研究报告Research Report 21 Mar 2024 时代天使 Angelalign (6699 HK) 出海逻辑强化第二增长曲线，差异化产品组合及医学服务优势突出 Overseas Expansion Strengthen the Second Growth Curve, With Outstanding Advantages in Differentiated Product Portfolio and Medical Services [观Ta点ble聚_y焦em Ieniv1e]s tment Focus [Tab维le_持Info优] 于大市Maintain OUTPERFORM (Please see APPENDIX 1 for English summary) 事件：公司发布2023年年报 评级 优于大市OUTPERFORM 现价 HK$75.10 第二增长曲线兑现，国际业务加速。2023年公司实现隐形矫治案例总 目标价 HK$103.50 数约 24.50万例（+33%），其中国内 21.20万例（+15%），国际 3.30 万例，国际案例占总案例数达 13%。公司已经搭建起覆盖欧 ...

智通财经APP获悉，时代天使(06699)涨幅扩大逾18%，高见77.4港元创去年7月底以来新高。截至发 稿，涨17.2%，报76.3港元，成交额1.66亿港元。 消息面上，时代天使发布2023年度业绩，该集团取得收入人民币14.76亿元(单位下同)，同比增加 16.24%；公司拥有人应占利润5347.5万元；每股盈利0.32元，拟派发特别末期股息每股1.1港元。期内集 团国内业务保持稳健增长，而国际业务快速发展。整体隐形矫治达成案例数从约18.39万例同比增长 33.2%至约24.5万例。 此外，时代天使昨日宣布，以零代价自合伙企业收购CC Orthodontics所有股权公告，合伙企业旨在投资 全球数字化正畸价值链中的创新数字化技术及产品。CC Orthodontics为合伙企业为投资其投资组合公司 而成立的投资控股公司。截至该公告日期，其已投资全球数字化正畸产业链上的数家公司。 ...

证券研究报告·海外公司点评·医疗保健设备和服务(HS) 时代天使（06699.HK） 2023 年年报点评：全球案例数达 24.5 万例， 2024年 03月 20日 海外表现亮眼 证券分析师 朱国广 买入（维持） 执业证书：S0600520070004 zhugg@dwzq.com.cn [Table_EPS] 盈利预测与估值 2022A 2023A 2024E 2025E 2026E 股价走势 营业总收入（百万元） 1,273 1,476 1,770 2,050 2,431 同比 -0.10% 15.98% 19.89% 15.87% 18.54% 时代天使 恒生指数 13% 归母净利润（百万元） 213.78 53.48 78.43 119.91 163.90 6% -1% 同比 -25.21% -74.99% 46.66% 52.90% 36.68% -8% -15% -22% EPS-最新摊薄（元/股） 1.26 0.32 0.46 0.71 0.97 -29% -36% P/E（现价&最新摊薄） 51.49 205.86 140.37 91.80 67.16 --- 554 703 %%% [ [ ...

Financial Performance - For the year ended December 31, 2023, the total number of cases achieved increased by 33.2% to approximately 245,000 cases from about 183,900 cases for the year ended December 31, 2022[3]. - Revenue for the year ended December 31, 2023, was approximately RMB 1,476.0 million, an increase of 16.2% from approximately RMB 1,269.7 million for the year ended December 31, 2022[3]. - Gross profit for the year ended December 31, 2023, was approximately RMB 920.7 million, up 17.2% from approximately RMB 785.7 million for the year ended December 31, 2022, with a gross margin of approximately 62.4%[4]. - Adjusted net profit for the year ended December 31, 2023, was approximately RMB 178.9 million, a decrease of 16.0% from approximately RMB 213.0 million for the year ended December 31, 2022, primarily due to investments in international business[4]. - The domestic market's adjusted profit increased by 29.9% to approximately RMB 256.2 million for the year ended December 31, 2023, compared to approximately RMB 197.3 million for the year ended December 31, 2022[4]. - The international market revenue for the year ended December 31, 2023, was approximately RMB 145.3 million[4]. - The net cash generated from operating activities for the year ended December 31, 2023, was approximately RMB 165.9 million, an increase of 12.9% from approximately RMB 146.9 million for the year ended December 31, 2022[4]. - The adjusted EBITDA for the year ended December 31, 2023, was RMB 58.7 million, down from RMB 276.4 million for the year ended December 31, 2022[8]. - The company reported a net profit of RMB 48,649 thousand for the year ended December 31, 2023, compared to RMB 213,157 thousand in 2022, showing a decrease of about 77.2%[128]. Market Expansion and International Operations - The company has successfully entered over 30 countries and regions since officially launching international operations in 2023[3]. - International business achieved 33,000 cases, marking significant growth as the company expands into global markets, including Brazil through the acquisition of ADITEK DO BRASIL S.A.[13]. - The company transitioned from a distribution model to a direct sales model in the Australia-New Zealand market, enhancing local business support[14]. - The acquisition of Aditek in Brazil has led to significant growth in its invisible orthodontics business, supported by the establishment of over 50 doctor learning clubs[14]. Research and Development - The company invested RMB 173.6 million in R&D, accounting for 11.8% of total revenue[17]. - The company launched the angelLink system in June 2023 to enhance clinical efficiency for orthodontists, addressing complex clinical challenges[11]. - A new generation KiD anterior traction solution was introduced, combining dental alignment with maxillary anterior traction, targeting early orthodontic treatment for children[12]. - The company upgraded its iOrtho cloud service platform in 2023, improving integration capabilities and local market adaptation[15]. - The company launched a series of 3D design and modification tools to enhance the precision of orthodontic treatment plans[16]. Financial Position and Cash Flow - Cash and cash equivalents decreased from RMB 3,649.4 million as of December 31, 2022, to RMB 2,689.5 million as of December 31, 2023, primarily due to investments in financial products[44]. - The company reported a net foreign exchange gain of RMB 11.4 million for the year ended December 31, 2023, compared to RMB 7.1 million for the year ended December 31, 2022[46]. - The company’s cash flow from operating