increased by 5.6% to RMB 244.8 million[38] - The Group's gross profit increased by 29.8% to RMB 1,061.8 million, with an overall gross profit margin rising from 13.6% to 14.1%[46] - Total comprehensive income for the period was RMB 233,041, a decrease of 25.4% from RMB 312,402 in 2023[118] - Basic earnings per share increased to RMB 0.18, compared to RMB 0.17 for the same period in 2023[116] Revenue Breakdown - The reserve power battery business accounted for 41.6% of total sales, generating RMB3,135.4 million, a year-on-year growth of 9.9%[16] - The SLI battery business contributed 37.7% of total sales, with revenue of RMB2,841.1 million, representing a significant year-on-year growth of 93.4%[17] - The motive power battery segment accounted for 9.1% of total sales, achieving revenue of RMB686.8 million, reflecting a year-on-year growth of 10.5%[19] - Sales revenue in the Chinese Mainland reached RMB4,363.9 million, marking a year-on-year growth of 19.2% driven by strong demand in the automotive sector and UPS systems[23] - The America Region recorded revenue of RMB1,349.5 million, representing a year-on-year growth of 67.6%, driven by demand in the automotive sector and industrial applications[24] - EMEA region sales revenue amounted to RMB 1,165.2 million, representing a year-on-year growth of 18.5% from RMB 983.4 million[26] - Asia-Pacific region (excluding Mainland China) recorded sales revenue of RMB 664.4 million, reflecting a year-on-year growth of 20.2% from RMB 552.6 million[27] Cost and Expenses - Operating costs increased by 1.8%, while gross margin improved by 0.5% due to reduced activities in joint ventures[15] - The cost of sales increased by 25.0% to RMB 6,481.1 million, in line with the increase in sales[45] - Selling and distribution expenses rose by 14.9% from RMB 214.3 million for the six months ended June 30, 2023, to RMB 246.3 million for the period, driven by increased import/export fees and sales commissions[50] - Administrative expenses increased by 14.0% from RMB 195.0 million for the six months ended June 30, 2023, to RMB 222.3 million for the period, mainly due to higher staff costs and office depreciation from business acquisitions[51] - Research and development costs grew by 13.0% from RMB 160.7 million for the six months ended June 30, 2023, to RMB 181.5 million for the period, attributed to performance enhancement and new product development[52] Supply Chain and Market Challenges - The Group faced supply chain challenges, particularly with lead availability, which impacted production costs and battery prices[14] - Shipping costs escalated due to geopolitical tensions, affecting overall profitability[14] - The appreciation of the RMB against the USD has negatively impacted profitability due to increased international activities denominated in USD[14] - The company faces supply chain challenges related to raw materials, particularly lead, impacting production costs and battery pricing[15] Research and Development - The company is investing in R&D to enhance battery life, efficiency, and safety, maintaining a leading role in the market[23] - The Group is focusing on R&D for new battery technologies, including lithium, lead-carbon, and sodium-ion batteries, to improve product differentiation and market competitiveness[35] - The company aims to expand its market presence and enhance product offerings through ongoing research and development initiatives[116] Corporate Governance and Shareholder Information - The Board recommended an interim dividend of HK 4 cents per share for the period[10] - The Group encourages employee training and development, providing workshops to enhance work safety knowledge and team spirit[62] - The Company is committed to high standards of corporate governance, although there were deviations from certain code provisions during the annual general meeting[98] - The Company has maintained compliance with the Corporate Governance Code, except for specific deviations noted during the reporting period[99] Financial Position and Assets - As of June 30, 2024, the group's net current assets amounted to RMB 1,473.7 million, with bank borrowings increasing to RMB 4,947.3 million[58] - Total non-current assets increased to RMB 4,984,285, up 5.5% from RMB 4,724,538 as of December 31, 2023[120] - Current assets decreased to RMB 9,069,829, down 3.2% from RMB 9,370,706 as of December 31, 2023[120] - Total equity attributable to owners of the parent increased to RMB 4,447,242, up from RMB 4,199,162 as of December 31, 2023[122] Borrowings and Financing - The Group has secured term loan facilities of HK70,375,000 for working capital financing[91] - The total amount repayable within one year is RMB 3,689,369,000, compared to RMB 3,501,194,000 in the previous period, indicating a rise of about 5.4%[197] - The total non-current borrowings, including convertible bonds, reached RMB 1,322,673,000, an increase from RMB 1,017,301,000[196] Market Outlook - The automotive industry remains the major consumer of lead-acid batteries, particularly for traditional internal combustion engine vehicles and backup power systems[12] - The lead-acid battery market is expected to grow steadily, particularly in auxiliary functions for electric vehicles[17] - Future growth is anticipated in the reserve power battery business, supported by ongoing technological advancements and market development trends[29]
理士国际(00842) - 2024 - 中期财报