YADEA(HK:01585)2019-09-18 08:45Revenue and Sales Performance - For the six months ended June 30, 2019, the group recorded revenue of approximately RMB 4,074.5 million, a decrease of about 11.1% compared to RMB 4,582.8 million for the same period in 2018[16]. - Total sales volume of electric scooters and bicycles decreased from approximately 2,473,000 units for the six months ended June 30, 2018, to approximately 2,033,000 units for the same period in 2019[14]. - The decrease in revenue was primarily due to the early Lunar New Year and the impact of the new national standards on sales of electric scooters and bicycles[16]. - Electric scooter sales volume decreased by approximately 24.2% from about 1,434,200 units for the six months ended June 30, 2018, to about 1,086,900 units for the same period in 2019[17]. - The sales volume of electric scooters fell by approximately 24.2% from 1,434,200 units to 1,086,900 units, while electric bicycles saw a decline of about 8.9% from 1,038,800 units to 946,100 units[127]. - Electric scooters generated revenue of RMB 1,929,291,000, down 17.9% from RMB 2,349,496,000 in the previous year[186]. - Electric bicycles revenue increased slightly to RMB 1,251,420,000, up 1.5% from RMB 1,232,400,000[186]. Profitability and Margins - Despite the decrease in sales volume, the overall gross profit margin increased from approximately 15.6% to 16.8%, attributed to the rise in average selling prices of electric scooters and bicycles[14]. - Gross profit for the six months ended June 30, 2019, was approximately RMB 683.3 million, a decrease of about 4.5% from RMB 715.2 million for the same period in 2018, with a gross margin of 16.8%[19]. - Net profit for the period was RMB 181,316 thousand, a decrease of 7.1% from RMB 195,269 thousand in the previous year[152]. - Net profit attributable to owners for the six months was RMB 180,042,000, a decrease of 7.6% from RMB 194,816,000[195]. - Basic earnings per share for the period was RMB 6.1, down from RMB 6.5, indicating a decline of about 6.15%[151]. Cash Flow and Financial Position - Cash and cash equivalents as of June 30, 2019, were approximately RMB 1,417.3 million, a decrease of about 28.2% from RMB 1,973.4 million as of December 31, 2018[22]. - Operating cash flow for the six months ended June 30, 2019, generated a net cash inflow of approximately RMB 101.5 million, compared to a net cash outflow of RMB 812.2 million for the same period in 2018[22]. - The net cash generated from operating activities for the first half of 2019 was RMB 101,546,000, compared to a net cash used of RMB 812,244,000 in the same period of 2018[158]. - The total cash and cash equivalents as of June 30, 2019, amounted to RMB 1,417,275,000, a decrease from RMB 1,461,526,000 at the end of June 2018[159]. - The company experienced a significant decrease in cash used in investing activities, reporting a net cash outflow of RMB 478,883,000 for the first half of 2019, compared to a net cash inflow of RMB 1,317,608,000 in the same period of 2018[158]. Inventory and Assets - Inventory increased by approximately 15.0% from RMB 259.5 million as of December 31, 2018, to RMB 298.5 million as of June 30, 2019, primarily due to increased stock of electric scooters and bicycles[24]. - Non-current assets increased to RMB 1,718,057 thousand as of June 30, 2019, compared to RMB 1,634,586 thousand at the end of 2018, representing a growth of approximately 5.1%[44]. - Total assets decreased to RMB 5,686,240 thousand from RMB 6,124,601 thousand, a decline of about 7.2%[44]. - Accounts receivable as of June 30, 2019, amounted to RMB 227,904 thousand, a decrease of 18.9% from RMB 278,079 thousand as of December 31, 2018[88]. - Inventory as of June 30, 2019, was RMB 298,530,000, an increase from RMB 259,492,000 at the end of 2018[197]. Corporate Governance and Management - The company has fully complied with the corporate governance code during the reporting period[37]. - The company appointed a new CEO, Qian Jinghong, effective May 14, 2019, following the resignation of the previous CEO, Liu Yeming[39]. - The company’s ultimate holding companies are registered in the British Virgin Islands, with the ultimate controlling shareholders being Mr. Dong Jinggui and Ms. Qian Jinghong[50]. - The company has a strong management team, with Qian Jinghong appointed as CEO on May 14, 2019[122]. Research and Development - The company plans to focus on enhancing its brand as a premium electric two-wheeler, strengthening R&D capabilities, and expanding its sales and service network[14]. - Research and development costs for the period amounted to RMB 123,476,000, an increase from RMB 108,159,000 in the previous year[82]. - The company is committed to continuing its research and development efforts, including hiring R&D personnel[36]. Market Outlook and Strategy - The implementation of new national standards for electric bicycles is expected to create a favorable environment for existing market leaders like Yadea, with anticipated demand growth in the second half of 2019[14]. - Management noted that the sales of electric two-wheelers showed an upward trend starting in April 2019, following the implementation of the new national standards[14]. - The company will adjust pricing and sales strategies in response to domestic and international market developments[14]. - Yadea aims to develop mid-to-high-end products to maintain its competitive edge in the industry[14]. - The group plans to focus on enhancing its brand, R&D capabilities, and expanding its sales and service network to maintain competitive advantage in the market[124]. Financial Reporting and Standards - The financial statements for the six months ended June 30, 2019, were prepared in accordance with Hong Kong Accounting Standards and the relevant disclosure requirements[51]. - The adoption of Hong Kong Financial Reporting Standard 16 has led to significant changes in accounting policies regarding leases[62]. - The financial performance and position of the group were not significantly impacted by the new accounting standards adopted during the period[61]. - The company recognizes right-of-use assets at the commencement date of the lease, measured at cost less accumulated depreciation and impairment losses[64].