activities after tax payments was RMB 213,369 thousand, compared to RMB 182,776 thousand in the previous year, reflecting operational efficiency improvements[64]. - The company’s total assets as of December 31, 2023, amounted to RMB 4,756,654 thousand, an increase from RMB 4,486,209 thousand in 2022[60][63]. Corporate Governance and Compliance - The company has maintained compliance with the corporate governance code and has addressed previous non-compliance issues by appointing additional independent non-executive directors[187][188]. - The audit committee, consisting of three independent non-executive directors, reviewed the annual performance for the year ended December 31, 2023, and recommended approval to the board[191]. - The financial statements for the year ended December 31, 2023, have been agreed upon by the auditor and are consistent with the audited financial reports[192]. Shareholder Returns - The board proposed a special final dividend of HKD 1.1 per share for the year ended December 31, 2023[4]. - The company plans to pay a special final dividend of HKD 1.1 per share for the fiscal year ending December 31, 2023, compared to HKD 0.68 per share in 2022[169]. Employee and Management - Employee costs for the year ending December 31, 2023, were approximately RMB 756.7 million[182]. - The company has provided ongoing management and technical training to employees to ensure they possess the necessary skills and professional ethics[183]. - Key management remuneration for the year ended December 31, 2023, totaled RMB 51,550 thousand, a substantial increase from RMB 21,111 thousand in the previous year, reflecting a growth of approximately 144%[177].

Financial Performance - The company reported a significant increase in revenue, achieving a total of $XX million for the interim period, representing a YY% growth compared to the previous year[3]. - Revenue for the six months ended June 30, 2023, rose to approximately RMB 616.3 million, an increase of 8.0% from RMB 570.9 million for the same period in 2022, driven by stable growth in domestic invisible orthodontic solutions and continued investment in international business[7][8]. - Revenue for the six months ended June 30, 2023, was RMB 616.3 million, an increase from RMB 570.9 million for the same period in 2022, representing an increase of approximately 8.5%[23]. - Revenue from invisible orthodontic solutions increased by 1.2% to RMB 553.2 million for the six months ended June 30, 2023, compared to RMB 546.4 million for the same period in 2022[24]. - Revenue from sales products surged by 217.3% to RMB 54.5 million for the six months ended June 30, 2023, from RMB 17.2 million in the prior year[25]. - Revenue from other services rose by 17.2% to RMB 8.6 million for the six months ended June 30, 2023, compared to RMB 7.3 million for the same period in 2022[25]. - The company achieved approximately 9,400 cases in the international market during the review period, indicating a strong demand for its orthodontic solutions[19]. - The total number of cases achieved in domestic and international markets increased by 23.6% year-on-year to approximately 95,400 cases for the six months ended June 30, 2023, compared to 77,200 cases for the same period in 2022[7]. Profitability and Expenses - Adjusted net profit decreased by 39.7% to approximately RMB 49.5 million for the six months ended June 30, 2023, down from RMB 82.0 million for the same period in 2022, primarily due to initial investments in international business[7][8]. - Net profit decreased by 60.0% to RMB 29.3 million for the six months ended June 30, 2023, with a net profit margin of 4.8%, compared to 12.8% for the same period in 2022[33]. - The company's profit before tax for the six months ended June 30, 2023, was RMB 35.6 million, down from RMB 82.5 million for the same period in 2022[32]. - The company reported a net cash outflow of RMB 93.0 million from operating activities for the six months ended June 30, 2023, compared to a cash inflow of RMB 31.5 million for the same period in 2022[39]. - Cash and cash equivalents decreased from RMB 3,649.4 million as of December 31, 2022, to RMB 3,028.3 million as of June 30, 2023, primarily due to net cash outflows from operating and investing activities[38]. - The company reported a total cost of property, plant, and equipment of RMB 516,325,000 as of June 30, 2023, reflecting ongoing investments in infrastructure[138]. Research and Development - The company is investing in R&D for innovative technologies, allocating DD% of its budget towards this initiative to enhance product offerings[3]. - R&D expenses reached RMB 86.1 million, accounting for 14.0% of revenue, with 165 patents and 16 software copyrights registered as of June 30, 2023[13]. - Research and development expenses increased to RMB 86,121 thousand from RMB 75,441 thousand, showing a rise of approximately 14.9% year-over-year[92]. - The company is focused on enhancing R&D capabilities and continuing to innovate orthodontic solutions as part of its