Financial Performance - Revenue for 2021 reached RMB 13,755,242 thousand, a significant increase from RMB 10,009,937 thousand in 2020[11] - Gross profit margin improved to 53.6% in 2021, up from 52.9% in 2020[11] - Net profit and total comprehensive income for 2021 was RMB 5,286,991 thousand, compared to RMB 2,399,921 thousand in 2020[11] - Adjusted net profit for 2021 was RMB 5,442,613 thousand, up from RMB 3,893,428 thousand in 2020[12] - Total assets increased to RMB 22,871,306 thousand in 2021 from RMB 14,773,809 thousand in 2020[11] - Cash and cash equivalents stood at RMB 11,426,758 thousand in 2021, compared to RMB 9,557,802 thousand in 2020[11] - Non-current assets grew to RMB 4,885,534 thousand in 2021 from RMB 2,333,221 thousand in 2020[11] - Current assets increased to RMB 17,985,772 thousand in 2021 from RMB 12,440,588 thousand in 2020[11] - Total equity/assets net worth rose to RMB 19,246,359 thousand in 2021 from RMB 12,399,721 thousand in 2020[11] - Adjusted net profit margin rose to 39.6% in 2021, compared to 38.9% in 2020[18] - Sales revenue reached RMB 13.76 billion in 2021, a year-on-year increase of 37.4%[24] - Revenue from enterprise customers grew by 37.4% to approximately RMB 12,593,523 thousand, surpassing the RMB 10 billion mark for the first time[37] - Revenue from retail customers increased by 37.1% to approximately RMB 1,161,719 thousand[38] - Export revenue accounted for 66.0% of total revenue, amounting to approximately RMB 9,082,316 thousand[37] - Domestic sales revenue accounted for 34.0% of total revenue, amounting to approximately RMB 4,672,926 thousand[37] - Total revenue for the period was approximately RMB 13.755 billion, a 37.4% year-on-year increase, with gross profit rising 39.3% to RMB 7.377 billion and a gross margin of 53.6%[45] - Adjusted net profit increased by 39.8% to approximately RMB 5.443 billion, driven by revenue growth and improved cost efficiency[45] - Revenue from Mainland China surged by 104.1% to RMB 5,530,301 thousand, reflecting economic recovery and increased customer orders[50] - Gross profit rose by 39.3% to RMB 7,377,039 thousand, with gross margin improving from 52.9% to 53.6% due to scale effects and product mix changes[52] - Net profit and total comprehensive income for the year surged by 120.3% to approximately RMB 5,286,991 thousand, with adjusted net profit increasing by 39.8% to RMB 5,442,613 thousand, primarily due to revenue growth, improved gross margin, and other income gains[67] Costs and Expenses - Raw material costs increased by 30.3% to RMB 4,467,152 thousand, accounting for 70.0% of total cost of sales[53] - Labor costs grew by 49.3% to RMB 1,011,034 thousand, representing 15.9% of total cost of sales, partly due to reduced government subsidies[54] - Distribution and sales expenses increased by 33.8% to RMB 192,916 thousand, driven by expanded marketing activities[55] - Administrative expenses rose by 26.5% to RMB 863,701 thousand, but decreased as a percentage of revenue from 6.8% to 6.3% due to cost-saving measures[57] - R&D expenses grew by 59.7% to RMB 670,629 thousand, with R&D as a percentage of revenue increasing from 4.2% to 4.9%[58] - Employee compensation and benefits in R&D surged by 76.5% to RMB 374,637 thousand, reflecting increased investment in talent and research areas[58] - Tax expenses increased by 28.5% to approximately RMB 922,375 thousand, accounting for 16.9% of adjusted net profit, driven by higher taxable profits[66] Market and Sales - Sales to enterprise customers grew by 37.4% year-on-year in 2021[24] - Sales to retail customers increased by 37.1% year-on-year in 2021[24] - The company's market share in the global atomization technology sector continues to grow[24] - The company's sales to the top five customers accounted for approximately 75.5% of total sales in 2021, with the largest customer contributing about 34.3% of total sales[119] - Purchases from the top five suppliers accounted for approximately 28.3% of total purchases in 2021, with the largest supplier contributing about 10.9% of total purchases[119] Regulatory and Geographic Revenue - The company faces regulatory challenges in key markets, such as the FDA's PMTA requirements in the US, which impact 12.2% of total revenue[25] - China's revenue contribution accounted for 40.2% of total revenue in 2021, with a significant portion affected by new tobacco regulations[26] - The U.S. revenue contribution, excluding products resold through Hong Kong, was approximately 37.1% in 2021[28] - Hong Kong's revenue contribution was 27.5% in 2021, with new regulations banning the import, production, and sale of e-cigarettes effective from April 2022[27] - The UK's revenue contribution was 11.1% in 2021, with regulatory changes post-Brexit requiring separate product notifications for Great Britain and Northern Ireland[27] - Japan and the EU contributed 1.5% and 3.0% respectively to revenue in 2021, with no significant regulatory changes reported[27] Research and Development - The company launched a new fully automated atomizer production line with a record efficiency of 7,200 atomizers per hour[20] - The company continues to invest in R&D for atomization technology, exploring applications in healthcare, beauty, and wellness[21] - R&D expenditure increased by 59.7% to approximately RMB 670.629 million, accounting for 