Industry and Company Analysis Key Points: 1. **Industry Overview**: - The industry is focused on heated tobacco products (HTP), including IQOS and other alternatives. - The market is experiencing rapid growth, with the H&B market reaching $34 billion in 2023 and expected to double in size over the next 3-5 years. - The market is dominated by IQOS, with a 15-16% market share, but there is significant potential for growth and competition. 2. **Smart International**: - Smart International is a key supplier to major tobacco companies and has a strong position in the HTP market. - The company has faced challenges due to the decline in the Chinese market and the rise of illegal products in the US and Europe. - Smart International is investing heavily in research and development to maintain its competitive advantage and develop new product categories. 3. **Glow Halo Product**: - Glow Halo is Smart International's new H&B product, offering several advantages over competitors like IQOS. - The product has a faster heating time, better heat distribution, improved portability, and competitive pricing. - The company expects Glow Halo to replace older products and capture a significant market share. 4. **Market Dynamics**: - The Chinese market is expected to recover as the government relaxes restrictions on flavored products. - The US market is facing increased regulation and enforcement against illegal products, which could benefit Smart International. - The European market is experiencing a shift towards alternative product formats, which could also benefit Smart International. 5. **Future Outlook**: - Smart International is targeting significant growth in the H&B market, with potential for revenue to triple over the next few years. - The company is also exploring new product categories, including medical, beauty, and hemp-based products. - The company's long-term growth prospects are strong, driven by its strong position in the HTP market and its commitment to innovation.

Financial Performance - The group's revenue for the six months ended June 30, 2024, was RMB 5,037,242 thousand, a decrease of 1.7% compared to RMB 5,122,862 thousand in the same period of 2023 [20]. - Gross profit increased by 3.2% to RMB 1,914,597 thousand, with a gross margin of 38.0%, up 1.8 percentage points from 36.2% in 2023 [20]. - The net profit margin decreased to 13.6% from 14.0% in the previous year, with net profit for the period at RMB 683,198 thousand, down 4.8% from RMB 717,342 thousand [20]. - The comprehensive income for the period was approximately RMB 724.60 million, a decrease of about 1.3% compared to the same period last year [70]. - Basic earnings per share decreased to RMB 11.20 from RMB 11.81, reflecting a decline of 5.2% year-over-year [197]. - The total revenue for the group during the review period was approximately RMB 5,037.24 million, a decrease of about 1.7% compared to the same period last year [70]. Research and Development - The company continued to increase R&D investment in the first half of 2024, focusing on aerosol medical and heated non-combustible products, with expectations for new revenue and profit growth points [13]. - Research and development expenditure totaled approximately RMB 760,112 thousand, an increase of about 23.7% compared to the previous year, with R&D spending as a percentage of revenue rising from approximately 12.0% to about 15.1% [57]. - The R&D team consists of over 1,400 personnel, with significant investment in innovation to support long-term growth and maintain competitive advantages [49]. - The company filed a total of 699 new patent applications globally during the review period, including 401 invention patents, bringing the total to 8,394 patents as of June 30, 2024 [54]. Product Development and Launches - The company launched multiple new products, including the FEELM Pro and the XROS 4, which received positive feedback and contributed to rapid revenue growth in its proprietary brand business [10]. - The atomization beauty product "MOYAL" was successfully launched, being the first in the industry to atomize high-viscosity serums, and is currently in the channel development phase [12]. - The company successfully launched several new product solutions in the first half of 2024, including the world's first 20,000 puff high-explosion dual-core disposable solution [25]. - The company plans to launch more innovative products in the second half of 2024 to enhance its product matrix and market share [15]. Market Expansion and Strategy - The company is actively advancing its atomization technology into new business areas, with steady progress in atomization medical and beauty sectors [12]. - The company is focusing on localizing its sales teams and enhancing delivery capabilities to better meet consumer preferences [12]. - The company plans to diversify its revenue across different countries and regions and enhance its product portfolio, focusing on the application of aerosol technology in healthcare and other industries [39]. - The company is committed to building a global leading aerosol technology platform, with confidence in the long-term growth of the global aerosol market [60]. Financial Position and Assets - The total assets of the group as of June 30, 2024, reached RMB 26,540,994 thousand, representing a 4.0% increase from RMB 25,508,284 thousand at the end of 2023 [20]. - Cash and cash equivalents increased by 22.6% to RMB 6,534,871 thousand from RMB 5,332,076 thousand at the end of 2023 [20]. - As of June 30, 2024, net current assets were approximately RMB 13,861,870 thousand, down from RMB 16,004,419 thousand as of December 31, 2023 [102]. - The current ratio as of June 30, 2024, was approximately 396.2%, down from 548.8% as of December 31, 2023 [102]. Regulatory Environment - The regulatory environment for electronic atomization products is strengthening, which is expected to benefit the long-term development of the industry [10]. - The EU's new regulations require all tobacco products to have unique identification codes, enhancing traceability and compliance [34]. - Belgium has received EU approval to implement a ban on disposable e-cigarettes, set to take effect on January 1, 2025 [35]. Shareholder and Governance - The board declared an interim dividend of HKD 0.05 per share for the six months ended June 30, 2024, consistent with the previous year [145]. - The company has established an ESG committee to enhance its ESG management capabilities [131]. - The company has established various communication channels with shareholders and investors to provide updates and gather feedback [141]. - The board of directors believes that the current governance structure is appropriate for shareholder interests and will continue to review its effectiveness [123]. Employee and Operational Efficiency - The company emphasizes employee training and development, with structured programs for various talent levels and a focus on online learning [110]. - The company is focusing on cost reduction and efficiency improvements, successfully achieving a significant decrease in administrative expenses during the review period [27]. - Employee compensation and benefits increased by 37.1% to RMB 148,642 thousand, accounting for 3.0% of total revenue [88]. Future Outlook - The company has outlined a future outlook with a focus on market expansion and new product development [1]. - The company projects a revenue growth of 2.99% to 3.51% for the periods ending in 2025 and 2026, respectively [1]. - The company plans to continue its strategy of incentivizing key personnel through the share incentive plan to drive further growth [169].

