丝路物流控股(00988) - 2023 - 年度财报

Company Information This chapter provides basic information about UBTECH Robotics Corp. Ltd., including core details such as board and committee members, company secretary, auditor, legal counsel, main office address, principal banks, and stock code Company Overview This chapter provides basic information about UBTECH Robotics Corp. Ltd., including core details such as board and committee members, company secretary, auditor, legal counsel, main office address, principal banks, and stock code - The company's board of directors consists of executive, non-executive, and independent non-executive directors, with five committees: Audit, Environmental, Social and Governance, Remuneration and Assessment, Nomination, and Strategy[4] - The company's auditor is PwC Zhongtian LLP[4] - The company's stock code is 9880, listed on the Hong Kong Stock Exchange[6] Chairman's Report This report highlights the company's strategic focus on humanoid robots and AI, detailing technological breakthroughs, business performance across segments, and future development plans Technology and R&D In 2023, the company achieved key technological breakthroughs in humanoid robots, large models, and the AI industry, with R&D investment accounting for 46.5% of total revenue - In robotics technology, the company enhanced motion planning and control, full-body torque control, and developed new servo drivers, enabling robots to autonomously navigate complex terrains[7] - In AI technology, the company achieved lightweight deployment of high-performance visual models, and independently developed low-cost binocular depth camera kits and offline full-link voice interaction technology[8] - In robot-AI integration, the company upgraded its USLAM localization and navigation system and successfully developed a robot task planning framework combining multi-modal large language models, enhancing robots' embodied intelligence[10][11] R&D Expenses | Year | R&D Expenses (RMB) | % of Total Revenue | | :--- | :--- | :--- | | 2023 | 490.5 million | 46.5% | | 2022 | 428.3 million | 42.5% | 2023 Business Review In 2023, logistics and consumer-grade robot businesses achieved strong growth, while education and other industry-customized robot businesses saw revenue decline due to project delivery delays Education Intelligent Robots and Intelligent Robot Solutions In 2023, education robot business revenue decreased by 32.8% to RMB 347 million due to project delivery delays, despite launching a new AI large model-integrated education platform and the successful UGOT robot Education Business Revenue | Indicator | 2023 (RMB) | 2022 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 347.4 million | 516.7 million | -32.8% | - The main reason for the revenue decline was that some awarded or signed projects were not completed and accepted by year-end[13] - The company developed a new generation education platform integrated with AI large models and successfully launched the UGOT robot, which was successfully crowdfunded on Kickstarter and is expected to be a new growth driver[12][13] Logistics Intelligent Robots and Intelligent Robot Solutions In 2023, logistics robot business revenue grew significantly by 47.9% to RMB 389.7 million, driven by enhanced product competitiveness, new product launches, and increased customer base Logistics Business Revenue | Indicator | 2023 (RMB) | 2022 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 389.7 million | 263.4 million | +47.9% | - Revenue growth was mainly attributed to enhanced product competitiveness, new product launches, customer repurchases, and an increase in new customers and application scenarios[17] - The company launched the Chitu L4 autonomous logistics vehicle, expanding outdoor operation scenarios, and achieved mass production of the Wali T3000 towing robot[16] Other Industry-Customized Intelligent Robots and Intelligent Robot Solutions In 2023, other industry-customized robot business revenue decreased by 24.5% to RMB 62.2 million due to project delivery delays, while the company explored new applications and received an Edison Award for its eldercare solution Other Industry-Customized Business Revenue | Indicator | 2023 (RMB) | 2022 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 62.2 million | 82.4 million | -24.5% | - The Walker S series began exploring applications in new energy vehicle assembly lines, developing a specialized industrial humanoid robot[18] - The eldercare solution won the Edison Award in the US and has been applied in various institutional, community, and home care scenarios[19] Consumer-Grade Robots and Other Hardware Devices In 2023, consumer-grade robot business revenue surged by 91.5% to RMB 254 million, becoming the fastest-growing segment, driven by continuous new product launches and successful crowdfunding initiatives Consumer-Grade Business Revenue | Indicator | 