Financial Performance - Revenue for 2023 was RMB 2,063,746 thousand, a decrease from RMB 2,324,807 thousand in 2022[35] - Gross profit for 2023 was RMB 798,110 thousand, compared to RMB 786,864 thousand in 2022[35] - Operating profit for 2023 was RMB 249,029 thousand, up from RMB 158,063 thousand in 2022[35] - Net profit attributable to the company's owners for 2023 was RMB 146,370 thousand, compared to RMB 48,317 thousand in 2022[35] - Basic and diluted earnings per share for 2023 were RMB 0.14, up from RMB 0.04 in 2022[35] - Annual profit for 2023 reached RMB 140,630 thousand, a significant increase from RMB 84,481 thousand in 2022[36] - Total comprehensive income for 2023 was RMB 145,083 thousand, compared to RMB 97,943 thousand in 2022[36] - The company's total comprehensive income attributable to the company's owners was RMB 148,936 thousand in 2023, compared to RMB 57,635 thousand in 2022[36] - Total revenue for the year ended December 31, 2023, was approximately RMB 2,063.7 million, a decrease of 11.2% compared to the previous year[133][137][139] - Net profit for the year was approximately RMB 140.6 million, an increase of 66.5% year-over-year, primarily due to the sale of two South Korean subsidiaries, which generated a gain of approximately RMB 62.8 million[133][137] - Excluding the gain from the sale of subsidiaries, the net profit would have been approximately RMB 77.8 million, a decrease of 7.9% compared to the previous year[133][137] - The company's gross profit increased slightly by 1.4% to approximately RMB 798.1 million[137] Subsidiaries and Equity Holdings - The company holds 100% equity in Boton Flavors & Fragrances (Hong Kong) Limited, with a paid-up capital of HKD 1[2] - The company holds 100% equity in Zhongxiang Fragrance (Shenzhen) Co., Ltd., with a registered capital of HKD 15,000,000[2] - The company holds 51% equity in Shenzhen Huachang Industrial Co., Ltd., with a registered capital of RMB 9,803,921[2] - The company holds 53% equity in PT DBFF Boton Indonesia Co., Ltd., with a paid-up capital of USD 3,400,000[2] - The company holds 100% equity in Boton (Hubei) Biotechnology Co., Ltd., with a registered capital of RMB 500,000,000 and a paid-up capital of RMB 130,700,000[2] - The company holds 51% equity in Fuzhou Yuangelin Technology Co., Ltd., with a paid-up capital of RMB 11,200,000[2] - The company holds 66% equity in Huizhou Babo Technology Co., Ltd., with a paid-up capital of RMB 5,000,000[2] - The company sold two South Korean subsidiaries in May 2023 for RMB 100,000 thousand, which strengthened liquidity and reduced administrative expenses[116] - The company became the exclusive manufacturer and supplier of certain e-cigarettes in the South Korean market following the sale of its subsidiaries[116] Cash and Financial Position - The company's cash and bank balances subject to foreign exchange control regulations in Asian countries (including China) amounted to RMB 276,763,000 in 2023, down from RMB 362,645,000 in 2022[3] - Capital commitments for property, plant, and equipment as of 2023 were RMB 320,517 thousand, significantly higher than RMB 28,247 thousand in 2022[22] - Short-term lease commitments for 2023 were RMB 313 thousand, compared to RMB 256 thousand in 2022[22] - The company's bank loans were secured by property, plant, and equipment with a book value of RMB 808,407 thousand as of December 31, 2023, up from RMB 601,016 thousand in 2022[43] - The company's total equity as of December 31, 2023, was RMB 3,376,227 thousand, up from RMB 3,262,120 thousand at the beginning of the year[62] - The company's distributable reserves as of December 31, 2023, were approximately RMB 548.8 million (2022: RMB 602.1 million)[199] - The company's share capital consists of 1,080,512,146 ordinary shares with a par value of HKD 0.10 each as of December 31, 2023[197] - The company's cash and cash equivalents at the end of 2023 were RMB 106,249 thousand for Dongguan Boton and RMB 27,102 thousand for Huizhou Babo[99] Assets and Liabilities - Right-of-use assets