Financial Performance - For the six months ended June 30, 2024, the company reported revenue of RMB 5,037,242 thousand, a decrease of approximately 1.7% compared to RMB 5,122,862 thousand in the same period last year[5]. - Gross profit for the same period was RMB 1,914,597 thousand, reflecting a growth of 3.2% year-on-year, with a gross margin of 38.0%, up 1.8 percentage points from 36.2%[5]. - The company achieved a profit before tax of RMB 811,555 thousand, an increase of 1.9% compared to RMB 796,170 thousand in the previous year[5]. - Net profit for the period was RMB 683,198 thousand, down 4.8% from RMB 717,342 thousand year-on-year, resulting in a net profit margin of 13.6%[5]. - The total revenue for the group during the review period was approximately RMB 5,037,242 thousand, a decrease of about 1.7% compared to RMB 5,122,862 thousand in the same period last year[39]. - The comprehensive income for the period was approximately RMB 724,597 thousand, a decrease of about 1.3% compared to RMB 734,356 thousand in the same period last year[39]. - The group reported a segment profit of RMB 820,065 thousand, a slight increase of 2.47% from RMB 802,075 thousand in the previous year[100]. - The company reported a net profit of RMB 683,198 thousand for the period, down 4.8% from RMB 717,342 thousand in the same period last year[84]. Assets and Liabilities - The total assets increased by 4.0% to RMB 26,540,994 thousand as of June 30, 2024, compared to RMB 25,508,284 thousand at the end of 2023[5]. - As of June 30, 2024, the group's current assets net value was approximately RMB 13,861,870 thousand, down from RMB 16,004,419 thousand as of December 31, 2023[65]. - The group's asset-liability ratio was approximately 24.5% as of June 30, 2024, compared to 19.1% as of December 31, 2023[68]. - The group had no bank or other financial institution borrowings as of June 30, 2024, consistent with the previous year[67]. Cash Flow and Expenditures - Cash and cash equivalents rose by 22.6% to RMB 6,534,871 thousand, up from RMB 5,332,076 thousand[5]. - Operating cash flow for the six months ended June 30, 2024, was RMB 602,829 thousand, a decline of 43.7% from RMB 1,072,440 thousand in 2023[89]. - Capital expenditures for the six months ended June 30, 2024, totaled approximately RMB 282,315 thousand, significantly lower than RMB 560,670 thousand in the same period of 2023[15]. - The group had capital commitments of approximately RMB 395,328 thousand, down from RMB 494,304 thousand as of December 31, 2023[78]. Revenue Breakdown - Revenue from the self-owned brand business was approximately RMB 1,115,607 thousand, representing a growth of about 71.9% compared to RMB 648,852 thousand in the same period last year[41]. - Revenue from enterprise customer sales was approximately RMB 3,921,635 thousand, a decrease of about 12.3% from RMB 4,474,010 thousand in the same period last year[43]. - Revenue from the European and other markets reached approximately RMB 928,687 thousand, with a year-on-year growth of about 88.0%[13]. - In the U.S. market, revenue was approximately RMB 1,858,160 thousand, a decrease of about 9.8% year-on-year, accounting for approximately 36.9% of total revenue[15]. - Revenue from the company's disposable electronic vapor products decreased by approximately 18.9% year-on-year to about RMB 1,217,423 thousand[16]. - Revenue from electronic vapor products and components (excluding APV) was RMB 3,921,635 thousand, down 12.34% from RMB 4,474,010 thousand in 2023[98]. - APV revenue increased significantly to RMB 1,115,607 thousand, up 71.93% from RMB 648,852 thousand in 2023[98]. Research and Development - The company has over 1,400 R&D personnel and significantly higher R&D investment compared to peers, ensuring long-term healthy growth[19]. - Research and development expenditure for the first half of 2024 totaled approximately RMB 760.1 million, representing a year-on-year increase of 23.7%, and accounting for about 15.1% of revenue, up from 12.0% in the same period last year[25]. - Research and development expenses grew by approximately 23.7% to RMB 760,112 thousand, increasing from 12.0% to 15.1% of total revenue, reflecting increased investment in nebulization medical and heat-not-burn product areas[56]. - The company’s employee compensation and benefits in R&D rose by approximately 23.6% to RMB 477,901 thousand, accounting for 9.5% of total revenue, due to increased salaries for R&D personnel in the nebulization medical field[56]. Market Expansion and Product Development - The company launched several new products during the review period, including the world's first 20,000 puff high-explosion dual-core disposable solution, enhancing user experience and nicotine delivery efficiency[8]. - The company is expanding its international market presence, operating six distribution centers in Europe and the United States as of June 30, 2024, to enhance global operational capabilities[10]. - The company is actively expanding its international market presence and localizing its product and sales systems to meet diverse consumer needs[13]. - The company plans to launch the MOYAL brand and its first generation of aerosol beauty products in Q1 2024, which will be the industry's first to achieve high-viscosity skincare essence aerosolization[22]. - In the medical field, the company has developed several drug delivery devices for asthma and COPD, with products receiving recognition from European and American regulatory authorities[23]. Compliance and Regulatory - The company is focusing on compliance and safety in the U.S. market, with a gradual recovery expected in its performance due to strengthened regulatory enforcement[15]. - The company aims to enhance its compliance operations to support customer market expansion amid increasing regulatory scrutiny in the electronic vapor market[29]. - The company has implemented cost reduction and efficiency improvement measures, resulting in a significant decrease in administrative expenses during the review period[10]. Other Financial Metrics - The group's financing costs were approximately RMB 18,512 thousand, representing an increase of about 68.6% from RMB 10,980 thousand in the same period last year[61]. - Income tax expenses for the group were approximately RMB 128,357 thousand, an increase of about 62.8% from RMB 78,828 thousand in the same period last year[62]. - The group recognized government grants amounting to RMB 57,955 thousand, an increase from RMB 35,096 thousand in 2023[107]. - The interim dividend declared for the six months ended June 30, 2024, is HKD 0.05 per share, totaling approximately HKD 308,888,000[122].

