Financial Performance - The Group's revenue for the period was RMB6,003.4 million, a decrease of 2.7% compared to RMB6,168.3 million in the same period of 2022[4][6]. - Profit for the period increased significantly by 141.1% to RMB232.6 million, with profit attributable to owners of the parent rising by 161.3% to RMB209.1 million[4][5]. - Basic and diluted earnings per share for the period were RMB0.15[4][5]. - The Group's gross profit increased by 19.3% to RMB818.0 million, with the overall gross profit margin rising from 11.1% to 13.6%[12][18]. - The Group's cost of sales decreased by 5.4% to RMB 5,185.4 million, down from RMB 5,482.9 million, attributed to a shift in revenue mix towards higher margin products[48]. - Profit before tax for the Period was RMB265.7 million, compared to RMB144.5 million for the six months ended 30 June 2022, reflecting a significant increase[147]. - Income tax expenses decreased by 31.3% from RMB48.1 million for the six months ended 30 June 2022 to RMB33.0 million for the Period, mainly due to a decrease in taxable profit[147]. - The Group recorded a profit for the Period of RMB232.6 million, up from RMB96.5 million for the six months ended 30 June 2022, with profit attributable to owners of the parent at RMB209.1 million[147]. Revenue Breakdown - Revenue from the Power Solutions business slightly increased by 1.9% to RMB5,006.9 million, while revenue from the Recycled Lead business decreased by 20.7% to RMB996.5 million[6]. - Revenue from power solutions increased by 1.9% to RMB 5,006.9 million, while revenue from recycled lead products decreased by 20.7% to RMB 996.5 million[128]. - The total revenue from reserve power batteries was RMB 2,853.2 million, accounting for 47.5% of total revenue, with a slight decrease of 3.1% compared to the previous year[131]. - The SLI battery business contributed 24.5% of total sales, with revenue of RMB1,469.1 million, an increase of 4.4% year-on-year[104]. - The motive power battery segment contributed 10.4% of total sales, with revenue of RMB621.8 million, representing a 16.3% increase compared to the previous year[106]. - Sales revenue from power batteries amounted to RMB 621.8 million, a 16.3% increase compared to RMB 534.6 million in the same period last year[116]. - Sales revenue from lead recycling products was RMB 996.5 million, a decrease of 20.7% from RMB 1,257.1 million in the same period last year[117]. Dividends and Shareholder Information - An interim dividend of HK4 cents per share has been recommended for the Period, compared to nil for the same period last year[34]. - The Board proposed an interim dividend of HK 4 cents per share, compared to no dividend in the same period last year[70]. - As of 30 June 2023, Dr. DONG Li beneficially owns 1,014,021,000 shares, representing 74.47% of the total shares issued[38]. - The total number of shares in issue as of 30 June 2023 is 1,361,707,666[38]. - Ms. YIN Haiyan holds 3,650,000 shares, which includes options granted under the 2010 Share Option Scheme and the New Share Option Scheme[38]. Operational Developments - The Group plans to enhance its global production layout and expand its product range to meet the increasing demand for energy storage and starting batteries[1]. - A flagship factory in Anhui will focus on lithium battery production, with plans to gradually increase annual production capacity[1]. - The Group intends to establish a battery assembly plant in Mexico to extend its production lines into the North American market[1]. - The Group plans to commence construction of a battery assembly plant in Mexico within the year to serve the North American market[112]. - The Group signed an agreement in July to acquire 70% stakes in Tianjin Jieshi Battery Co., Ltd. and Shunde Yuasa Battery Co., Ltd. for approximately HK$230 million, aiming to enhance cooperation and expand business scale[127]. Employee and Expense Information - As of June 30, 2023, the Group had 13,019 employees, with employee benefit expenses totaling RMB 533.1 million, up from RMB 488.0 million in the previous year[48]. - The Group's selling and distribution expenses decreased by 29.0% from RMB 301.7 million in the first half of 2022 to RMB 214.3 million in the current period[139]. - Administrative expenses increased by 28.2% from RMB 152.1 million in the first half of 2022 to RMB 195.0 million, primarily due to increased staff costs[139]. - Research and development expenditure rose by 31.5% from RMB 122.2 million in the first half of 2022 to RMB 160.7 million, aimed at enhancing product performance and developing new products[139]. Financial Position and Borrowings - As of June 30, 2023, the Group's bank borrowings amounted to RMB2,916.8 million, with an effective interest rate range of 1.88% to 8.10%[22]. - The Group's bank borrowings are secured by various assets including properties, equipment, and trade receivables[32]. - The Group's gearing ratio as of June 30, 2023, was 25.9%, slightly up from 25.8% at the end of 2022[141]. - The Group's cash and bank deposits amounted to RMB1,139.9 million as of 30 June 2023, compared to RMB1,230.0 million as of 31 December 2022[147]. - The Group's finance costs increased by 32.3% from RMB74.1 million for the six months ended 30 June 2022 to RMB98.1 million for the Period due to higher average interest rates[147]. Market Outlook and Trends - The average growth rate of the Group's battery business in China was over 27% in terms of turnover during the first half of 2023[87]. - The Group expects overseas shipments to recover in the second half of the year, while growth in China is anticipated to continue[102]. - The global start-stop battery market size is projected to grow from US$70.6 billion in 2022 to US$273.4 billion in 2032, representing a compound annual growth rate of 14.5%[110]. - The market size of data centers is expected to rise from US$5 billion in 2023 to over US$120 billion in 2030, with a compound annual growth rate of 12%[119]. - The market size of household energy storage products is expected to grow from approximately US$4.38 billion in 2023 to US$16.75 billion in 2028, representing a compound annual growth rate of 24.4%[124]. Risks and Challenges - The Group's financial performance is subject to foreign exchange risk[44]. - The decrease in recycled lead revenue was attributed to increased internal sales to battery factories and a reduction in sales to unprofitable third-party accounts[107]. - The Group's profit contribution from the recycled lead business has improved, as reflected in the profit attributed to minority interest[107].

