LC Group (2490) H1 2024 earnings summary

Executive summary

• H1 revenue rose 15.0% YoY to RMB754.2m, while profit fell 87.8% to RMB12.8m as higher costs and lower time-charter rates compressed margins.

• Cross-border logistics volume reached 140,355 TEUs; self-operated services, overseas warehousing and a China–Africa break-bulk route broadened the service mix.

Financial highlights

• Revenue increased to RMB754.2m from RMB655.8m; cost of sales rose 35.2% to RMB686.1m and gross profit fell 54.1% to RMB68.1m.

• Gross margin declined to 9.0% from 22.6%; profit before tax fell 87.4% to RMB13.0m and profit for the period fell 87.8% to RMB12.8m from RMB105.1m.

• Basic and diluted EPS was RMB0.03 versus RMB0.41; profit attributable to parent owners was RMB9.4m versus RMB104.1m.

• Net cash from operating activities was negative RMB8.1m versus positive RMB69.9m; cash and cash equivalents decreased RMB52.2m during H1.

Outlook and guidance

• H2 third-party cross-border shipping is expected to improve with traditional peak seasons on China–Americas, China–Europe and China–Asia routes.

• Time-charter performance is expected to improve in H2 as market charter rates increased during 2024; service supply will be adjusted prudently to market conditions.

• Business development will continue to support steady performance growth and shareholder value creation.