Financial Data and Key Metrics - The company expects a double-digit growth in overseas markets, potentially between 10% to 20% [2] - Domestic market revenue is expected to remain flat [2] - Free brand business is projected to grow by 10% to 20% [2] - Medical sector is expected to see a high single-digit to low double-digit growth, excluding additional R&D investments [2] - Capital expenditure for 2024 is estimated to be around 1 billion, similar to 2023 [2] - The company aims to maintain a dividend payout ratio of around 35% [2] Business Line Data and Key Metrics - Growth in 2024 is expected to be driven mainly by disposable products, while refillable products may see a slight decline [1][2] - Cannabis vaporizers are expected to maintain a growth rate of over 20% [2] - The company is investing in new product lines, particularly in medical and beauty sectors, with expected returns in 2025 and 2026 [2][3] Market Data and Key Metrics - The US market saw a decline in the second half of 2023 due to the impact of non-compliant disposable products [6] - The company is preparing for potential bans on disposable products in Europe and the US by developing new product lines [4][5] - The company's free brand, VAPORESSO, is expanding in Europe with new product offerings [5] Company Strategy and Industry Competition - The company is focusing on differentiated products and new technological routes to stay competitive [1] - It is preparing for potential regulatory changes in Europe and the US by diversifying its product portfolio [4][5] - The company is investing in R&D to develop new solutions and technologies, particularly in the medical and beauty sectors [2][3] Management Commentary on Operating Environment and Future Outlook - The company is optimistic about future growth, particularly in 2025 and 2026, as new product lines mature [2][3] - Management is cautious about the regulatory environment in the US and Europe, particularly regarding disposable products [1][4] - The company is prepared to adapt to market changes and regulatory shifts by leveraging its R&D capabilities [4][5] Other Important Information - The company has a strong cash position, with cash and deposits totaling approximately 16 billion [5] - It is open to increasing share buybacks if necessary [5] - The company uses a mix of USD and RMB for customer settlements, with complex arrangements for large clients [6] Q&A Session Summary Question: Trends for refillable and disposable products in 2024 - Disposable products are expected to drive market growth, while refillable products may see a decline due to regulatory pressures [1] Question: CBD growth trends in 2024 - CBD growth is expected to recover in the second half of 2024, driven by new product launches and market recovery [2] Question: Cash flow, capital expenditure, and dividend guidance for 2024 - The company expects strong cash flow, with capital expenditure similar to 2023 and a dividend payout ratio of around 35% [2] Question: Revenue and profit guidance for 2024 - Revenue is expected to grow in overseas markets, while domestic revenue remains flat. Profit growth is expected to be in the high single-digit to low double-digit range, excluding medical R&D investments [2] Question: Impact of US flavor ban and FDA enforcement - The company is cautious about FDA enforcement and the potential impact of flavor bans, but remains optimistic about its product portfolio [4] Question: New product launches in Europe - The company is preparing to launch new products in Europe, including larger-capacity refillable products, to adapt to potential bans on disposable products [4] Question: Pricing pressure from large clients - Pricing pressure from large clients is decreasing as the focus shifts to differentiated products and innovation [5] Question: R&D investment in HMB market - The company is investing in R&D to develop new solutions and technologies, particularly in the HMB market, with expected returns in the future [5] Question: Free brand strategy in Europe - The company is expanding its free brand, VAPORESSO, in Europe with new product offerings, including bottled e-liquids [5] Question: Share buyback plans - The company is open to increasing share buybacks if necessary, given its strong cash position [5] Question: US market decline in H2 2023 - The decline in the US market in H2 2023 was due to the impact of non-compliant disposable products and changes in customer stocking patterns [6] Question: Currency settlement arrangements - The company uses a mix of USD and RMB for customer settlements, with complex arrangements for large clients [6]

Financial Performance - Revenue for 2023 decreased to RMB 11,168,422 thousand, down from RMB 12,144,980 thousand in 2022[10] - Gross profit for 2023 was RMB 4,334,446 thousand, with a gross margin of 38.8%, compared to 43.3% in 2022[10] - Net profit for 2023 was RMB 1,645,090 thousand, with a net profit margin of 14.7%, down from 20.7% in 2022[10] - Total assets increased to RMB 25,508,284 thousand in 2023, up from RMB 24,359,317 thousand in 2022[10] - Cash and cash equivalents decreased significantly to RMB 5,332,076 thousand in 2023 from RMB 9,762,933 thousand in 2022[10] - Total sales revenue for the period was approximately RMB 11,168,422 thousand, a decrease of 8.0% year-over-year[40] - Revenue from the Chinese mainland market was approximately RMB 163,008 thousand, a significant decrease of 92.7% year-over-year, accounting for 1.5% of total revenue[40] - Revenue from overseas markets was approximately RMB 11,005,414 thousand, an increase of 11.2% year-over-year, accounting for 98.5% of total revenue[40] - Revenue from enterprise customers decreased by 12.7% year-over-year, accounting for 83.5% of total revenue[40] - Revenue from the company's own brand business increased by 26.0% year-over-year, accounting for 16.5% of total revenue[40] - Revenue from the US market for enterprise customers was approximately RMB 4,083,779 thousand, an increase of 8.2% year-over-year, accounting for 36.6% of total revenue[41] - Revenue from Europe and other markets for enterprise customers was approximately RMB 5,074,276 thousand, an increase of 8.9% year-over-year, accounting for 45.4% of total revenue[43] - Revenue from disposable e-vapor products in Europe and other markets was approximately RMB 3,370,149 thousand, a significant increase of 74.5% year-over-year, accounting for 30.2% of total revenue[43] - Revenue from the company's own brand business was approximately RMB 1,847,359 thousand, an increase of 26.0% year-over-year[44] - The company's total R&D expenditure in 2023 was approximately RMB 1,482,846 thousand, an increase of 8.1% compared to the previous year, accounting for 13.3% of revenue[50][51] - The company's R&D expenditure in the electronic nicotine delivery systems sector (including e-cigarettes and heated non-combustible products) was RMB 1,033,899 thousand, accounting for 69.7% of total R&D spending[50] - The company's R&D expenditure in the atomized medical and beauty products sector increased by 67.4% to RMB 277,627 thousand, accounting for 18.7% of total R&D spending[50] - The company's total revenue for the review period was approximately RMB 11,168,422 thousand, a decrease of 8.0% year-on-year[61] - The company's gross profit for the review period was approximately RMB 4,334,446 thousand, a decrease of 17.6% year-on-year, with a gross margin of 38.8% compared to 43.3% in 2022[61] - Revenue from enterprise customers decreased by 12.7% to approximately RMB 9,321,063 thousand, with a significant drop of 