Financial Performance - Revenue for the six months ended June 30, 2023, decreased by 2.7% to RMB 6,003.4 million compared to RMB 6,168.3 million in the same period of 2022[8]. - Gross profit increased by 19.3% to RMB 818.0 million, with a gross margin improvement from 11.1% to 13.6%[9]. - Profit for the period surged by 141.1% to RMB 232.6 million, up from RMB 96.5 million in the previous year[9]. - Profit attributable to equity holders of the parent increased by 161.3% to RMB 209.1 million, compared to RMB 80.0 million in the same period last year[9]. - The total comprehensive income for the period was RMB 312.4 million, compared to RMB 132.3 million in the same period last year[11]. - The total revenue for the six months ended June 30, 2023, was RMB 6,003,416, a decrease of 2.67% from RMB 6,168,315 in the same period of 2022[27]. - The company's net profit for the same period was RMB 232.6 million, an increase of 141.1% year-on-year, with profit attributable to equity holders rising by 161.3% to RMB 209.1 million[103]. Dividends and Shareholder Returns - The company declared an interim dividend of 4 HK cents per share, with a payout ratio of 24.0%[8]. - The group proposed an interim dividend of HKD 0.04 per share, compared to no dividend for the previous period[135]. Revenue Breakdown - Revenue from the power solutions business increased to RMB 5,006,921, up 1.99% from RMB 4,911,188 in the previous year[27]. - Revenue from lead recycling business decreased to RMB 996,495, down 20.73% from RMB 1,257,127 in the previous year[27]. - Revenue from mainland China was RMB 3,662,189, an increase of 9.39% from RMB 3,347,229 in the previous year[29]. - Revenue from the Americas decreased to RMB 805,290, down 31.73% from RMB 1,179,691 in the previous year[29]. - The backup battery business contributed 47.5% to total sales, with revenue of RMB 2,853.2 million, a decrease of 3.1% from RMB 2,945.4 million in the same period last year[82]. - The starting battery business accounted for 24.5% of total sales, with revenue of RMB 1,469.1 million, an increase of 4.4% from RMB 1,406.9 million in the same period last year[90]. - The power battery segment achieved revenue of RMB 621.8 million, a 16.3% increase from RMB 534.6 million in the same period last year[91]. Expenses and Costs - Research and development costs rose to RMB 160.7 million, up from RMB 122.2 million in the previous year, reflecting the company's strategy for further growth[9]. - The company reported a significant increase in administrative expenses, which rose to RMB 195.0 million from RMB 152.1 million[9]. - The total employee benefits expenses increased to RMB 533,088, up 9.16% from RMB 487,994 in the previous year[39]. - Financial costs increased to RMB 98,058, up 32.23% from RMB 74,120 in the previous year[42]. - Selling and distribution expenses decreased by 29.0% from RMB 301.7 million to RMB 214.3 million, attributed to the reclassification of transportation costs[112]. - Administrative expenses increased by 28.2% from RMB 152.1 million to RMB 195.0 million, mainly due to rising employee costs[113]. - Research and development expenses grew by 31.5% from RMB 122.2 million to RMB 160.7 million, focused on enhancing product performance and developing new products[122]. Assets and Liabilities - Non-current assets totaled RMB 3,756.9 million as of June 30, 2023, compared to RMB 3,704.9 million at the end of 2022[13]. - Current assets increased to RMB 7,503.8 million from RMB 6,789.5 million at the end of the previous year[13]. - Current liabilities increased to RMB 6,517,476 thousand as of June 30, 2023, compared to RMB 6,208,599 thousand as of December 31, 2022, reflecting a growth of 4.98%[15]. - Net current assets rose significantly to RMB 986,275 thousand from RMB 580,883 thousand, marking an increase of 69.5%[15]. - Total assets minus current liabilities reached RMB 4,743,238 thousand, up from RMB 4,285,796 thousand, indicating a growth of 10.67%[15]. - Non-current liabilities totaled RMB 483,480 thousand, a substantial increase from RMB 249,561 thousand, representing a growth of 93.8%[15]. - Equity attributable to owners of the parent company increased to RMB 4,022,229 thousand from RMB 3,822,278 thousand, reflecting a growth of 5.23%[15]. - The company’s total liabilities increased to RMB 2,489,171,000 as of June 30, 2023, from RMB 2,361,044,000 as of December 31, 2022, marking an increase of 5.4%[64]. Market