strategy to maintain market leadership[21]. Market Expansion and Strategy - The company provided an optimistic outlook for the next quarter, projecting revenue growth of BB% based on current market trends and user acquisition strategies[3]. - Market expansion efforts are underway, targeting EE new regions, which are anticipated to increase market share by FF%[3]. - The company is actively pursuing international business expansion, building local teams in the U.S., Europe, and Australia to better serve diverse market needs[19]. - The company is focusing on expanding its market presence and enhancing its product offerings through new technology developments and strategic initiatives[96]. Corporate Governance and Management - The company has adopted the corporate governance code as per the listing rules and has complied with applicable provisions during the review period, except for certain requirements which were later met[55]. - The company is committed to maintaining high standards of corporate governance to protect shareholder interests and enhance corporate value[55]. - The audit committee, composed of three independent non-executive directors, reviewed the unaudited interim consolidated financial information for the six months ended June 30, 2023[58]. - The independent auditor, PwC, conducted a review of the unaudited interim financial information for the six months ended June 30, 2023, in accordance with international review standards[59]. Shareholder Information - Major shareholder CareCapital EA, Inc. holds 100,000,000 shares, representing 58.91% of the total shares[52]. - The total number of shares issued as of June 30, 2023, is 169,741,384[49]. - The company did not declare any interim dividend for the six months ended June 30, 2023, consistent with the previous year[55]. - The company has no significant contingent liabilities or major litigation as of June 30, 2023[43]. Employee and Incentive Plans - The company has established a compensation committee to review and recommend remuneration for directors and senior management based on performance and market comparisons[83]. - The company has implemented various employee incentive plans, including pre-IPO share incentive plans and post-IPO restricted share unit plans[83]. - Key management compensation included RMB 7,074,000 in share-based payment expenses, significantly up from RMB 788,000 in the prior year, indicating a strategic focus on incentivizing management[192]. Acquisitions and Investments - The company completed the acquisition of a 51% stake in Aditek in January 2023, following a share purchase agreement signed in October 2022[43]. - The identifiable net assets of Aditek at fair value amounted to RMB 148,601,000, with goodwill recognized of RMB 49,800,000 attributed to the sales network and high market share in Brazil[177]. - The company has committed to invest RMB 119,025,000 in non-listed equity investments as of June 30, 2023, compared to RMB 87,510,000 as of December 31, 2022[187]. Sustainability Initiatives - The management team emphasized the importance of sustainability initiatives, committing to reduce carbon emissions by II% by 2025[3].

Financial Performance - For the six months ended June 30, 2023, the total number of cases achieved in domestic and international markets increased by 23.6% year-on-year to approximately 95,400 cases, compared to 77,200 cases for the same period in 2022[3]. - Revenue for the six months ended June 30, 2023, rose to approximately RMB 616.3 million, up from RMB 570.9 million for the same period in 2022, primarily due to stable growth in domestic invisible orthodontic solutions and continued investment in international business[3]. - Gross profit for the six months ended June 30, 2023, increased to approximately RMB 365.7 million, compared to RMB 331.4 million for the same period in 2022[3]. - The gross profit margin for the six months ended June 30, 2023, was 59.3%, up from 58.0% for the same period in 2022, with the domestic invisible orthodontic solutions gross profit margin at 61.7% compared to 60.2% in the previous year[3]. - Net profit for the six months ended June 30, 2023, decreased to approximately RMB 29.3 million, down from RMB 73.3 million for the same period in 2022, mainly due to initial investments in international business[3]. - Adjusted EBITDA for the six months ended June 30, 2023, was approximately RMB 45.3 million, down from RMB 111.9 million for the same period in 2022[3]. - The total comprehensive income for the six months ended June 30, 2023, was RMB 130.3 million, compared to RMB 196.8 million for the same period in 2022[6]. - Total revenue for the six months ended June 30, 2023, was RMB 661,469,000, an increase from RMB 526,594,000 in the same period of 2022, representing a growth of approximately 25.6%[36]. - The net profit attributable to the company's owners for the six months ended June 30, 2023, was RMB 32,308,000, down from RMB 74,307,000 in the same period of 2022, indicating a decline of about 56.5%[44]. - The company