stockmarket

China Geely Auto's full-year profit jumps 18 percent, shares climb


© Reuters. FILE PHOTO: A logo of Geely automobile company is seen on a car at the Belarusian-Chinese closed joint-stock company BelGee plant in Zhodino

By Yilei Sun and Brenda Goh

BEIJING (Reuters) – China’s Geely Automobile Holdings posted an 18 percent jump in annual net profit, driven by higher sales of its sedans and sports utility vehicles (SUVs), but forecast flat sales growth in 2019 due to uncertainty about domestic demand.

Geely, China’s most high-profile car maker globally thanks to the Geely group’s investments in European automakers Volvo and Daimler, posted a record 2018 net profit of 12.55 billion yuan (£1.42 billion), up from the previous year’s 10.63 billion.

That compared with the 12.8 billion yuan average estimate of 34 analysts, according to Refinitiv data.

Total revenue for the year was a record 106.60 billion yuan, up from 92.76 billion yuan in 2017. That slightly missed the 108.59 billion yuan estimated by analysts, according to Refinitiv data.

Shares of Geely rose by as much as 5 percent to HK$14.80 after the results, and were up 3.8 percent at 0600 GMT.

Geely, which sells vehicles under its eponymous and Lynk & Co brands, sold 1.5 million cars last year, 20 percent higher than the 1.25 million it sold in 2017.

The company said in a statement on Thursday that the deterioration of consumer confidence in China, the world’s biggest auto market, caused by increased political and economic uncertainties had affected demand, but that its sales had only missed its own annual target by 5 percent.

Its sales volumes started to particularly slow in the last quarter of 2018, with a 44 percent drop in December alone, according to monthly sales data filings.

Geely is forecasting largely unchanged sales this year as the country’s giant auto market struggles with slowing economic growth and more cautious consumers. Last year, the market contracted for the first time since the 1990s.

It said the strong performance last year was due to demand for its sedans and SUVs, and exports. It is launching a series of new energy and electrified vehicles as well as some upscale models to achieve higher profit margins.

In the statement, Geely also said the Group plans to acquire an engine plant in Zhejiang’s Yiwu City from its parent company, Zhejiang Geely Holding, without providing more details.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.