China Galaxy Securities (6881) Q2 2024 earnings summary

Executive summary

• Revenue and other income for H1 2024 was RMB22.91 billion, down 0.42% year-over-year; net profit attributable to owners was RMB4.39 billion, down 11.16% year-over-year.

• Weighted average return on net assets was 3.63%, a decrease of 1.47 percentage points year-over-year.

• Total assets reached RMB766.31 billion, up 15.55% from end-2023; equity attributable to owners was RMB133.93 billion, up 2.66%.

• Interim cash dividend of RMB0.84 per 10 shares (tax inclusive) proposed, totaling RMB918.49 million, subject to shareholder approval.

• The company maintained strong risk control, with all regulatory risk indicators met.

Financial highlights

• Basic earnings per share was RMB0.35, down 22.22% year-over-year; diluted EPS was RMB0.35, down 18.60%.

• Net cash flows from operating activities were RMB10.99 billion, down 6.63% year-over-year.

• Gearing ratio increased to 77.14% from 75.97% at end-2023.

• Profit before income tax was RMB4.54 billion, down 11.91% year-over-year.

• No material differences between IFRS and China Accounting Standards for net profits and net assets.

Outlook and guidance

• The company expects continued global economic uncertainty and sector rotation in A-shares, with policy support for capital market development.

• Focus areas for H2 2024 include technology, green, inclusive, pension, and digital finance, with ongoing digital transformation and risk management enhancements.

• Investment banking to enhance professional capabilities; institutional business to cultivate niche competence; international business to deepen domestic-overseas integration.

• Risk management and compliance to be further strengthened.