reported a profit of RMB 32,308 thousand for the period, contributing to a total comprehensive income of RMB 128,744 thousand for the six months ended June 30, 2023[9]. Assets and Liabilities - As of June 30, 2023, total assets amounted to RMB 4,688.9 million, compared to RMB 4,486.2 million as of December 31, 2022[7]. - The equity attributable to the owners of the company as of June 30, 2023, was RMB 3,358.9 million, down from RMB 3,606.8 million as of December 31, 2022[7]. - Total liabilities increased to RMB 1,260,238 thousand as of June 30, 2023, compared to RMB 884,012 thousand as of December 31, 2022, representing a growth of 42.5%[8]. - The total equity attributable to owners reached RMB 3,358,866 thousand as of June 30, 2023, up from RMB 3,606,766 thousand at the beginning of the year, indicating a decrease of 6.9%[9]. - The company’s bank borrowings stood at RMB 8,881 thousand as of June 30, 2023, with total current liabilities amounting to RMB 830,697 thousand, an increase from RMB 781,490 thousand at the end of 2022[8]. - The company’s total equity and liabilities amounted to RMB 4,688,895 thousand as of June 30, 2023, compared to RMB 4,486,209 thousand at the end of 2022, indicating an increase of 4.5%[8]. Cash Flow and Financial Position - The net cash used in operating activities was RMB (93,027) thousand for the six months ended June 30, 2023, compared to RMB 31,496 thousand for the same period in 2022, reflecting a significant decline in cash flow[12]. - Cash and cash equivalents decreased by RMB 715,762 thousand, ending at RMB 3,028,317 thousand as of June 30, 2023, compared to RMB 3,519,974 thousand at the end of the previous period[12]. - The company’s cash position reflects a significant liquidity challenge, with a notable decrease in cash reserves compared to the previous year[65]. - The company maintains a net cash position as of June 30, 2023, consistent with the position on December 31, 2022[23]. - The company’s current ratio as of June 30, 2023, was 4.6, slightly down from 5.0 as of December 31, 2022[144]. Expenses and Costs - Employee benefits expenses increased to RMB 327,216,000 for the six months ended June 30, 2023, from RMB 256,761,000 in the same period of 2022, reflecting a rise of approximately 27.4%[36]. - Sales and marketing expenses increased by 59.7% to RMB 204.1 million, primarily due to international business expansion[120]. - Administrative expenses rose by 44.0% to RMB 120.7 million, mainly due to increased costs associated with international operations[121]. - The company incurred a total tax expense of RMB 6,267,000 for the six months ended June 30, 2023, down from RMB 9,260,000 in the same period of 2022, representing a decrease of approximately 32.3%[37]. - The company reported a significant increase in administrative expenses, which rose to RMB 6,595 thousand in the first half of 2023 from RMB 649 thousand in the same period of 2022[52]. Research and Development - The company achieved a research and development expenditure of RMB 86.1 million, accounting for 14.0% of its revenue as of June 30, 2023[104]. - R&D expenses increased by 14.2% to RMB 86.1 million, driven by professional and consulting fees related to ongoing R&D efforts[122]. - The company launched the angelLink system in June 2023, which is the first clear aligner mechanical interface designed to address clinical challenges in complex malocclusion cases[100]. - The company upgraded its digital remote diagnosis solution, MOOELI, was released in the first half of the year, improving diagnostic quality and patient interaction[103]. - The company established a strategic global partnership with 3Shape A/S for digital intraoral scanning, facilitating seamless data upload to its cloud service platform[102]. Market and Business Strategy - The company is focused on managing liquidity risk by monitoring cash reserves and cash flow forecasts[21]. - The company has plans for market expansion and new product development as part of its future strategy[48]. - The company continues to focus on digitalization and internationalization as part of its long-term strategic layout[99]. - The company has successfully established its position in the international market and expects this to drive future business growth[99]. - The company aims to enhance R&D capabilities and continue innovating orthodontic solutions to maintain market leadership[113]. Corporate Governance - The audit committee consists of three independent non-executive directors, with Mr. Zhou Hao serving as the chairman[153]. - The company has adopted the corporate governance code as per the listing rules and confirmed compliance during the review period[151]. - The company emphasizes the importance of high corporate governance standards to protect shareholder interests and enhance transparency[150]. - As of April 2023, the company did not meet certain corporate governance requirements but has since regained compliance following the appointment of Mr. Zhou Hao as an independent non-executive director[153].