for land use rights and buildings amounted to RMB 154,235 thousand in 2023, an increase from RMB 119,906 thousand in 2022[45] - Lease liabilities decreased to RMB 6,949 thousand in 2023 from RMB 11,688 thousand in 2022[45] - The company's total fixed assets at the end of 2023 amounted to RMB 1,528,866,000, with significant additions of RMB 122,993,000 during the year[67] - Depreciation expenses for 2023 were RMB 75,785,000, allocated to cost of sales (RMB 9,726,000), sales and marketing (RMB 692,000), and administrative expenses (RMB 65,367,000)[67] - The company's bank borrowings were secured by land use rights with a book value of RMB 25,313,000 as of December 31, 2023[70] - Total lease cash outflows for 2023 were RMB 4,699,000, a decrease from RMB 6,995,000 in 2022[70] - The company's right-of-use assets increased to RMB 154,235,000 at the end of 2023, up from RMB 119,906,000 at the beginning of the year[70] - The company's total fixed assets cost at the end of 2023 was RMB 2,090,532,000 with accumulated depreciation of RMB 561,666,000[67] - Accounts receivable decreased from RMB 913,025 thousand in 2022 to RMB 728,106 thousand in 2023, a decrease of 20.3%[77] - Expected credit loss provision for accounts receivable increased from RMB 86,015 thousand in 2022 to RMB 241,444 thousand in 2023, a significant increase of 180.7%[77] - The company's inventory net value at the end of 2023 was RMB 330,619 thousand, a decrease from RMB 360,818 thousand in 2022[104] - Inventory cost recognized as expenses and included in cost of sales for 2023 was RMB 1,168,262 thousand, a decrease from RMB 1,426,976 thousand in 2022[104] Revenue Segments - Revenue from e-cigarettes and accessories decreased by 22.6% from RMB 1,164,900 thousand in 2022 to RMB 901,600 thousand in 2023 due to new regulations on e-cigarette flavor sales in China[90] - The electronic cigarette products segment contributed approximately 43.7% of total revenue, a decrease of 22.6% compared to the previous year[140] - The flavor enhancer segment contributed approximately 37.3% of total revenue, a decrease of 3.4% compared to the previous year[140] - The food flavor segment revenue increased by 6.0% to approximately RMB 182.0 million, driven by support from existing customers[141] - The daily-use flavor segment revenue increased by 10.7% to approximately RMB 165.8 million, supported by new and long-term customers[141] Corporate Governance and Management - The total remuneration for directors and senior executives in 2023 was RMB 4,949,000, including salaries, retirement benefits, and share-based payments[16] - Total remuneration for directors in 2023 was RMB 4,948 thousand, with the highest paid being the CEO, Mr. Wang Mingfan, at RMB 1,905 thousand[25] - The company's risk management and internal control systems were deemed effective and sufficient by the board of directors[31] - The company emphasizes diversity in its board composition and workforce, aiming to leverage different skills and backgrounds for long-term development[33] - The company appointed Ms. Yin Shuzhen as a non-executive director on December 29, 2023, to enhance board diversity[57] - The audit committee consists of four independent non-executive directors responsible for financial oversight and governance[73] - The company secretary ensures compliance with legislative, regulatory, and corporate governance developments[74] - The Board of Directors did not recommend the payment of any dividends for the year ended December 31, 2023 (2022: none)[192] Strategic Initiatives and Market Focus - The company revised its short-term strategy to focus on international markets with its own brand and customized e-cigarette products due to new regulations in China[90] - The company plans to continue focusing on strict cost control and expanding market share in the flavor and fragrance industry[134][140] - The company implemented strict cost control measures across all business segments and departments in 2023[116] - The company streamlined its corporate structure and