As of January 21, a total of 17 securities companies have issued performance forecasts or 2021 annual reports that have not been audited by the parent company. The vast majority of the disclosed performance of securities companies increased, and only three net profits declined. Behind the decline in the performance of these securities companies is a great relationship with investment losses.
Citic Securities Company Limited(600030) net profit hit a record high
firmly ranking as the “first brother of the securities industry”
On January 13, Citic Securities Company Limited(600030) announced that in 2021, the company achieved an operating revenue of 76.57 billion yuan, a year-on-year increase of 40.8%; The net profit attributable to the shareholders of the parent company was 22.979 billion yuan, a year-on-year increase of 54.20%, and the net profit hit a record high.
For the performance growth, Citic Securities Company Limited(600030) explained that China’s economy overcame the impact of the epidemic and continued to improve. The capital market was booming. The company’s investment banking, asset management and other businesses developed in a balanced and steady manner in 2021.
According to the semi annual report of Citic Securities Company Limited(600030) 2021, as of June 30, 2021, the total asset management of Citic Securities Company Limited(600030) was 1.4 trillion yuan, and the business revenue was about 6.36 billion yuan, an increase of 56% over the same period last year. In terms of investment banking business, according to incomplete statistics of the reporter, Citic Securities Company Limited(600030) sponsored 67 projects last year, ranking first in the market. The underwriting amount is also far ahead of the absolute value of 84.956 billion yuan.
In addition to asset management and investment banking, the wealth management business of Citic Securities Company Limited(600030) is also a major attraction.
According to the data of China Foundation Association, by the end of the third quarter of 2021, Citic Securities Company Limited(600030) had firmly taken the top position in the sales scale of securities companies’ equity + hybrid public funds, ranking first.
Although there is still a certain gap with the leading commercial banks in the fund consignment market, it is understood that in terms of product ownership, Citic Securities Company Limited(600030) public offering and private placement products have reached 400 billion. The proportion of wealth management income has also increased from 16% to 28%. The income of wealth management sector has become one of the most important income growth points of Citic Securities Company Limited(600030) .
small and medium-sized securities companies increased surprisingly
Central China Securities Co.Ltd(601375) becomes the largest “dark horse”
Among the six listed securities companies that disclosed the performance pre increase announcement, Central China Securities Co.Ltd(601375) became the largest “dark horse” in 2021.
On January 10, Central China Securities Co.Ltd(601375) announced that the net profit attributable to the parent company in 2021 is expected to increase by 376 million yuan to 456 million yuan year-on-year, with a year-on-year increase of 360.2% ~ 436.9%.
Central China Securities Co.Ltd(601375) said that in 2021, the multi-level capital market continued to improve, the capital market flourished, actively grasped market opportunities, continuously improved core competitiveness, and the main businesses such as investment banking and primary and secondary market investment developed steadily.
Public data show that in 2021, the company completed 13 IPO lead underwriting projects and 6 refinancing lead underwriting projects of listed companies. The amount of equity lead underwriting in Shanghai and Shenzhen stock markets totaled 11.083 billion yuan, a year-on-year increase of 24.95%. According to the 2021 semi annual report, Central China Securities Co.Ltd(601375) the investment banking revenue in the first half of last year was about 260 million yuan, far exceeding the 180 million yuan in 2020.
The net profit of Guosheng securities also increased by 162.67% year-on-year. Guosheng securities parent company Guosheng Financial Holding Inc(002670) is therefore expected to turn loss into profit in 2021. Guosheng Financial Holding Inc(002670) said, “in 2021, the company’s primary task was to stabilize its operation and prevent risks. All businesses operated stably and turned losses into profits. The main reasons for the changes in performance during the reporting period were the growth of net operating income, the increase of income from changes in fair value and the reversal of credit impairment losses affected by the stock market.”
In terms of changes in fair value, Guosheng securities reduced its loss from 250 million yuan in 2020 to 13.23 million yuan in 2021. At the same time, in terms of credit impairment loss, it reversed 114 million yuan, which helped its net profit increase significantly, but its revenue only increased by 10.77% year-on-year.
The sharp rise in net profit of Jianghai securities is also mainly due to the reversal of credit impairment losses. According to the announcement, the operating revenue of Jianghai securities in 2021 was 1.272 billion yuan, a year-on-year decrease of 26%. However, the net profit increased by 210% year-on-year to 186 million yuan.
The “abnormal situation” of declining revenue and sharp increase in net profit of Jianghai securities is mainly due to the credit impairment loss of 232 million yuan in 2021, a year-on-year decrease of 567 million yuan.
proprietary investment tests the profitability of securities companies
Among the 10 securities subsidiaries of listed companies that disclosed their performance (Unaudited), Anxin securities in South China was the most surprising.
Sdic Capital Co.Ltd(600061) on January 17, the unaudited financial statements of its subsidiary Anxin securities in 2021 were disclosed. Anxin securities achieved an annual operating revenue of 9.044 billion yuan, a year-on-year decrease of 3.98%; The net profit was 3.363 billion yuan, a slight increase of 3.25%.
From the perspective of specific business, the brokerage, investment banking and investment income of Anxin securities increased in 2021, especially the income of investment banking reached 1.443 billion yuan, a year-on-year increase of 44.63%.
The loss of proprietary investment is likely to be the main reason for the weak performance growth of Anxin securities. According to the financial report, Anxin securities lost 576 million yuan from changes in fair value in 2021, while the gain from changes in fair value in the same period in 2020 reached 1.23 billion yuan.
Similarly, there are also losses in the self operated part of small and medium-sized securities companies. According to the announcement, the brokerage, investment banking, asset management and other business income of Donghai securities in 2021 was basically the same as that in 2020. The “income from changes in fair value” with the largest change lost 487 million yuan, while the income from changes in fair value in the same period in 2020 reached 472 million yuan.
As a result, the revenue and net profit of Donghai securities have both halved. In 2021, it achieved an operating revenue of 1.078 billion yuan and a net profit of 151 million yuan, down 48.96% and 56.86% respectively year-on-year.
In addition, the same decline in net profit of Minmetals securities is mainly due to the decline in investment income. However, different from the above two, Minmetals securities mainly reduced the income of equity investment projects by 58.03% year-on-year, and the changes in fair value changed from negative to positive, to 38.83 million yuan, but it still reduced the self operated business income by 48.3% in 2021.
Everbright Securities Company Limited(601788) however, due to the significant increase in investment income, the net profit attributable to the parent company increased by 50% year-on-year under the condition of declining operating profit.
According to the performance pre increase announcement, the company achieved an operating revenue of 16.705 billion yuan in 2021, an increase of 5% over the previous year, but the operating profit decreased by 1.94%; The net profit attributable to shareholders of listed companies was 3.501 billion yuan, an increase of 50% over the previous year.
For the main reason for the expected increase in performance in the current period, Everbright Securities Company Limited(601788) explained that due to the growth of wealth management business income, institutional business income, bond underwriting and trading business income over the same period of the previous year, asset impairment losses and estimated liabilities decreased significantly compared with the previous year.