Financial Performance - Angelalign reported a total revenue of RMB 1.27 billion and a net profit of RMB 213 million for the year 2022, with a total of 183,900 cases handled[40]. - For the year ended December 31, 2022, the company's revenue was approximately RMB 1,269.7 million, a slight decrease of 0.2% compared to RMB 1,271.7 million for the year ended December 31, 2021[59]. - The company's gross profit for the year ended December 31, 2022, was approximately RMB 785.7 million, down 5.0% from RMB 826.6 million for the previous year[59]. - The net profit for the year ended December 31, 2022, was approximately RMB 213.2 million, representing a decrease of 25.4% compared to RMB 285.6 million for the year ended December 31, 2021[59]. - The adjusted EBITDA for the year ended December 31, 2022, was approximately RMB 295.6 million, a decrease of 29.2% from RMB 417.5 million for the previous year[59]. - The company's costs increased by 8.8% from RMB 445.0 million in the year ended December 31, 2021, to RMB 484.0 million in the year ended December 31, 2022, primarily due to employee benefits and depreciation costs associated with new production facilities[80]. - Gross profit decreased by 5.0% from RMB 826.6 million in the year ended December 31, 2021, to RMB 785.7 million in the year ended December 31, 2022, with a gross margin decline from 65.0% to 61.9%[81]. - The net profit margin fell to 16.8% in 2022 compared to 22.5% in 2021[109]. Market Expansion and Strategy - The company acquired a high-quality overseas orthodontic brand to rapidly enter the growing Brazilian market[40]. - The company successfully acquired the leading orthodontic brand Aditek in Brazil, enhancing its international presence[45]. - The company is focused on expanding its presence in lower-tier markets in China by providing cost-effective products and professional training to local dentists[43]. - The company strategically expanded into emerging markets, with a steady increase in case contributions from these regions during the reporting period[53]. - The company is building subsidiaries in the US, Europe, and Australia to support its global business development, adapting to local regulations and market conditions[54]. - The company aims to enhance user experience and treatment efficiency, particularly for complex orthodontic cases[46]. - The company is focused on expanding its market influence through intelligent manufacturing and medical technology innovations[50]. Research and Development - As of December 31, 2022, the company had obtained 143 patents and 16 software copyrights, indicating a strong commitment to R&D innovation[44]. - The company plans to continue focusing on R&D investments to innovate digital orthodontic solutions and enhance user experience[56]. - In 2022, the company's R&D expenditure reached RMB 147.7 million, accounting for 11.6% of revenue[68]. - The company has established a comprehensive and differentiated product matrix to meet the evolving needs of oral doctors and patients, particularly in emerging markets, with a steady increase in case contributions from tier 3 and tier 4 markets in 2022[65]. - The company emphasizes the importance of talent development to enhance organizational capabilities and achieve mutual growth with employees[56]. Digital Innovation - In response to the pandemic, Angelalign launched the MOOELI smart remote monitoring system, allowing patients to capture intraoral images and send them to doctors without using a mobile phone[41]. - The company has established a comprehensive digital orthodontic service solution, integrating AI and intelligent manufacturing to enhance the diagnosis and treatment process for dentists and patients[51]. - The company launched a new digital remote solution called MOOELI in January 2023, filling a gap in remote monitoring for orthodontics in China[52]. - The iOrtho 10.0 doctor interaction system was upgraded in 2022, significantly improving operational efficiency for doctors through new features and AI-driven analysis tools[66]. - The A-Treat digital treatment design platform utilizes AI and data mining to optimize treatment plans, enhancing the efficiency of case design for doctors[66]. Corporate Governance and Management - The company is focused on strategic planning and governance under the leadership of the board chairman, Mr. Feng Dai[111]. - CEO Ms. Li Huamin has been with the company since its founding in 2003, emphasizing operational management[112]. - The company has a strong management team with extensive experience in finance and business operations, including members with backgrounds in listed companies[116]. - The board includes experienced members with backgrounds in investment and dental technology, enhancing strategic direction[114]. - The company is committed to maintaining high standards of corporate governance and financial transparency[116]. Sustainability and Corporate Social Responsibility - The company is committed to sustainable development and has integrated ESG principles into its operational strategy[46]. - The company complied with all relevant environmental and occupational health and safety laws in China during 2022, with no significant adverse incidents reported[146]. - The company has a commitment to sustainable development and minimizing environmental impact as part of its corporate social responsibility[144]. Shareholder and Financial Information - The board has proposed a special final dividend of HKD 0.68 per share for the year ended December 31, 2022[59]. - As of December 31, 2022, the company had reserves available for distribution to shareholders amounting to RMB 2,941.9 million[128]. - The company reported no bank or other interest-bearing borrowings as of December 31, 2022[128]. - The total amount allocated for developing a flexible and scalable intelligent information technology system is HKD 339.0 million[195]. - The company will continue to comply with the relevant provisions regarding ongoing related party transactions as per the listing rules[139].

