Financial Performance - The company's sales revenue for the year ended December 31, 2020, was approximately RMB 444.1 million, a decrease of about 10% compared to RMB 494.6 million in the previous year[14]. - Net profit attributable to equity holders of the company was approximately RMB 16.8 million, down about 71% from RMB 58.3 million in the previous year[14]. - In 2020, the company's revenue was RMB 444,106,000, a decrease of 10.2% from RMB 494,580,000 in 2019, with a gross margin of 23.2%, down from 27.3%[37]. - The company recorded a net profit attributable to equity holders of approximately RMB 16,827,000 for the year ended December 31, 2020, a significant decrease from RMB 58,299,000 in 2019[42]. - Exports accounted for approximately 36% of the company's revenue in 2020, down from 47% in 2019, while domestic sales represented 64%, up from 53%[44]. Impact of COVID-19 - The company faced significant negative impacts on foreign trade sales and new business development due to the COVID-19 pandemic[14]. - The company faced a significant decline in sales due to reduced demand in major export regions like Europe and the US, with shipping costs rising to three to four times previous levels[17]. Production and Operations - The company plans to relocate relevant equipment to a new factory in Dalian due to the inability to produce certain products in Changzhou[15]. - The main production line for food additives has been largely relocated to the second phase of the Changzhou factory, ensuring no impact on future production capacity[15]. - The production line for phthalic anhydride was halted in June 2020, leading to increased production costs due to the need for external procurement of raw materials[17]. - The company is actively relocating the phthalic anhydride production line to a new facility in Dalian, aiming to transition from chemical to light industrial production[25]. - The company plans to build a new factory in Dalian, Liaoning Province, to relocate production lines from Changzhou and Lianyungang, aiming to restore normal production of phthalic anhydride[38]. Research and Development - The company is advancing the development of new feed additive PQQ, with positive feedback received from the Ministry of Agriculture during the second review meeting[21]. - The company has expanded its pharmaceutical excipients project, completing the application for L-potassium tartrate and L-tartaric acid as pharmaceutical excipients[22]. - The raw material drug project is underway, with the production line built and awaiting provincial regulatory approval for national drug application[23]. - The company is focusing on technological innovation and product upgrades, investing in the development of new feed additives and pharmaceutical excipients[30]. Environmental and Safety Measures - Environmental investments have been increased, with electronic monitoring systems installed to ensure compliance with pollution discharge standards[20]. - The company aims to balance product quality improvement with cost control and environmental protection, implementing energy-saving measures and pollution reduction initiatives[125]. - The company has implemented measures to ensure effective operation of equipment to reduce emissions and has engaged independent environmental monitoring firms to ensure compliance with national standards[131]. - The company’s Changzhou factory received ISO 14000 certification, reflecting its commitment to environmental management and pollution prevention[125]. - In 2020, the company invested over RMB 25 million in environmental protection, focusing on waste treatment and pollution control upgrades[126]. Governance and Management - The management team includes experienced professionals with over 20 years of accounting and financial management experience, enhancing the company's financial oversight[68]. - The independent directors bring extensive academic and industry experience, contributing to the company's strategic direction and governance[60][61]. - The company has a robust management structure with a focus on improving production management and safety standards, evidenced by awards received for excellence in production[64]. - The board includes members with diverse backgrounds in engineering, finance, and academia, enhancing the company's strategic capabilities[60][61]. - The board confirmed the preparation of financial statements on a going concern basis, with reasonable assumptions and disclosures[74]. Shareholding Structure - As of December 31, 2020, Mr. Rui Xinsheng holds 2,500,000 domestic shares (100%) and 135,000,000 foreign shares (39.30%) of the company, along with 3,820,000 H shares (2.08%)[173]. - The company has a significant ownership structure with key individuals holding substantial stakes in both domestic and foreign shares[177]. - The report indicates that the company is actively managing its shareholding structure among its directors and related parties[175]. - The company has a diverse shareholding base, with significant foreign investment represented in its capital structure[177]. Employee and Community Engagement - Total employee costs for the year ended December 31, 2020, were approximately RMB 55,946,000, down from RMB 65,477,000 in 2019, attributed to a decrease in average employee numbers[49]. - The company has a strong emphasis on employee development and recognition, fostering a culture of innovation and productivity[64]. - The company made charitable donations totaling RMB 140,000 in 2020, a decrease from RMB 190,000 in 2019[157]. - The company donated 5,000 masks to the government of Chunjiang Town in March 2020 as part of its community support efforts[157]. Compliance and Risk Management - The company has established anti-corruption and anti-bribery control procedures and conducts annual internal audits related to social responsibility[156]. - The board is committed to ongoing monitoring and review of the company's risk management framework and emerging risks[108]. - The company has a policy in place to ensure timely and equal disclosure of insider information to relevant parties[113]. - The internal audit department was formed to continuously evaluate the effectiveness of the internal control system, reporting findings to the board[112].
常茂生物(00954) - 2020 - 年度财报