WANT WANT CHINA(HK:00151)2020-07-15 04:01Financial Performance - Want Want China Holdings Limited reported a revenue of HKD 6.5 billion for the fiscal year 2019/2020, representing a 5% increase compared to the previous year[14]. - The company achieved a net profit of HKD 1.2 billion, which is a 10% increase year-over-year[14]. - The revenue for the fiscal year ended March 31, 2020, was RMB 20,094,531, a slight decrease from RMB 20,712,027 in the previous fiscal year[38]. - Profit for the year was RMB 3,636,243, compared to RMB 3,462,571 in the previous fiscal year, reflecting an increase of 5.0%[38]. - The gross profit margin for the year was 48.4%, showing a stable performance compared to previous years[36]. - The EBITDA margin for the year was 27.8%, indicating a solid operational efficiency[36]. - The company declared dividends of RMB 3,649,215, an increase from RMB 2,877,682 in the previous fiscal year[38]. - Basic earnings per share for the year was RMB 29.38, up from RMB 27.93 in the previous fiscal year[38]. - Revenue for FY2019 decreased by 3.0% to RMB20,094.5 million compared to FY2018, impacted by the COVID-19 pandemic[43]. - Gross profit margin increased from 45.4% in FY2018 to 48.0% in FY2019 due to product-mix optimization and decreased raw material costs[43]. - Operating profit rose by 4.8% to RMB4,805.9 million in FY2019 compared to FY2018[43]. - Net profit attributable to equity holders increased by 5.0% to RMB3,649.2 million in FY2019 compared to FY2018[43]. Strategic Initiatives - The company plans to expand its product line with the introduction of three new snack products in the next fiscal year[14]. - Future outlook includes a projected revenue growth of 8% for the upcoming fiscal year, driven by market expansion strategies[14]. - Market expansion efforts will target Southeast Asia, with a goal to increase market share by 10% in the region[14]. - The company has initiated discussions for potential acquisitions to diversify its product offerings and enhance market presence[14]. - Want Want China Holdings Limited has set a performance guidance of HKD 7 billion in revenue for the next fiscal year[14]. - The company aims to create new business ventures annually, emphasizing the importance of teamwork and dedication among employees[32]. - The management highlighted the need for a long-term vision to ensure sustainable profitability and growth[32]. - The company is focused on integrating talent, technology, and market strategies to achieve its goal of becoming a "World Elite Dragon"[32]. Operational Efficiency - Want Want China Holdings Limited is focusing on enhancing its supply chain efficiency, aiming for a 20% reduction in logistics costs[14]. - The company is investing HKD 300 million in new technology for production automation to improve operational efficiency[14]. - The Group achieved a 100% complaint resolution rate and a 100% pass rate of quality inspection of finished goods[67]. - The Group's quality control initiatives included 223 national QC teams and 1,823 in-service circle members, resulting in tangible benefits amounting to RMB 8.2353 million from 14,178 accepted proposals[114]. - The Group's recall management process is standardized, ensuring timely identification and resolution of food safety risks[172]. - The average traceability time for product recalls is 3.18 hours, with a conformity rate of 99.10% during the reporting period[172]. - The Group has implemented an online quality assessment system to enhance food safety and operational efficiency, contributing to its digital transformation[164]. Market Presence - The company has a significant presence in the People's Republic of China, which is one of the fastest-growing economies globally, and has an extensive nationwide sales and distribution network[18]. - The company exports products to various markets, including North America, East Asia, Southeast Asia, and Europe[20]. - More than 90% of the Group's revenue and businesses were generated in the Chinese mainland during the reporting period from April 1, 2019, to March 31, 2020[61]. - The sales entity in Vietnam commenced operations in 2019, with plans for additional Southeast Asian sales entities in 2020[44]. - The company aims for overseas markets to become a significant growth engine in the future[44]. Corporate Culture and Employee Engagement - The company emphasizes a corporate culture that fosters communication and unity among employees and their families through various activities[24]. - The management philosophy focuses on being people-oriented, self-confident, and united, aiming to achieve sustainable profits and prosperity for both the group and individuals[30]. - The company aims to become the "Elite Dragons of the World" through periodic new ventures and collective efforts from all employees[30]. - The Group's commitment to employee rights includes providing a safe and healthy working environment and establishing career development platforms[187]. - The Group emphasizes a remuneration system that is systematic and fair, adjusting salaries based on efficiency and sustainable development principles[200]. Environmental and Social Responsibility - Cumulative investment in upgrading environmental protection technologies was RMB198 million[73]. - The Group used 3.5 billion cartons certified by the Forest Stewardship Council (FSC) and the Sustainable Forestry Initiative (SFI), equivalent to planting 63,000 trees[75]. - Solar photovoltaic power generated amounted to 2,550,000 kWh, reducing carbon dioxide emissions by about 2,036 tonnes[77]. - Energy efficiency increased by 17.97% compared to 2015, equivalent to saving 30,900 tonnes of standard coal[69][71]. - Utilization efficiency of water resources increased by 20.48%, equivalent to saving 1,920,000 tonnes of water[71]. - The Group has donated Water God disinfectant generation equipment to over 100 schools across China as part of its community support efforts during the pandemic[104]. - The Group's environmental, social, and governance (ESG) strategies involve active communication with stakeholders, including shareholders, consumers, and regulatory authorities[107]. Product Development and Innovation - The company aims to develop functional products focusing on sugar reduction, organic nutrition, and green packaging, enhancing health benefits while reducing unhealthy ingredients[121]. - The Group's R&D strategy emphasizes independent innovation, targeting consumer demand for safety and health in product development[115]. - A new branding business team "Shi Ji Yan" was established in 2019 to target younger consumer groups[44]. - New product series launched include "Prime of Love" for middle-aged consumers, "Fix Body" for fitness enthusiasts, and "Baby Mum-Mum" for new parents[44]. - The company integrates Chinese food culture into its products, enhancing their appeal through natural and healthy ingredients[121]. Supplier Management - The supplier management system includes strict qualification examinations and adherence to quality and environmental standards, ensuring integrity and mutual benefit[125]. - The group emphasizes risk assessment of suppliers through third-party platforms and on-site visits, rejecting those that do not meet standards[130]. - A quantifiable assessment standard for suppliers is established based on quality, delivery, cost, and service, with monthly evaluations conducted[134]. - The Group's supplier management includes annual reviews and daily assessments, with non-compliant suppliers blacklisted[145]. - In FY 2019, the Group had 1,403 centralized procurement suppliers, primarily local suppliers, managed according to the Group's supplier management measures[138]. Safety and Compliance - The Group's safety project in the second quarter of 2019 focused on "Full Inspection of Risks and Hidden Dangers," aligning with national safety production month themes[193]. - The Group's safety production policy prioritizes "safety first, prevention driven," ensuring comprehensive governance in production safety[189]. - The Group's factories achieved a production safety standardization level of Class C, with factories in Beijing and Shijiazhuang reaching Class B standard[189]. - There were no employee fatal accidents reported during the reporting period[195]. - The Group conducted 2,030 "One-Day Auditor" activities across 32 production bases to enhance product quality[150]. Intellectual Property Management - The Group owns 2,457 trademarks, 32 patents, and 112 copyrights registered in mainland China, ensuring robust intellectual property management[174]. - The intellectual property rights department conducts regular training for staff on legal knowledge related to intellectual property and advertising compliance[179]. - The Group's intellectual property rights department actively engages in protecting trademarks and fighting against counterfeiting, providing legal support for major cases[177]. - All product packaging, promotional materials, and advertisements are subject to review by the intellectual property rights department to ensure compliance with relevant laws and regulations[185].