梦百合(603313) - 2021 Q4 - 年度财报

Company Profile and Key Financial Indicators Basic Company Information MLILY Hometech (stock code: 603313) is a Shanghai-listed company specializing in memory foam home products - The company's Chinese name is 梦百合家居科技股份有限公司, with the stock ticker "MLILY" and stock code 603313, listed on the Shanghai Stock Exchange[637][59] - The company's legal representative is Ni Zhanggen, and the Board Secretary is Fu Dongqing[637][39] Key Accounting Data and Financial Indicators In 2021, revenue grew 24.64% to RMB 8.14 billion, but net profit turned to a loss of RMB 276 million due to rising costs 2019-2021 Key Accounting Data | Key Accounting Data | 2021 | 2020 | Y-o-Y Change (%) | 2019 | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue (RMB) | 8,139,254,616.14 | 6,530,134,253.31 | 24.64 | 3,831,588,314.29 | | Net Profit Attributable to Shareholders (RMB) | -275,532,304.29 | 378,585,689.15 | -172.78 | 373,677,311.95 | | Net Profit Attributable to Shareholders (Non-recurring) (RMB) | -258,392,029.10 | 349,917,990.50 | -173.84 | 361,286,172.50 | | Net Cash Flow from Operating Activities (RMB) | 67,922,544.84 | 582,525,962.44 | -88.34 | 129,794,963.26 | | Asset Data | End of 2021 | End of 2020 | Y-o-Y Change (%) | End of 2019 | | Net Assets Attributable to Shareholders (RMB) | 2,906,893,844.75 | 3,556,693,841.04 | -18.27 | 2,334,071,079.34 | | Total Assets (RMB) | 9,198,519,914.62 | 7,075,842,657.13 | 30.00 | 4,619,775,351.10 | 2019-2021 Key Financial Indicators | Key Financial Indicators | 2021 | 2020 | Y-o-Y Change (%) | 2019 | | :--- | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (RMB/Share) | -0.57 | 1.11 | -151.35 | 1.18 | | Diluted Earnings Per Share (RMB/Share) | -0.57 | 1.10 | -151.82 | 1.13 | | Weighted Average Return on Equity (%) | -8.44 | 14.24 | Decrease of 22.68 p.p. | 18.29 | 2021 Quarterly Key Financial Data | Indicator | Q1 (RMB) | Q2 (RMB) | Q3 (RMB) | Q4 (RMB) | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 1,889,004,260.53 | 2,010,994,273.01 | 2,210,469,039.75 | 2,028,787,042.85 | | Net Profit Attributable to Shareholders | 55,268,176.42 | -46,452,495.95 | -188,925,955.63 | -95,422,029.13 | | Net Cash Flow from Operating Activities | -115,699,362.09 | -69,185,359.27 | -153,027,437.54 | 405,834,703.74 | Management Discussion and Analysis Discussion and Analysis of Operations In 2021, the company advanced its global strategy, achieving 24.64% revenue growth to RMB 8.14 billion despite a net loss - The company firmly executed its "Global Production, International Branding" strategy, establishing a global footprint with production bases in China, Serbia, the US, Thailand, and Spain through organic growth and acquisitions[67][92] - During the reporting period, the company initiated a non-public offering of shares to raise up to RMB 1.286 billion for production base expansion, intelligent upgrades, and working capital replenishment to enhance sustainable competitiveness[100] - Significant progress was made in IT infrastructure, including the launch of a customer data platform, SAP system rollout, and MES system optimization, providing systemic support for global lean management[99] Industry Analysis The global mattress market is growing steadily, with memory foam products showing strong penetration, especially in the US and China - The global mattress market is growing steadily, reaching $29 billion in 2020, with the US and China being the largest consumer markets at $9.02 billion and $8.54 billion, respectively[132][79][109] - The penetration of memory foam mattresses in the US market is increasing, with its sales growth (CAGR of 10.03% from 2004-2015) far outpacing traditional spring mattresses (CAGR of 3.71%), indicating a clear market substitution effect[80] - The industry is polarized, with Western brands dominating while manufacturing shifts to developing countries; leading domestic firms like MLILY are transitioning from OEM/ODM to OBM models[140] Core Competitiveness Analysis The company's core strengths lie in its global production capacity, international brand presence, R&D capabilities, and diverse sales channels - Globalized production capacity is a core advantage, with bases in China, Serbia, the US, Thailand, and Spain effectively reducing transport costs, shortening delivery times, and mitigating trade friction risks[121] - The company possesses strong R&D capabilities, holding 136 authorized patents (including 14 domestic invention patents) as of year-end 2021 and participating in drafting multiple industry standards[121] - A multi-channel sales network has been established across 73 countries and regions, including traditional stores, e-commerce, and hotel partnerships ("zero-pressure rooms"), enhanced by acquisitions like