On August 18, Geely Automobile Holding Co., Ltd. (hereinafter referred to as "Geely Automobile") released the financial report for the first half of 2022 on the Hong Kong stock exchange. According to the financial report, Geely motor's revenue in the first half of 2022 was about 58.184 billion yuan, with a year-on-year increase of 29%.

Source: Geely official

The revenue growth of 29% was due to the significant increase in the average price of products. Geely Motor said that the average ex factory sales price of the company in the first half of the year (after taking into account the income of Lingke and Ruilan brand cars sold by Lingke joint venture and Ruilan joint venture on a pro forma basis) increased by 21% year-on-year, the average sales price increased by more than 20%, and the total income increased by nearly 30%, but in contrast, the profit decreased significantly.

Data show that Geely's gross profit margin in the first half of the year decreased by 2.6 percentage points to 14.6% year on year; Excluding the non cash share based payment expenses, the profit attributable to equity holders of Geely Group decreased by 20% year-on-year to rmb2.41 billion.

The financial report also mentioned that the distribution and sales expenses of Geely Automobile in the first half of this year reached 3.304 billion yuan, a year-on-year increase of 29.35%, and the administrative expenses reached 4.661 billion yuan, a year-on-year increase of 43.56%. The expenditure on R & D activities was 3.265 billion yuan, with a year-on-year increase of 41.68%.

In terms of sales volume, Geely's total sales volume in the first half of the year was about 613800, compared with 630000 in the same period of last year, a year-on-year decrease of 3%; Among them, the domestic sales volume was 526000, a year-on-year decrease of 9%, and the export sales volume in the first half of the year increased by 64% to 88000, accounting for 14.3% of the total sales volume. The overall sales of electric vehicles performed well: the total sales of pure electric vehicles was 86000, up 520% year-on-year; the sales of plug-in hybrid vehicles increased 192% year-on-year, reaching 24000.

However, comparing the sales volume of various brands within Geely Group, the data is not optimistic. Among them, the total sales volume of Geely, geometry, krypton, Lingke and Ruilan brands in the first half of this year were 500000, 54000, 19000, 77000 and 17000 respectively. In addition to Ruilan (less than one year old) and jikrypton brand (the first product was released in April last year) which have no data of the same period last year, only geometric brand achieved a year-on-year increase in total sales in the first half of the year, while the sales of Geely brand and Lingke brand, which were established earlier, fell by 4% and 28% respectively.

It is worth noting that Geely said in the financial report that its sales target for the whole year of 2022 is 1.65 million units, in order to achieve a year-on-year growth of 24%. In the first half of this year, the total sales volume only reached 37.2% of the sales target of 1.65 million. Geely's official sales data for July is only 123000, which is still 55.4% behind the sales target of 1.65 million units in 2022. However, Geely has only five months left.

In the first half of the year, Geely Automobile Group said that the sales volume was lower than the official expectation because of the epidemic and the shortage of chips. In addition, although the total sales volume of new energy vehicles increased by 14.4 percentage points to 17.9%, the sales volume of fuel vehicles exceeded the growth of the former, resulting in the decline of its total sales volume. As for the decrease in gross profit rate, Geely said that it was mainly affected by the increase in the cost of automobile raw materials and the increase in the proportion of new energy vehicles.

As for the business performance in the second half of the year, Geely officially said that it would continue to expand its export sales to new markets in Southeast Asia and Western Europe, and continue to increase the proportion of new energy vehicles in the total sales volume.

It is worth mentioning that Li Donghui, CEO of Geely Holding Group, once said at the performance meeting that technology licensing has become a new profit growth point of Geely Automobile. According to the financial report data released by Geely, in the first half of the year, Geely Group's income from "intellectual property licensing" reached 728 million yuan, a year-on-year increase of 14.3%, accounting for 1.25% of the total income in the first half of the year.