Cheche Group reports improved financial performance for Q2 2024

Cheche Group reports improved financial performance for Q2 2024 | Insurance Business Asia

Insurance News

Cheche Group reports improved financial performance for Q2 2024

CEO highlighted key factors to growth

Insurance News

By
Jonalyn Cueto

Cheche Group Inc. has announced its unaudited financial results for the second quarter ended June 30, 2024. The company reported modest revenue growth alongside significant reductions in net losses.

For the second quarter of 2024, Cheche’s net revenues rose by 2.5% year-over-year to RMB851.8 million (US$117.2 million). The increase, according to a news release, reflects continued expansion in its insurance transactions, supported by partnerships and a growing platform. Revenue for the first half of 2024 also saw a 1.8% increase, reaching RMB1.6 billion (US$225.5 million).

Cheche achieved a notable reduction in net losses, which decreased by 16.4% to RMB23.6 million (US$3.2 million) from RMB28.3 million in the previous year. Adjusted net loss for the quarter, a non-GAAP measure, fell by 38.8% to RMB12.2 million (US$1.7 million), improving from RMB20.0 million a year earlier.

The company reported a total of RMB5.6 billion (US$0.78 billion) in written premiums for the quarter, unchanged from the previous year but reflecting an overall increase of 4.2% to RMB11.1 billion (US$1.5 billion) for the first half of 2024.

Operational highlights

Cheche’s performance was bolstered by a substantial increase in the number of insurance policies issued. For the second quarter, policies issued rose by 11.1% to 4.0 million, and for the first half, the increase was 15.9% to 8.0 million.

Significant growth was observed in the company’s partnerships with new energy vehicle (NEV) manufacturers. Collaborations with 12 NEV companies led to 225,000 policies embedded in new NEV deliveries, contributing RMB662.6 million (US$91.2 million) in premiums—a 147.3% increase in policies and a 99.6% rise in premiums compared to the previous year.

For the first half of 2024, policies embedded in NEV deliveries reached 344,000, generating RMB1.0 billion (US$142.1 million) in premiums, marking growths of 140.6% and 91.3%, respectively.

“Cheche reported positively-trending bottom-line results and continues to see revenue growth driven in part by increased engagement with our ever-evolving technology platform,” said Lei Zhang, founder, CEO, and chairman of Cheche.

Zhang highlighted the rebound in NEV sales and the company’s strengthened partnerships with major NEV manufacturers as key factors in the company’s growth. He also noted the positive impact of recent collaborations with Volkswagen (Anhui), Xiaomi Group, and other industry leaders.

The company saw an increase in operating expenses, with selling and marketing costs rising by 14.2% to RMB19.3 million (US$2.7 million) and general and administrative expenses up by 41.8% to RMB27.7 million (US$3.8 million). Research and development expenses decreased by 21.1% to RMB9.1 million (US$1.3 million).

Outlook

Cheche Group has reaffirmed its revenue and premium growth forecasts for the full year 2024. The company anticipates net revenues between RMB3.5 billion and RMB3.7 billion, a year-over-year increase of 6.1% to 12.1%. Total written premiums are expected to range from RMB24.5 billion to RMB26.5 billion, reflecting an increase of 8.4% to 17.3% compared to the previous year.

Cheche announced hosting a conference call to discuss the second quarter results on August 29, 2024, at 8:00 a.m. EDT. Details for the call are available on the company’s investor relations website.

Founded in 2014, Cheche Group is an auto insurance technology platform headquartered in Beijing. It has 108 branches across 25 provinces, autonomous regions, and municipalities in China.

Do you have something to say about the recent results? Let us know in the comments below.