and Strategic Initiatives - The company is engaged in power solutions and lead recycling, indicating a focus on sustainable and innovative business practices[17]. - The company plans to strengthen cooperation with telecom operators and invest in research and development to capture opportunities in the energy storage market[94]. - The company aims to expand into new segments such as solar and wind energy while continuing to grow its replacement market[94]. - The sales of start-stop batteries are expected to benefit from the growing demand for new energy vehicles, with a projected global market size increase from USD 70.6 billion in 2022 to USD 273.4 billion by 2032, reflecting a compound annual growth rate of 14.5%[96]. - The home energy storage market is anticipated to grow from approximately USD 4.38 billion in 2023 to USD 16.75 billion by 2028, at a compound annual growth rate of 24.4%[98]. - The company plans to enhance its production capacity in its flagship factory in Anhui, focusing on lithium battery production, and aims to establish a battery assembly plant in Mexico to expand its North American presence[99]. Other Financial Information - The company recognized foreign exchange gains of RMB 74,189, compared to gains of RMB 54,159 in the previous year[39]. - The total income tax expense for the six months ended June 30, 2023, was RMB 33,034,000, a decrease of 31.3% from RMB 48,060,000 in the same period of 2022[8][9]. - The group recorded a profit before tax of RMB 265.7 million, compared to RMB 144.5 million for the previous period[117]. - The group had no impairment losses recognized for the six months ended June 30, 2023[56]. - The group recognized a net loss of RMB 2,101,000 from the sale of assets with a carrying amount of RMB 8,392,000 during the six months ended June 30, 2023[49].

Stock Options - The number of stock options available for grant under the new stock option plan decreased from 115,314,466 shares at the beginning of the period to 77,814,466 shares at the end of the period[6]. - The total number of shares available for issuance under the 2010 stock option plan and the new stock option plan is 24,095,000 shares and 131,297,466 shares, respectively, which represent approximately 1.70% and 9.28% of the total shares issued as of the date of the annual report[10]. - The number of new stock options granted during the period was 37,500,000 shares, calculated against the weighted average number of shares issued during the period of 1,357,854,935 shares, resulting in a ratio of 0.0276[3].

Financial Performance - For the year ended December 31, 2022, the Group's revenue increased by 13.6% to approximately RMB12,845.9 million compared to RMB11,303.1 million in 2021[14]. - Gross profit for the same period rose by 5.6% to RMB1,594.8 million, up from RMB1,509.7 million in 2021[14]. - Profit attributable to owners of the parent surged by 225.3% to RMB442.8 million, compared to RMB136.1 million in the previous year[14]. - Basic earnings per share increased to RMB0.33 from RMB0.10 in 2021, based on a weighted average of 1,357,854,935 shares issued during the year[17]. - The Group's overall revenue for the year reached RMB12,845.9 million, a 13.6% increase from RMB11,303.1 million in 2021[41]. - Profit for the period amounted to RMB464.4 million, compared to RMB166.7 million for the year ended December 31, 2021, with profit attributable to owners of the parent at RMB442.8 million[123]. Dividends and Shareholder Returns - The Board recommended a final dividend of 10 HK cents per share for the year ended December 31, 2022, compared to no dividend in 2021[18]. - The Group did not declare or pay any interim or special dividends during the year ended December 31, 2022[19]. Revenue Breakdown - Revenue from the battery business amounted to RMB10,432.8 million, a 12.8% increase from RMB9,249.2 million in the same period of 2021, driven by a 25.8% growth in overseas markets and 1.9% in the PRC market[39]. - Sales of reserve power batteries reached RMB6,006.1 million, representing a 26.2% increase compared to RMB4,758.9 million in 2021, accounting for approximately 57.6% of total battery sales revenue[44]. - Revenue from recycled lead products was RMB2,413.0 million, an increase of 17.5% from RMB2,053.9 million in 2021, despite higher collection costs impacting profit margins[56]. - SLI battery sales decreased by 4.9% to RMB2,860.1 million from RMB3,006.0 million