1) The company's net income for the first half of the year is expected to increase by 60.37%-93.78% year-on-year; 2) The collection compensation affects net income, which increases by approximately CNY 0.145 billion, and the return on stock investments is up year-on-year; 3) In the first half of the year, continue to invest in setting up subsidiaries, using our own funds for investment and financial business.
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On July 11th, Financial Association Press (Reporter Chen Kang) reported that Zhejiang Yongyang (002489.SZ) had a higher net profit in the first half of the year due to the collection compensation and investment income. The company announced late this evening that it is expected that the net profit attributable to shareholders of listed companies in the first half of 2024 will be CNY 0.48 billion – 0.58 billion, a year-on-year increase of 60.37%-93.78%.
About CNY 0.145 billion of the net profit comes from the collection compensation: Zhejiang Yongyang's land and factory buildings in Shuiyuntang, Linhai City were collected by relevant departments during the reporting period, with a total collection compensation of CNY 0.177 billion, and the asset disposal affected the net profit of this reporting period by about CNY 0.145 billion. In addition, Zhejiang Yongyang mentioned that the return on stock investment income and fair value changes increased year-on-year during the reporting period.
Zhejiang Yongyang's non-net profit for the first half of the year was CNY 0.23 billion-0.28 billion. The change from the same period last year was -10.37%—9.11%. The profit and loss caused by the aforementioned collection compensation and investment business is non-recurring profit and loss, so the investment income is about CNY 0.105 billion—CNY 0.155 billion, and the maximum value amounted to CNY 0.3 billion for the two non-recurring profit and loss.
Compared with that, Zhejiang Yongyang's main business, sales revenue of outdoor leisure furniture products, did not see a significant increase. The company mentioned in the announcement, "The international outdoor leisure product market is grim, and industry enterprises are vying to lower prices to grab orders. The company adheres to the guidance of reducing costs, improving quality and increasing efficiency."
However, Zhejiang Yongyang's enthusiasm for external investment did not diminish in the first half of the year.
On the one hand, the company invested in setting up subsidiaries and building new industrial parks. The fully-owned subsidiary, Hong Kong Yongyang Investment, used no more than USD 50 million to set up a wholly-owned subsidiary, Singapore Yongyang, to conduct capacity investment and construction in Vietnam through Singapore Yongyang.
On the other hand, in April, Zhejiang Yongyang issued an announcement on investment and securities investment, stating that it will use idle self-owned funds for investment and financial business within a limit of no more than CNY 0.5 billion. The investment varieties are products with high security, good liquidity, low risk, and stability. And use no more than CNY 1 billion of self-owned funds for securities investment, investment methods include new stock allocation or subscription, stock investment and margin brokers, bond investment, and other investment behaviors recognized by the Shenzhen Stock Exchange.
According to its disclosed securities investment situation for 2023, Zhejiang Yongyang's initial investment cost of the stock account in 2023 is CNY 0.591 billion, and the profit and loss for the reporting period is CNY 36.0643 million. As of the end of 2023, Zhejiang Yongyang held the top ten stocks with market cap including Tencent (00700.HK), Semiconductor Manufacturing International Corporation (00981.HK), Ningbo Ronbay New Energy Technology (688005.SH), Orient (03958.HK), Zhejiang Bangjie Holding Group (002634.SZ), etc.