92.7% in revenue from the Chinese mainland market[63] - Revenue from the US market increased by 8.2% to approximately RMB 4,083,779 thousand, accounting for 36.6% of total revenue[63] - Revenue from Europe and other regions increased by 8.9% to approximately RMB 5,074,276 thousand, accounting for 45.4% of total revenue[63] - The company's own brand business sales increased by 26.0% to approximately RMB 1,847,359 thousand, accounting for 16.5% of total revenue[62] - Revenue from the company's own-brand business reached approximately RMB 1,847,359 thousand, a year-on-year increase of 26.0%, with revenue from the US at RMB 372,192 thousand (up 8.8%) and from Europe and other regions at RMB 1,475,167 thousand (up 31.3%)[64] - Total revenue for 2023 was RMB 11,168,422 thousand, a decrease of 8.0% compared to 2022, with revenue from Europe and other regions accounting for 45.4% (RMB 5,065,271 thousand), the US at 10.8% (RMB 1,210,769 thousand), and Hong Kong at 36.0% (RMB 4,016,522 thousand)[65] - Revenue from the Chinese mainland market was approximately RMB 875,860 thousand, a significant decrease of 92.7% compared to 2022, accounting for only 1.5% of total revenue after adjustments[66] - Gross profit for 2023 was RMB 4,334,446 thousand, a decrease of 17.6% year-on-year, with the gross margin dropping from 43.3% to 38.8% due to lower-margin products and reduced revenue from the Chinese mainland market[68] - Distribution and sales expenses increased by 35.7% to RMB 526,238 thousand, accounting for 4.7% of total revenue, driven by the expansion of localized marketing teams and increased promotional activities in overseas markets[69] - Employee compensation and benefits within distribution and sales expenses grew by 44.4% to RMB 269,416 thousand, reflecting the company's efforts to strengthen overseas market presence[69] - Market development expenses rose by 42.4% to RMB 129,155 thousand, primarily due to increased marketing activities for new product launches in overseas markets[69] - Travel expenses increased by 22.4% to RMB 34,525 thousand, as the company intensified its overseas market expansion and promotional efforts[70] - Raw material costs accounted for 49.4% of total revenue, up from 41.5% in 2022, driven by the increased proportion of lower-margin disposable e-vapor products[68] - Labor costs decreased by 30.6% to RMB 608,898 thousand, reflecting improved production efficiency and automation, reducing the need for manual labor[68] - Administrative expenses decreased by 24.5% to approximately RMB 867,154 thousand, accounting for 7.8% of revenue, down from 9.5% in the previous year[71] - Employee compensation and benefits decreased by 17.8% to approximately RMB 564,044 thousand, accounting for 5.1% of revenue, down from 5.6% in the previous year[71] - Professional service fees decreased by 38.8% to approximately RMB 100,073 thousand, accounting for 0.9% of revenue, down from 1.3% in the previous year[71] - R&D expenses increased by 8.1% to approximately RMB 1,482,846 thousand, accounting for 13.3% of revenue, up from 11.3% in the previous year[73] - Development costs increased by 25.8% to approximately RMB 466,953 thousand, accounting for 4.2% of revenue, up from 3.1% in the previous year[74] - Other income increased by 24.6% to approximately RMB 619,147 thousand, with bank deposit interest income increasing by 23.9% to RMB 515,056 thousand[75] - Other losses totaled approximately RMB 103,740 thousand, compared to other gains of RMB 133,266 thousand in the previous year[76] - Tax expenses decreased by 34.4% to approximately RMB 291,449 thousand, primarily due to a decrease in taxable profits and the impact of preferential tax rates[78] - Comprehensive income for the year decreased by 37.2% to approximately RMB 1,566,470 thousand, primarily due to a decline in revenue and gross profit margin[79] - The company's current ratio increased to 548.8% as of December 31, 2023, up from 534.9% in the previous year, primarily due to an increase in short-term bank deposits[80][81] - The company's asset-liability ratio was approximately 19.1% as of December 31, 2023, compared to 19.5% in the previous year[84] - The company recorded foreign exchange gains of approximately RMB 19,509 thousand in 2023, compared to RMB 126,711 thousand in 2022[86] - The company incurred losses of approximately RMB 95,810 thousand from forward foreign exchange contracts in 2023, compared to RMB 50,029 thousand in 2022[86] - Approximately 60% of the company's revenue was settled in USD, while 40% was settled in RMB during the reporting period[87] - A 10% increase in the USD/RMB exchange rate would increase the company's comprehensive income by approximately RMB 599,744 thousand, while a 10% decrease would reduce it by the same amount[88] - The company's total employee costs accounted for approximately 23.0% of revenue in 2023, down from 25.0% in 2022[90] - The company invested approximately RMB 1,155,547 thousand in property, plant, equipment, and intangible assets in 2023, compared to RMB 2,478,206 thousand in 2022[92] - As of December 31, 2023, the company had capital commitments of approximately RMB 494,304 thousand for property, plant, and equipment[93] - The company had no bank or financial institution borrowings as of December 31, 2023, and held a bank credit line of RMB 6,000.0 million, of which RMB 1,102.2 million was utilized[83] - The company had no significant contingent liabilities as of December 31, 2023[96] - The annual transaction caps for battery procurement are set at RMB 4,500,000 thousand, RMB 6,000,000 thousand, and RMB 7,500,000 thousand for the years ending December 31, 2023, 2024, and 2025, respectively[101] - Battery product procurement transactions during the review period amounted to approximately RMB 548,638 thousand, accounting for 9.9% of the company's total procurement[102] - The company's independent non-executive directors confirmed that the ongoing connected transactions are conducted under normal commercial terms and are fair and reasonable, aligning with the overall interests of shareholders[104] - The company's auditors issued an unqualified opinion on the ongoing connected transactions, confirming compliance with the relevant agreements and not exceeding the annual cap for 2023[105] - Available distributable reserves stood at RMB 7,440.8 million as of December 31, 2023[155] - Charitable donations amounted to RMB 6.3 million in 2023, down from RMB 8.6 million in 2022[156] - The company proposed a final dividend of HK$0.05 per ordinary share for 2023[160] - The share-based compensation plan accounted for approximately 0.94% of the weighted average number of shares issued in 2023[165] - The pre-IPO share option plan allows for the issuance of up to 319,032,000 shares, representing approximately 5.20% of total issued shares[168] - The exercise price for each share option under the pre-IPO share option plan is RMB 0.38[171] - The pre-IPO share option plan has a validity period from the adoption date (September 30, 2019) to the listing date (July 10, 2020), after which no further options will be granted[172] - Each grantee must pay HKD 1 as consideration for accepting the share options under the pre-IPO share option plan, which is non-refundable and not part of the exercise price[171] - The term of share options is determined by the board and shall not exceed ten years from the date of the option offer[170] - Any unexercised share options will expire after the option term ends[170] - The company granted a total of 16,000,000 share options to Director Chen