Product Development and Innovation - The company launched new products such as spicy Latiao "BADAO PANDA", konjac vegetarian tripe "XIAO MO NV", and spicy crisp Latiao "CUI HUO HUO" in 2023, which gained significant popularity among consumers[4] - The company started the Chinese seasoned flour products (Latiao) industry in 2001 and has since diversified into vegetable products, bean-based products, and others, such as Konjac Shuang and Fengchi Kelp[4] - The company's product portfolio includes popular items like 78° Braised Egg, which complements its core Latiao offerings[4] - The Group launched new products including "BADAO PANDA" in September, "XIAO MO NV" in October, and "CUI HUO HUO" in December, enriching its product matrix[33] - The company launched new products including spicy Latiao "BADAO PANDA", konjac vegetarian tripe "XIAO MO NV", and spicy crisp latiao "CUI HUO HUO" to diversify its product portfolio and enhance category competitiveness[49][50] - "BADAO PANDA" spicy Latiao is inspired by authentic Sichuan cuisine, reflecting the company's commitment to traditional flavors and cultural heritage[50] - "XIAO MO NV" konjac vegetarian tripe features larger, crispier slices (35x35mm) and a unique 2D brand image to appeal to young consumers[51] - The company continues to focus on innovation and a multi-category strategy to meet diversified consumer needs through consumer insights[43] Awards and Recognition - The company won over 30 awards in 2023, including "2023 Vibrant Brands Favored by College Students" and "TopBrand2023 Top 500 Chinese Brands"[5] Sales and Distribution Network - The company expanded its sales and distribution network to include supermarkets, convenience stores, traditional e-commerce, and emerging channels like content and social e-commerce, effectively reaching young consumers[6] - The company's omni-channel strategy includes traditional and emerging e-commerce platforms, ensuring wide exposure to young consumers[6] - The Group strengthened its online and offline omni-channel strategy, embracing opportunities from emerging offline snack specialty retailer channels and online content e-commerce channels[34] - The company strengthened its omni-channel operation and expansion strategies to adapt to the rapid development of new retail channels like O2O and content e-commerce[44][46] - The company collaborated with 1,708 offline distributors and sold products through distributors to 147 national or regional operators for hypermarkets, supermarkets, and chained convenience stores as of December 31, 2023[59][60] - The company expedited the process of embracing emerging channels such as O2O and snack specialty retailers in the second half of 2023, establishing close cooperation with major systems of snack specialty retailers[61] - The company established its presence in major e-commerce platforms, including traditional and emerging content e-commerce platforms, to cover all channels of e-commerce platforms[62] - The company's online models include online direct sales and online distribution, complementing offline channels, and focus on creating topics and increasing interaction with consumers through short videos, internal live streaming, and influencer live streaming[62] - Revenue from offline channels increased by 5.2% from RMB4,145.9 million in 2022 to RMB4,361.2 million in 2023, driven by growth in emerging channels like O2O and snack specialty retailers, partially offset by a decline in traditional offline channels due to reduced consumer flow[65] - Revenue from online channels grew by 5.0% from RMB486.3 million in 2022 to RMB510.4 million in 2023, with online distribution revenue decreasing by 17.2% to RMB195.9 million and online direct sales revenue increasing by 26.0% to RMB314.5 million, reflecting the company's focus on capturing growth opportunities from content e-commerce platforms like Douyin[66] - Overseas revenue from offline distributors increased significantly, contributing RMB97.6 million in 2023 compared to RMB65.5 million in 2022, representing 2.2% of total revenue, driven by active expansion into overseas markets[68][69] - The company's total revenue for 2023 was RMB4,871.7 million, with offline channels contributing 89.5% (RMB4,361.2 million) and online channels contributing 10.5% (RMB510.4 million)[64] - Eastern China remained the largest revenue contributor among domestic regions, generating RMB967.1 million in 2023, up from RMB877.0 million in 2022, and accounting for 22.2% of total revenue[68] Financial Performance - Revenue for 2023 reached RMB 4,871.7 million, a 5.2% increase from 2022[24] - Gross profit for 2023 was RMB 2,322.7 million, with a gross margin of 47.7%, up 5.4 percentage points from 2022[24][26] - Adjusted net profit for 2023 was RMB 970.3 million, a 6.3% increase from 2022[24] - Adjusted EBITDA margin for 2023 improved to 31.2%, up 2.6 percentage points from 2022[26] - Inventory turnover days decreased to 73 days in 2023, down from 82 days in 2022[26] - Trade receivables turnover days improved to 4.4 days in 2023, down from 4.9 days in 2022[26] - Total assets for 2023 increased to RMB 7,053.6 million, up 1.8% from 2022[25] - Net assets for 2023 grew to RMB 5,705.9 million, a 3.3% increase from 2022[25] - The liability-to-asset ratio decreased to 19.1% in 2023, down 1.2 percentage points from 2022[26] - Adjusted return on equity for 2023 was 17.3%, down 2.6 percentage points from 2022[26] - The Group's overall revenue for the year was RMB4,871.7 million, representing a 5.2% increase compared to the previous year[31][32] - Gross profit margin was 47.7%, up 5.4 percentage points from 