2023 (RMB) | 2022 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 253.6 million | 132.4 million | +91.5% | - Revenue growth was mainly due to the company's continuous launch of new consumer-grade intelligent products[21] - The first-generation cat litter box received positive reviews globally, and the second-generation cat litter box and Cyclone Strong Suction Robot Vacuum have achieved mass production[21] Future Outlook The company's future strategy centers on humanoid robots and AI, focusing on R&D, multi-modal perception, large models, and embodied intelligence to expand applications and international markets - Continued investment in humanoid robot software and hardware R&D, integrating multi-modal large language models and other latest AI technologies, to promote their application in industrial and service scenarios[22] - Multi-modal perception and large model technology will be key strategies, researching large model robots to enhance their perception, reasoning, decision-making, and multi-task generalization capabilities[23] - Research embodied intelligence technology to enhance robots' ability to autonomously execute complex tasks and improve software and hardware architecture and platforms[24] - The company will further optimize its overseas layout and expand into international markets to meet global customer demand[24] Financial Highlights This section provides a concise overview of the company's financial performance and position, including revenue, profitability, assets, and liabilities Financial Highlights In 2023, the company's total revenue increased by 4.7% to RMB 1.056 billion, but gross profit decreased, and the annual loss expanded to RMB 1.265 billion, with total assets significantly growing to RMB 4.766 billion, and financial reports now prepared under China Accounting Standards 2020-2023 Financial Data Summary (RMB thousand) | Indicator | 2022 | 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 1,008,272 | 1,055,698 | +4.7% | | Gross Profit | 397,168 | 332,818 | -16.2% | | Loss for the Year | (987,368) | (1,264,590) | +28.1% | | Loss per Share (RMB) | (2.50) | (3.05) | +22.0% | | Total Assets | 2,788,002 | 4,765,635 | +70.9% | | Total Liabilities | 1,734,078 | 2,676,752 | +54.4% | | Net Assets | 1,053,924 | 2,088,883 | +98.2% | - Starting from the 2023 fiscal year, the Group's financial statements are prepared in accordance with China Accounting Standards for Business Enterprises, and 2022 data has been restated[26] Management Discussion and Analysis This section provides an in-depth analysis of the company's financial performance, liquidity, capital resources, and human capital management Financial Review In 2023, revenue grew by 4.7% to RMB 1.056 billion, driven by logistics and consumer-grade robots, but gross profit declined by 16.2% to RMB 333 million due to product mix shifts, and increased expenses and credit impairment losses led to an expanded annual loss of RMB 1.265 billion Revenue by Product and Service (RMB thousand) | Product/Service | 2023 Amount | 2023 % | 2022 Amount | 2022 % | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Education Intelligent Robots | 347,328 | 32.9% | 516,688 | 51.2% | -32.8% | | Logistics Intelligent Robots | 389,724 | 36.9% | 263,437 | 26.1% | +47.9% | | Other Industry-Customized Robots | 62,238 | 5.9% | 82,418 | 8.2% | -24.5% | | Consumer-Grade Robots | 253,583 | 24.0% | 132,448 | 13.1% | +91.5% | | Total | 1,055,698 | 100.0% | 1,008,272 | 100.0% | +4.7% | - Gross profit decreased from RMB 397.1 million in 2022 to RMB 332.8 million in 2023, with gross margin falling from 39.4% to 31.5%, primarily due to changes in product sales mix, with increased revenue contribution from lower-margin logistics business and decreased contribution from higher-margin education business[33] - Selling expenses increased by RMB 133 million year-on-year to RMB 506 million, mainly due to an increase of RMB 91.6 million in share-based payments and RMB 40.1 million in e-commerce promotion expenses[35] - R&D expenses increased by RMB 62.2 million year-on-year to RMB 491 million, primarily due to an increase of RMB 60.7 million in share-based payment expenses[37] - Credit impairment losses significantly increased from RMB 46.4 million in 2022 to RMB 145 million in 2023, mainly due to delayed payments from certain government-related customers, leading to a prudent provision for impairment[38] Non-GAAP Measures The company provides Non-GAAP financial metrics, including adjusted net loss and adjusted EBITDA, which exclude non-cash or one-off items like share-based payments and listing expenses, to offer a supplementary view of performance Non-GAAP Measures Reconciliation (RMB thousand) | Item | 2023 | 2022 | | :--- | :--- | :--- | | Net Loss for the Year | (1,264,590) | (987,368) | | Add: Share-based Payments | 383,839 | 204,387 | | Add: Listing Expenses | 63,749 | 944 | | Adjusted