Baota Industry(000595)2024-04-18 12:38Production and Sales Model - The company's main product production model is based on sales-driven production, with sales being the central link of production and operation, and procurement and production are organized around sales. After receiving tentative orders, the technical R&D department organizes technical docking or new product development, and production is organized after successful trial production. The sales model is mainly direct sales, supplemented by distribution[25] Market and Industry Trends - In 2023, the macroeconomic situation was complex, with shrinking market demand, leading to a decrease in the sales price of some bearing products. According to the Bearing Industry Association, 144 bearing companies produced a total of 7.786 billion sets of bearings, an increase of 486 million sets compared to the same period last year, a year-on-year increase of 6.65%. Bearing sales were 7.929 billion sets, a decrease of 65 million sets compared to the same period last year, a year-on-year decrease of 0.81%. Bearing export sales were 2.155 billion sets, a decrease of 116 million sets compared to the same period last year, a year-on-year decrease of 5.1%[22] - In 2022, 139 bearing companies produced a total of 7.097 billion sets of bearings, a decrease of 1.014 billion sets compared to the same period last year, a year-on-year decrease of 12.5%. Bearing sales were 7.769 billion sets, a decrease of 126 million sets compared to the same period last year, a year-on-year decrease of 1.59%. Bearing export sales were 2.239 billion sets, a decrease of 264 million sets compared to the same period last year, a year-on-year decrease of 10.56%. The cumulative main business income was 108.081 billion yuan, a year-on-year decrease of 1.42%[23] Financial Performance - The company's total operating income in 2023 was 297,934,696.74 yuan, an increase from 250,413,072.18 yuan in 2022[38] - The company's operating income after deduction was 236,326,032.32 yuan in 2023, compared to 232,593,430.56 yuan in 2022[38] - The company's material costs for bearing business accounted for 42.45% of operating costs, with a year-on-year increase of 10.12%[36] - The company's salary costs for bearing business accounted for 35.05% of operating costs, with a year-on-year increase of 10.60%[36] - The company's mechanical manufacturing industry segment had a gross profit margin of -5.24%, with a year-on-year increase of 0.05%[47] - The company's equipment manufacturing industry segment had a gross profit margin of 26.58%, with a year-on-year increase of 0.04%[47] R&D and Innovation - R&D personnel accounted for 19.74% of total employees, a decrease of 1.63% compared to the previous year[54] - R&D personnel with bachelor's degrees increased by 2.50% to 123, while those with master's degrees decreased by 11.11% to 8[54] - R&D personnel under 30 years old increased by 5.06% to 83, while those aged 30-40 decreased by 8.70% to 63[54] - R&D personnel increased by 1.19% from 168 in 2022 to 170 in 2023[80] - R&D investment decreased by 4.63% from RMB 19,256,716.89 in 2022 to RMB 18,364,206.45 in 2023, with the R&D investment to revenue ratio dropping from 7.69% to 6.16%[81] - Capitalized R&D investment dropped to 0.00% in 2023 from 75.87% in 2022, with no capitalized R&D investment in 2023[81] Cash Flow and Financing - Operating cash inflow increased by 11.77% to RMB 308.67 million, while operating cash outflow decreased by 3.42% to RMB 338.39 million[56] - Net cash flow from operating activities improved by 59.95% to RMB -29.71 million[56] - Net cash flow from financing activities increased by 120.65% to RMB 6.73 million, mainly due to new short-term borrowing and debt repayment[56][58] - Net increase in cash and cash equivalents improved by 70.90% to RMB -34.98 million[56] - Short-term borrowing increased by RMB 60,000,000.00, accounting for 5.40% of total assets[86] - The company secured a loan of RMB 39.77 million from CITIC Bank using land and buildings as collateral[88] Subsidiaries and Investments - Subsidiary Northwest Bearing reported a net loss of RMB 95.34 million with total assets of RMB 751.11 million[67] - Subsidiary Equipment Manufacturing Company reported a net loss of RMB 6.38 million with total assets of RMB 33.80 million[67] - Investment in the reporting period was RMB 20,846,018.56, a 100% increase compared to the previous year[89] Corporate Governance and Investor Relations - Internal asset restructuring has been a frequent topic of discussion with individual investors throughout June, July, and August 2023[73] - Non-public issuance matters were repeatedly addressed with individual investors in July and August 2023[73] - Subsidiary shipbuilding business was a key focus in discussions with individual investors in June and July 2023[73] - Company's operational status was frequently inquired about by individual investors in