42.3% in the previous year[31][32] - Net profit was RMB880.4 million, a 481.9% increase compared to the previous year, while adjusted net profit was RMB970.3 million, up 6.3%[31][32] - Total revenue for the year increased by 5.2% to RMB4,871.7 million, driven by growth in emerging channels such as O2O, snack specialty retailers, and content e-commerce platforms[45][46] - Gross profit rose by 18.5% to RMB2,322.7 million, with gross profit margin improving from 42.3% to 47.7% due to higher average selling prices, lower raw material costs, and optimized cost management[45][46] - Net profit surged by 481.9% to RMB880.4 million, primarily due to increased gross profit and the absence of share-based payments related to Pre-IPO investments[45][46] - Adjusted net profit increased by 6.3% to RMB970.3 million, with adjusted net profit margin slightly improving from 19.7% to 19.9%[45][46] - Revenue from seasoned flour products decreased by 6.2% from RMB2,718.6 million in 2022 to RMB2,549.2 million in 2023, accounting for 52.3% of total revenue, down from 58.7% in 2022[54][55] - Revenue from vegetable products increased by 25.1% from RMB1,693.3 million in 2022 to RMB2,118.5 million in 2023, accounting for 43.5% of total revenue, up from 36.6% in 2022[55][56] - Sales volume of seasoned flour products decreased by 17.4% to 124,427.2 tons in 2023, while vegetable products sales volume increased by 31.1% to 71,454.7 tons[58][59] - Revenue from bean-based and other products decreased by 7.4% from RMB220.3 million in 2022 to RMB203.9 million in 2023, accounting for 4.2% of total revenue[54][55] - Revenue increased by 5.2% to RMB4,871.7 million in the current year, driven by growth in emerging channels such as O2O, snack specialty retailers, and content e-commerce platforms[90] - Gross profit rose by 18.5% to RMB2,322.7 million, with gross profit margin increasing by 5.4 percentage points to 47.7% due to higher average selling prices, lower raw material costs, and optimized cost management[91][93] - Distribution and selling expenses increased by 27.4% to RMB806.7 million, accounting for 16.6% of total revenue, driven by higher employee benefits and a 53.6% increase in promotion and advertising expenses[92][94] - Administrative expenses decreased by 4.7% to RMB458.9 million, with the proportion to total revenue dropping from 10.4% to 9.4%[95][101] - Net finance income surged by 204.3% to RMB175.6 million, primarily due to increased bank interest income[98][103] - Income tax expense increased by 52.8% to RMB398.9 million, driven by higher taxable income and increased withholding tax provisions[99][103] - Profit for the year skyrocketed by 481.9% to RMB880.4 million, largely due to the absence of share-based payments related to Pre-IPO investments and higher gross profit[100] - Annual profit increased by 481.9% from RMB 151.3 million in the previous year to RMB 880.4 million in the current year, primarily due to the increase in gross profit and share-based payments related to Pre-IPO investments[104] - Adjusted net profit (Non-IFRS measure) increased by 6.3% from RMB 913.1 million in the previous year to RMB 970.3 million in the current year, with the adjusted net profit margin rising from 19.7% to 19.9%[110] - The company proposed a final dividend of RMB 0.10 per share, totaling approximately RMB 235.1 million, representing 27% of the net profit for the year ended December 31, 2023[110] - A special dividend of RMB 0.11 per share was proposed, totaling approximately RMB 258.6 million, representing 30% of the net profit for the year ended December 31, 2023[110] - Total term deposits, restricted cash, and cash equivalents increased by 19.1% to RMB 4,690.5 million at the end of the current year, compared to RMB 3,939.3 million at the end of the previous year[113] - Borrowings increased from RMB 161.3 million at the end of the previous year to RMB 180.9 million at the end of the current year, primarily for plant construction and machinery purchases[113] - Inventories decreased by 29.9% from RMB599.3 million to RMB419.9 million, with inventory turnover days reduced from 82 to 73 days[115][118] - Trade receivables decreased by 22.3% from RMB66.4 million to RMB51.6 million, with turnover days reduced from 4.9 to 4.4 days[116][119] - Other receivables decreased by 38.0% from RMB62.4 million to RMB38.7 million[116][119] - Prepayments increased by 9.0% from RMB111.2 million to RMB121.2 million[117][119] - Financial assets at fair value through profit or loss decreased by 67.9% from RMB382.4 million to RMB122.8 million[120][125] - Trade payables decreased by 12.1% from RMB187.3 million to RMB164.7 million, with turnover days reduced from 26 to 25 days[121][126] - Contract liabilities and refund liabilities decreased by 8.4% from RMB225.3 million to RMB206.3 million[122][127] - Gearing ratio increased from 2.9% to 3.2%[123][128] - Capital commitments for property, plant, and equipment decreased from RMB79.5 million to RMB49.4 million[131][137] - Pledged land use rights decreased from RMB93.8 million to RMB91.8 million[132][138] Production and Capacity - The company operates multiple production plants in Luohe, Henan Province, including Luohe Pingping Plant, Luohe Weidao Plant, Luohe Weilai Plant, and Luohe Xinglin Plant[10] - The company's total production capacity in 2023 was 339,884.9 tons, with actual production reaching 187,994.0 tons, resulting in a utilization rate of 55.3%, down from 59.2% in 2022[73] - Seasoned flour products accounted for the largest share of production, with a designed capacity of 237,722.4 tons and actual production of 114,791.6 tons in 2023, achieving