2021-04-13 08:30Financial Performance - The revenue for the year 2020 was RMB 92.11 billion, a decrease of 5% compared to RMB 97.40 billion in 2019[14]. - Profit attributable to equity holders of the company decreased by 32% to RMB 5.53 billion from RMB 8.19 billion in 2019[26]. - The total assets at the end of 2020 were RMB 110.82 billion, an increase from RMB 107.93 billion in 2019[23]. - The total liabilities were RMB 46.60 billion, down from RMB 53.00 billion in 2019[14]. - The basic earnings per share for 2020 were RMB 0.56, compared to RMB 0.90 in 2019[23]. - The company declared a dividend of HKD 0.20 per share, down from HKD 0.25 in the previous year[23]. - The EBITDA margin for 2020 was 13.5%, compared to 16.2% in 2019[17]. - Capital expenditure (CAPEX) for 2020 was RMB 7.64 billion, slightly up from RMB 7.04 billion in 2019[17]. - The total equity attributable to equity holders of the company was RMB 63.63 billion, an increase from RMB 54.44 billion in 2019[23]. - The company’s total debt to EBITDA ratio was 31.6% in 2020, compared to 19.9% in 2019[17]. - Total revenue for the year ended December 31, 2020, decreased by 5% to RMB 92.1 billion, and net profit fell by 33% to RMB 5.6 billion[28]. - The diluted earnings per share decreased by 37% to RMB 0.56, with net profit attributable to equity holders dropping by 32% to RMB 5.5 billion[29]. Sales and Market Performance - In 2020, the total wholesale volume in China decreased by 4% to 1,247,526 units, while total vehicle sales amounted to 1,320,217 units, a decline of 3% compared to 2019[27]. - Geely's total vehicle sales in 2020 reached 1,320,217 units, a decrease of 3% compared to 2019, but achieved the revised sales target of 1,320,000 units set in August 2020[36]. - Export sales grew by 25% year-on-year to 72,691 units in 2020, indicating strong performance in international markets[27]. - The company's wholesale volume in China decreased by 4% to 1,247,526 units, while the overall Chinese passenger car market declined by 6%[70]. - The company's export sales increased by 25% to 72,691 units, accounting for 5.5% of total sales in 2020[70]. - The SUV sales increased by 3% to 821,202 units, while sedan and MPV sales decreased by 11% and 9% respectively[68]. - The company maintained a leading position among Chinese independent automotive manufacturers, ranking fourth in the Chinese passenger car market by sales volume in 2020[70]. Strategic Initiatives - The company plans to continue its globalization strategy in 2021, focusing on opportunities in electrification, intelligent driving, and shared mobility[30]. - The company aims to achieve carbon neutrality by 2060 and has established a sustainable development committee to enhance its ESG performance[32]. - The company plans to launch more new energy vehicle models in 2021, including a large electric SUV model named "Zero EV" developed on the SEA architecture[77]. - A joint venture was established with Geely Holding to focus on the development, procurement, and sales of electric mobility products, with a total investment of RMB 2 billion, where the company holds 51% and Geely holds 49%[75]. - The company is exploring a business merger and collaboration with Volvo Cars, aiming for a restructuring that maintains both companies' independent structures[55]. - The company plans to merge its powertrain business through an equity merger, aiming to develop next-generation dual-motor hybrid systems and provide products and services to other automotive companies[56]. - The company is jointly developing the next-generation electric vehicle modular architecture, which will be shared with the Lynk & Co and Polestar brands, focusing on cost reduction through joint procurement[57]. Research and Development - Research and development expenses amounted to RMB 3.738 billion in 2020, up from RMB 3.067 billion in 2019[64]. - The company's total research and development costs deducted from profit and loss amounted to RMB 3,738,208 thousand, an increase of 22% from RMB 3,067,153 thousand in 2019[67]. - The company emphasizes the importance of its R&D capabilities to ensure the success of new product developments[180]. - The company is committed to developing new products and improving quality through advanced technology and powertrain systems, expanding its product portfolio with new energy vehicles[184]. Corporate Governance - The company is committed to high levels of corporate governance and has adhered to the Stock Exchange's corporate governance code, with some exceptions noted[99]. - The board includes independent directors with significant experience in the automotive sector and investment banking, enhancing decision-making capabilities[100]. - The company has established a transparent communication channel with shareholders to maintain effective governance[99]. - The management team includes professionals with advanced degrees and certifications in finance and engineering, contributing to the company's strategic direction[98]. - The company has a structured approach to risk assessment and internal controls, overseen by the Chief Internal Auditor[98]. - The board's composition allows for diverse perspectives, aiding in effective decision-making processes[100]. - The company has established internal policies for handling insider information, ensuring confidentiality and compliance with legal obligations[111]. Financial Position and Capital Management - The company raised HKD 6.48 billion by placing 600 million new shares to strengthen its financial position amid the pandemic[29]. - The company issued USD 500 million (approximately RMB 3.43 billion) in 4% perpetual capital securities, with the net proceeds fully utilized for business development and operational funding[45][48]. - The company’s total borrowings decreased by 6% to RMB 3.9 billion by the end of 2020[60]. - The company’s net cash position at the end of 2020 was RMB 11.8 billion, down from RMB 12.6 billion six months prior[60]. - The total cash level at the end of 2020 was maintained at approximately RMB 19 billion, benefiting from the placement of 600 million new shares in June 2020[88]. - The total distributable reserves attributable to the company's equity holders as of December 31, 2020, amounted to RMB 7,439,139,000, compared to RMB 2,992,831,000 in 2019, reflecting a significant increase[188]. Market Outlook and Challenges - The company acknowledges the challenge of accurately predicting market trends and customer demands, which are influenced by various external factors[179]. - The automotive market in China is experiencing significant growth due to increased consumer purchasing power, which may encourage competition from both domestic and foreign companies[184]. - Regulatory changes regarding fuel efficiency, product recalls, and emissions standards may impose significant cost pressures on domestic brands, impacting production and profitability[186]. - The company faces risks related to product liability, which could significantly impact its reputation and financial performance[181]. - The company has outlined potential risks and uncertainties that could affect its ongoing growth and market performance[179]. Sustainability and ESG Initiatives - The company plans to publish its environmental, social, and governance report within five months after the fiscal year ending December 31, 2020[187]. - The company emphasizes environmental performance in its product development and aims to exceed national standards in environmental compliance[186]. - The sustainable development committee was established to assist the board in overseeing the group's environmental, social, and governance developments[150]. - The management team emphasized a commitment to sustainability, with plans to reduce carbon emissions by 30% by 2025[95].