in 2021, representing 27.4% of total battery sales revenue[46]. - Motive power batteries recorded sales revenue of RMB1,258.3 million, a 2.9% increase from RMB1,223.1 million in 2021, accounting for approximately 12.1% of total battery sales revenue[51]. Market Expansion and Strategy - The Group plans to expand its business with key accounts and strengthen its distribution sales network in various battery segments, with a focus on the aftermarket as a driving engine for sales and profit[28]. - The lithium battery and Energy Storage System applications are identified as another key growth driver for the company[28]. - The Group's sales network spans over 100 countries and regions, with more than 80 sales offices and centers globally, employing over 700 dedicated sales and marketing staff[57]. - The Group anticipates that the APAC region will be a major contributor to overseas business growth in 2023, driven by China's economic recovery[112]. - The Group aims to expand its market share in China by investing sufficient resources in the new energy vehicle segment, which includes partnerships with major domestic brands[100]. Research and Development - The company is investing more in technology and product development, with a R&D team of 1,000 engineers, enabling the production of over 3,000 different battery models and holding more than 900 patents[29]. - R&D expenses surged by 59.9% to RMB 382.9 million, focusing on enhancing existing products and developing new ones[144]. - The battery R&D team consists of over 350 researchers and technicians, focusing on new models of lead-acid and lithium-ion batteries[62][64]. Economic and Market Conditions - The global economic growth is projected to fall to 2.9% in 2023, with inflation expected to decrease to 6.6%[78][81]. - The automobile market in China is expected to grow at a rate of approximately 3% in 2023, supported by economic stabilization policies and alleviation of chip supply shortages[96]. - The demand for reserve power batteries for 5G applications in the PRC market is increasing, with expectations for further growth due to infrastructure development[89][92]. Operational Efficiency - The Group's cost of sales increased by 14.9% to RMB 11,251.1 million, primarily due to increased sales volume[136]. - Gross profit rose by 5.6% to RMB 1,594.8 million, but the overall gross profit margin decreased from 13.4% in 2021 to 12.4% in 2022[137]. - The Group's factory has maintained full capacity operations despite industry-wide challenges, contributing to sustained growth in recycled lead output[118]. Employee and Workforce Management - Employee benefit expenses totaled RMB1,053.1 million for the period, an increase from RMB1,020.2 million in 2021, covering wages, bonuses, and retirement benefits[191]. - The Group has established a share option scheme for selected participants to incentivize and reward contributions[193]. - The Group encourages continuous education and training for employees to enhance their skills and personal development[193]. Future Outlook - The Group plans to invest in a battery assembly plant in Mexico in 2023 to enhance competitiveness in the Americas[67]. - The establishment of a lithium battery recycling business is planned for 2023, following a careful evaluation of the industry's future prospects[119].

Financial Performance - For the fiscal year ending December 31, 2022, the sales and distribution costs increased by 38.6% from RMB 586.1 million in 2021 to RMB 812.0 million[3] - The gross profit for the fiscal year 2022 rose by approximately 33.6%, increasing from RMB 1,509.7 million in 2021 to RMB 2,017.7 million[3] - The gross margin improved from approximately 13.4% in 2021 to 15.7% in the fiscal year 2022[3] - The sales and distribution costs for the fiscal year 2022 decreased by 33.6% to RMB 389.2 million, primarily due to the inclusion of transportation costs in the sales cost[6]

Leoch International Technology Limited 理士國際技術有限公司 （於開曼群島註冊成立的有限公司） （股份代號：842） | --- | --- | --- | --- | |---------------------------|---------------------------|-------------------------|--------| | | | | | | | | | | | 財務摘要 | | | | | | 二零二二年 人民幣百萬元 | 二零二一年 人民幣百萬元 | 變動 | | 營業額 | 12,845.9 | 11,303.1 | 13.6% | | 毛利 | 1,594.8 | 1,509.7 | 5.6% | | 本年度溢利 | 464.4 | 166.7 | 178.6% | | 母公司擁有人應佔溢利 | 442.8 | 136.1 | 225.3% | | 每股基本盈利 （人民幣） | 0.33 | 0.10 | | | 建議每股末期股息 （港仙） | 10.0 | 無 | | 全年業績 | --- | --- | --- | --- | ...