Net Loss for the Year (Non-GAAP) | (817,002) | (782,037) | | ...Adjustments... | ... | ... | | Adjusted EBITDA (Non-GAAP) | (515,454) | (537,674) | - The company defines "Adjusted Net Loss for the Year" as net loss for the year plus share-based payment expenses and listing expenses[43] Liquidity and Capital Resources As of 2023 year-end, the company's liquidity was robust, with increased cash and bank borrowings, an improved current ratio, and further strengthened by IPO proceeds in early 2024 Key Capital Resources Indicators | Indicator | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Cash and Cash Equivalents (RMB million) | 520.9 | 145.4 | | External Bank Borrowings (RMB million) | 1,453.5 | 622.7 | | Gearing Ratio | 73.3% | 55.4% | | Current Ratio | 1.5x | 1.0x | - The increase in bank borrowings was mainly for daily operations and payment of construction costs for the Shenzhen headquarters building[47] - Capital expenditure in 2023 was RMB 541 million, primarily related to the construction of the Shenzhen headquarters[53] Employees and Remuneration Policy As of 2023 year-end, the company had 2,013 full-time employees, with total remuneration costs increasing to RMB 1.007 billion, primarily due to higher share-based payment expenses, reflecting a competitive remuneration policy and equity incentive plans Employee and Remuneration Overview | Indicator | 2023 | 2022 | | :--- | :--- | :--- | | Full-time Employees | 2,013 | - | | Total Remuneration Costs (RMB million) | 1,007 | 827 | - The increase in remuneration costs was mainly due to an increase of RMB 179.5 million in share-based payment expenses[51] Biographies of Directors, Supervisors and Senior Management This section provides detailed biographical information for the company's directors, supervisors, and senior management, highlighting their professional backgrounds and roles within the Group Core Management Background This chapter details the personal biographies, professional backgrounds, and internal/external appointments of the company's executive directors, non-executive directors, independent non-executive directors, supervisors, senior management, and joint company secretaries, showcasing the core management team's extensive experience in robotics technology, corporate management, finance, and investment - Mr. Zhou Jian, Founder, Chairman of the Board, and CEO, is responsible for the Group's strategic planning and major decisions[55] - Mr. Xiong Youjun, Executive Director and CTO, is responsible for technology R&D management, and holds a Ph.D. in Mechanical Design and Theory[56] - Mr. Zhang Ju, Deputy General Manager, CFO, and Board Secretary, is responsible for the Group's overall finance, accounting, and capital market affairs[82] Corporate Governance Report This report details the company's corporate governance framework, including board structure, committee functions, risk management, and communication with shareholders Corporate Governance Practices and Compliance The company adheres to high corporate governance standards, adopting the HKEX Corporate Governance Code and complying with all applicable provisions since its listing, with a noted deviation where the Chairman and CEO roles are combined for strategic continuity - The company has adopted the HKEX Corporate Governance Code as the basis for its corporate governance practices[87] - From the listing date to December 31, 2023, the company complied with all applicable code provisions, except for code provision C.2.1 (separation of Chairman and CEO roles)[87] Board of Directors The Board of Directors, comprising 11 members with a balanced composition of executive, non-executive, and independent non-executive directors, oversees company affairs and ensures directors' continuous professional development - The Board of Directors consists of 4 executive directors, 3 non-executive directors, and 4 independent non-executive directors, with no relationships among members[92] - Mr. Zhou Jian serves as both Chairman of the Board and CEO, deviating from the Corporate Governance Code's recommendation, which the Board believes is in the overall best interest of the company and shareholders, as it facilitates management continuity and strategic implementation[97] - All directors have received training on the duties of directors of a listed company and confirmed their understanding of their obligations[107] Board Committees The Board has five committees—Audit, ESG, Remuneration and Assessment, Nomination, and Strategy—each composed of directors with relevant expertise, with key committees chaired by independent non-executive directors to ensure independence - The Audit Committee consists of three independent non-executive directors, chaired by Mr. Xiong Chuxiong, responsible for overseeing financial reporting, risk management, and internal control systems[109][111] - The Remuneration and Assessment Committee