Financial Performance - For the year ended December 31, 2022, the company's revenue was approximately RMB 1,269.7 million, a slight decrease of 0.2% compared to approximately RMB 1,271.7 million for the year ended December 31, 2021[2]. - The company's gross profit for the year ended December 31, 2022, was approximately RMB 785.7 million, down 5.0% from approximately RMB 826.6 million for the year ended December 31, 2021[2]. - The net profit for the year ended December 31, 2022, was approximately RMB 213.2 million, a decrease of 25.4% compared to approximately RMB 285.6 million for the year ended December 31, 2021[2]. - Adjusted EBITDA for the year ended December 31, 2022, was approximately RMB 295.6 million, down 29.2% from approximately RMB 417.5 million for the year ended December 31, 2021[2]. - The adjusted net profit for the year ended December 31, 2022, was approximately RMB 232.4 million, a decrease of 33.1% compared to approximately RMB 347.5 million for the year ended December 31, 2021[2]. - Basic earnings per share for the year ended December 31, 2022, were RMB 1.28, compared to RMB 1.93 for the year ended December 31, 2021[8]. - The company's net profit decreased by 25.4% from RMB 285.6 million for the year ended December 31, 2021, to RMB 213.2 million for the year ended December 31, 2022, with a net profit margin of 16.8% compared to 22.5% in the previous year[140]. Dividends and Shareholder Returns - The board proposed a special final dividend of HKD 0.68 per share for the year ended December 31, 2022[3]. - The company proposed a special final dividend of HKD 0.68 per share for the year ended December 31, 2022, down from HKD 1.22 per share in 2021[101]. Assets and Liabilities - Total assets as of December 31, 2022, amounted to RMB 4,486.2 million, an increase from RMB 4,140.8 million as of December 31, 2021[10]. - Total liabilities as of December 31, 2022, were RMB 884.0 million, compared to RMB 826.1 million as of December 31, 2021[12]. - The company's equity attributable to owners was RMB 3,606.8 million as of December 31, 2022, up from RMB 3,319.1 million as of December 31, 2021[11]. Cash Flow and Investments - Operating cash flow for the year ended December 31, 2022, was RMB 182,776 thousand, a decrease of 64.1% from RMB 509,130 thousand in 2021[13]. - Net cash from operating activities for the year ended December 31, 2022, was RMB 146,870 thousand, down 66.7% from RMB 441,713 thousand in 2021[13]. - Cash used in investing activities amounted to RMB (89,784) thousand, compared to RMB (195,551) thousand in 2021, indicating a 54.1% improvement[13]. - Cash flow from financing activities showed a net outflow of RMB (193,612) thousand, a significant decrease from a net inflow of RMB 2,523,244 thousand in 2021[13]. - Cash and cash equivalents at the end of the year were RMB 3,649,376 thousand, slightly up from RMB 3,626,983 thousand in 2021[13]. Revenue Breakdown - Total revenue for the year ended December 31, 2022, was RMB 1,269,706 thousand, slightly down from RMB 1,271,677 thousand for the year ended December 31, 2021[72]. - Revenue from invisible orthodontic solutions was RMB 1,209,582 thousand, an increase from RMB 1,183,801 thousand in the previous year, while revenue from other services decreased to RMB 15,733 thousand from RMB 19,777 thousand[72]. - Revenue from intraoral scanners recognized at a point in time was RMB 44,391 thousand, down from RMB 68,099 thousand in the previous year[72]. - The revenue breakdown for 2022 shows that invisible orthodontic solutions accounted for 95.3% (RMB 1,209.6 million), while intraoral scanner sales contributed 3.5% (RMB 44.4 million) of total revenue[122]. Research and Development - The company’s research and development expenses for the year ended December 31, 2022, were RMB 2,774 thousand, compared to RMB 1,674 thousand in 2021, indicating an increase of approximately 65.7%[89]. - In 2022, the company's R&D expenditure reached RMB 147.7 million, accounting for 11.6% of revenue[114]. - The company registered a total of 143 patents and 16 software copyrights by December 31, 2022[114]. Market Strategy and Future Outlook - The company plans to focus on expanding its market presence and investing in new technologies to drive future growth[13]. - The company anticipates a challenging market environment but remains optimistic about long-term growth prospects through strategic investments and operational efficiencies[13]. - The company aims to expand its sales network and increase brand awareness and academic influence[119]. - The macroeconomic environment and potential COVID-19 impacts present uncertainties for 2023, which may affect business operations and financial performance[120]. Corporate Governance - The annual performance review for the year ended December 31, 2022, was conducted by the audit committee, which consists of three independent non-executive directors[163]. - The company has maintained compliance with the corporate governance code and the standard code for securities transactions by directors during the reporting period[163]. - The audit committee confirmed that the annual performance aligns with applicable accounting standards and legal regulations[163].