July, August, and September 2023[73] - Industrial machine-related technologies were discussed with individual investors in June and July 2023[73] - R&D and technological advancements were a recurring topic in discussions with individual investors from July to September 2023[73] - Main business operations of subsidiaries were a point of interest for individual investors in July and September 2023[73] - High-quality asset injection matters were discussed with individual investors in July and August 2023[73] - Company reform and restructuring-related issues were addressed with individual investors in July 2023[73] - Main business operations were a topic of discussion with individual investors in August and September 2023[73] - Internal asset restructuring discussions were held multiple times with individual investors in September and October 2023[101] - The company's subsidiaries' main business operations were a frequent topic of discussion with individual investors in September, October, and November 2023[101] - Non-public issuance matters were discussed with individual investors on multiple occasions in October and November 2023[101] - The company's operational status was a recurring topic in discussions with individual investors throughout September, October, and November 2023[101] - Research and development technology matters were addressed in multiple investor calls in September, October, and November 2023[101] - High-quality asset injection was a key topic in discussions with individual investors in October and November 2023[101] - The company's industrial machinery-related technologies were discussed with individual investors in September 2023[101] - Subsidiary ship business matters were addressed in discussions with individual investors in September and December 2023[101] - The company's reform and restructuring-related matters were discussed with individual investors in November 2023[101] - The company's main business operations were a topic of discussion with individual investors in November and December 2023[101] Human Resources and Talent Management - The company optimized 43 positions, increasing the proportion of front-line production personnel from 52% to 56%, and reducing the proportion of production support personnel from 21% to 14%, saving labor costs[31] - The company's labor productivity increased by 0.8 percentage points year-on-year[31] - The company implemented a talent strategy to attract high-level and professional talents, improve the compensation system, and enhance employee training and development[98] - The company's education level distribution includes 10 postgraduate students, 167 undergraduate students, 207 college students, 42 technical secondary school students, and 418 high school and below students, totaling 844 employees[125] - The company has established a broad salary system linked to revenue, output, and profit growth, with a focus on performance-based pay and incentives for key employees[154] - The company has implemented a "mentorship" program, with 160 pairs of employees forming mentor-mentee relationships, and an additional 41 pairs established during the reporting period[172] - The total pre-tax remuneration for directors, supervisors, and senior management is 2.792 million yuan, with the highest remuneration of 553,000 yuan for the chairman[165] Environmental and Social Responsibility - The company has implemented measures to respond to national energy conservation and emission reduction policies, including reducing energy consumption in production[182] - The company has invested special funds to manage harmful substances generated during the production process to meet national environmental requirements[182] - The company has established a comprehensive employee welfare system, including regular training, health check-ups, and social insurance coverage, to enhance employee satisfaction and well-being[192] Corporate Strategy and Future Plans - The company plans to focus on technology leadership, optimize production processes, and enhance new product development and transformation in 2024[70] - The company emphasizes the importance of market, quality, finance, technology, management, brand, and talent as the foundation for high-quality development and the main focus of its three-year development plan[126] - The company is implementing a lean management project to enhance efficiency and quality, aiming to optimize organizational structure and improve management systems[127] - The company completed the internal asset restructuring by transferring the bearing business segment, three wholly-owned subsidiaries, and related land to the wholly-owned subsidiary Northwest Bearing Co., Ltd., with the benchmark date set as December 31, 2022[175] - No significant issues were encountered during the integration process, and no specific measures or follow-up plans were required[175] Supplier and Procurement Management - The