Far East Horizon Limited · HKEX:3360
Far East Horizon — H1 2024 Earnings Presentation
41 slides from Far East Horizon's earnings presentation, August 2024
Slide 1: Far East Horizon Limited 2024 Interim Results
Far East Horizon Limited 2024 Interim Results August 2024
Slide 2: Disclaimer
Disclaimer This material is prepared by Far East Horizon Limited (the “Company”) and has not been independently audited. This document contains confidential and proprietary information, and its contents have not been verified by an independent third party. The Company does not guarantee the accuracy
Slide 3: Contents
Contents 1 Results Overview 2 Business Analysis 3
Slide 4: Adhere to prudent strategy to ensure the safety of business
Adhere to prudent strategy to ensure the safety of business • In the first half of 2024, the Company adhered to prudent strategy and achieved revenue of RMB18.0 billion and operating profit before tax* of RMB4.2 billion on the basis of ensuring operational safety • The performance was mainly attribu
Slide 5: Value shareholder returns and continuously increase dividends
Value shareholder returns and continuously increase dividends • The Company has always focused on shareholder returns, and the Board has approved the first interim dividend since listing, with a dividend amount of HKD0.25 per share and a payout ratio of 47% • Meanwhile, the Company will continue to
Slide 6: Financial services: Strengthen the stability and safety, and maintain stable asset scale
Financial services: Strengthen the stability and safety, and maintain stable asset scale • The size of net interest-earning assets was RMB266.4 billion along with the balance of non-performing assets continuing to decline, and the revenue of financial services was RMB10.9 billion • The Company regar
Slide 7: Financial services: Maintain stable asset quality and prudent provision policy
Financial services: Maintain stable asset quality and prudent provision policy • NPL maintained a robust level of 1.04%, and overdue interest-earning assets (over 30 days) ratio further declined to 0.90%, indicating asset quality continuously improved. NPL provision coverage ratio remained stable, a
Slide 8: Financial services: Keep stable leverage and match the duration of assets and liabilities
Financial services: Keep stable leverage and match the duration of assets and liabilities • The gearing ratio was 83.67%, remaining a reasonable and stable level compared to the end of 2023 • Adhered to a prudent liquidity management strategy and strictly matched cash flows to avoid liquidity risk M
Slide 9: Financial services: Decrease financing costs and maintain stable net interest margin
Financial services: Decrease financing costs and maintain stable net interest margin • The NIS was 3.95% and the NIM was 4.47%, representing an increase of 14 bps and 5 bps compared to 1H2023 • It was mainly attributable to: (1) maintaining a personalized product and service strategy, responding to
Slide 10: HCD: Continue to expand business layout and improve financial performance
HCD: Continue to expand business layout and improve financial performance • HCD continuously deepened the domestic market, actively expanded overseas business, and achieved revenue of RMB4.87 billion and net profit of RMB0.27 billion, representing an increase of 16% yoy and 13% yoy, consolidating th
Slide 11: Horizon Healthcare: Continuously improve operating efficiency and performance
Horizon Healthcare: Continuously improve operating efficiency and performance • Horizon Healthcare exerted the advantages of group-based hospital operation, continuously improved operating efficiency and decreased operating costs, achieving revenue of RMB2.12 billion and net profit of RMB0.15 billio
Slide 12: Appendix: Condensed Balance Sheet
Appendix: Condensed Balance Sheet RMB'00 million 30 June 2024 31 December 2023 Change Total assets 3,616.42 3,514.83 2.89% Interest-earning assets 2,663.79 2,690.85 -1.01% Total liabilities 3,025.89 2,939.14 2.95% Interest-bearing liabilities 2,648.64 2,556.36 3.61% Total equity 590.53 575.70 2.58%
Slide 13: Appendix: Condensed Income Statement
Appendix: Condensed Income Statement RMB'00 million 1H2024 1H2023 Change Total revenue 180.36 183.62 -1.77% Profit before tax 40.08 49.90 -19.69% Operating profit before tax 42.29 47.83 -11.60% Net profit attributable to ordinary 20.85 30.71 -32.10% shareholders EPS (RMB/share) 0.49 0.73 -32.88% ROA