consists of one executive director and two independent non-executive directors, chaired by Mr. Pan Fuquan, responsible for formulating and reviewing remuneration policies[114] - The Nomination Committee consists of one executive director and two independent non-executive directors, chaired by Mr. Zhao Jie, responsible for reviewing the Board structure, identifying, and nominating director candidates[117] 2023 Remuneration Ranges for Directors, Supervisors, and Senior Management (RMB thousand) | Remuneration Range (RMB thousand) | Number of People | | :--- | :--- | | 0 - 1,000 | 9 | | 1,000 - 5,000 | 1 | | 5,000 - 10,000 | 4 | | 10,000 - 20,000 | 1 | | 20,000 - 30,000 | 1 | Risk Management and Internal Control The company maintains a three-lines-of-defense risk management and internal control system, with the Board responsible for oversight, addressing business, financial, compliance, and information risks through established policies and reporting channels - The company has established a three-lines-of-defense risk management and internal control system, with the Board as the highest decision-making body, bearing ultimate responsibility for its establishment and effective implementation[132] - Significant risks identified during the reporting period primarily include business risks, financial risks, compliance risks, inside information, and internal control risks, for which corresponding response plans have been developed[134] - The company has formulated an anti-corruption policy with zero tolerance for corrupt behavior and established reporting channels[139][142] - The Board has reviewed the risk management and internal control work during the reporting period and considers the system effective and adequate, with no significant risk control failures or deficiencies found[141] Communication with Shareholders and Investors The company prioritizes effective shareholder communication through various channels, including general meetings, its website, and announcements, ensuring shareholders' rights to convene meetings and propose resolutions - The company communicates with shareholders through various channels, including general meetings, the company website (www.ubtrobot.com), announcements, and corporate communications[155][158][160] - Shareholder rights: Shareholders holding individually or collectively over 10% of shares may request to convene an extraordinary general meeting; shareholders holding individually or collectively over 3% of shares may propose ad-hoc resolutions[150][151] Directors' Report This report provides an overview of the company's performance, dividend policy, use of IPO proceeds, key customer and supplier relationships, continuing connected transactions, and equity incentive schemes Use of Proceeds from Global Offering The company's global offering in December 2023 yielded approximately HKD 906 million in net proceeds, primarily allocated to R&D enhancement, bank loan repayment, and brand promotion, with funds remaining unutilized as of year-end Planned Use of Net Proceeds from Global Offering | Purpose | Approx. % | Amount (HKD million) | Expected Utilization Time | | :--- | :--- | :--- | :--- | | Enhance R&D Capabilities | 47.0% | 425.8 | Before end of 2026 | | Repay Bank Loans | 19.4% | 175.7 | Before end of 2024 | | Strengthen R&D Infrastructure | 7.9% | 71.6 | Before end of 2024 | | Enhance Brand Awareness | 9.5% | 86.1 | Before end of 2025 | | Optimize Management & Operational Efficiency | 6.2% | 56.2 | Before end of 2026 | | General Working Capital | 10.0% | 90.6 | Before end of 2024 | | Total | 100% | 905.9 | | - As of December 31, 2023, the net proceeds from the global offering remained unutilized[174] Results and Dividend Distribution The Group's performance for the year is detailed in the financial statements, and the Board does not recommend a final dividend for the year ended December 31, 2023 - The Board does not recommend the distribution of a final dividend for the year ended December 31, 2023[177] Major Customers and Suppliers In 2023, the company experienced high customer and supplier concentration, with the largest customer accounting for 27.6% of total revenue and the top five customers for 53.4%, while the largest supplier accounted for 6.9% of total purchases and the top five for 21.1% Customer and Supplier Concentration | Concentration | 2023 | 2022 | | :--- | :--- | :--- | | Largest Customer as % of Total Revenue | 27.6% | 27.4% | | Top Five Customers as % of Total Revenue | 53.4% | 71.5% | | Largest Supplier as % of Total Purchases | 6.9% | 6.5% | | Top Five Suppliers as % of Total Purchases | 21.1% | 26.3% | Continuing Connected Transactions The Group engaged in a significant non-exempt continuing connected transaction in 2023, involving the sale of intelligent robots and solutions to Tianqi Automation Engineering Group, which was reviewed and confirmed by independent directors and