Xinyi Solar (968) H1 2024 earnings summary

Executive summary

• Revenue for 1H2024 rose 4.5% year-over-year to HK$12,686.8 million, driven by higher solar glass sales volume despite lower average selling prices and currency headwinds.

• Net profit attributable to equity holders increased 41.0% year-over-year to HK$1,962.5 million, with basic EPS at 22.03 HK cents.

• Solar glass business drove profit growth, offsetting price declines with higher sales volume, improved efficiency, and reduced costs.

• Solar farm business grew steadily, with grid-connected capacity reaching 6,244MW as of June 2024, but future expansion is cautious due to market uncertainties.

Financial highlights

• Gross profit increased 27.5% year-over-year to HK$3,406.0 million; gross margin improved to 26.8% from 22.0%.

• EBITDA rose 28.0% to HK$3,910.3 million; EBITDA margin was 30.8%.

• Net profit margin increased to 15.5% from 11.5% year-over-year.

• Interim dividend declared at 10.0 HK cents per share, up from 7.5 HK cents in 1H2023.

• Total assets grew to HK$62,465.0 million; equity attributable to shareholders at HK$31,827.4 million.

Outlook and guidance

• Industry faces ongoing volatility from supply-demand imbalances, trade restrictions, and high interest rates.

• Solar glass capacity expansion continues, targeting 32,200 tonnes/day by end-2024, with flexibility to adjust timelines.

• No new solar farm projects planned for grid connection in 2H2024; focus remains on operational efficiency and prudent capital management.

• Overseas production capacity to be expanded to diversify risk and meet global demand.