Welcome to this week’s edition of top stock market highlights.
Grab Holdings (NASDAQ: GRAB)
Grab released another strong set of earnings for the second quarter of 2024 (2Q 2024) and the first half of this year (1H 2024).
Revenue rose 17% year on year to US$664 million and the delivery and mobility giant reduced its operating loss by 68% year on year to US$56 million.
Loss for the quarter stood at US$68 million and more than halved from the US$148 million net loss in the prior year.
The company generated a positive free cash flow of US$253 million for 2Q 2024, reversing the negative free cash flow of US$76 million in 2Q 2023.
Grab’s monthly transacting units (MTUs) hit a record high for the quarter at 40.9 million, up 17% year on year, and have grown for six consecutive quarters.
On-demand gross merchandise value (GMV), which is the sum of the GMV across its Mobility and Deliveries segments, climbed 13% year on year to US$4.4 billion.
Digging into each division, Grab’s largest division, Deliveries, logged revenue of US$356 million, up 11% year on year.
The adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) for the division more than quadrupled year on year to US$42 million.
Mobility division delivered even better growth with revenue rising 19% year on year to US$247 million.
Adjusted EBITDA improved by 14% year on year to US$129 million.
Grab’s smallest division, Financial Services, saw revenue jump 54% year on year to US$60 million but generated negative EBITDA of US$24 million for the quarter.
The better top-line performance was due to a 71% year-on-year increase in Grab’s loan portfolio to US$397 million.
Looking ahead, Grab expects 2024 revenue to come in between US$2.7 billion to US$2.75 billion for a 14% to 17% year-on-year growth.
Free cash flow for the year is also projected to be positive.
Temasek’s Chinese bonds
Temasek Financial (I), a wholly-owned subsidiary of Temasek Holdings, has issued US$1 billion 10-year and US$1.7 billion 30-year offshore Chinese yuan bonds at par value.
The 10-year bond has a yield-to-maturity (YTM) of 2.75% per annum while the 30-year bond’s YTM stood at 3.1% per annum.
These bonds, which pay semi-annual coupons, will be issued under Temasek’s US$25 billion guaranteed global medium-term note programme.
The proceeds will be used to fund Temasek’s ordinary course of business.
This latest bond offering comes on the heels of three offshore Chinese yuan bond issuances – one in February and two in March.
Back then, the investment firm raised a total of 1.6 billion yuan (around S$293 million), representing the first time that Temasek issued this type of bond.
Sea Limited (NYSE: SE)
Sea Limited also released its 2Q 2024 earnings recently.
Total revenue rose 23% year on year to US$3.8 billion for the quarter, led by a strong performance from its e-commerce division (Shopee).
Shopee’s revenue jumped 30.4% year on year to US$3 billion but this was offset by a 17.7% year-on-year revenue decline to US$ 435.6 million for Sea’s digital entertainment (Garena) division.
Operating profit plunged nearly 71% year on year to US$82.9 million and was impacted by a sharp 57% year-on-year surge in sales and marketing expenses to US$774.8 million.
Sea reported a net profit of US$79.9 million for 2Q 2024, down three-quarters year on year from last year’s US$331 million.
Digging further into each division, Shopee saw its GMV increase by 29.4% year on year to US$23.3 billion.
Gross orders on the division’s e-commerce platform shot up nearly 39% year on year to 2.5 billion.
Management believes that Shopee should become adjusted EBIDTA positive in 3Q 2024 and is revising the full-year GMV growth rate to the mid-20% region.
Over at Garena, its popular Free Fire game continued to be the most downloaded game globally during the quarter.
The multiplayer online game saw more than 100 million daily active users (DAU) every day throughout 2Q 2024, a testament to the game’s consistent popularity.
Quarterly active users (QAU) for 2Q 2024 came in at 648 million, up 19% year on year.
The more important metric, quarterly paying users, increased by 22% year on year to 52.5 million.
Despite the improvement, Garena still saw a 29% year-on-year fall in operating profit to US$210 million for the quarter.
For its Digital Financial Services division, total loans hit US$3.5 billion and were up 40% year on year.
The division made good progress in registering over four million first-time borrowers for its credit products, which was more than double the number onboarded in the prior year’s quarter.
Investors will also be pleased to note that the business generated an operating cash flow of US$1.1 billion and spent just US$91 million on capital expenditures.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
The post Top Stock Market Highlights of the Week: Grab Holdings, Temasek’s Chinese Bonds and Sea Limited appeared first on The Smart Investor.