HTSC reported net profit increase
with top-tier performance across various businesses
HONG KONG – (ACN Newswire) – HTSC (the “Company”; stock code: 6886) is pleased to release its interim report for 2018, with total revenue and other income reaching RMB11.98 billion. The profit for the period attributable to the shareholders of the Company amounted to RMB3.16 billion, up by 5.53% year-on-year. Despite unfavorable market environment, HTSC continued to accelerate transformation of wealth management business, and maintain strong momentum in all businesses with solid increase in operating performance.
Retail Business Continuously Pioneering the Industry
As the commission rate for stock and fund trading of securities firms continued to decline, the traditional profitability and operation models were facing unprecedented challenges. Adhering to its customer-centered focus, HTSC consistently expanded its customer base and assets under management, and deepened its footprints in progressive transformation of wealth management business.
During the first half of 2018, HTSC reached over 12 million customers, with client assets exceeding RMB2.91 trillion. According to statistics from Securities Association of China, the Company’s stock and fund trading volume during the reporting period totaled RMB7.58 trillion, ranking first in the industry since 2014.
HTSC made enormous efforts in building investment advisor team and exploring business model. According to statistics from Securities Association of China, by the end of the reporting period, the number of investment advisors accounted for 27.56% of the Company’s securities practitioners, a ratio that leads the industry.
HTSC’s wealth management APP “ZhangLe Fortune Path” continued to take the lead in the industry with cumulative downloads of over 41.96 million times. According to the statistics of Analysys, its average monthly active users were over 6.36 million in the first half of 2018, ranking first among all the APPs of securities firms. “ZhangLe Fortune Path” has been successfully optimizing its customer experience by modernizing digital systems and launching new features in the past months, such as ZhangLe U Membership, Position Perspective, Intelligent Real-time Account 3.0, and etc.
Investment Banking Strengthening its Leadership Position
With China’s capital market further opening up and regulators imposing stricter rules in the past six months, the market concentration of institutional services business has increased significantly and the leading securities firms have gained more competitive advantages. The Company continued to implement the whole business chain strategy by means of improving the integrated operation system of large investment banking centering on customers, thereby strengthening the market position and brand effect in the investment banking business.
During the reporting period, the number of mergers, acquisitions, and restructuring deals approved by the reorganization committee reported 8 and the transaction volume totaled RMB70.45 billion, both ranking first in the industry. Huatai United Securities assisted 360 Security Technology Inc. in completing its US stock privatization, which was the largest restructuring and listing project in terms of transaction volume. A number of highlights also include Huatai United Securities acting as an exclusive financial advisor for Baidu Financial Services Group’s spin-off, and an exclusive sponsor and joint underwriter for Wuxi AppTec’s A-share listing.
The brand influence of equity underwriting business has been elevated by a number of landmark transactions. According to WIND, the Company’s lead equity underwriting amount (including initial public offering, follow-on offering, rights issue, preferred shares, convertible bonds and exchangeable bonds) reached RMB82.95 billion, ranking third in the industry. HTSC’s bond underwriting business made its steady progress according to WIND, with lead bond underwriting projects amounting to RMB83.95 billion in volume, ranking seventh in the industry.
ABS New Issuance Volume Topping the Industry
Since the beginning of 2018, asset management business has continued to dechannelize process and expedite the popularity of net-asset-value typed products. Huatai Asset Management focused on the core value of asset management to provide comprehensive full life cycle services and solutions to fulfill customers’ goals and needs.
According to the statistics from Asset Management Association of China, by the end of the second quarter of 2018, the average monthly AUM of the Company was RMB 922.85 billion, ranking second place in the industry. The average monthly active AUM was RMB226.68 billion, ranking fourth in the industry.
HTSC maintained a differentiated competitive advantage in ABS business. According to WIND, the Company’s ABS new issuance scale in the first half of 2018 exceeded RMB37.06 billion, ranking first in the industry. HTSC also issued the very first US dollar-denominated aircraft leasing ABS in China.
International Business Contributed to 12% of HTSC’s Revenue
The two-way opening up of capital markets has accelerated the internationalization of securities firms. During the reporting period, international business reached RMB1.5 billion, contributing to 12.53% of HTSC’s total revenue and effectively enhancing HTSC’s market influence worldwide.
In the first half of 2018, Huatai International Financial Holdings Co., Ltd. has achieved remarkable results in cross-border merger and acquisition. With a completion of multiple IPO deals, Huatai International successfully raised a total of HKD14.4 billion and won the third place in terms of both the number of IPO sponsorships and the total fund-raising volume in Hong Kong in the first half of 2018, according to data by Dealogic.
AssetMark, the turnkey asset management platform (TAMP), acquired by HTSC in 2016 has delivered a compelling performance during the reporting period. Total AUM under AssetMark platform reported USD45.27 billion, up by approximately 6.8% as compared with year-end 2017. The platform served 7,300 independent investment advisers and over 218,000 terminal accounts.
By the end of the first quarter of 2018, the market share of AssetMark in TAMP industry was 9.7%, ranking third in the industry according to Cerulli Associates Inc. and other public information. Riding on the acquisition of AssetMark, HTSC facilitated the improvement of its investment advisor platform and service efficiency.
In terms of IT development, the Company vigorously promoted the transformation from technology-backed service to technology-driven business development. During the reporting period, the Company’s IT staffs accounted for 7.47% of the total, dedicating to various launches and upgrades in advanced business systems and service platforms. Ongoing technology investment and development will continue to reshape HTSC’s business and support further growth.
* The financial information included in this press release has been compiled in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”)