Financial Performance - The Group's turnover for the six months ended June 30, 2022, was approximately RMB 6,168.3 million, representing a 19.1% increase from RMB 5,180.5 million in the same period of 2021[13]. - Gross profit for the same period was RMB 685.4 million, a decrease of 8.0% compared to RMB 744.9 million in 2021[13]. - Profit for the period increased by 116.9% to RMB 96.5 million, up from RMB 44.5 million in the previous year[13]. - Profit attributable to owners of the parent reached RMB 80.0 million, marking a significant increase of 174.3% from RMB 29.2 million in 2021[13]. - Basic earnings per share for the period was RMB 0.06, compared to RMB 0.02 in the same period last year[15]. - Other income and gains surged by 617.0% to RMB 114.5 million, mainly driven by increased exchange gains and government grants[83]. - Profit before tax rose to RMB 144.5 million, compared to RMB 55.5 million for the same period in 2021[93]. - Income tax expenses increased by 335.4% to RMB 48.1 million, attributed to a rise in assessable profit[94]. - Total comprehensive income for the period reached RMB 132,295,000, a significant increase of 167% compared to RMB 49,545,000 in the same period last year[193]. Revenue Breakdown - Revenue from the Power Solutions business amounted to RMB 4,911.2 million, a 15.6% increase from RMB 4,248.0 million in the same period last year[33]. - The Recycled Lead business generated revenue of RMB 1,257.1 million, reflecting a 34.8% increase from RMB 932.5 million in the corresponding period of 2021[44]. - The reserve power battery business accounted for 47.7% of total sales, with sales revenue of RMB 2,945.4 million, up 45.2% from RMB 2,028.1 million in the previous year[37]. - The SLI battery business contributed 22.8% of total sales, with revenue of RMB 1,406.9 million, a slight decrease of 1.3% from RMB 1,425.9 million in the same period last year[39]. - The motive power battery segment represented 8.7% of total sales, with revenue of RMB 534.6 million, down 2.4% from RMB 547.9 million in the previous year[42]. - The Group's recycled lead business contributed 20.4% of total sales, but rising costs of scrap batteries negatively impacted gross profit margins[44]. Operational Overview - The Group operates over 80 sales offices and centers globally, serving battery customers in more than 100 countries[24]. - The Group has eleven manufacturing facilities located in the PRC, Vietnam, Malaysia, India, and Sri Lanka[24]. - The Power Solutions business is categorized into three major applications: reserve power batteries, SLI batteries, and motive power batteries[24]. - The Group is also engaged in the recycled lead business in the People's Republic of China[23]. Cost and Expenses - Selling and distribution expenses increased by 21.9% to RMB 301.7 million, primarily due to rising freight charges and export-related expenses[84]. - Research and development costs decreased by 29.1% to RMB 122.2 million, mainly due to the completion of recycling skill improvements[90]. - The Group's cost of sales increased by 23.6% to RMB 5,482.9 million, primarily due to increased sales volume[78]. - Gross profit decreased by 8.0% to RMB 685.4 million, with a gross profit margin of 11.1%, down from 14.4% in the previous year[81]. Economic Context - Global economic growth is projected to slow from around 6% last year to 3.2% in 2022, with inflation revised up to 8.3% due to rising food and energy prices[48]. - The PRC government has adjusted its GDP growth target for 2022 from "around 5.5%" to a focus on stabilizing employment and prices[49]. - China's reserve power batteries shipment grew by over 30% in tonnage compared to the same period in 2021, indicating strong market demand[52]. Shareholder Information - Dr. DONG Li beneficially owns 1,009,513,000 shares, representing 74.35% of the issued share capital[134]. - Ms. YIN Haiyan has been granted options for 1,500,000 shares and 1,000,000 shares under the 2010 Share Option Scheme and the New Share Option Scheme respectively[134]. - Mr. CAO Yixiong Alan and Mr. LAU Chi Kit have both been granted options for 800,000 shares under the 2010 Share Option Scheme[134]. - The total issued shares as of June 30, 2022, was 1,357,854,666 shares[134]. - The New Share Option Scheme allows the issuance of a maximum of 135,764,466 shares, representing 10% of the issued shares as of the extraordinary general meeting on October 30, 2020[150]. Corporate Governance - The Company has confirmed compliance with the Model Code for Securities Transactions by Directors during the reporting period[166]. - The Company has maintained high standards of corporate governance, meeting the provisions of the Corporate Governance Code during the period[169]. - The Audit Committee has reviewed the unaudited financial statements and discussed accounting principles and internal control matters with management and auditors[170].