4.9% of revenue, up from 4.2% in the previous year[39] - The company filed 1,187 new patent applications globally, including 605 invention patents, bringing the total number of patent applications to 3,408, with 1,570 being invention patents[39] - The company plans to establish at least 5 new research institutes in 2022, focusing on new materials, innovative vaporization technologies, and medical vaporization products[43] - R&D expenditure for 2022 is projected to reach approximately RMB 1.68 billion, exceeding the total R&D investment of the past six years[44] - The company launched the Feelm Air, a next-generation ultra-thin e-vaporizer solution, featuring a seven-layer composite heating film and a thinner ceramic core[44] Production and Capacity - Production capacity utilization rates were 67.6% for enterprise customers and 90.7% for retail customers, with total production reaching 1,748.4 million standard units for enterprise and 22.4 million for retail[41] - The company invested approximately RMB 977 million to acquire a commercial land plot in Shenzhen for the construction of its headquarters, with a planned construction area of 66,000 square meters[42] - Total investment in property, plant, and equipment and intangible assets during the review period: RMB 1,234,123 thousand, mainly for expanding production scale and increasing R&D activities[75] - Capital commitments for land use rights and property, plant, and equipment as of December 31, 2021: RMB 390,128 thousand, compared to RMB 70,272 thousand in 2020[76] - Significant investment of approximately RMB 977 million in a commercial land plot in Shenzhen for the construction of the company's headquarters, with a planned completion by the end of 2026[77] - Planned investment of approximately RMB 1,500 million over the next five years for the headquarters office building project[78] Market Growth and Projections - The global electronic vaporization device market is expected to grow at a CAGR of 25.3% from 2022 to 2026[35] - The company maintained its position as the world's largest electronic vaporization device manufacturer, with a market share increase from 18.9% in 2020 to 22.8% in 2021[35] - The global closed-system electronic vaporization device market is expected to grow at a CAGR of 24.6% from 2022 to 2026[35] - The global open-system electronic vaporization device market is expected to grow at a CAGR of 11.0% from 2022 to 2026[35] - The global special-purpose electronic vaporization device market is expected to grow at a CAGR of 45.8% from 2022 to 2026[35] - Global e-vapor device market is expected to grow at a CAGR of 25.3% from 2022 to 2026, according to Frost & Sullivan[43] Dividends and Shareholder Returns - The Board proposed a final dividend of 18 HK cents per ordinary share for the year ended December 31, 2021[17] - The board proposed a final dividend of 18 HK cents per ordinary share for the year ended December 31, 2021, subject to approval at the annual general meeting[124] - The company's annual general meeting is scheduled to be held on May 27, 2022[125] - The company will suspend share transfer registration from May 24, 2022, to May 27, 2022, to determine shareholders eligible to attend the annual general meeting and vote[126] - The company will suspend share transfer registration from June 6, 2022, to June 8, 2022, to determine shareholders eligible for the final dividend[126] Share Options and Incentives - The company granted a total of 319,032,000 share options under the Pre-IPO Share Option Plan to eligible participants[130] - The exercise price for each share option granted under the Pre-IPO Share Option Plan is RMB 0.38[132] - The Pre-IPO Share Option Plan has a maximum term of 10 years from the date of the option offer[131] - The Pre-IPO Share Option Plan was effective from the adoption date (September 30, 2019) to the listing date (July 10, 2020)[133] - The total number of share options granted under the Pre-IPO Share Option Scheme as of December 31, 2021, was 16,000,000 for Chen Zhiping, with an exercise price of RMB 0.38[134] - Wang Guisheng exercised 6,000,000 share options during the period, with an exercise price of RMB 0.38[134] - Li Xiaoping exercised 1,192,000 share options during the period, with an exercise price of RMB 0.38[134] - Yuan Xiang exercised 52,000 share options during the period, with an exercise price of RMB 0.38[134] - Xiong Fei exercised 81,000 share options during the period, with an exercise price of RMB 0.38[134] - Other employees exercised 39,535,000 share options during the period, with an exercise price of RMB 0.38[134] - The Post-IPO Share Option Plan was conditionally approved and adopted on June 15, 2020, with the purpose of encouraging and rewarding eligible participants for their contributions to the group[136][137] - The maximum number of shares that can be issued under the Post-IPO Share Option Plan and other share option plans is 10% of the total issued shares as of the listing date, or 574,351,272 shares[138] - The total number of shares that can be issued under all share option plans at any time cannot exceed 30% of the total issued shares[138] - The total number of stock options granted under the post-IPO share option plan in 2021 was 39,791,000 shares, distributed on April 1 (26,388,000 shares), July 9 (3,670,000 shares), and September 