auditors - The main continuing connected transaction is the provision of intelligent robot products and services by subsidiary Wuxi Uqi to Tianqi Automation Engineering Group[209] Annual Caps for Sales to Tianqi Automation Engineering Group (RMB million) | Transaction Type | 2023 Actual Amount | 2023 Cap | 2024 Cap | 2025 Cap | | :--- | :--- | :--- | :--- | :--- | | Purchase of Tianqi Automation Engineering Products and Services | 293.6 | 294.0 | 122.0 | 62.0 | - As Tianqi Automation Engineering holds 30.97% equity in Wuxi Uqi, it is a major shareholder of a company subsidiary, constituting a connected person under the Listing Rules, and this transaction constitutes a non-exempt continuing connected transaction[216] - Independent non-executive directors and independent auditors have reviewed these transactions and deemed them to be entered into in the ordinary course of business on normal commercial terms, fair and reasonable, and in the overall interest of shareholders[218][219] Equity Incentive Scheme The company's equity incentive scheme, implemented since 2015, grants indirect interests in shares to core employees through shareholding platforms, with all shares issued and no new grants after listing - The equity incentive scheme grants indirect interests in company shares to participants through limited partnership entities (shareholding platforms) to incentivize and retain talent[227][228] Changes in Unvested Awards for Certain Grantees (Units) | Grantee Category | Unvested at Listing Date | Unvested at Dec 2023 | Vested During Period | Forfeited During Period | | :--- | :--- | :--- | :--- | :--- | | Mr. Zhou Jian | 20,000 | 20,000 | 0 | 0 | | Mr. Xiong Youjun | 300,000 | 300,000 | 0 | 0 | | Ms. Wang Lin | 370,000 | 370,000 | 0 | 0 | | Mr. Liu Ming | 291,000 | 291,000 | 0 | 0 | | Top Five Highest Paid Individuals (excluding directors) | 1,340,000 | 1,300,000 | 40,000 | 0 | Major Shareholders' Interests This chapter discloses the interests of directors, supervisors, chief executives, and major shareholders in the company's shares, highlighting the controlling shareholder's collective voting power and other significant investors - Controlling shareholder Mr. Zhou Jian, through direct holdings, controlled corporations (Shenzhen Sanciyuan), and acting-in-concert parties including Mr. Xia Zuoquan, Mr. Xiong Youjun, and Ms. Wang Lin, collectively holds approximately 51.17% of the company's voting rights[222][226][514] - Tencent Holdings Limited, through its subsidiaries Image Frame and Shenzhen Tencent, collectively holds approximately 6.14% of the company's shares[243] - Qiming Venture Partners, through its affiliated entities, collectively holds approximately 5.66% of the company's shares[243] Supervisory Committee Report This report outlines the Supervisory Committee's work in 2023, confirming the Board's effective operation, sound financial status, and robust internal controls, with plans to strengthen oversight in 2024 Overview of Supervisory Committee Work The Supervisory Committee's 2023 report confirms the Board's effective operation, legal decision-making, normal financial status, and sound internal controls, with no violations by directors or senior management, and outlines plans to strengthen oversight in 2024 - The Supervisory Committee believes that the company's Board of Directors operates effectively, decision-making is reasonable and legal, and directors and senior management fulfill their duties diligently, with no acts detrimental to the company or shareholders' interests[278] - The Supervisory Committee confirms that the company's financial operations are normal, systems are sound, financial statements truly reflect the company's financial position, and connected transactions are fair and reasonable[278] - The 2024 work plan includes: strengthening oversight functions, focusing on risk management and internal control, deepening financial supervision, and increasing attention to information disclosure matters[279] Environmental, Social and Governance (ESG) Report This report details the company's commitment to sustainable development, covering its ESG governance structure, product and service responsibility, talent management, and environmental initiatives Sustainable Development Governance The company has established a top-down ESG governance structure, identifying 7 highly material issues through stakeholder engagement, and implementing comprehensive policies for risk management, anti-bribery, information security, and environmental management, supported by ISO37001 certification - The company has established a three-tier ESG governance structure: Board of Directors, ESG and Sustainable Development Committee, and ESG-related functional departments[308][309] - Through materiality assessment, 7 highly material issues were identified, including: product quality and safety, compliant operations, intellectual