Financial Performance - Revenue for 2021 reached RMB 11,303,125, an increase of 17.4% from RMB 9,631,362 in 2020[14] - Gross profit for the year was RMB 1,509,706, reflecting a growth of 27.0% compared to RMB 1,188,279 in 2020[14] - Profit for the year amounted to RMB 166,729, which is a 20.8% increase from RMB 137,964 in the previous year[14] - Profit attributable to owners of the parent was RMB 136,126, up 10.0% from RMB 123,732 in 2020[14] - Basic earnings per share increased to RMB 0.10, compared to RMB 0.09 in 2020[14] - The Group's gross profit rose by 27.0% to RMB 1,509.7 million, with the overall gross profit margin increasing from 12.3% in 2020 to 13.4%[144] - Profit before tax increased to RMB 192.0 million from RMB 161.7 million in 2020, reflecting improved operational performance[159] - Net profit for the period was RMB 166.7 million, up from RMB 138.0 million in 2020, with profit attributable to owners of the parent rising to RMB 136.1 million from RMB 123.7 million[161] Revenue Breakdown - Revenue from battery sales amounted to RMB 9,249.2 million, an 11.1% increase from RMB 8,324.2 million in 2020, driven by a 27.3% growth in the overseas market[51] - Sales of reserve power batteries reached RMB 4,758.9 million, a 13.7% increase compared to RMB 4,187.1 million in 2020, accounting for approximately 51.5% of total battery sales revenue[55] - Revenue from recycled lead business increased by approximately 57.1% to RMB 2,053.9 million from RMB 1,307.1 million in 2020[51] - Sales of SLI batteries amounted to RMB 3,006.0 million, representing a 4.3% increase from RMB 2,883.1 million in 2020, accounting for approximately 32.5% of total battery sales revenue[58] - The motive power batteries business recorded sales revenue of RMB 1,223.1 million, representing a 9.7% increase from RMB 1,114.6 million in 2020, accounting for approximately 13.2% of total battery sales revenue[64] Market and Economic Outlook - The global economy experienced a strong recovery in 2021, with the Group's business in the EMEA and Americas regions achieving over 36% and 50% year-on-year growth rates respectively during the period[28] - The economic outlook for China in 2022 is predicted to be relatively bright, with GDP growth forecast at over 5%, higher than the global average[35] - The Group anticipates sustained growth in overseas business, despite potential challenges from renewed COVID-19 outbreaks and supply chain disruptions[30] - The World Bank projects global growth to decelerate from 5.5% in 2021 to 4.1% in 2022 due to ongoing COVID-19 disruptions and supply bottlenecks[89] - China's GDP grew by 8.1% in 2021, the largest increase since 2011, but the government set a lower GDP target of 5.5% for 2022, indicating weaker economic expectations[88][91] Production and Capacity - The Group's manufacturing plants, with 85% of production capacity located in China, operated smoothly to meet increasing overseas demand despite a slowdown in local demand[24] - The Group plans to concentrate production capacity resources more in China in the near future to enhance efficiency[29] - The production capacity of the recycling plant was fully utilized at the maximum allowed capacity of 200,000 tons in 2021[80] - The Group's Vietnam factories accounted for 8% of total production capacity in 2021, with an average utilization ratio of 70% due to labor supply issues[75] Research and Development - The Group's R&D team consists of over 350 researchers focused on developing new models of lead-acid and lithium-ion batteries, including those for smart cars[70] - R&D expenditure rose by 38.6% from RMB 172.7 million in 2020 to RMB 239.4 million, primarily for enhancing existing products and developing new products across all categories[151] - The Group is focusing on marketing and R&D for new 5G products, including lithium-ion batteries, to capture opportunities from the rising 5G life cycle in 2022 and beyond[56] Investment and Financial Position - The Group invested RMB282.6 million in property, plant, and equipment for new production facilities during the period, down from RMB520.0 million in 2020[183] - As of December 31, 2021, the Group's net current assets were RMB541.8 million, a decrease from RMB596.4 million in 2020, with cash and bank deposits at RMB951.7 million, up from RMB848.5 million[186] - The Group's bank borrowings totaled RMB2,372.2 million as of December 31, 2021, compared to RMB2,303.3 million in 2020, with effective interest rates ranging from 1.80% to 7.09%[186] - The gearing ratio as of December 31, 2021, was 24.7%, slightly down from 25.4% in 2020, calculated by dividing total borrowings by total assets[187] Challenges and Strategic Focus - The Group plans to continue investing in relevant technology and products, increasing production capacity and flexibility to meet changing client demands[43] - The Group will continue to monitor the global economic outlook and manage overseas resources prudently amid uncertainties[125] - The Group aims to enhance customer satisfaction and solidify its world-class status through competitive pricing, reliable quality, and comprehensive services[42]