Slide 14: Business Analysis
Contents 1 Results Overview 2 Business Analysis 14
Slide 15: Business Analysis Highlights
Business Analysis 1. Leading position in industry and long-term stable performance 2. Financial services: Long-term stable asset quality and interest spreads profit remained stable 3. Industrial operation: Rapid expansion and multi-pole drivers helped to maintain stable performance Highlights 4. Cre
Slide 16: 1. Leading position in industry and long-term stable performance
1. Leading position in industry and long-term stable performance
Slide 17: Largest independent financial leasing group in China and in-depth operation in specific industries
Largest independent financial leasing group in China and in-depth operation in specific industries • Financial leasing business: Leading in the industry, ranking first in terms of profitability, with net interest- earning assets of RMB266.4 billion • Equipment operation business (HCD): China's leadi
Slide 18: The leading position in the industry is stable and widely recognized by the market
The leading position in the industry is stable and widely recognized by the market • Total assets: RMB360+ billion • Headquarters: Hong Kong, China • Net asset scale: RMB50+ billion • Business operation centers: Shanghai, SIZE • Financial services customers: 30,000+ LAYOUT Tianjin, Guangzhou • HCD c
Slide 19: 2. Financial services: Long-term stable asset quality and interest spreads profit remained stable
2. Financial services: Long-term stable asset quality and interest spreads profit remained stable
Slide 20: Financial services: Steady growth in performance across cycles and the business model shows strong vitality
Financial services: Steady growth in performance across cycles and the business model shows strong vitality Large customer selection and adjustment space Net interest-earning assets (RMB'00 million) Existing Target industries customers and customers 2,691 2,706 2,664 2,584 2,354 2,240 First-ever A-F
Slide 21: Financial services: Deeply cultivate and flexibly allocate in nine major industries
Financial services: Deeply cultivate and flexibly allocate in nine major industries Changes in the proportion of net interest-earning assets in nine major industries in recent years 51.0% 43.6%45.6% 39.8%35.6% 13.6% 12.7% 11.1% 10.5% 8.9% 10.9% 9.9% 11.5% Urban 8.0% 9.4% Engineering Culture & public
Slide 22: Financial business: Continuously optimizing regional strategies along the coast and Yangtze River
Financial business: Continuously optimizing regional strategies along the coast and Yangtze River towards the east and south Regional distribution of interest-earning asset balances Decrease Increase 43.34% 33.45% 16.51% 14.39% 10.31% 11.12% 10.50% 8.38% 9.82% 9.24% 6.83% 6.82% 5.73% 5.70% 5.29% 2.5
Slide 23: Financial services: Adhere to the business strategy of putting asset quality first
Financial services: Adhere to the business strategy of putting asset quality first, and the asset safety has been tested in cycles Over 30 days ratio and NPL provision NPL has maintained stable for a long time since listing coverage ratio remained stable 246% 242% 1.86% 220% 228% 227% 218% 219% 1.29
Slide 24: Financial services: Long-term advantages in asset returns and stable interest spreads
Financial services: Long-term advantages in asset returns and stable interest spreads Net interest spread (NIS) Net interest margin (NIM) 4.67% 4.58% 4.42% 4.47% 3.94% 3.98% 3.95% 3.81% 4.06% 3.21% 2021 2022 2023 1H2023 1H2024 2021 2022 2023 1H2023 1H2024 24
Slide 25: Financial services: Reasonable matching of financial asset and financial liability maturity
Financial services: Reasonable matching of financial asset and financial liability maturity and balance liquidity safety and efficiency Matching of financial asset and financial liabilities (RMB'00 million) 1,559 1,320 1,168 1,009 625 510 251 6 29 50 28 - On demand Less than 3 months 3 to 12 months
Slide 26: Financial services: Leverage has been maintained at a reasonable level and risks well controlled
Financial services: Leverage has been maintained at a reasonable level and risks have been well controlled The leverage level of the Company and main financial leasing business entities Regulatory Control Line (8x) 6.63 6.62 6.33 6.11 6.12 6.15 5.81 5.21 5.15 4.32 4.43 4.45 4.58 4.34 4.34 4.25 3.40
