Firmly implementing the two core strategies of &#34;Two Blue Geely Actions&#34; and &#34;Smart Geely 2025&#34;, Geely Auto (00175) delivered an outstanding mid-term performance report for 2024 that exceeded expectations.
On August 21st, Geely Auto released its financial results for the first half of 2024. The financial report shows that during the period, Geely Auto achieved a total revenue of RMB 107.3 billion, reaching a historical high and a significant increase of 47% year-on-year; the net cash level increased by 25.4% to a historical high of RMB 35.7 billion, with ample and stable cash reserves. The group's operating profitabilty improved, with the shareholders' attributable profit increasing significantly year-on-year. The shareholders' attributable profit for the first half of the year was RMB 10.6 billion, a 574.7% increase year-on-year; achieving a non-GAAP shareholders' attributable profit of RMB 3.37 billion, a 114% increase year-on-year.
At the Geely Auto 2024 mid-term performance conference on August 21st, Geely Auto Group's Deputy CFO, Dai Yong, introduced that the total cash level of Geely in the first half of this year increased by 17% to RMB 44.4 billion, setting a historical high with ample cash reserves. He stated that Geely Auto particularly values the return to small and medium shareholders, and plans to maintain a stable and increasing dividend ratio in the future to make shareholder investments more valuable. It is expected that the operating profit will maintain a dividend ratio of over 30% in 2024 and beyond.
It is worth noting that investors had anticipated the growth in Geely Auto's performance in the first half of the year. Since May this year, southbound funds have continued to increase their holdings of Geely Auto shares. As of the close on August 16th, the southbound funds held 806 million shares, accounting for 8.01% of the total shares.
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<h2>Balanced Development of New Energy and Fuel, Significant Effects of High-end Transformation</h2>
Analyzing Geely Auto's interim report, many key terms can be identified, including: new energy, intelligence, internationalization, high-end, etc. The synergistic effects of these key variables have manifested in various characteristics such as &#34;increased sales, enhanced brand, and optimized structure&#34; at the level of Geely Auto's product sales.
In the first half of 2024, the automotive industry faced fierce competition, with adjustments in the industry chain structure disrupted by various uncertain factors. However, with the improvement in the business environment and the marginal improvement in automotive consumption policies, the industry's growth still shows resilience. On one hand, Geely seized consumer demand and promoted the launch of popular models; on the other hand, it actively promoted the &#34;going global&#34; strategy for automobiles, achieving significant results.
In the first half of the year, Geely Auto exceeded expectations in sales, with a total sales volume of 956,000 vehicles, reaching a historical high and a year-on-year increase of approximately 41%, with three consecutive months of year-on-year and month-on-month growth. Under the strategy of balanced development of fuel and new energy vehicles, the group's sales of fuel vehicles, plug-in hybrid vehicles, and pure electric vehicles in the first half of the year were 635,545 units, 130,238 units, and 189,947 units respectively, with year-on-year growth rates of 20%, 489%, and 51% respectively. Currently, Geely Auto ranks among the top tier of domestic brands in new energy vehicles and is the top domestic brand in fuel vehicle sales
In addition to the growth in product sales, Geely Auto has also achieved a qualitative improvement. With the optimization of the company's product structure, cost reduction, and economies of scale improving the gross profit situation, the total gross profit has increased significantly to 16.2 billion yuan, with a high gross profit margin of 15.1%, showing a stable and upward trend. At the same time, the group's effective control of marketing costs, further improvement in management efficiency, and year-on-year decreases in sales expense ratio and administrative expense ratio.
The above data fully confirms the correctness and effectiveness of Geely Auto's firm strategy of electrification and intelligent transformation. In the first half of the year, Geely Auto adhered to the concept of &#34;innovating high-value products and creating a complete industry chain ecosystem&#34;, further enriching its brand matrix and enhancing brand strength.
In the first half of the year, the mid-to-high-end new energy series Geely Galaxy series achieved a cumulative sales volume of 81,000 vehicles, a significant increase of 742% year-on-year, with monthly sales exceeding 10,000 units. The first pure electric SUV Geely Galaxy E5 was launched in August, forming the Geely Galaxy's product layout of &#34;pure electric + hybrid, sedan + SUV&#34; with three other models.
The Lynk &amp; Co brand continues to lead the development of Chinese automotive brands upwards, achieving a total sales volume of 126,000 units in the first half of the year, a strong year-on-year increase of 53.6%. Among them, the cumulative sales volume of new energy vehicles reached 64,072 units, accounting for a record high of 50.9%. By the end of June, Lynk &amp; Co had sold over 1.17 million units, breaking the record for Chinese high-end automotive brands. By the first half of the year, Lynk &amp; Co had 353 operational Lynk Centers nationwide, covering 262 cities, and 111 operational Lynk new energy retail centers, including 20 Lynk direct stores.