Financial Performance - The Group's turnover for the six months ended June 30, 2021, was approximately RMB 5,180.5 million, representing a 40.6% increase from RMB 3,684.2 million in the same period of 2020[12]. - Gross profit for the same period was RMB 745.0 million, up 56.1% from RMB 477.4 million year-on-year[12]. - Profit for the period increased significantly to RMB 44.5 million, a 233.8% rise compared to RMB 13.3 million in the previous year[12]. - Profit attributable to owners of the parent was RMB 29.2 million, reflecting a 15.9% increase from RMB 25.2 million in 2020[12]. - Basic earnings per share remained stable at RMB 0.02 for both 2021 and 2020[14]. - Profit before tax for the period was RMB 55.5 million, compared to RMB 26.1 million in the same period of 2020[83]. - Total comprehensive income for the period reached RMB 49,545,000, a significant increase from RMB 4,701,000 in the previous year, representing a growth of approximately 951%[175]. - The net income attributable to owners of the parent was RMB 34,072,000, compared to RMB 16,890,000 in 2020, marking an increase of about 102%[175]. Revenue Breakdown - Revenue from the Power Solutions business was RMB 4,248.0 million, an increase of 24.7% from RMB 3,405.4 million in the same period last year[31]. - The Recycled Lead business saw revenue of RMB 932.5 million, a significant increase of 234.5% from RMB 278.8 million in the corresponding period of 2020[31]. - Revenue in Mainland China increased by 38.2% to RMB 3,157.5 million, primarily due to increased production output from the Recycled Lead business[68]. - The reserve power battery business accounted for 39.1% of total sales, with sales revenue of RMB 2,028.1 million, a 10.1% increase from RMB 1,842.3 million in the same period last year[37]. - The SLI battery business contributed 27.5% of total sales, with revenue of RMB 1,425.9 million, representing a 35.7% increase from RMB 1,050.7 million in the same period last year[40]. - The motive power battery segment contributed 10.6% of total sales, with revenue of RMB 547.9 million, a 13.7% increase from RMB 481.7 million in the same period last year[40]. Operational Insights - The Group serves battery customers in over 100 countries through more than 80 sales offices and 11 manufacturing facilities located in various countries[22]. - The Group provides backup power solutions to leading telecommunications operators and data center solution providers globally[20]. - The Group anticipates that the new 5G investment cycle will drive growth in the telecommunications and data center backup power solution market in China, presenting new growth opportunities[50]. - The Group has increased resources for research and development to meet the rapid expansion of mobile and data center infrastructure requirements, impacting short-term profitability[50]. Cost and Expenses - Cost of sales rose by 38.3% to RMB 4,435.5 million, primarily due to increased sales[73]. - Selling and distribution expenses increased by 44.4% to RMB 247.5 million, driven by higher freight charges and sales staff commissions[78]. - Research and development expenditure surged by 140.6% to RMB 172.4 million, focusing on performance enhancement of existing products and new product development[78]. - Administrative expenses and research and development costs totaled RMB 143,971 and RMB 172,357 respectively for the six months ended June 30, 2021[167]. Financial Position - As of June 30, 2021, the Group's net current assets were RMB 534.2 million, with cash and bank deposits totaling RMB 858.2 million[83]. - The Group's gearing ratio was 25.2% as of June 30, 2021, slightly down from 25.4% at the end of 2020[86]. - As of June 30, 2021, the Group's bank borrowings amounted to RMB 2,341.6 million, with an interest rate range of 1.80% to 7.90%[88]. - The Group's debt-to-asset ratio was 25.2% as of June 30, 2021, slightly down from 25.4% at the end of 2020[89]. - Current assets totaled RMB 5,828,453,000, up from RMB 5,594,180,000, reflecting an increase of approximately 4.2%[177]. - Total current liabilities amounted to RMB 5,294,298,000, an increase from RMB 4,997,761,000, which is approximately 5.9% higher[179]. - Total equity increased to RMB 3,450,285,000 from RMB 3,399,936,000, showing a growth of approximately 1.5%[181]. Share Options and Corporate Governance - The total number of shares issued as of June 30, 2021, is 1,357,854,666[132]. - The company has authorized a stock option plan allowing for the issuance of up to 135,764,466 shares, representing 10% of the issued shares as of the special meeting date on October 30, 2020[125]. - The company secured a term loan facility of US$100,000,000 to refinance a previous facility and finance working capital, with repayment scheduled in five installments of 15%, 15%, 15%, 15%, and 40% over three years[137][138]. - The company is committed to high standards of corporate governance and believes it has met the relevant code provisions during the reporting period[146]. - The Audit Committee has reviewed the unaudited financial statements and discussed accounting principles and internal controls with management and auditors[148].