MOR in the US[121] Main Operating Conditions In 2021, revenue grew 24.64%, but rising costs led to a 5.32 percentage point drop in gross margin and a net loss Key Items in Income Statement and Cash Flow Statement | Item | Current Period (RMB) | Prior Period (RMB) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 8,139,254,616.14 | 6,530,134,253.31 | 24.64 | Increased sales orders and overseas factory capacity | | Operating Costs | 5,822,051,028.65 | 4,315,389,851.90 | 34.91 | Rise in freight and raw material prices | | Selling Expenses | 1,313,514,110.18 | 881,527,023.01 | 49.00 | Increase in sales channel fees, staff costs, and advertising | | Administrative Expenses | 664,014,303.73 | 460,599,604.74 | 44.16 | Higher costs from overseas factory construction and talent acquisition | | Net Cash Flow from Operating Activities | 67,922,544.84 | 582,525,962.44 | -88.34 | Growth in payments for goods, services, and employee compensation | Main Business by Product | Product | Operating Revenue (RMB) | Operating Costs (RMB) | Gross Margin (%) | Revenue Y-o-Y Change (%) | Gross Margin Y-o-Y Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Mattresses | 3,748,475,913.23 | 2,792,099,156.22 | 25.51 | 21.66 | Decrease of 7.14 p.p. | | Pillows | 632,825,142.38 | 489,717,976.46 | 22.61 | 12.13 | Decrease of 5.49 p.p. | | Sofas | 1,302,275,852.42 | 829,553,282.76 | 36.30 | 33.56 | Increase of 1.01 p.p. | | Electric Beds | 760,874,767.18 | 524,699,420.75 | 31.04 | 15.46 | Decrease of 3.66 p.p. | | Bedding | 796,715,485.15 | 437,930,164.35 | 45.03 | 51.99 | Decrease of 0.61 p.p. | Main Business by Region | Region | Operating Revenue (RMB) | Operating Costs (RMB) | Gross Margin (%) | Revenue Y-o-Y Change (%) | Gross Margin Y-o-Y Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Domestic | 1,185,105,902.63 | 820,647,905.90 | 30.75 | 46.46 | Decrease of 1.21 p.p. | | Overseas | 6,726,791,607.43 | 4,808,540,141.88 | 28.52 | 21.31 | Decrease of 5.98 p.p. | Analysis of Assets and Liabilities Total assets grew 30.00% to RMB 9.20 billion, driven by capacity expansion, while liabilities also rose significantly Key Items in Balance Sheet | Item | Closing Balance (RMB) | Opening Balance (RMB) | Change (%) | Explanation | | :--- | :--- | :--- | :--- | :--- | | Inventory | 1,939,131,042.06 | 1,367,748,411.47 | 41.78 | Rising material prices and business expansion | | Fixed Assets | 2,396,289,345.75 | 1,725,637,001.00 | 38.86 | Capitalization of plants and overseas capacity expansion | | Construction in Progress | 141,475,113.86 | 454,550,603.11 | -68.88 | Capitalization of a large number of projects | | Right-of-use Assets | 1,138,707,837.92 | - | - | Adoption of new lease standard | | Short-term Borrowings | 1,610,310,355.29 | 1,111,554,616.67 | 44.87 | Increased funding needs due to business expansion | | Accounts Payable | 1,492,898,147.72 | 933,924,541.41 | 59.85 | Increased business volume and raw material prices | | Lease Liabilities | 1,064,778,546.11 | - | - | Adoption of new lease standard | - The company's overseas assets amounted to RMB 6.99 billion, accounting for a significant 76.00% of total assets, reflecting the depth of its global footprint[218] Future Outlook and Risk Analysis The company plans to enhance efficiency and manage risks, including economic fluctuations, currency volatility, and trade friction - The company's 2022 operating plan focuses on improving efficiency and reducing costs, centered around product R&D, channel expansion, global brand promotion, IT, talent, and internal controls[231][247][268] - Key risks faced by the company include: - Macroeconomic Risk: Demand for consumer goods is affected by economic conditions - Exchange Rate Fluctuation Risk: As an export-oriented company, it faces risks from RMB exchange rate volatility - Raw Material Price Fluctuation Risk: Key raw materials are chemical-based and subject to oil price volatility - International Trade Friction Risk: Faces risks of anti-dumping duties and tariffs in markets like the US - Overseas Operational Risk: Foreign subsidiaries face risks from political, economic, and legal differences[234][235][253][277] Corporate Governance Overview of Corporate Governance The company maintains a sound corporate governance structure in compliance with regulations, ensuring operational independence - The company's governance structure complies with relevant laws and regulations, with clear responsibilities and standardized operations for the shareholders' meeting, board of directors, board of supervisors, and management[281] - The company is fully independent from its controlling shareholder in terms of assets, personnel, finance, organization, and business, ensuring its autonomous operational capability[286][287] Directors, Supervisors, and