Chongqing Sokon Industry Group stock issued multiple announcements tonight, disclosing not only its mid-term performance, but also the latest progress in investing in Huawei YINGPAN.

Realized a net income of 1.625 billion yuan in the first half of the year.

Chongqing Sokon Industry Group stock's semi-annual report shows that the company achieved operating revenue of 65.044 billion yuan in the first half of the year, a year-on-year increase of 489.58%; net income of 1.625 billion yuan, a profit turnaround from a loss of 1.344 billion yuan in the same period of the previous year.

In the announcement, Chongqing Sokon Industry Group stock explained the relevant situation of revenue and profit growth in the first half of the year.

The company achieved operating revenue of 65.044 billion yuan in the first half of 2024, a year-on-year increase of 489.58%, mainly due to the increase in sales of new energy automobiles.

Net income attributable to shareholders of listed companies was 1.625 billion yuan, turning a profit from a loss in the same period of the previous year, mainly due to the increase in sales of new energy automobiles; at the same time, the company adheres to the business policy of technological innovation and cost contribution, and the new quality productivity leads the continuous improvement of the company's business quality, with an increase in gross margin and a decrease in expense ratio year-on-year.

Net cash flow from operating activities was 16.36 billion yuan, mainly due to the increase in sales receipts of new energy vehicles.

According to Chongqing Sokon Industry Group's introduction, the company ranked sixth in luxury brand sales in the Chinese market in the first half of this year. In the first half of the year, the company's production and sales of new energy vehicles were 0.2039 million units and 200,900 units, respectively, an increase of 349.24% and 348.55% year-on-year.

The subsidiary plans to purchase 10% equity of Shenzhen Yinfang held by Huawei Technologies for 11.5 billion yuan in cash.

Following Chongqing Changan Automobile's Avita Technology, Chongqing Sokon Industry Group also disclosed the latest progress of investing in Huawei Yinfang. Chongqing Sokon Industry Group announced that its wholly-owned subsidiary, Sokon Automobile, plans to acquire 10% equity of Shenzhen Yinfang Intelligent Technology Co., Ltd. held by Huawei Technologies Co., Ltd. in cash, at a transaction price of 11.5 billion yuan. After the completion of this transaction, Shenzhen Yinfang will take over Huawei's existing core business of smart car solutions.

According to the announcement, Shenzhen Yinfang is engaged in smart car solution services, focusing on incremental components for the smart connected car industry, assisting in the upgrading of the automotive industry in terms of intelligence, connectivity, and electrification. It provides customers with products and solutions such as intelligent driving, intelligent cockpit, intelligent vehicle control, intelligent vehicle cloud, and intelligent vehicle-mounted light.

Chongqing Sokon Industry Group also disclosed 4 impacts of this transaction on the listed company in the announcement.

In terms of the impact on the company's main business, the announcement stated that the cross-border cooperation between the company and Huawei has created a new business model, bringing market-recognized AITO Vantage M5, M7, M9 high-end luxury electric vehicle products to users. Through this transaction, based on equity links, the strategic cooperation has been upgraded to "business cooperation + equity cooperation", further solidifying the sustainability of the cooperation relationship, jointly exploring the innovative cooperation mechanism of close coordination and co-creation in the era of intelligent vehicles and intelligent components, and jointly building Shenzhen Yinfang into a leading enterprise in automotive intelligent components and solutions, and AITO Vantage into a world-class leading brand of new luxury cars, providing a solid foundation and long-term guarantees for the company to achieve technological leadership and brand elevation in the era of intelligence.

In terms of the impact on the company's equity structure, the announcement stated that this transaction involves the payment of cash by the listed company to purchase assets, does not involve the issuance of shares, and will not result in any changes to the equity structure of the listed company. It has no impact on the equity structure of the listed company.

Regarding the impact on the main financial indicators of the company, the announcement states that after the completion of this transaction, the listed company will acquire a 10.00% stake in the target company and is expected to account for it under the equity method. Based on the financial data and future business prospects of the target company, the acquisition of the minority equity of the target company is expected to have a positive impact on the investment income of the listed company. The total assets, net profit scale, and basic earnings per share of the listed company will be improved, which will help the listed company increase its profit and maximize the interests of shareholders, fully safeguarding the interests of the listed company and all shareholders.

Regarding the impact of the goodwill generated by the merger on the listed company, the announcement states that after the completion of this transaction, the listed company will acquire a 10.00% stake in the target company to recognize long-term equity investment at cost, without changing the scope of consolidation of the listed company's financial statements and without generating goodwill.