Financial Performance - For the year ended December 31, 2020, the Group's revenue increased by 15.2% to approximately RMB9,631.4 million compared to RMB8,362.7 million in 2019[16] - Gross profit for the year was RMB1,188.3 million, reflecting a growth of 17.0% from RMB1,015.4 million in the previous year[16] - Profit attributable to owners of the parent was approximately RMB123.7 million, an increase of 8.2% from RMB127.5 million in 2019[18] - The Group's profit for the year was RMB137.9 million, compared to RMB127.5 million in 2019, indicating a positive trend in profitability[16] - The Group's revenue for the year ended December 31, 2020, amounted to RMB 9,631.4 million, representing a 15.2% increase from RMB 8,362.7 million in 2019[49] - Profit for the period amounted to RMB 138.0 million, compared to RMB 127.5 million in 2019, with profit attributable to the owners of the parent at RMB 123.7 million, down from RMB 132.6 million in the previous year[123] - Basic earnings per share decreased to RMB0.09 from RMB0.10 in 2019, based on a weighted average of 1,357,594,679 shares issued during the year[19] Revenue Breakdown - Revenue from the battery business was RMB 8,324.2 million, a 12.7% increase from RMB 7,386.5 million in 2019, with over 75% of this revenue coming from the PRC market[50] - Sales of reserve power batteries amounted to RMB 4,187.1 million, a 7.0% increase from RMB 3,913.1 million in 2019, accounting for approximately 50.3% of total battery sales[52] - SLI batteries sales increased to RMB 2,883.1 million, a 16.7% rise from RMB 2,470.5 million in 2019, representing about 34.6% of total battery sales[58] - The motive power batteries business recorded sales revenue of RMB1,114.6 million, an increase of 33.7% compared to RMB833.9 million in 2019, accounting for approximately 13.4% of total battery sales revenue[63] - Revenue from recycled lead products amounted to RMB1,307.1 million, representing a 34.6% increase from RMB971.2 million in 2019, with significant output growth after resuming full operations[66] Market and Economic Outlook - The Group plans to continue focusing on market expansion and product development to sustain growth in the coming years[15] - The Group anticipates fierce competition in China, which may lead to oversupply and price wars affecting margins and profits[39] - The global economic recovery in 2021 is uncertain, with many wealthy nations not expected to fully rebound until 2022[38] - China's economy is expected to improve significantly over the next five years, benefiting reserve power battery manufacturers due to strategic technology developments[30] - The dual circulation policy will be central to the 14th Five-Year Plan, promoting mutual reinforcement of domestic and international markets[36] Production and Capacity - Production capacity for the lead-acid plant in the PRC was expanded by 10% to support current and future growth[29] - The production volume of the Group's two new plants in Vietnam reached a 90% occupation rate for the motorcycle battery production lines by the end of 2020[77] - The production capacity for the lead-acid plant was expanded by 10% to support current and future growth, while the lithium-ion battery plant will gradually expand[78] Research and Development - The Group plans to increase investment in R&D for new battery models to meet rapidly changing application needs[41] - R&D expenditure increased by 44.7% from RMB119.3 million in 2019 to RMB172.7 million in 2020, focusing on performance enhancement and new product development[154] - As of December 31, 2020, the battery R&D team consisted of over 350 researchers, and the Group owned 505 patents with another 160 in the application process[72] Employee and Operational Insights - Employee benefit expenses totaled RMB 849.2 million for the period, up from RMB 805.3 million in 2019, reflecting the Group's commitment to employee compensation and benefits[196] - The Group employs 14,553 individuals, emphasizing its workforce size and the importance of employee development and training programs[196] - The Group encourages continuous education and training for employees to enhance skills and personal development, reflecting its commitment to workforce improvement[196] Financial Position and Assets - As of December 31, 2020, the Group's net current assets increased significantly to RMB596.4 million from RMB65.5 million in 2019, mainly due to the reclassification of a term loan[162][167] - Trade receivables increased to RMB2,419.7 million in 2020 from RMB2,306.9 million in 2019, reflecting higher sales from the battery business[171][175] - Other payables and accruals increased to RMB990.0 million in 2020 from RMB854.8 million in 2019, mainly due to higher payables for fixed asset purchases[179] Strategic Initiatives - The Group plans to deepen the franchise store model and optimize agent quality and quantity to improve product turnover efficiency in 2021[110] - The Group is actively promoting green recycling of lead and has established a national recycling network system[117] - The Group has adopted a price-linked pricing mechanism to minimize lead price exposure and centralized procurement to reduce raw material costs[84]