Zhiping, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.04 to HKD 2.08 per option[174] - Director Wang Guisheng was granted 6,000,000 share options, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.34 to HKD 2.42 per option[174] - Director Wang Xin received 1,428,000 share options, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.34 to HKD 2.42 per option[174] - Director Bu Zhiqiang was granted 544,000 share options, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.34 to HKD 2.42 per option[174] - Director Bu Weiqiang received 290,000 share options, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.31 to HKD 2.42 per option[174] - Director Li Xiaoping was granted 1,192,000 share options, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.34 to HKD 2.42 per option[174] - Director Yuan Xiang received 52,000 share options, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.31 to HKD 2.42 per option[174] - Director Xiong Fei was granted 81,000 share options, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.34 to HKD 2.42 per option[174] - Non-director employees were granted a total of 73,219,000 share options, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.31 to HKD 2.42 per option[174] - The company granted an additional 37,000 share options to non-director employees, with an exercise price of HKD 0.38 and a fair value ranging from HKD 2.08 to HKD 2.11 per option[174] - The number of share options available under the post-IPO share option plan at the beginning of 2023 was 160,063,272 shares, and at the end of 2023, it was 86,793,572 shares[175] - The maximum number of shares that can be issued under the post-IPO share option plan and other share option plans combined is 574,351,272 shares, which is 10% of the total issued shares as of the listing date[177] - The total number of shares that can be issued under the post-IPO share option plan is 255,319,272 shares, representing approximately 4.16% of the total issued shares of 6,137,238,720 as of the annual report date[177] - The post-IPO share option plan is valid for ten years from the listing date (July 10, 2020), after which no further options will be granted[183] - In 2023, the company granted a total of 85,475,100 share options under the post-IPO share option plan on April 19, July 20, August 23, and October 20[184] - 319,150 stock options were granted to Director Wang Guisheng on 2023/08/23, with exercise prices of HKD 7.79 and fair values ranging from HKD 2.15 to HKD 3.06[185] - 172,825 stock options were granted to Director Xiong Shaoming on 2023/08/23, with exercise prices of HKD 7.79 and fair values ranging from HKD 2.15 to HKD 3.06[185] - 87,650 stock options were granted to Director Wang Xin on 2023/08/23, with exercise prices of HKD 7.79 and fair values ranging from HKD 2.15 to HKD 3.06[185] - 66,500 stock options were granted to Director Wang Guisheng on 2022/11/09, with an exercise price of HKD 11.11 and a fair value of HKD 2.77[185] - 117,000 stock options were granted to Director Xiong Shaoming on 2022/11/09, with an exercise price of HKD 11.11 and fair values of HKD 2.77 and HKD 3.19[185] - 7,500 stock options were granted to Director Wang Xin on 2022/11/09, with an exercise price of HKD 11.11 and fair values of HKD 2.77 and HKD 3.19[185] - 44,333 stock options were granted to Director Wang Guisheng on 2021/04/01, with an exercise price of HKD 51.05 and fair values ranging from HKD 10.15 to HKD 12.40[185] - 78,000 stock options were granted to Director Xiong Shaoming on 2021/04/01, with an exercise price of HKD 51.05 and fair values ranging from HKD 10.15 to HKD 12.40[185] - 5,000 stock options were granted to Director Wang Xin on 2021/04/01, with an exercise price of HKD 51.05 and fair values ranging from HKD 10.15 to HKD 12.40[185] - 21,667 stock options were granted to Li Xiaoping (Director) on 2021/04/01 with an exercise price of HK$51.05 and a vesting period from 2021/04/01 to 2023/03/31[186] - 32,500 stock options were granted to Li Xiaoping (Director) on 2022/11/09 with an exercise price of HK$11.11 and a vesting period from 2022/11/09 to 2024/03/31[186] - 33,550 stock options were granted to Bu

Financial Performance - For the fiscal year ending December 31, 2023, the company's revenue was RMB 11,168,422 thousand, a decrease of 8.0% compared to RMB 12,144,980 thousand in 2022[4] - Gross profit for the same period was RMB 4,334,446 thousand, resulting in a gross margin of 38.8%, down from 43.3% in 2022[4] - The company reported a net profit of RMB 1,645,090 thousand, a decline of 34.4% from RMB 2,510,316 thousand in the previous year[4] - The total comprehensive income for the review period was approximately RMB 1,566,470 thousand, down about 37.2% from RMB 2,494,934 thousand in 2022[41] - Basic earnings per share for 2023 were RMB 27.01, down from RMB 41.66 in 2022, reflecting a decrease of 35.4%[85] - The company reported a significant increase in inventory provision costs, which rose to RMB 61,176 thousand in 2023 from RMB 8,791 thousand in 2022[129] Market Performance - The company maintained a market share of approximately 13.7% in the global electronic vaporizer equipment market, down from 18.1% in 2022[11] - Revenue from the mainland China market was approximately RMB 163,008 thousand, a significant decline of about 92.7%, accounting for approximately 1.5% of total revenue[19] - Revenue from overseas markets increased by approximately 11.2% to RMB 11,005,414 thousand, rising to approximately 98.5% of total revenue[16] - In the U.S. market, revenue from enterprise customers reached approximately RMB 4,083,779 thousand, an increase of about 8.2%, representing approximately 36.6% of total revenue[17] - Revenue from Europe and other regions increased by approximately 17.9% to RMB 5,065,271 thousand, representing about 45.4% of total revenue[46] Research and Development - The company continues to focus on research and development in electronic vaporization products, enhancing its R&D management system to improve efficiency[7] - The total R&D expenditure amounted to approximately RMB 1,482,846 thousand, representing an increase of about 8.1% compared to the previous year, with the percentage of revenue rising from approximately 11.3% to about 13.3%[28] - The company has over 1,400 R&D personnel and significantly higher R&D investment compared to peers, ensuring long-term growth and innovation[23] - The company has filed a total of 2,033 new patent applications globally during the review period, including 1,172 invention patents, bringing the cumulative total to 7,695 patents, of which 3,867 are invention patents[28] - The introduction of a digital management system for new product development has significantly improved the efficiency and effectiveness of R&D resource allocation[28] Cost Management - The company has implemented cost reduction strategies, resulting in a significant decrease in administrative expenses during the review period[9] - Distribution and sales expenses increased from approximately RMB 387,671 thousand to about RMB 526,238 thousand, a growth of approximately 35.7%, accounting for about 4.7% of revenue[53] - Administrative expenses decreased from approximately RMB 1,147,916 thousand to about RMB 867,154 thousand, a decline of approximately 24.5%, accounting for about 7.8% of revenue[54] - Total employee costs accounted for approximately 23.0% of the group's revenue in 2023, down from 25.0% in 2022, due to improved operational efficiency[78] Corporate Governance - The board of directors consists of eight members, including three independent