Red Avenue New Materials Group (603650) Q2 2024 earnings summary

Executive summary

• Achieved revenue of RMB 1,576.35 million in H1 2024, up 15.11% year-over-year; net profit attributable to shareholders was RMB 313.12 million, up 40.35% year-over-year.

• Growth driven by core businesses: specialty materials for automotive/tires, electronic materials, and biodegradable materials.

• Significant expansion in international and domestic markets, especially in tire resins and electronic materials.

Financial highlights

• Revenue: RMB 1,576.35 million (+15.11% YoY); net profit: RMB 313.12 million (+40.35% YoY).

• Operating cash flow: RMB 181.28 million (+137.33% YoY).

• Basic and diluted EPS: RMB 0.52 (+36.84% YoY); ROE: 8.88%.

• Net assets: RMB 3,219.74 million; total assets: RMB 7,832.72 million.

• Proposed interim dividend: RMB 2.50 per 10 shares (pre-tax).

Outlook and guidance

• Continued focus on expanding specialty materials and electronic chemicals, with strong demand expected in automotive, tire, and electronics sectors.

• Ongoing investment in R&D and capacity expansion, including new semiconductor polishing pad project.

• Anticipates further market share gains in electronic materials and biodegradable products as technology and market education advance.