company's total procurement amount from the top five suppliers was 78,764,745.38 yuan, accounting for 38.71% of the total annual procurement[52] - The company has established a comprehensive supplier evaluation system and centralized procurement for main and auxiliary materials, equipment, and finished parts to improve efficiency and reduce costs[182] - The company has developed an online procurement platform and optimized procurement processes to enhance efficiency and cost-effectiveness[182] Customer and Market Focus - The company added 124 new host users and distributors, and obtained the A2-level supplier qualification for Ouye and Obei platform manufacturing enterprises[30] - The top five customers accounted for a total sales amount of RMB 92,216,015.16, representing 30.94% of the total annual sales[78] - The company has strengthened market response speed and improved customer satisfaction by optimizing management processes and establishing a service guarantee system[182] Corporate Independence and Governance - The company has a complete asset independence, with clear ownership and control over its assets, and no instances of shareholders occupying assets or funds[106] - The company is independent in its business operations, with separate procurement, production, sales, and R&D systems, and has no competitive relationship with its major shareholders[134] - The company has an independent financial system, including a separate accounting department, financial management system, and bank accounts, ensuring financial independence from its major shareholders[135] - The company ensures the financial independence of its listed subsidiaries, including maintaining separate financial departments, accounting systems, and bank accounts, and avoiding shared financial personnel with other controlled enterprises[186] - The company commits to avoiding unfair competition and ensuring fair market-based pricing for unavoidable related-party transactions with its listed subsidiaries[186] - Ning Guoyun has committed to avoiding competition with the company and ensuring the independence of the company's assets, personnel, finance, organization, and business[195] - Ning Guoyun has pledged to reduce and regulate related-party transactions with the company to protect the interests of the company and its shareholders[195] - Baota Petrochemical has committed to relinquishing voting rights for 398,415,924 shares of the company, effective from December 8, 2023, for a period of 36 months[200] - Baota Petrochemical will not seek actual control of the company during the commitment period[200] Board and Committee Activities - Zhang Wenjun resigned as an independent director on November 29, 2023, due to holding the position in more than three domestic listed companies, and will continue to fulfill his duties until a new independent director is elected[109] - The company held multiple board meetings in 2023, including the 20th to 27th meetings of the 9th Board of Directors, with resolutions disclosed on the same day as the meetings[120] - The Audit Committee reviewed and approved various reports and plans, including the 2022 annual report, internal control self-assessment report, and financial budget report for 2023[123] - The Strategic Committee approved the "Northwest Bearing Three-Year Development Plan (2024-2026)" on October 23, 2023[123] - The company conducted 1 annual general meeting and 3 extraordinary general meetings in 2023, passing 21 proposals, with separate voting for minority investors to ensure their participation and supervision rights[133] - The company held its 2022 annual general meeting with a 29.36% attendance rate and two extraordinary general meetings in 2023 with attendance rates of 1.07% and 29.36% respectively[137] - Li Xiuyong resigned as the company's vice president on August 17, 2023, but continues to serve as a director[139] - Li Changsheng has been serving as the company's director, chairman, and general manager since January 2023, and as chairman since September 2023[145] - Guo Weihong currently serves as the company's vice president, board secretary, and chief legal officer, and holds multiple directorships in affiliated companies[146] Internal Control and Compliance - The company conducted 14 training sessions on internal control systems and identified 3 non-compliant items during the reporting period[174] - No financial or non-financial report significant defects were identified during the reporting period[179] - The company emphasizes the protection of shareholder rights, particularly for minority shareholders, through continuous improvement of corporate governance and internal control systems[189] Employee Distribution and Structure - Total number of employees at the end of the reporting period is 844, with 611 production personnel, 28 sales personnel, 62 technical personnel, 14 financial personnel, and 129 administrative personnel[153]