Financial Performance - For the six months ended June 30, 2022, the company's revenue was approximately RMB 570.9 million, remaining stable compared to RMB 571.0 million for the same period in 2021[9]. - Gross profit for the same period was approximately RMB 331.4 million, a decrease of 12.2% from RMB 377.6 million in the prior year[9]. - Net profit decreased by 23.4% to approximately RMB 73.3 million, down from RMB 95.7 million for the six months ended June 30, 2021[9]. - Adjusted EBITDA for the period was approximately RMB 111.9 million, compared to RMB 195.4 million in the same period of the previous year[9]. - The gross margin for the six months ended June 30, 2022, was 58.0%, down from 66.1% for the same period in 2021[23]. - Net profit margin fell to 12.8% in 2022 from 16.8% in 2021, a decrease of 4.0 percentage points[54]. - Basic earnings per share decreased to RMB 0.44, down from RMB 0.74 in the prior year[81]. - Operating profit for the period was RMB 72,687 thousand, representing a decline of 38.1% from RMB 117,507 thousand in the previous year[81]. Revenue Breakdown - Revenue from the invisible orthodontic solutions increased by 2.6% to RMB 546.4 million for the six months ended June 30, 2022, from RMB 532.7 million for the same period in 2021[20]. - Revenue from other services decreased by 25.0% to RMB 7.3 million for the six months ended June 30, 2022, from RMB 9.8 million for the same period in 2021[21]. - Revenue from intraoral scanner sales decreased by 39.9% to RMB 17.2 million for the six months ended June 30, 2022, from RMB 28.6 million for the same period in 2021[21]. - Revenue for the six months ended June 30, 2022, was RMB 570,936 thousand, a slight decrease of 0.02% compared to RMB 571,049 thousand in the same period of 2021[81]. Cost and Expenses - The company's costs increased by 23.8% to RMB 239.5 million for the six months ended June 30, 2022, from RMB 193.4 million for the same period in 2021[21]. - Sales and marketing expenses increased by 32.3% from RMB 966 million for the six months ended June 30, 2021, to RMB 1,278 million for the six months ended June 30, 2022, driven by business strategies targeting emerging domestic and overseas markets[26]. - Research and development expenses increased by 26.6% from RMB 596 million for the six months ended June 30, 2021, to RMB 754 million for the six months ended June 30, 2022, due to increased employee benefits related to ongoing R&D efforts[28]. Investments and R&D - In the first half of 2022, the company's R&D investment reached RMB 75.4 million, accounting for 13.2% of total revenue[13]. - The company registered 130 patents and 16 software copyrights by June 30, 2022, reflecting its commitment to innovation[13]. - The company continues to invest in business growth and market expansion despite the challenges posed by the COVID-19 pandemic[10]. - The company is expanding its presence in emerging third and fourth-tier markets, with a steady increase in case contributions from these areas[11]. Operational Developments - The company launched the A7 Speed solution, enhancing treatment efficiency for complex cases using advanced materials and technology[11]. - The upgraded iOrtho 10.0 doctor interaction system introduced multiple new features to enhance efficiency and patient compliance[12]. - The first automated production line at the Chuangmei base was completed and began production based on order demand in the first half of 2022[16]. - The AI-driven diagnostic and treatment planning tools improved the efficiency of case design in digital orthodontics[12]. Shareholder and Corporate Governance - The company did not declare any interim dividends for the six months ended June 30, 2022, consistent with the previous year[61]. - The audit committee, composed of three independent non-executive directors, reviewed the unaudited consolidated interim financial statements for the six months ended June 30, 2022[63]. - The company has adopted the corporate governance code principles and has complied with applicable code provisions during the review period[62]. - The company is committed to maintaining high standards of corporate governance to protect shareholder interests and enhance corporate value[62]. Future Outlook - The company expects to maintain its growth trajectory and continue investing in R&D and market expansion initiatives[116]. - The company plans to use the remaining funds from the global offering within the next 18 months[77]. - The company is planning to expand its market presence in Southeast Asia, targeting a market share increase of EE% by the end of 2023[163]. - A new product line is expected to launch in Q3 2022, with projected sales of $FF million in the first year[163].