In the first half of the year, ZEEKR delivered a total of 87,870 units, a year-on-year increase of 106%, aiming to become the top-selling Chinese pure electric brand with over 200,000 units by 2024, leading among new forces in achieving the annual sales target. In June alone, 20,106 units were delivered, surpassing the 20,000 mark in a single month for the first time, reaching a historic high. ZEEKR achieved a revenue of 20 billion yuan in the second quarter of 2024, hitting a historic high, with significant year-on-year and quarter-on-quarter growth, nearly breaking even after excluding equity payments (according to Hong Kong Financial Reporting Standards). By the end of July, ZEEKR had delivered over 300,000 units in 33 months, setting a record for the fastest delivery among pure electric new forces.
Gui Shengyue, CEO and Executive Director of Geely Auto Holdings Limited, stated that in the first half of 2024, the proportion of Geely Auto's new energy vehicle sales has significantly increased, with fuel vehicles returning to the top spot among independent brands, heralding the dawn of Geely Auto's resurgence.
Gui Shengyue emphasized that this confidence mainly comes from two aspects. On the one hand, it comes from the strong momentum of sales growth, with each subsequent half-year sales reaching a historical high; on the other hand, it comes from new energy, as the new energy sector is expected to turn losses into profits quickly with the company's rational layout in various price segments and the combined improvement in economies of scale and intelligent technology. Coupled with Geely Auto's strong leadership in the traditional fuel vehicle sector, Geely Auto will soon see a resurgence.
It is evident that in the new energy vehicle market, Geely Auto is not just &#34;going with the flow&#34;, but striving to &#34;build good cars and produce quality products&#34;, leading the industry trend. Based on the outstanding performance in the first half of the year, Geely Auto raised its full-year sales target from 1.9 million units to 2 million units as of July 1, 2024, a year-on-year increase of 21%, with new energy vehicle sales expected to increase by 70% and export sales by 45%
<h2>&#34;Globalization&#34; Hits the Accelerator</h2>
With the significant increase in sales of intelligent and high-end products, Geely Auto's brand influence has achieved a new breakthrough, injecting momentum into the group's export business growth. The Securities Times app noted that since the introduction of its overseas strategy, Geely Auto's overseas sales and service network have continued to expand, forming a broad coverage in global markets, with the brand image and influence in international markets constantly improving.
In the first half of 2024, Geely Auto's cumulative export sales reached 197,428 vehicles, a year-on-year increase of over 67%, leading the industry in overseas market growth. In July, overseas export sales reached 32,382 vehicles, an increase of about 65% year-on-year.
Geely's brand has deepened its presence in regions such as the Middle East, Asia-Pacific, Africa, Latin America, and Europe, with 12 products launched in 30 countries overseas in the first half of the year. From the landing of the Lynk &amp; Co European strategy in 2021 to the first half of 2024, Lynk &amp; Co's global overseas shipment volume exceeded 72,000 vehicles, becoming a high-quality example of Chinese auto brands' overseas exports. ZEEKR's overseas business expansion has also entered a new chapter. In the first half of the year, ZEEKR's internationalization process accelerated, entering 30 countries including Sweden, the Netherlands, the UAE, Saudi Arabia, and Mexico, with ZEEKR 001 and ZEEKR X commencing overseas deliveries.
Furthermore, BaoTeng and Renault Korea have joined hands with Geely to explore global markets. BaoTeng Auto, in which Geely Auto holds a 49.9% stake, has steadily developed in the ASEAN market, with sales of 78,000 vehicles in the first half of the year and a net profit of 126 million yuan. Geely's imported models X50 and S70 have achieved sales of over ten thousand units, leading the local segmented market. Geely Auto holds a 34.02% stake in Renault Korea, with cumulative sales of 42,000 vehicles in the first half of the year and a net profit of 85 million yuan. It has stable investment returns in the Korean and European-American markets, receiving dividends of 180 million yuan and 150 million yuan in 2023 and the first half of 2024, respectively. The new Renault Arkana is planned to be launched in Korea in September 2024, followed by other countries.
Geely Auto Group CEO and Geely Auto Holdings Limited Executive Director Gan Jiayue stated that in the first half of the year, Geely Auto's exports outperformed the market. The overall overseas export target for this year has also been raised from 330,000 units to 380,000 units.
Regarding future international business development plans, Gan Jiayue mentioned that as a global enterprise, Geely has rich international resources and numerous advantages in overseas models. Taking the BaoTeng model as an example, through outputs in products, technology, supply chain, talent, etc., the BaoTeng model has developed into a model for the ASEAN region. In the future, the company will continue to activate potential markets such as Mexico, Central Asia, and quickly expand into emerging markets such as Vietnam, Australia and New Zealand, Indonesia, etc., and promote international business development through multiple means.
Geely Holdings Group CEO, Vice Chairman, and Executive Director of Geely Auto Holdings Limited Li Donghui stated that as a global enterprise, Geely has always contributed to the development of Europe, creating tens of thousands of job opportunities. He emphasized that Geely's development follows the trend of globalization and complies with the laws and regulations of various countries.
