ADAMA(000553)2021-03-30 16:00Financial Performance - Adama's operating revenue for 2020 was 28,444,833 thousand yuan, an increase of 3.20% compared to 2019[11]. - The net profit attributable to shareholders for 2020 was 352,753 thousand yuan, representing a significant increase of 27.33% year-over-year[11]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was 287,724 thousand yuan, a decrease of 52.84% compared to the previous year[11]. - The net cash flow from operating activities reached 2,023,015 thousand yuan, showing a remarkable increase of 139.84% from 2019[11]. - The total assets at the end of 2020 amounted to 46,801,034 thousand yuan, reflecting a growth of 3.34% compared to the end of 2019[11]. - The net assets attributable to shareholders decreased to 21,353,752 thousand yuan, down by 4.55% from the previous year[11]. - The company's sales revenue for 2020 reached RMB 28,444,833 thousand, representing a year-on-year increase of 3.20% compared to RMB 27,563,239 thousand in 2019[30]. - The pre-tax profit for 2020 was RMB 575,212 thousand, showing a significant increase of 27.38% from RMB 451,572 thousand in the previous year[30]. - The net profit for 2020 was RMB 352,753 thousand, which is a 27.33% increase compared to RMB 277,041 thousand in 2019[30]. - The company achieved an EBITDA of RMB 4,088,571 thousand, with an EBITDA margin of 14.4%, down from 15.2% in 2019[30]. Market Position and Strategy - The company emphasizes its strong R&D capabilities and diverse product offerings, serving farmers in over 100 countries[1]. - Adama's future development strategy includes addressing risks such as currency fluctuations and raw material costs[3]. - The company has a strong market position due to its unique formulation technologies and high-quality differentiated products[1]. - The company focuses on developing and marketing non-patented crop protection products, including herbicides, insecticides, and fungicides, catering to local farmer needs globally[15]. - Emerging markets contributed over 50% of the company's total sales in 2020, highlighting the strength of its business in these regions[30]. - The company has a diverse product portfolio, with no single active ingredient accounting for more than 5% of total sales in 2020, enhancing business stability[26]. - The company aims to enhance its market position through a differentiated product portfolio, focusing on high-margin, innovative solutions, including unique mixtures and formulations[93]. - The company plans to leverage its strong R&D capabilities to develop new formulations and delivery technologies, aiming for market-first launches post-patent expiration[94]. Acquisitions and Investments - The company’s acquisition of Adama Solutions resulted in a significant increase in assets, with the investment valued at 18,577,615 thousand yuan[25]. - The company completed acquisitions in Greece and Paraguay, which contributed positively to its performance[39]. - The company acquired Alfa Agricultural Supplies S.A., FNV S.A., and Shanghai Dubai Plant Protection Co., Ltd. during the reporting period, indicating a strategic expansion through mergers and acquisitions[138]. - The company plans to use the raised funds to acquire a 51% stake in Shanghai Dubai, with the acquisition completed on November 16, 2020[80]. Research and Development - The company has established R&D and registration centers in multiple countries, enabling efficient market entry for new products[38]. - Research and development expenses increased by 9.73% year-over-year, totaling 478,778 thousand yuan[58]. - The total research and development investment in 2020 was RMB 478.78 million, representing a 9.36% increase compared to the previous year[67]. Environmental and Regulatory Compliance - The company is classified as a key pollutant discharge unit by environmental protection authorities[168]. - The company has a wastewater treatment facility with a capacity of 20,000 tons/day, achieving compliance with discharge standards for COD, ammonia nitrogen, and total phosphorus[170]. - The company received approval for the environmental impact report for the ultra-low emission renovation project and the pesticide relocation and upgrade project[171]. - The company has implemented a self-monitoring plan for environmental management, including continuous monitoring of wastewater and emissions[173]. Shareholder and Dividend Information - Adama reported a cash dividend of 0.16 RMB per 10 shares for a total of 2,329,811,766 shares, amounting to approximately 373.57 million RMB[3]. - The cash dividend for 2019 was RMB 0.12 per 10 shares, totaling RMB 29,358,642.98, which accounted for 10.6% of the net profit attributable to ordinary shareholders[128]. - The company’s cash dividend policy remains unchanged during the reporting period[124]. - The total cash dividend, including other methods, amounts to 97,676,284.26 RMB, representing 100% of the distributable profit[129]. Risks and Challenges - The company faces challenges in passing on rising procurement costs to sales prices due to intense global competition[18]. - The company expects continued upward pressure on production costs in 2021 due to rising raw material prices and a strong RMB against the USD[19]. - The company faces risks from currency fluctuations, particularly exposure to the Euro, Israeli Shekel, and Brazilian Real, which could impact sales and profitability[98]. - The company is exposed to risks in emerging markets, including political instability and currency volatility, which could negatively affect its operations[100]. - The crop protection market is highly competitive, with seven major multinational companies leading, including Bayer, Syngenta, and BASF, which impacts the company's market share and financial performance[102]. Management and Governance - The company has undergone changes in its board and management structure, with several appointments and resignations in 2020[195]. - The leadership team includes experienced professionals with diverse backgrounds in finance, engineering, and agrochemicals, contributing to strategic decision-making[200]. - The management team is committed to maintaining transparency and providing accurate financial information to stakeholders[200].