Senior Management The company's management team remained stable, with total pre-tax compensation for all directors, supervisors, and executives amounting to RMB 5.36 million Remuneration of Selected Directors, Supervisors, and Senior Management (FY2021) | Name | Position | Total Pre-tax Remuneration from the Company (RMB 10,000) | | :--- | :--- | :--- | | Ni Zhanggen | Chairman, President | 96.09 | | Wang Zhen | Director, Executive Vice President | 52.83 | | Zhang Hongjian | Director, Vice President | 44.45 | | Zhu Changling | Independent Director | 8.00 | | Sun Jian | Chairman of the Board of Supervisors | 39.25 | | Fu Dongqing | Secretary of the Board, CFO | 33.09 | | Total | / | 536.15 | Equity and Employee Incentives Due to unmet 2021 performance targets, certain restricted stock units were not unlocked and were subsequently repurchased and canceled - Due to the failure to meet 2021 performance targets, a portion of the company's restricted stock was not eligible for unlocking[1093] - On April 28, 2021, the company resolved to repurchase and cancel a total of 847,750 restricted shares that were granted but not yet vested, with the cancellation completed on June 28[336][354] Significant Matters Material Litigation The company is involved in a lawsuit with a US subsidiary's minority shareholder, with a provision of RMB 110 million recognized - The company is in a material lawsuit with BENJAMIN L. FOLKINS, a minority shareholder of its US subsidiary; after a retrial, the judgment amount was adjusted to $18.51 million[412][402] - The company has recognized a provision of RMB 110,134,488.10 based on the adjusted judgment and plans to continue its appeal[903] Material Related-Party Transactions The company engaged in routine related-party transactions, primarily involving sales to and purchases from associated companies - The company engaged in related-party sales transactions with Matratzen Concord GmbH, with sales amounting to RMB 286 million in fiscal year 2021[1103][1087] - The company purchased fixed assets and received services from related party Heng Kang CNC, and procured services from other related parties such as Nantong World Expo Logistics Co, Ltd[1086] External Guarantees Total guarantees for subsidiaries amounted to RMB 2.15 billion, representing 73.91% of the company's net assets Summary of Guarantees at the End of the Reporting Period | Item | Amount (RMB 10,000) | | :--- | :--- | | Total Outstanding Guarantees for Subsidiaries at Period-End (B) | 214,835.41 | | Ratio of Total Guarantees to Company's Net Assets (%) | 73.91 | | Debt Guarantees for Parties with Asset-Liability Ratio >70% (D) | 170,304.66 | | Amount of Total Guarantees Exceeding 50% of Net Assets (E) | 69,490.71 | Share Capital Changes and Shareholders Share Capital Changes Total share capital increased to 487 million shares, mainly due to a bonus issue from capital reserves and convertible bond conversions - The company's total share capital increased from 374,400,741 shares at the beginning of the year to 486,548,339 shares at year-end[424] - The main reasons for the change in share capital were: - Bonus issue from capital reserve increased shares by 112,280,386 - Conversion of convertible bonds increased shares by 714,962 - Repurchase and cancellation of restricted stock decreased shares by 847,750[426] Shareholder Information As of year-end, the controlling shareholder Mr. Ni Zhanggen held 49.27% of shares, with a total of 26,444 shareholders - As of the end of the reporting period, the total number of common shareholders was 26,444[463] Top Ten Shareholders | Shareholder Name | Shares Held at Period-End | Percentage (%) | Number of Restricted Shares | Share Status | | :--- | :--- | :--- | :--- | :--- | | Ni Zhanggen | 239,721,715 | 49.27 | 0 | Pledged 111,189,000 | | Wu Xiaofeng | 22,157,552 | 4.55 | 0 | Pledged 8,600,000 | | ICBC - CEIBS Value Select Return Hybrid Securities Investment Fund | 14,026,184 | 2.88 | 0 | None | Bond-Related Information Convertible Corporate Bonds The "Baihe Convertible Bond" was fully redeemed and delisted during the reporting period after triggering the early redemption clause - The company triggered the early redemption clause for its "Baihe Convertible Bond" and completed the redemption and delisting process on January 7, 2021[456] Cumulative Conversion of Convertible Bonds during the Reporting Period | Item | Amount/Quantity | | :--- | :--- | | Converted Amount during the Period (RMB) | 10,841,000 | | Converted Shares during the Period (Shares) | 714,962 | | Outstanding Amount (RMB) | 6,434,000 | | Ratio of Outstanding Bonds to Total Issuance (%) | 1.26 | Financial Report Audit Report Tianjian CPA firm issued a standard unqualified audit opinion, identifying