Regarding the issue of new tariffs in the European Union, Li Donghui mentioned that Geely Holdings has long been engaged in global layout. In the next step, for the European region, Geely Holdings will definitely have diverse market and production capacity arrangements, such as utilizing Volvo, LEVC, Lotus factories or cooperating flexibly with other global partners to complete production capacity planning and deployment
<h2>Practicing ESG, Achieving Carbon Neutrality by 2045</h2>
According to the Intelligent Financial News APP, on the journey of globalization, creating economic value is the pursuit of Geely Auto. As a member of society, it uses the concept of green and low-carbon development to &#34;protect the health of the earth&#34; and undertake corresponding social responsibilities, which is also the direction it is vigorously working towards.
For a long time, Geely Auto has based its operations on compliance with laws and regulations, benchmarking the best global corporate governance practices, and creating a fair and transparent governance and ethical system. In July 2024, Geely Auto was selected as one of the &#34;Top 100 ESG Listed Companies in China,&#34; ranking eighth and maintaining its position as the top Chinese auto company. It is the only company in the automotive industry to receive a &#34;five-star&#34; excellent rating, firmly holding a leading position among Chinese auto companies in terms of ESG performance.
In the S&amp;P Global Sustainable Development Assessment, Geely has continuously been honored as the top Chinese auto company; it has become the only Chinese auto company included in the Hang Seng Sustainable Development Index; Geely Auto has been selected for three consecutive sessions as a constituent stock of the FTSE Social Responsibility Index Series; it has received an AA rating in the MSCI ESG rating, placing it at a leading level in the global automotive industry; Geely Auto maintains an ESG &#34;low risk&#34; rating, ranking second among global auto companies.
As of the end of June 2024, Geely Auto has achieved a 14% reduction in carbon emissions. On the manufacturing side, Geely Auto has established three zero-carbon factories, significantly increasing the proportion of renewable energy use, with renewable electricity accounting for 66%. At the same time, Geely Auto promotes the circular economy, popularizing recycled materials, renewable businesses, battery recycling, recycled parts, and recycled vehicles. On the supply side, Geely Auto attaches importance to the sustainability of the supply chain, promoting carbon reduction and sustainable development in the supply chain through the formulation of supplier codes of conduct, implementation of supplier ESG evaluations, and supplier empowerment.
Geely Auto has set short-term and long-term goals, aiming to achieve a 25% reduction in carbon emissions by 2025 and carbon neutrality by 2045.
According to observations from the Intelligent Financial News APP, overall, the fulfillment of ESG responsibilities by enterprises in the medium to long term can have a positive impact on financial performance, reflected in the increase in the value of existing businesses and the creation of value for potential opportunities and new businesses. In terms of existing businesses, fulfilling ESG responsibilities can enhance corporate reputation, improve management capabilities, reduce corporate risks, establish competitive advantages, increase product value, and ultimately enhance financial performance.
As China's economy enters a new stage of high-quality development, especially against the backdrop of goals such as &#34;dual carbon&#34; and common prosperity, the concept of ESG has attracted more attention from Chinese enterprises, and the investment value of ESG-focused companies is also on the rise. Empirical results show that practicing ESG has a significant impact on the short-term stock prices and long-term market value of listed companies.
From the perspective of Geely Auto, mastering core technologies in key areas of the automotive electrification and intelligent industrial chain and continuously innovating research and development give it strong core competitiveness for the development of its multi-brand business. As a practitioner of low-carbon environmental protection, Geely Auto has been relentlessly pursuing the strengthening of sustainable development capabilities, foreseeing a continuous increase in the company's intrinsic value as a result

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Geely Auto released its mid-term performance for 2024, which exceeded market expectations, with total revenue reaching 107.3 billion RMB and net profit soaring by 574.7%. The company has implemented the "Blue Geely Action" and "Smart Geely 2025" strategies, focusing on returning value to small and medium shareholders, with an expected dividend payout ratio of over 30% in the future. Geely has made significant achievements in new energy, intelligence, high-end, and internationalization. Despite fierce competition in the automotive industry, the industry's performance remains strong with the support of favorable policies

- Geely Auto (00175) delivered exceptional performance in the first half of 2024, showcasing a 47% revenue increase to 107.3 billion RMB, with net cash reaching 35.7 billion RMB. The company emphasized shareholder returns and plans to maintain a dividend ratio of over 30%, focusing on both traditional and new energy vehicles.
- The strategic balance between fuel and new energy vehicles led to significant sales growth, with Geely achieving record-high sales of 956,000 units in the first half of 2024. The company's commitment to ESG practices and carbon neutrality by 2045 further enhances its global positioning and sustainability efforts.
- Geely's international expansion, particularly in new energy vehicles, has propelled its overseas sales, with a focus on markets like Europe and Asia. The company's dedication to ESG principles not only boosts its reputation but also aligns with global trends, enhancing its financial performance and market value.

Geely Auto: Mid-term performance growth exceeds expectations, new energy, high-end, and export all-round offensive