a utilization rate of 48.3%[73] - Vegetable products saw a utilization rate increase to 72.0% in 2023, up from 64.4% in 2022, with actual production reaching 69,309.0 tons against a designed capacity of 96,228.0 tons[73] - The company operates five production plants in Henan, with the Luohe Xinglin Plant currently undergoing capacity expansion and partially operational as of December 31, 2023[71][72] - Designed production capacity for seasoned flour products decreased in the current year due to production line adjustments, while vegetable products and bean-based products increased due to new production lines at Luohe Xinglin Plant[74][75] - Overall utilization rate decreased to 55.3% in 2023 from 59.2% in 2022, primarily due to a drop in utilization rate of seasoned flour products[76][77] - Luohe Xinglin Plant achieved the highest utilization rate at 93.6% in 2023, up from 90.1% in 2022, driven by higher efficiency and production line shifts[76][77] Corporate Governance and Board Structure - The company's board of directors includes executive directors such as Mr. LIU Weiping (Chairman), Mr. LIU Fuping (Vice Chairman), and Mr. SUN Yinong (Chief Executive Officer), as well as independent non-executive directors like Ms. XU Lili and Mr. ZHANG Bihong[18] - The company's audit committee is chaired by Mr. ZHANG Bihong, with members including Ms. XU Lili and Ms. XING Dongmei[18] - The company's nomination committee is chaired by Mr. LIU Weiping, with members including Ms. XU Lili and Mr. ZHANG Bihong[19] - The company's remuneration committee is chaired by Ms. XING Dongmei, with members including Ms. XU Lili and Mr. CHEN Lin[19] - The company's website is www.weilongshipin.com[18] - The Company emphasizes corporate governance, including a diligent Board of Directors and a robust risk management and internal control system[146] - The Board is responsible for formulating the Company's long-term and short-term strategic direction, including development strategy, major investments, and significant asset acquisitions or disposals[148][149] - Management provides monthly reports to the Board, supported by up-to-date financial data, to ensure informed decision-making[150] - The Board's authorization to management includes daily production, management, and operational decisions, but excludes major decisions and key personnel appointments[151] - The company's Board consists of nine Directors, including six executive Directors and three independent non-executive Directors, ensuring a balance of skills and experience[153][157] - The Board complies with the Listing Rules by having at least three independent non-executive Directors, with one possessing appropriate professional qualifications or financial expertise[154][157] - The Board includes two female members, accounting for 22.22% of the total Directors, aligning with gender diversity requirements[160][162] - The company's employees (including executive Directors and senior management) achieved gender diversity with 42.7% male and 57.3% female employees as of December 31, 2023[163][166] - The roles of Chairman and Chief Executive Officer are separated, with Mr. LIU Weiping as Chairman and Mr. SUN Yinong as CEO, ensuring a balance of power and authority[159][161] - The company has adopted a Board diversity policy, selecting candidates based on gender, age, cultural background, industry experience, and other factors[160][162] - The company has made appropriate insurance arrangements for Directors regarding any legal proceedings[158][161] - The Board is responsible for developing and reviewing corporate governance policies, monitoring compliance, and ensuring adherence to the Corporate Governance Code[164][165] - The Board reviewed and ensured compliance with the Corporate Governance Code and disclosed requirements in the Corporate Governance Report[167] - All Directors participated in training courses or reading materials on corporate governance and related topics, with records provided to the Company[169] - The Board held four meetings and one general meeting in 2023, with all Directors attending all meetings[174] - The Audit Committee comprises three independent non-executive Directors and oversees financial policies, risk management, and internal controls[177] - The Board adopted a policy on seeking independent professional advice by Directors on March 23, 2023, and will review its implementation annually[168] - The Company has mechanisms in place for Directors to seek independent professional advice to ensure access to independent views[168] - The Board is responsible for leadership, strategic decisions, and maintaining effective risk management and internal control systems[175] - The Chairman held one meeting with independent non-executive Directors without the attendance of other Directors in 2023[176] - The Audit Committee supervises the financial activities, internal audit, and external accounting firm's work[177] - The Board has three committees: Audit, Nomination, and Remuneration, each with specific terms of reference[172] - The Audit Committee held four meetings in 2023, exceeding the minimum requirement of two meetings per year as stipulated by the Corporate Governance Code[179] - The Audit Committee reviewed the company's annual results for 2023 and confirmed compliance with all applicable accounting standards and regulations, with sufficient disclosures made[180] - The Audit Committee was satisfied with the effectiveness and sufficiency of the company's internal control mechanisms, including financial, operational, and compliance controls, as well as risk management
卫龙(09985) - 2023 - 年度财报