Edianyun Limited (2416) H1 2024 earnings summary

Executive summary

• H1 revenue rose 1.7% YoY to RMB646.9m; IFRS profit was RMB16.5m versus a loss of RMB881.7m, while adjusted net profit increased 8.4% to RMB30.7m.

• Active customers grew 10.4% YoY to 49,737 and devices under service increased 15.6% to 1.33m, supporting a return to growth despite SME market pressure.

Financial highlights

• Revenue rose 1.7% YoY to RMB646.9m; cost of sales increased 4.7% to RMB369.9m and gross profit declined 2.1% to RMB277.0m.

• IFRS profit was RMB16.5m versus a loss of RMB881.7m in H1 2023, when an RMB888.0m fair-value loss on financial liabilities was recorded; those preferred shares converted upon the May 2023 listing.

• Adjusted net profit, excluding share-based payment, fair-value changes in financial liabilities and listing expenses, rose 8.4% to RMB30.7m; adjusted EBITDA increased 5.6% to RMB320.6m.

• Finance costs declined to RMB57.9m from RMB71.7m; income tax expense was RMB4.8m versus RMB5.3m.

Outlook and guidance

• Several key products were planned for H2 2024; priorities include improving product strength, expanding and training the sales team, and applying AI-based analysis to sales processes.

• Further investment in remanufacturing technology and automation is planned to improve digital capabilities, equipment quality and unit costs; a keyboard inspection robot has entered operation.

• Management expects rising penetration of office IT integrated solutions to support performance, while acknowledging ongoing challenges in SME recovery.