property protection, information security and privacy protection, product innovation technology, customer service, and occupational health and safety[321][322] - The company has formulated a comprehensive anti-corruption policy, established reporting channels, joined the "Enterprise Anti-Fraud Alliance" and "Sunshine Integrity Alliance," and obtained ISO37001 anti-bribery management system certification[328][329] Products and Services The company provides intelligent service robot solutions across various sectors, emphasizing AI ethics, strict quality management (ISO9001 certified), robust intellectual property protection (2,172 patents), and comprehensive data security measures - The company has benchmark application cases in education, logistics, general services, and eldercare, such as participating in the Chengdu Universiade closing ceremony and collaborating with Tianqi Automation to empower smart logistics[341][343][346][349] - The company has established a comprehensive product quality management system and obtained ISO9001 certification, achieving a 92.66% customer service satisfaction rate in 2023, handling 46 product complaints with no product recalls due to safety or health reasons[363][371][372] - As of the end of 2023, the company held 2,172 robotics and AI-related patents, with 566 new additions during the year, and two patents received the China Patent Excellence Award[282][374][377] - The company has established a comprehensive data protection policy system and a data compliance working group, with its data security management capabilities certified by the China Academy of Information and Communications Technology's Trustworthy Big Data Program[379][383][390] - The company implements a sustainable procurement policy, incorporating ESG assessments into supplier onboarding and management, and audited 233 major suppliers in 2023[394][395][396] Talent Management The company prioritizes employees as core assets, offering comprehensive employment, compensation, training, and health and safety systems, including "five social insurances and one housing fund," talent development frameworks, and ISO45001 certification for occupational health and safety 2023 Employee Profile | Indicator | Data | | :--- | :--- | | Total Employees | 2,013 people | | Female Employee Ratio | 34.4% | | Total Employee Turnover Rate | 22.16% | | Workdays Lost Due to Work Injury | 163 days | | Work-related Fatalities in Past Three Years | 0 people | 2023 Employee Training Overview | Indicator | Data | | :--- | :--- | | Percentage of Female Employees Trained | 32.38% | | Percentage of Male Employees Trained | 67.62% | | Average Training Hours for Female Employees | 2.90 hours | | Average Training Hours for Male Employees | 3.90 hours | - The company strictly prohibits child labor and forced labor, and has detailed attendance and leave management regulations[398] - The company's occupational health and safety management system has obtained GB/T 45001/ISO45001 certification[406] Environmental Management The company adheres to an environmental policy of "promoting energy saving and consumption reduction, achieving pollution prevention," holding ISO14001 certification, and has set 2025 environmental targets for energy, water, and waste, while also assessing and addressing climate change risks 2023 Key Environmental Performance | Indicator | Unit | 2023 Data | | :--- | :--- | :--- | | Greenhouse Gas Emissions | | | | Total Scope 1+2 Emissions | metric tons CO2e | 1,767.65 | | Emissions Intensity (per area) | metric tons CO2e/sqm | 0.03 | | Energy Consumption | | | | Total Electricity Consumption | MWh | 3,134.97 | | Water Consumption | | | | Total Water Consumption | cubic meters | 26,126.64 | | Waste | | | | Non-hazardous Waste Generated | metric tons | 267,432.50 | - The company has set environmental targets until 2025, including energy consumption growth rate lower than production growth rate by 5-10%, water consumption intensity reduction of approximately 7%, and 100% compliant disposal of hazardous waste[415] - The company identified climate change-related risks, including physical risks such as extreme heat and floods, and transition risks such as tightening policies and regulations and changes in customer preferences, and formulated corresponding response measures[428][430][432][433] Audit Report This section presents the independent auditor's opinion on the company's financial statements and highlights key audit matters Audit Report PwC Zhongtian LLP issued an unqualified audit opinion on the company's 2023 financial statements, confirming their fair presentation, and identified inventory net realizable value and accounts receivable expected credit losses as key audit matters requiring detailed procedures - Auditor PwC Zhongtian issued a standard unqualified audit opinion[468] - Key Audit Matter One: Assessment of net realizable value of