non-executive directors, exceeding the one-third requirement set by listing rules[148] - The board has recommended a final dividend of HKD 0.05 per ordinary share for the year ending December 31, 2023, pending approval at the upcoming annual general meeting[158] - The company has adopted a dividend policy that considers its financial condition and other relevant factors before declaring dividends[158] - The audit committee has been established in accordance with the listing rules, consisting of three independent non-executive directors, with Mr. Zhong Shan as the chairman[171] - The board is committed to maintaining high standards of corporate governance and has reviewed the effectiveness of its governance structure[150] Future Outlook - The global electronic vaporization product market is projected to reach approximately $19.86 billion by 2028, with a compound annual growth rate (CAGR) of about 11.5% from 2023 to 2028[32] - The company plans to launch a new oil cartridge-based closed product in the European market in 2024, which has successfully obtained TPD compliance certification[33] - The company aims to enhance production management levels in 2024 to reduce manufacturing costs and improve product competitiveness[38] - The company will continue to invest in R&D across electronic vaporization, heated tobacco, and medical vaporization products to maintain its leading position in these sectors[37] - The company is committed to optimizing supply chains and production processes to shorten order delivery cycles and improve delivery efficiency[38]

Financial Performance - The group's revenue and profit experienced a decline during the first half of 2023 due to a rapidly changing market and external environment[12]. - The company's revenue for the first half of 2023 was RMB 5,122,862 thousand, a decrease of 9.4% compared to RMB 5,653,321 thousand in 2022[27]. - Gross profit for the same period was RMB 1,855,370 thousand, reflecting a decline of 31.4% from RMB 2,705,607 thousand in the previous year[27]. - The pre-tax profit dropped by 52.5% to RMB 796,170 thousand from RMB 1,675,965 thousand in 2022[27]. - The net profit for the period was RMB 717,342 thousand, down 48.2% from RMB 1,384,690 thousand in the prior year[27]. - The adjusted net profit margin decreased to 14.8%, down 10.6 percentage points from 25.4% in 2022[27]. - Total comprehensive income for the period decreased by 46.9% from RMB 1,384,101 thousand to RMB 734,356 thousand[90]. - Basic earnings per share decreased to RMB 11.81 from RMB 23.08, reflecting a drop of 48.9% year-on-year[173]. Market and Product Development - The company launched the upgraded FEELM Max ceramic atomization core technology platform, achieving significant shipment volumes while meeting compliance requirements[14]. - The company is focusing on four strategic areas: electronic atomization products, heat-not-burn products, special-purpose atomization products, and atomization in healthcare[14]. - The company plans to introduce more differentiated disposable innovative products to overseas markets in the second half of 2023, aiming to drive revenue growth[18]. - The company is committed to expanding the application of atomization technology in healthcare, collaborating with leading companies in the respiratory drug field[14]. - The company aims to diversify its revenue across different countries and regions while expanding its product portfolio and applications of aerosol technology in healthcare[40]. - The company plans to launch more innovative products in the special-purpose aerosol market to enhance competitiveness[19]. Research and Development - The company's R&D expenditure totaled RMB 614.724 million, representing a 1.8% increase compared to the same period last year[41]. - Research and development in the aerosol medical field is progressing steadily, with plans to continue development of pharmaceutical projects in the second half of 2023[19]. - The company aims to leverage its R&D capabilities and management improvements to navigate industry changes and deliver greater returns to shareholders[19]. - The R&D spending for electronic nicotine delivery systems (including electronic vapor products and heated non-combustible products) accounted for approximately 68.1% of total R&D expenditure, down from 82.4% year-on-year[47]. - The company has filed a total of 1,154 new patent applications globally during the review period, including 684 invention patents, bringing the cumulative total to 6,816 patents, with 3,379 being invention patents[44]. Regulatory Environment - The introduction of the "E-cigarette Management Measures" in mainland China has led to a prohibition on the sale of flavored e-cigarettes, impacting short-term sales[33]. - The FDA has issued marketing denial orders (MDO) for over 100,000 non-tobacco and non-menthol flavored ENDS products, affecting market dynamics in the US[35]. - The revised Import and Export (Amendment) Ordinance in Hong Kong allows for the transit of alternative smoking products, which may influence market operations[37]. - The company continues to monitor global regulatory developments to ensure compliance and adapt its R&D and production activities accordingly[40]. Operational Efficiency - Management expenses decreased during the review period as part of cost reduction and efficiency improvement initiatives[17]. - The company is optimizing its supply chain management and strengthening local warehousing to improve customer service experience[15]. - The company has adopted agile modular production to meet the rapidly changing market demand for disposable electronic vapor products, significantly improving production efficiency and delivery capabilities[51]. - The company aims to enhance production operations management to improve customer service responsiveness and supply chain management to strengthen cost control capabilities[67]. Market Trends - The company believes that the electronic atomization product market is in a phase of low penetration and steady growth, with opportunities arising from clearer regulatory policies[18]. - In the US market, the market share of disposable e-cigarettes increased from 24.7% in January 2020 to 51.8% in December 2022, according to the CDC[33]. - The global electronic vaporization equipment market is projected to reach approximately USD 23,413.9 million by 2027, with a compound annual growth rate (CAGR) of 18.5% from 2022 to 2027[62]. - The global heated tobacco product market is expected to reach approximately USD 16,600 million by 2027, also with a CAGR of 18.5% during the same period[63]. - The global market for pulmonary drugs and drug delivery devices is estimated to reach approximately USD 56 billion in 2022, with expectations to grow to about USD 93.3 billion by 2030[66]. Shareholder and Corporate Governance - The board of directors consists of eight members, including three independent non-executive directors, ensuring sufficient checks and balances[109]. - The audit committee, led by independent non-executive director Zhong Shan, reviews the group's financial and accounting practices, risk management, and internal controls[112]. - The company has established an internal audit mechanism to independently assess the effectiveness of its risk management and internal control systems[116]. - The company has committed to ongoing professional training for all directors to enhance their knowledge and skills in corporate governance[120]. - The remuneration committee is responsible for recommending overall remuneration policies for directors and senior