Slide 27: Financial business: Prudent promotion of inclusive finance and gradual maturity of business model
Financial business: Prudent promotion of inclusive finance and gradual maturity of business model • The net interest-earning assets of inclusive finance reached RMB13.96 billion, representing an increase of 12% compared to the end of 2023. NPL ratio was 1.31%, down 12bps from the end of 2023. The in
Slide 28: 3. Industrial operation: Rapid expansion and multi-pole drivers helped to maintain stable performance
3. Industrial operation: Rapid expansion and multi-pole drivers helped to maintain stable performance
Slide 29: The income structure is constantly optimized, and the contribution of the industry continues to rise
The income structure is constantly optimized, and the contribution of the industry continues to rise • The two-wheel-driven strategy of “finance + industry” has achieved remarkable results. With the growth of Horizon Construction Development (HCD) and the improvement of operation of Horizon Healthca
Slide 30: HCD: A leading equipment operation service provider in China
HCD: A leading equipment operation service provider in China • Ranked the 14th in IRN World’s Top 100 Rental Companies • Total assets:RMB35.3 billion • Ranking No.2 in ACCESS Global Top 50 Ariel Machinery • Customers served: 271,000 Leasing • Outlets: 515 domestic + 35 overseas • The first domestic
Slide 31: HCD: Continuously integrating domestic and overseas markets, maintaining a growth trend in performance
HCD: Continuously integrating domestic and overseas markets, maintaining a growth trend in performance Revenue (RMB'00 million) Net profit (RMB'00 million) 96.1 9.6 48.7 42.1 2.4 2.7 19.1 2.0 2018 2023 1H2023 1H2024 2018 2023 1H2023 1H2024 31
Slide 32: Horizon Healthcare: China's largest social capital medical service organization
Horizon Healthcare: China's largest social capital medical service organization • 26 holding hospitals • Effective supplementation of the public healthcare system • About 10,000 beds available • Layout in third, fourth, and fifth tier cities and counties • Annual outpatient visits exceed 4,000,000 •
Slide 33: Horizon Healthcare: Steady growth in operating performance and continuous improvement in operational efficiency
Horizon Healthcare: Steady growth in operating performance and continuous improvement in operational efficiency Revenue (RMB'00 million) Revenue per bed (RMB thousand) Net profit (RMB'00 million) 42.4 42 1.7 1.5 1.2 21.2 21.3 21 21 19 0.6 8.8 2016 2023 1H2023 1H2024 2016 2023 1H2023 1H2024 2016 2023
Slide 34: 4. Credit rating remained stable and ESG rating improved steadily
4. Credit rating remained stable and ESG rating improved steadily
Slide 35: BBB- credit rating confirmed by S&P and ESG rating maintained industry-leading
BBB- credit rating confirmed by S&P and ESG rating maintained industry-leading Credit rating maintain stable and S&P confirmed ESG rating are all in the forefront of BBB- long-term issuer rating with a stable outlook the domestic financial industry Global Rating BBB- By S&P Maintained A since 2022,
Slide 36: 5. Shareholders' returns continuously improved through multiple initiatives
5. Shareholders’ returns continuously improved through multiple initiatives
Slide 37: Stable dividend payout since listing and continuously improving shareholder returns through multiple initiatives
Stable dividend payout since listing and continuously improving shareholder returns through multiple initiatives • Since its listing, the total cash dividend paid has reached HKD15.69 billion, exceeding the amount of public equity financing after the Company's IPO and listing • Cash dividend: The fi
Slide 38: 6. Long-term and stable management team with highly aligned interests
6. Long-term and stable management team with highly aligned interests
Slide 39: Long-term and stable management with highly aligned interests achieved excellent performance
Long-term and stable management with highly aligned interests achieved excellent performance The core management team has joined the Company Managed the Company to achieve long-term for more than 20 years with highly aligned interests outstanding performance Since listed in 2011, key metrics keep KO
Slide 40: Q&A
Q&A 40
Slide 41: Contact us
Contact us Far East Horizon Company Website： www.fehorizon.com Contact of Investor Relations： ir@fehorizon.com Horizon Construction Development Horizon Healthcare 41