established a central working committee to improve efficiency in 2023[116] - The company will continue to develop its e-cigarette business in China and other countries and explore the feasibility of applying e-cigarette atomizers in the healthcare field[190] Intangible Assets and Goodwill - The total amortization expense for intangible assets in 2023 was RMB 48,197,000, compared to RMB 48,383,000 in 2022[148] - The net book value of intangible assets at the end of 2023 was RMB 1,721,629,000, a decrease from RMB 1,768,882,000 at the end of 2022[148] - The net book value of goodwill remained unchanged at RMB 1,625,741,000 from 2022 to 2023[148] - The net book value of customer relationships decreased from RMB 102,675,000 in 2022 to RMB 72,736,000 in 2023[148] - The net book value of patents, formulas, and trademarks decreased from RMB 29,555,000 in 2022 to RMB 16,888,000 in 2023[148] - The net book value of non-compete agreements decreased from RMB 6,283,000 in 2022 to RMB 4,908,000 in 2023[148] - The net book value of computer software increased from RMB 623,000 in 2022 to RMB 1,181,000 in 2023[148] - The total cost of intangible assets increased slightly from RMB 2,081,863,000 in 2022 to RMB 2,082,807,000 in 2023[148] - The accumulated amortization of intangible assets increased from RMB 309,883,000 in 2022 to RMB 358,080,000 in 2023[148] - The goodwill from the acquisition of Kimree, Inc. is allocated to the e-cigarette product segment, amounting to RMB 426,373[170] - The goodwill from the acquisition of four businesses is allocated to the flavor enhancer segment, amounting to RMB 1,199,368[170] Investment Properties and Valuation - The fair value of investment properties is determined based on active market prices, adjusted for specific asset characteristics, location, or condition. If active market prices are unavailable, alternative valuation methods such as discounted cash flow forecasts are used[147] - The market rent for investment properties in 2023 is RMB 53 to RMB 95 per square meter per month, compared to RMB 54 to RMB 101 in 2022, with higher market rents leading to higher fair values[162] - The periodic yield for investment properties remains at 2%-6%, with higher yields leading to lower fair values[162] - The reversionary yield for investment properties remains at 4%-7%, with higher yields leading to lower fair values[162] - A 5% increase or decrease in market rent would result in a RMB 25,000,000 change in the value of investment properties[162] Subsidiary Performance - Dongguan Boton's revenue increased from RMB 321,589 thousand in 2022 to RMB 347,786 thousand in 2023, an increase of 8.1%[98] - Huizhou Babo's revenue increased from RMB 153,341 thousand in 2022 to RMB 183,790 thousand in 2023, an increase of 19.9%[98] - Net current assets of Dongguan Boton increased from RMB 159,337 thousand in 2022 to RMB 252,605 thousand in 2023, an increase of 58.5%[95] - Net current assets of Huizhou Babo increased from RMB 15,583 thousand in 2022 to RMB 36,152 thousand in 2023, an increase of 132.0%[95] - Operating cash flow for Dongguan Boton in 2023 was RMB 88,073 thousand, a significant increase from RMB 33,207 thousand in 2022[99] Environmental, Social, and Governance (ESG) - The company's environmental policies and performance, as well as compliance with relevant laws and regulations, are detailed in the 2023 Environmental, Social, and Governance (ESG) Report[190] - The company's financial performance and key risk factors for the year under review are analyzed in the "Management Discussion and Analysis" section of the annual report[190] Other Financial Information - The company paid RMB 7,480 thousand in audit fees to PricewaterhouseCoopers for the fiscal year 2023[56] - The company's property, plant, and equipment changes during the year are detailed in Note 6 of the financial statements[196] - The company's reserves and equity changes during the year are detailed in Notes 19, 20, and 38(a) and the consolidated statement of changes in equity[198]
中国波顿(03318) - 2023 - 年度财报