management, ensuring competitiveness and fairness[113]. Cash Flow and Liquidity - Cash and cash equivalents increased by 29.1% to RMB 12,605,378 thousand from RMB 9,762,933 thousand[31]. - The current ratio improved to 639.3% from 534.9% as of December 31, 2022[91]. - The company reported a significant increase in cash inflow from short-term deposits, with RMB 7,052,638 thousand withdrawn during the six months ended June 30, 2023, compared to RMB 3,048,345 thousand in the previous year[181]. - The company’s financing activities resulted in a net cash outflow of RMB 537,990 thousand for the six months ended June 30, 2023, compared to a net cash inflow of RMB 460,937 thousand in the same period of 2022[181]. Employee Compensation and Stock Options - Employee compensation and benefits rose by 54.7% from RMB 70,117 thousand to RMB 108,439 thousand, representing 2.1% of revenue, up from 1.2%[83]. - The company has a significant number of stock options, with 3,520,000 options granted to non-director employees[140]. - The total number of stock options exercised during the six months ended June 30, 2023, was 2,917,000[140]. - The company continues to manage its stock option plan actively, reflecting its commitment to employee incentives and retention strategies[140].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告之內容概不負責，對其準確性或完整性亦不 發表任何聲明，並明確表示，概不對因本公告全部或任何部分內容而產生或因倚賴該等內容而引致之任何損 失承擔任何責任。 Smoore International Holdings Limited 思 摩 爾 國 際 控 股 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：6969） 截至2023年6月30日止 6個月中期業績公告 思摩爾國際控股有限公司（「本公司」）董事（「董事」）會（「董事會」）欣然公佈本公司及其附屬 公司（統稱「本集團」）截至2023年6月30日止6個月（「回顧期」）的未經審核綜合業績。本公司 獨立核數師德勤‧關黃陳方會計師行（執業會計師）已根據香港會計師公會頒佈的香港審閱 委聘準則第2410號「由實體之獨立核數師審閱中期財務資料」審閱本集團截至2023年 6月30日止6個月的未經審核簡明綜合中期財務資料。此外，該等中期業績亦由本公司審核 委員會（「審核委員會」）審閱。 ...

Financial Performance - Smoore reported a revenue of approximately 1.2 billion HKD for the fiscal year 2022, representing a year-over-year increase of 15%[2]. - The company achieved a net profit margin of 25%, with net profit reaching around 300 million HKD, up from 240 million HKD in the previous year[2]. - Total revenue for the year ended December 31, 2022, was RMB 12,144,980 thousand, a decrease of 11.7% compared to RMB 13,755,242 thousand in 2021[5]. - Gross profit for 2022 was RMB 5,259,632 thousand, resulting in a gross margin of 43.3%, down from 53.6% in 2021[5][7]. - Net profit for the year was RMB 2,510,316 thousand, a decline of 52.5% from RMB 5,286,967 thousand in 2021[5]. - Adjusted net profit for 2022 was RMB 2,575,122 thousand, reflecting a decrease of 52.7% compared to RMB 5,442,613 thousand in 2021[5][6]. - The adjusted net profit margin for 2022 was 21.2%, down from 39.6% in 2021[7]. - Total comprehensive income for the year was RMB 2,494,934 thousand, down 52.8% from RMB 5,286,991 thousand in 2021[77]. Market Expansion and Strategy - Smoore plans to expand its market presence in Europe and North America, targeting a 30% increase in market share by 2025[2]. - Future guidance estimates revenue growth of 10-15% for the next fiscal year, driven by new product launches and market expansion[2]. - The company is exploring potential acquisitions to enhance its product portfolio and market reach, with a budget of 200 million HKD allocated for this purpose[2]. - The company aims to reduce production costs by 5% through operational efficiencies and supply chain optimization[2]. - The company is focusing on expanding its product line in the special-purpose vaporization products sector to increase market share[17]. Research and Development - The company is investing 100 million HKD in R&D for new product development, focusing on innovative vaping technologies[2]. - The company increased R&D investment, achieving significant breakthroughs in core technologies, particularly in heated tobacco products and new heating element technologies[12]. - R&D expenditure totaled RMB 1,372,258 thousand, an increase of 104.6% year-on-year, representing 11.3% of revenue compared to 4.9% the previous year[45]. - The company expanded its R&D team by over 320 personnel, bringing the total to over 1,500, which is more than 40% of the total non-production staff[43]. - The company launched a new generation ceramic core technology platform, FEELM Max, which outperforms competitors in vaporization efficiency and user experience[44]. Regulatory Environment - The company is actively monitoring ongoing legal challenges related to MDOs issued by the FDA, with some being temporarily stayed by federal courts[20]. - The company is preparing for compliance with the new electronic cigarette management regulations that took effect on May 1, 2022[23]. - The company has obtained tobacco monopoly licenses and supported brand clients in submitting electronic vapor product technical reviews compliant with national standards as of March 11, 2022[23]. - The national standard for electronic cigarettes (GB 41700-2022) was officially released on April 8, 2022, and will be implemented starting October 1, 2022[25]. Corporate Governance - The company adhered to the corporate governance code and complied with all provisions, except for a deviation from the code's C.2.1[105]. - The board of directors is composed of a balanced mix of executive and independent non-executive directors, ensuring strong independence and effective judgment[106]. - The company has established an Environmental, Social, and Governance (ESG) committee as of December 28, 2022[114]. - The board has committed to holding at least four regular board meetings annually, approximately once per quarter[114]. Employee and Management - The group has over 14,787 employees in mainland China, 9 in Hong Kong, and 1,577 overseas as of December 31, 2022[87]. - The group established the "Simor Academy" for continuous professional and management training for employees, including a 6-month onboarding program for new graduates[88]. - The company has a strong management team with over 10 years of experience in the electronic vaporization industry, led by the CEO who has been instrumental in the company's strategic direction[194]. Shareholder Engagement and Dividends - The company plans to declare a final dividend of HKD 0.08 per ordinary share for the year ended December 31, 2022[6]. - The annual general meeting is scheduled for May 25, 2023, to approve the proposed dividend and other matters[153]. - The company’s board believes that the share buyback plan reflects confidence in the long-term strategy and growth of the company[155]. Financial Health and Assets - Total assets as of December 31, 2022, amounted to RMB 24,359,317 thousand, an increase from RMB 22,871,306 thousand in 2021[5]. - Current assets reached RMB 19,198,773 thousand, up from RMB 17,985,772 thousand in 2021, with a current ratio of 534.9%[5][7]. - The debt-to-asset ratio for 2022 was 16.3%, slightly up from 15.8% in 2021, indicating stable financial leverage[7]. Sales and Revenue Trends - Revenue from sales to overseas corporate clients increased by approximately 6.5%, while revenue from sales to overseas retail clients rose by 26.2% compared to the previous year[34]. - In the US market, sales revenue from electronic vapor products decreased by 22.7% year-over-year, accounting for 31.1% of total revenue, down from 35.5%[38]. - Revenue from disposable electronic vapor products reached RMB 1,931,028 thousand, a growth of 1,919.2% compared to RMB 95,634 thousand in 2021[41]. - Revenue from retail customer products grew by 26.2% year-over-year, totaling RMB 1,465,608 thousand, with the second half of the year showing a 28.3% increase[42].