revenue recognition and accounts receivable as key audit matters - The auditor, Tianjian Certified Public Accountants (Special General Partnership), issued a standard unqualified audit opinion[457][648] - Key audit matters were: 1. Revenue Recognition: Due to revenue being a key performance indicator and the high proportion of overseas business (85.02%), there is an inherent risk of management using inappropriate revenue recognition to meet targets 2. Allowance for Doubtful Accounts: Due to the material amount of accounts receivable (RMB 1.25 billion gross), impairment involves significant management judgment[506][479][480] Financial Statements This section presents the consolidated and parent company financial statements for the 2021 fiscal year Consolidated Balance Sheet At year-end 2021, total assets reached RMB 9.20 billion, while the asset-liability ratio increased to 67.45% Consolidated Balance Sheet Key Items (Unit: RMB) | Item | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | Total Assets | 9,198,519,914.62 | 7,075,842,657.13 | | Cash and Cash Equivalents | 994,499,444.23 | 1,070,561,346.05 | | Accounts Receivable | 1,125,245,842.66 | 997,203,325.96 | | Inventory | 1,939,131,042.06 | 1,367,748,411.47 | | Fixed Assets | 2,396,289,345.75 | 1,725,637,001.00 | | Total Liabilities | 6,204,638,697.98 | 3,382,596,960.38 | | Short-term Borrowings | 1,610,310,355.29 | 1,111,554,616.67 | | Accounts Payable | 1,492,898,147.72 | 933,924,541.41 | | Total Equity | 2,993,881,216.64 | 3,693,245,696.75 | | Equity Attributable to Parent Company | 2,906,893,844.75 | 3,556,693,841.04 | Consolidated Income Statement In 2021, the company reported a net loss of RMB 276 million on revenue of RMB 8.14 billion due to surging costs Consolidated Income Statement Key Items (Unit: RMB) | Item | FY2021 | FY2020 | | :--- | :--- | :--- | | Total Operating Revenue | 8,139,254,616.14 | 6,530,134,253.31 | | Total Operating Costs | 8,258,352,961.94 | 6,041,730,687.96 | | Of which: Cost of Goods Sold | 5,822,051,028.65 | 4,315,389,851.90 | | Selling Expenses | 1,313,514,110.18 | 881,527,023.01 | | Administrative Expenses | 664,014,303.73 | 460,599,604.74 | | Credit Impairment Loss | -110,472,727.72 | -39,515,740.47 | | Total Profit | -274,163,769.57 | 474,591,957.09 | | Net Profit Attributable to Parent Company Shareholders | -275,532,304.29 | 378,585,689.15 | Consolidated Cash Flow Statement Net cash from operating activities decreased by 88.34% to RMB 67.92 million, reflecting increased operational expenditures Consolidated Cash Flow Statement Key Items (Unit: RMB) | Item | FY2021 | FY2020 | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 67,922,544.84 | 582,525,962.44 | | Net Cash Flow from Investing Activities | -523,504,695.42 | -1,305,176,892.78 | | Net Cash Flow from Financing Activities | 363,570,518.81 | 1,139,545,121.12 | | Net Increase in Cash and Cash Equivalents | -284,272,762.37 | 256,148,914.12 | | Cash and Cash Equivalents at End of Period | 777,124,925.24 | 1,061,397,687.61 | Significant Accounting Policies and Estimates The company adopted the new lease standard in 2021, which significantly impacted the balance sheet by recognizing lease liabilities - The company adopted the new lease standard from January 1, 2021, measuring lease liabilities based on the present value of remaining lease payments and adjusting right-of-use assets accordingly, with adjustments made to opening balance sheet items[600][46] - Specific revenue recognition methods: domestic sales are recognized upon customer acceptance; export sales are recognized upon obtaining the bill of lading after customs declaration; consignment sales are recognized upon receipt of the consignment sales list[25] - Financial instrument impairment uses an expected credit loss model; for accounts receivable, the company uses an aging analysis combined with forward-looking estimates to determine the expected credit loss rate[605][606] Notes to Consolidated Financial Statement Items This section details key balance sheet items, including accounts receivable, inventory, goodwill, and provisions for litigation Accounts Receivable Aging Analysis (Year-End Balance) | Aging | Gross Amount (RMB) | | :--- | :--- | | Within 1 year | 1,173,682,319.73 | | 1 to 2 years | 50,139,776.34 | | 2 to 3 years | 3,585,940.92 | | Over 3 years | 27,044,506.72 | | Total | 1,254,452,543.71 | - Goodwill, primarily from the acquisitions of MATRESSES in Spain, Lang Le Fu in Shenzhen, and MOR in the US, had a carrying amount of RMB 321 million at year-end; no significant impairment loss was recognized during the period[831][833][834] - The company recognized a provision of RMB 110 million for the lawsuit with BENJAMIN L. FOLKINS based on the adjusted court judgment[901][903]