inventories, which due to its significant amount and complex judgments, was addressed by understanding internal controls, evaluating methodologies, and sampling and testing estimated selling prices and costs[472][473][475] - Key Audit Matter Two: Measurement of expected credit losses on accounts receivable, which due to its significant amount and complex estimates, was addressed by evaluating portfolio segmentation, testing aging, examining key assumptions, and assessing models with expert assistance[472][478][481] Financial Statements This section presents the company's consolidated financial statements, including the balance sheet, income statement, cash flow statement, and selected notes Consolidated Balance Sheet As of 2023 year-end, total assets reached RMB 4.766 billion, a 70.9% increase, driven by construction in progress, other receivables, and cash, while total liabilities rose 54.4% to RMB 2.677 billion due to increased borrowings, and shareholders' equity grew 98.2% to RMB 2.089 billion Consolidated Balance Sheet Summary (RMB thousand) | Item | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Assets | | | | Total Current Assets | 2,917,237 | 1,385,159 | | Total Non-current Assets | 1,848,398 | 1,402,843 | | Total Assets | 4,765,635 | 2,788,002 | | Liabilities and Shareholders' Equity | | | | Total Current Liabilities | 1,952,105 | 1,364,495 | | Total Non-current Liabilities | 724,647 | 369,583 | | Total Liabilities | 2,676,752 | 1,734,078 | | Total Shareholders' Equity | 2,088,883 | 1,053,924 | | Total Liabilities and Shareholders' Equity | 4,765,635 | 2,788,002 | Consolidated Income Statement In 2023, operating revenue increased by 4.7% to RMB 1.056 billion, but rising operating costs, increased selling, administrative, and R&D expenses, and significant credit and asset impairment losses led to an expanded net loss of RMB 1.265 billion Consolidated Income Statement Summary (RMB thousand) | Item | 2023 | 2022 | | :--- | :--- | :--- | | Operating Revenue | 1,055,698 | 1,008,272 | | Less: Operating Costs | (722,880) | (611,104) | | Gross Profit | 332,818 | 397,168 | | Selling Expenses | (506,113) | (373,344) | | Administrative Expenses | (399,706) | (409,652) | | R&D Expenses | (490,502) | (428,280) | | Credit Impairment Losses | (144,995) | (46,386) | | Asset Impairment Losses | (26,376) | (70,618) | | Operating Loss | (1,227,636) | (968,394) | | Net Loss | (1,264,590) | (987,368) | | Net Loss Attributable to Parent Company Shareholders | (1,234,048) | (974,809) | Consolidated Cash Flow Statement In 2023, the company experienced increased net cash outflow from operating activities (RMB 1.000 billion) and investing activities (RMB 506 million), offset by significant net cash inflow from financing activities (RMB 1.880 billion), resulting in a net increase of RMB 376 million in cash and cash equivalents at year-end Consolidated Cash Flow Statement Summary (RMB thousand) | Item | 2023 | 2022 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (1,000,302) | (538,697) | | Net Cash Used in Investing Activities | (505,598) | (394,317) | | Net Cash Generated from Financing Activities | 1,880,305 | 802,797 | | Net Increase/(Decrease) in Cash and Cash Equivalents | 375,504 | (127,705) | | Cash and Cash Equivalents at Beginning of Year | 145,398 | 273,103 | | Cash and Cash Equivalents at End of Year | 520,902 | 145,398 | Notes to Financial Statements (Selected) The notes provide detailed explanations of financial statement items, including the adoption of China Accounting Standards, changes in revenue structure, increased impairment provisions, strengthened capital structure through IPO and borrowings, ongoing losses, and the implementation of equity incentive plans - The company began preparing its overseas financial statements in accordance with China Accounting Standards for Business Enterprises for the year ended December 31, 2023, and restated 2022 data[26] Provision for Bad Debts on Accounts Receivable (RMB thousand) | Item | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Book Balance | 1,068,734 | 739,284 | | Bad Debt Provision | (235,061) | (89,629) | | Book Value | 833,673 | 649,655 | | Bad Debt Provision Rate | 21.99% | 12.12% | Inventory Impairment Provision (RMB thousand) | Item | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Book Balance | 427,485 | 398,937 | | Inventory Impairment Provision | (11,461) | (72,771) | | Book Value | 416,024 | 326,166 | - In 2023, the company raised approximately RMB 2.517 billion through private placement and IPO listing, significantly increasing share capital and capital reserves[695] - Total share-based payment expenses recognized in 2023 were RMB 384 million, a significant reason for the increase in administrative and selling expenses[756] - Regarding related party transactions, sales of goods to Tianqi Automation and its subsidiaries amounted to RMB 294 million in 2023[759]