Financial Performance - For the year ended December 31, 2022, the total revenue was RMB 12,144,980, a decrease of 11.7% compared to RMB 13,755,242 in 2021[2] - The adjusted net profit for 2022 was RMB 2,575,122, reflecting a decline from RMB 5,442,613 in 2021[3] - The gross profit margin for 2022 was 43.3%, down from 53.6% in 2021[2] - The total revenue for the group was RMB 12,144,980 thousand, a decrease of 11.7% compared to RMB 13,755,242 thousand in 2021[22] - Gross profit for the period was RMB 5,259,632 thousand, down 28.7% from RMB 7,377,039 thousand in 2021, resulting in a gross margin of 43.3%[22] - Adjusted net profit decreased by 52.7% to RMB 2,575,122 thousand from RMB 5,442,613 thousand in 2021, primarily due to a decline in sales revenue from enterprise customers and increased expenses[22] - The net profit for the year was RMB 2,510,316 thousand, a decline of 52.5% from RMB 5,286,967 thousand in 2021[58] Revenue Breakdown - Export revenue accounted for 81.5% of total revenue, significantly increasing from 66.0% in 2021, with a notable rise in the second half of the year[8] - Sales revenue in the U.S. market decreased by 22.7%, with its share of total revenue dropping from 35.5% to 31.1%[9] - In the European market, sales revenue increased by 53.4%, rising from 22.1% of total revenue to 38.3%[10] - Revenue from enterprise customers decreased to RMB 10,679,372 thousand, a decline of 15.2% compared to RMB 12,593,523 thousand in 2021, primarily due to regulatory impacts in the US and China[24] - Revenue from retail customers increased to RMB 1,465,608 thousand, representing a growth of approximately 26.2% from RMB 1,161,719 thousand in 2021, driven by strong R&D capabilities and successful new product launches[25] Research and Development - The total R&D expenditure amounted to RMB 1,372,258 thousand, representing a 104.6% increase year-on-year, and accounting for 11.3% of revenue, up from 4.9% the previous year[13] - The group added over 320 R&D personnel during the review period, bringing the total to over 1,500, which is more than 40% of the total non-production staff[12] - The group established 7 new research institutes focusing on new materials, medical research, and health and beauty applications of atomization technology[12] - The group has applied for a total of 5,662 patents globally, including 2,695 invention patents, with 2,254 new patent applications filed during the review period[14] - Research and development expenses increased significantly to RMB 1,372,258 thousand in 2022, compared to RMB 670,629 thousand in 2021, reflecting a rise of 104.5%[58] Market and Product Development - The company is focusing on long-term competitiveness through increased investment in core technology R&D and talent development[5] - The company aims to expand its product line in the special-purpose atomization products sector to increase market share[5] - The company launched disposable electronic vaporization products, achieving revenue of RMB 1,931,028 thousand, a growth of 1,919.2% compared to RMB 95,634 thousand in 2021[11] - The company aims to expand its market share in specialized atomization products by entering more niche markets with new product launches[13] - The company plans to invest in R&D, including the establishment of a group-level research institute in Shenzhen and the development of new heating technologies[105] Operational Efficiency - The company successfully implemented an SAP system to enhance management capabilities, laying a solid foundation for long-term development[6] - The group has introduced advanced product development management processes to enhance manufacturability and automation feasibility in product design[16] - The group successfully implemented an SAP system to improve operational efficiency across procurement, production, sales, and financial management[15] - The company is upgrading its group-level ERP system and existing factories to enhance operational efficiency[105] Challenges and Risks - The company faced challenges from the ongoing COVID-19 pandemic, impacting production, logistics, and supply chains[5] - The cost of raw materials accounted for 73.3% of total sales costs, up from 70.0% in the previous year, primarily due to increased sales of low-margin disposable products[30] - Distribution and selling expenses rose to RMB 387,671 thousand, an increase of 101.0% from RMB 192,916 thousand in 2021, representing 3.2% of total revenue[31] Shareholder Communication and Governance - The company has maintained compliance with corporate governance principles, adhering to all code provisions except for the separation of the roles of Chairman and CEO[89] - The board consists of eight directors, including three independent non-executive directors, ensuring adequate checks and balances[89] - The company established various communication channels with shareholders, including printed and electronic reports, annual meetings, and dedicated investor relations teams[94] - The board expressed confidence in the company's long-term strategy and growth potential, as evidenced by recent share purchases by directors totaling HKD 201,410,020[100] Dividends and Share Buybacks - The company plans to distribute a final dividend of HKD 0.08 per ordinary share for the year ended December 31, 2022[4] - The company declared a mid-year dividend of HKD 0.10 per share for 2022, down from HKD 0.21 per share in 2021[80] - The total dividend paid for the year was approximately RMB 1,448,103 thousand, a decrease of 38.8% compared to RMB 2,369,905 thousand in 2021[80] - The company aims to enhance shareholder value through its share buyback program, reflecting confidence in its business outlook[98] Future Outlook - The global electronic vaporization equipment market is projected to grow at a compound annual growth rate (CAGR) of approximately 18.5% from 2022 to 2027[7] - The global heated tobacco products market is expected to grow at a CAGR of about 18.5%, with a projected market size of approximately USD 16,600 million by 2027[19] - The global special purpose vaporization equipment market is anticipated to grow at a CAGR of around 18.4%, reaching approximately USD 2,784.6 million by 2027[19] - The company aims to apply for additional resources from PMTA to launch more products in the medical and pharmaceutical sectors[105]