Financial Performance - Total revenue for the year reached RMB 1.27 billion, representing a year-on-year growth of 55.7%[7] - Adjusted net profit amounted to RMB 350 million, with a year-on-year increase of 52.9%[7] - The gross profit for the year ended December 31, 2021, was approximately RMB 826.6 million, up 43.8% from approximately RMB 575.0 million for the year ended December 31, 2020[20] - The net profit for the year ended December 31, 2021, was approximately RMB 285.6 million, representing an increase of 89.2% compared to approximately RMB 150.9 million for the year ended December 31, 2020[20] - The adjusted EBITDA for the year ended December 31, 2021, was approximately RMB 417.5 million, an increase of 40.7% from approximately RMB 296.6 million for the year ended December 31, 2020[20] - Revenue increased by 55.7% from RMB 816.5 million in 2020 to RMB 1,271.7 million in 2021[35] - Net profit increased by 89.2% year-on-year to RMB 285.6 million, while adjusted EBITDA grew by 40.7% to RMB 417.5 million[24] Operational Highlights - The number of cases treated was 183,200, reflecting a year-on-year growth of 33.1%[7] - The number of cases completed increased from approximately 137,600 for the year ended December 31, 2020, to approximately 183,200 for the year ended December 31, 2021[20] - The number of dental professionals served increased from approximately 19,900 for the year ended December 31, 2020, to approximately 25,000 for the year ended December 31, 2021[20] - The company launched a new generation of adaptive polymer composite materials, masterControl S and angelAttach, enhancing its product offerings[17] - The company introduced a children's facial management solution tailored to individual characteristics for early orthodontic treatment[17] - The company expanded its digital technology services by adding intraoral scanner sales, significantly improving dental professionals' treatment efficiency[17] Research and Development - The company invests nearly 10% of its revenue in R&D annually, maintaining a leading position in the industry[10] - Research and development expenses amounted to RMB 123.1 million, representing 9.7% of total revenue[27] - The company plans to continue investing in research and development to innovate digital orthodontic solutions and enhance user experience[18] - The company aims to leverage digital technology to drive innovation and improve the quality of orthodontic services[16] - The company established a digital oral intelligence research institute to enhance R&D capabilities and encourage innovation through cash rewards for patent inventors[180] Market Expansion and Strategy - The company aims to expand its services into emerging markets, focusing on cost-effective products and flexible channels[11] - The company is focused on international expansion, leveraging its advanced manufacturing and delivery capabilities to serve global markets[9] - The company is committed to expanding its digital orthodontics into international markets gradually[18] - The company has established partnerships with leading dental schools and researchers to support orthodontic research initiatives[10] - The company has launched a joint venture, CareCapital Aligner Tech L.P., to invest in global orthodontic digital technologies, supporting its international expansion[32] Corporate Governance and Compliance - The company has established a robust governance structure with independent directors and committees to oversee its operations and ensure compliance[71] - The board has established three committees: Audit Committee, Nomination Committee, and Remuneration Committee to oversee specific areas of governance[135] - The independent non-executive directors confirmed their independence in accordance with the listing rules[137] - The company has maintained high corporate governance standards since the listing date, adhering to all applicable code provisions[135] - The audit committee oversees the financial reporting system, risk management, and internal control procedures[149] Employee Relations and Incentives - The company has implemented a continuous employee equity incentive plan to foster team cohesion and drive growth[7] - The total employee cost, including director remuneration and share-based payment expenses, was approximately RMB 400.4 million as of December 31, 2021[89] - The company employed 2,034 employees as of December 31, 2021[89] - The company provides pre-employment and ongoing management and technical training to employees to ensure they possess the necessary skills and work ethics[90] - The company has implemented employee incentive plans, including pre-IPO share reward plans and post-IPO restricted share unit plans, to promote long-term development[90] Environmental, Social, and Governance (ESG) - The company has established a three-tier ESG governance structure involving the board, management, and an ESG working group to oversee ESG initiatives[170] - The company actively engages with stakeholders, including government, shareholders, employees, and customers, to understand their expectations and feedback on sustainability strategies[175] - The company has committed to integrating ESG factors into its business strategy and daily operations to promote sustainable development[170] - The company has received several awards, including recognition as a "Jiangsu Province Small Giant" and "2021 Key Industrial Internet Platform" by Jiangsu Provincial Department of Industry and Information Technology[181] - The company has developed a comprehensive product traceability system, allowing for tracking of production records back to raw materials and equipment[189] Risk Management - The company has established an internal audit and internal control department to enhance its internal control and risk management processes[158] - The board is responsible for ensuring effective risk management and internal control systems, with management tasked with designing and maintaining these systems[157] - The company has implemented a whistleblowing mechanism to address financial, operational, and internal control issues, ensuring significant internal control deficiencies are reported to the audit committee[158] - The company has no knowledge of any significant uncertainties that may severely impact its ability to continue as a going concern[156] - The company faces market risks due to economic uncertainties, changing regulations, and the ongoing impact of the COVID-19 pandemic[74] Marketing and Customer Relations - The company emphasizes responsible marketing, strictly following advertising laws to avoid misleading customers and protect brand reputation[197] - The company has established a data security management regulation to oversee data handling processes, ensuring compliance with relevant laws[200] - The company has developed internal policies for complaint handling and product recall management to ensure timely resolution of customer issues[187] - The company received a total of 2,062 customer complaints during the reporting period, achieving a resolution rate of 100%[189] - The company has implemented strict regulations for supplier admission, process audits, and regular evaluations to ensure procurement quality[190]