30 (9,733,000 shares)[142] - The closing share prices on the day before the option grant dates were HK42.95 (July 9), and HK5,000,000[139] - The company adopted a Share Award Plan on September 2, 2021, to reward eligible participants for their contributions to the group's growth and development[144] - As of December 31, 2021, the total number of unexercised stock options held by employees was 6,620,668 shares (granted on April 1), 821,000 shares (granted on July 9), and 2,464,500 shares (granted on September 30)[143] - The company's share incentive plan has a validity period of 10 years, starting from the adoption date, with the board having the authority to terminate it early, provided that the termination does not affect the vested rights of any selected participants[146] - The maximum number of shares that the trustee may hold at any point during the plan's validity period shall not exceed 2% of the company's total issued share capital, and the maximum number of shares that may be awarded under the plan shall not exceed 5% of the company's total issued share capital[149] - On September 2, 2021, the company's board approved the adoption of the share incentive plan, and as of December 31, 2021, the trustee purchased 1,412,700 and 1,449,000 shares in the market on September 15, 2021, and November 5, 2021, respectively[151] - On December 24, 2021, the company granted 4,797,300 award shares to specific selected participants under the terms of the share incentive plan[151] - The share incentive plan allows for the award of shares to eligible participants, including employees, non-executive directors, consultants, and other contributors to the company's development and growth[145] - The trustee is required to transfer and vest the legal and beneficial ownership of the award shares to the selected participants as soon as practicable after the latest of the earliest vesting date specified in the award notice, receipt of necessary documents, and achievement of any performance targets[148] - If a selected participant who is an employee ceases to be an employee due to corporate restructuring, any awards granted to them will immediately lapse and be canceled[149] - The trustee is prohibited from exercising voting rights and must waive voting rights for any shares held under the trust, including award shares, additional shares, returned shares, bonus shares, and dividend shares[150] - The share incentive plan will terminate on the earlier of the 10th anniversary of the adoption date or the early termination date determined by the board or committee, without affecting the vested rights of any selected participants[150] Corporate Governance and Board Structure - The Board of Directors consists of 7 members, including 3 independent non-executive directors and 1 non-executive director, ensuring sufficient checks and balances[91] - The Chairman and CEO roles are held by the same individual, Mr. Chen Zhiping, which the Board considers appropriate for shareholder interests[91] - The company has a policy for the continuous professional development of directors, with all directors participating in training types A and B during the reporting period[94] - The Board held 5 meetings, the Audit Committee held 3 meetings, and other committees held a total of 3 meetings during the year ending December 31, 2021[95] - The company holds at least four regular board meetings annually, with agendas and documents sent to directors at least 3 days in advance[96] - All directors and relevant employees strictly complied with the Model Code for Securities Transactions as of December 31, 2021[97] - The company has adopted a Board Diversity Policy to enhance diversity, which is considered a key element in maintaining competitive advantage[98] - The Nomination Committee reviews the board's structure annually and considers diversity in gender, age, cultural background, professional experience, and skills[99] - The company has a Director Nomination Policy to ensure a balanced board with diverse skills, experience, and perspectives[100] - The Audit Committee includes three independent non-executive directors and focuses on financial reporting, risk management, and internal controls[104] - The Audit Committee held three meetings with external auditors in 2021 to review financial statements and discuss audit procedures[105] - The Nomination Committee evaluates board composition and considers factors like gender, age, and industry experience for board appointments[106] - The company's remuneration committee, chaired by Mr. Yan Xiaoying, is responsible for recommending the overall remuneration policy and structure for directors and senior management[107] - The company's senior management salary range for the fiscal year ending December 31, 2021, includes 2 individuals earning between 0 HKD and 10,000,000 HKD, and 1 individual earning between 10,000,001 HKD and 20,000,000 HKD[109] - The company's independent external auditor, Deloitte Touche Tohmatsu, received approximately 3,300,000 RMB for audit services and 973,000 RMB for non-audit services during the fiscal year ending December 31, 2021[113] - The company's risk management and internal control systems are designed to manage operational efficiency, ensure asset protection, maintain proper accounting records, and comply with relevant
思摩尔国际(06969) - 2021 - 年度财报