[Autohome? Industry]? The global epidemic is still spreading, and the international economic and trade situation is grim. The market performance of automobile companies has naturally become the focus of the industry.

On August 17, Geely Automobile Holdings Co., Ltd. ("Geely Automobile" for short) released its financial report for the first half of 2020. Under the general situation of declining sales of car companies, Geely Automobile's performance has many bright spots.

Since the first half of the year, Geely Automobile's market share has steadily increased from 6.51% at the beginning of the year to 6.74%.

Due to market uncertainty, Geely Auto lowered its full-year sales target for 2020 from 1.41 million vehicles to 1.32 million vehicles.

Performance: Outperforming the market? Profit contribution from joint ventures soared. Facing the market downturn and the huge pressure from the COVID-19 epidemic, the decline in the automobile market has become the norm in the first half of the year.

Geely Auto stated in its financial report that the COVID-19 epidemic has seriously affected the company's operations and the adverse factors are expected to continue until the rest of this year.

Under difficult market conditions, competition in the Chinese market may worsen and will put pressure on the overall performance and profitability of Chinese automakers.

The financial report shows that as of June 30, 2020, Geely Automobile achieved revenue of 36.820 billion yuan, a year-on-year decrease of 23%; net profit was 2.297 billion yuan, a year-on-year decrease of 43%.

In this regard, Geely Auto stated in its financial report that its financial performance in the first half of the year was lower than management expectations, mainly due to the adverse impact of the COVID-19 epidemic.

"Geely Automobile 2020 Interim Performance Report" Specifically, Geely Automobile's operating profit margin fell from 9.2% in the first half of 2019 to 5.7% in the first half of 2020.

Mainly affected by the decline in gross profit margin and increase in administrative and research and development expenses.

The financial report shows that the gross profit margin in the first half of 2020 was 17.1%, and the gross profit margin in the first half of 2019 was 17.8%. The decline in gross profit margin was mainly due to a 9% increase in administrative expenses during the reporting period, as well as investment in R&D and new factories in the past few years.

Amortization and depreciation expenses increased.

Data show that since the outbreak of the domestic epidemic in the first half of the year, Geely Automobile and the Li Shufu Charity Foundation immediately established a 200 million yuan special fund for COVID-19 prevention and control.

In the first half of the year, Geely Automobile also invested 370 million yuan to quickly start the research and development of "all-round healthy cars". So far, it has completed two major phased results of car-grade CN95 high-efficiency composite air-conditioning filter element and antibacterial steering wheel, and has installed them on many models.

Brand promotion has played a positive role.

In terms of specific financial indicators, Geely Automobile's vehicle sales in the first half of 2020 were 33.720 billion yuan, a decrease of 25% from 44.979 billion yuan in the first half of 2019; in terms of average selling price, the average selling price of a single unit in the first half of 2020 was 70,900 yuan, which was relatively high.

Compared with 75,500 yuan in the first half of 2019, a year-on-year decrease of 6%; in terms of return on equity, it was 7.6% in the first half of 2020, a year-on-year decrease of 56% compared with 17.2% in the first half of 2019. This was mainly affected by the decline in net profit.

"Financial Analysis of Geely Automobile's 2020 Interim Performance Report" The profit contribution of Geely Automobile's joint venture has become the highlight of this financial report.

The financial report shows that the joint venture's profit contribution increased by 38% in the first half of 2020, mainly from Geely Auto Finance and Lynk & Co.

Genius Auto Finance provides automobile financing for the group's three major automobile brands; loan assets increased from RMB 31.6 billion at the end of 2019 to RMB 34.8 billion in June 2020; net profit increased from RMB 233 million in the first half of 2019 to the first half of 2020

423 million yuan.

Despite the impact of the COVID-19 pandemic, default rates have remained healthy.

Sales volume: Outperforming the market? Market share is rising steadily. Data from the China Automobile Association shows that in the first half of the year, passenger car sales in China's auto market fell by 22.4% year-on-year, and sales of Chinese brand passenger cars fell by as much as 29.0% year-on-year.

Judging from sales changes, Geely Auto's decline was much lower than the overall market decline.

In the first half of 2020, Geely Automobile's total sales in the Chinese market were 510,873 vehicles (including Lynk & Co), a year-on-year decrease of 17%.

Despite the decline in sales, Geely Auto still maintains its ranking of fourth in the industry and first among Chinese brands.

In terms of brands, the Geely brand sold 474,518 vehicles, accounting for 89%; the Lynk & Co brand sold 54,763 vehicles, accounting for 10%.

Geometry (referring to Geometry A and Geometry C only) 1,165 vehicles.

It is worth mentioning that since the launch of the Lynk & Co brand, cumulative sales have exceeded 300,000 vehicles.

Although the overall Chinese market has declined severely, sales of the Lynk & Co brand have remained stable, contributing a net profit of 189 million yuan to the company in the first half of the year.

"Geely Auto Sales Details in the First Half of 2020" In terms of overseas exports, Geely Auto's cumulative export volume from January to June reached 19,573 vehicles.

Among them, Geely Automobile's Belarus plant ranked second among local passenger car brand sales in the first half of the year, reaching 4,350 units, with a market share of 17.52%.

Proton's market share in the first half of the year was 21.2%, an increase of 6.5% from the same period last year.

In the first half of the year, Geely Binyue and Binrui were launched in Saudi Arabia; Boyue PRO was released and delivered simultaneously in the Philippines; Binyue was launched in Qatar, further deepening Geely Auto's overseas layout.

Geely said that since April, sales have continued to grow positively, with year-on-year growth of 20% and 21% in May and June, indicating a good recovery trend.