INVESTMENT manager Yangzijiang Financial on Tuesday (Aug 13) posted net profit of S$107.4 million for the six months ended Jun 30, falling 33.9 per cent from S$162.5 million year on year.
This translates to an earnings per share of S$0.0304, compared to S$0.0439 in the corresponding year-ago period.
First-half revenue, reflected as total income, dropped 21.7 per cent to S$161.4 million, from S$206.1 million a year ago.
This comes as interest income slid 30 per cent to S$106.7 million, from S$151.6 million year on year. Interest income from debt investments in China fell 49.3 per cent on year to S$71.4 million from S$140.8 million, due to a lower average balance of debt investments.
The slide in the segment was partially mitigated by interest income in cash management activities rising 228 per cent to S$35.3 million, from S$10.8 million in H1 FY2023. This was attributed to higher average cash balance and improved returns.
Meanwhile, the group’s non-interest income ticked up marginally by 0.2 per cent to S$54.7 million, from S$54.6 million. This segment includes investment income, earned through maritime fund assets, private credit, private equity and venture capital funds.
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Income from maritime fund assets leapt to S$22.1 million from S$349,000 in H1 FY2023, due to the higher average proportion of maritime-related investments during the period. However, the growth was offset by lower contributions from other net changes in fair value of financial assets at S$25.3 million for H1 FY2024, compared to S$42.2 million a year ago.
The group’s total assets increased 2.7 per cent to S$4.3 billion as at Jun 30, from S$4.2 billion as at Dec 31, 2023.
As at Jun 30, the group’s assets under management (AUM) are split 50-50 between China and Singapore, compared to a 69-31 split as at Dec 31, 2023.
The group, which was spun off from Yangzijiang Shipbuilding, has lowered its debt investments in China, reflected in a 17.8 per cent drop to S$1.3 billion over the six-month period.
“This translates to approximately 32 per cent of the group’s total AUM of (around S$4.1 billion), nearing its mid-term target of 30 per cent,” said Yangzijiang Financial.
Over the same period, maritime fund assets grew 62.2 per cent to S$376.6 million, while cash and yield enhancement products increased 7.8 per cent to S$1.7 billion, said the group.
The group said its cash and yield enhancement products, which represent 42 per cent of its total AUM as at Jun 30, will gradually be allocated to the newly established cash management fund launched in June.
“The fund is designed to maximise returns through active management as the group progressively deploys these liquid assets into global investment opportunities,” said Yangzijiang Financial.
In the mid term, Yangzijiang Financial plans to invest up to US$900 million in maritime-related assets as part of its asset allocation strategy. As at the end of the review period, US$325 million has been invested in deals involving 50 vessels.
Ren Yuanlin, Yangzijiang Financial chief executive and executive chair, said: “The group now sits in a healthier position with lessened single-country risk.
“Going forward, we are focusing on redeploying more funds into maritime-related investments.”
Shares of Yangzijiang Financial closed at S$0.35 on Tuesday, up 2.9 per cent or S$0.01, before the announcement.
