NH Investment & Securities (005940) Q3 2024 earnings summary

Executive summary

• Net income for 3Q24 was W154.0bn, down from W197.2bn in 2Q24, with ROE at 7.9% compared to 10.3% in the previous quarter.

• For the nine months ended September 30, 2024, consolidated net income was ₩576.6 billion, up 23.4% year-over-year, with consolidated revenue of ₩15.59 trillion and pre-tax income of ₩765.1 billion.

• Brokerage, IB, and asset management all saw double-digit growth in fee income, with IB fees up 37.5% year-over-year, driven by increased real estate deal closings and capital market activity.

• The company maintained a strong capital position, with a consolidated net capital ratio of 1,815.1% and a leverage ratio of 607.2%.

• Dividend policy remains focused on shareholder returns, with a cash dividend of ₩800 per common share and ₩850 per preferred share for the prior year.

Financial highlights

• Operating revenue for 3Q24 was W2,366.0bn, a decrease from W2,410.4bn in 2Q24.

• Consolidated net income attributable to controlling interests was ₩576.6 billion, up from ₩467.5 billion year-over-year.

• Brokerage fee income rose 2.4% to ₩346.0 billion, with overseas brokerage up 34.3%. IB fee income surged 37.5% to ₩275.3 billion.

• Trading and related interest income dropped sharply to W130.5bn (-58.1% QoQ).

• EPS (basic) was ₩1,653, up from ₩1,334 year-over-year.

Outlook and guidance

• Conservative trading positions are being maintained to minimize risk amid elevated market volatility.

• The company expects continued growth in asset management and IB, with a focus on digital transformation and global expansion.

• Management anticipates a stable interest rate environment and ongoing demand for professional investment advisory services.

• The dividend policy will remain proactive, but may be adjusted based on market and earnings conditions.

• Investment sentiment remains weak, impacting financial product sales.