Review of the "preview" of the performance of nearly 20 securities firms in the first half of the year: 40% of companies expect profit growth, with significant impacts from investments and fair value adjustments

The performance of securities companies in the first half of the year is gradually "coming to light".

According to Wind statistics, as of July 30, nearly 20 securities firms have disclosed their performance forecasts or interim reports for the first half of 2024.

The data shows that nearly 40% of these securities firms have seen a year-on-year increase in net profit, while over 60% have experienced a year-on-year decline in net profit.

Among the companies with year-on-year increases, Dongxing Securities, Shouchuang Securities, Jinlong Stock, and other securities firms have seen the largest growth in net profit.

Significant Growth in Investment Performance for Some Securities Firms

So how did these small and medium-sized securities firms achieve an increase in performance in the first half of the year?

Dongxing Securities stated that during the reporting period, the company's investment performance saw significant growth, helping the company achieve a substantial year-on-year improvement in overall operating performance.

Shouchuang Securities provided more specific reasons for the increase in performance: mainly due to the company actively seizing market opportunities, timely adjusting its business strategies, with significant year-on-year increases in revenue from asset management and fixed income investment trading businesses, leading to overall year-on-year growth in the company's performance in the first half of the year.

Prosperity and Adversity are Fleeting

Compared to securities firms with good year-on-year performance increases, Tianfeng Securities, Huaxi Securities, Huachuang Securities, and others with significant year-on-year declines also have their own explanations.

Tianfeng Securities' performance forecast for the first half of 2024: it is expected to achieve a net profit attributable to the owners of the parent company ranging from -338 million to -270 million RMB, resulting in a loss compared to the same period last year.

In the interim report performance forecast, Tianfeng Securities stated that in the first half of 2024, due to market fluctuations in equity markets, the fair value change income and investment income decreased compared to the same period last year, leading to an operating loss for the company.

It is worth mentioning that Tianfeng Securities mentioned that the company's operating performance improved in the second quarter of 2024, and with the steady progress of various businesses, the company is expected to achieve profitability in the second quarter, showing a turnaround in its operations.

Huaxi Securities also attributed the decline in performance to factors such as a decrease in revenue from brokerage and wealth management businesses, significant fluctuations in investment business leading to a corresponding decrease in income, and an increase in impairment losses on financial assets compared to the same period last year, resulting in a decline in the company's operating performance in the first half of 2024.

Eventual Factors Also Affect Profits

In addition, some securities firms have also been affected by event-driven factors.

Zhongtai Securities stated that in the first half of 2024, the company actively responded to market changes, focusing on improving its five core competencies and enhancing its four core functions to promote work quality and efficiency.

However, due to factors such as the equity fair value change income generated by the merger of Wan Jia Fund in the same period last year, as well as adjustments in market volatility and changes in IPO issuance pace, the company's operating performance declined year-on-year.

This can only be attributed to event-driven factors.