HONG KONG — Huarong International Financial Holdings Limited (“HRIF”) (993.HK), is one of a few HK-listed companies to achieve outstanding earnings results with over 100% growth in net profit for four consecutive half-year results. Its significant profitability expansion in 1H2017 further demonstrates the great investment value of the Company and may give more upside potential for its share price.
During the Period, benefiting from the brand effect and business synergy of “China Huarong”, HRIF expanded its business rapidly, and again recognized a significant growth of the results. During the Period, the core business revenues surged by 108.3% year-on-year to approximately HK$1.16 billion, and the Profit attributable to owners of the Company (“Net Profit” ) amounted to approximately HK$584.15 million, representing a significant increase of 168.3% year-on-year and continuously maintained a high-quality business results growth.
During the first half of 2017, HRIF upheld the development principle of “Robust Progress” and continued to expand its three business segments, namely, securities, corporate finance, and asset management and direct investment. In addition, HRIF brought the synergy of its business lines into full play and strove to provide customers with professional, diversified and integrated financial services, so as to keep improving the market competitiveness of HRIF.
Asset Management and Direct Investment Business – During the first half of 2017, HRIF has sought to provide customers with customized, professional and integrated financial service solutions, through various measures such as establishing long-term partnerships with key customers, exploring new customers through business synergy, and subdividing and expanding professional investment teams. HRIF also seized various business cooperation and market opportunities, to optimize its investment portfolio continuously and achieve better investment returns. During the Period, the segment revenue achieved approximately HK$1,023.2 million, representing a year-on-year increase of 175.8% while the segment result increased by 176.3% year-on-year to approximately HK$997.0 million.
Corporate Finance Business – HRIF is devote to provide institutional clients with comprehensive securities issuance and underwriting, financial advisory and financing arrangement services. Leveraging on the diversified client portfolio of China Huarong Asset Management Co., Ltd. (“China Huarong”) (stock code:2799.HK), the corporate finance segment gained a new driving force by putting greater efforts in market expansion to explore the effective cooperation among different licensed companies and in doing so, the benefits of synergy have been achieved. Several large issues of USD bonds and equity financing projects were completed during 1H2017, including underwriting of initial public offering (IPO) and placing. During the Period, the related revenue increased by 209.3% year-on-year to approximately HK$193.1 million while the result of corporate finance business has significantly increased by 254.3% year-on-year to approximately HK$186.2 million.
Securities Business – During 1H2017, the segment revenue increased by 71.5% year-on-year to approximately HK$190.4 million while the result of the securities segment increased by 95.6% year-on-year to approximately HK$171.9 million. As at 30 June 2017, HRIF’s margin loan balance was approximately HK$3.8 billion.
Mr. Wang Qiang, Chairman and Executive Director of Huarong International Financial Holdings Limited concluded: “During 1H2017, investors’ confidence has been further boosted as the Hong Kong financial market benefited from an improving global economic outlook. Hong Kong has witnessed a substantial increase in the daily average turnover of its stock market, and the Hang Seng index also recorded a new height for the past two years. The good economic environment created favorable conditions for the business development of HRIF.”
“Looking ahead in 2H2017, the external environment is expected to be challenging. In the complicated and constantly changing macro-economic environment, HRIF will continue to adhere to “Stability, Innovation, Harmony, Development” as its core principles and strive to become “Professional Asset Manager, Excellent Integrated Financial Service Provider”. HRIF will fully explore the synergy and interconnection between its direct investment business and licensed business, and actively seize the development opportunities made available by Shanghai-Hong Kong Stock Connect, Shenzhen-Hong Kong Stock Connect, Bond Connect, RMB internationalization and the “One Belt, One Road” initiative.
With all such efforts in the pipeline, HRIF seeks to propel the development of platforms regarding its three major business segments, namely securities, corporate finance, and asset management and direct investment, continue to enhance its core competitiveness and overall profitability, and create greater value for shareholders.”