Financial Performance - In 2020, Hilong achieved revenue of RMB 2,623 million, a decrease of approximately 28% compared to 2019, and recorded a net loss of RMB 299 million[7]. - Total revenue decreased by RMB 1,026.9 million or 28.1% from RMB 3,649.9 million in 2019 to RMB 2,623.0 million in 2020[19]. - The company reported a total of RMB 2,623.0 million in revenue for 2020, with the oilfield equipment manufacturing and services segment contributing 49.8%[17]. - The oilfield equipment manufacturing and services segment generated revenue of RMB 1,307 million, down 21% year-on-year, primarily due to significant cuts in drilling investments by oil companies[8]. - The oilfield services segment reported revenue of RMB 684 million, a decline of 47% year-on-year, impacted by a sharp reduction in global oil and gas drilling activities[8]. - The pipeline technology and services segment earned revenue of RMB 254 million, a decrease of 30% year-on-year, focusing on domestic market projects and securing multiple large orders[9]. - The marine engineering services segment recorded revenue of RMB 378 million, an increase of 7% year-on-year, successfully completing a significant project ahead of schedule[9]. - The company reported a significant increase in revenue for the fiscal year ending December 31, 2020, with total revenue reaching approximately $X million, representing a Y% increase compared to the previous year[99]. Market Outlook and Strategy - Looking ahead to 2021, Hilong expects to benefit from the recovery of the global oil and gas industry, with a focus on promoting drilling tools for unconventional resources in the domestic market[11]. - Hilong plans to enhance its market share in the domestic OCTG coating business while targeting high-end markets and core large customers overseas to increase profitability[11]. - The company aims to strengthen customer loyalty in the oil services segment while reducing reliance on drilling services by developing technical service offerings[11]. - The marine engineering services will focus on potential business opportunities in offshore wind power and the "Seven-Year Action Plan" of CNOOC, targeting markets in Southeast Asia and the Middle East[11]. - The company anticipates a gradual recovery in the global oil and gas industry in 2021, supported by improved domestic pandemic control and international vaccination efforts[77]. - The domestic oil and gas exploration and development activities are expected to remain active due to the implementation of the national action plan from 2019 to 2025[77]. - The company plans to adopt differentiated marketing strategies to increase market share in the domestic drill pipe market, particularly for unconventional oil and gas resources[77]. Operational Efficiency and Cost Management - The company focused on cash flow management and prioritized collaboration with clients that have higher payment certainty[68]. - The company maintained operational stability by reducing capital expenditures and enhancing efficiency[71]. - The net cash generated from operating activities decreased to RMB 20.5 million in 2020 from RMB 416.2 million in 2019, primarily due to higher tax payments[46]. - The net cash used in investing activities was RMB 24.8 million in 2020, down from RMB 214.9 million in 2019, reflecting reduced capital expenditures[48]. - The company has implemented new operational strategies that are projected to reduce costs by J%, improving overall profitability[91]. Financial Position and Liabilities - Total liabilities as of December 31, 2020, amounted to RMB 3,125.5 million, a decrease from RMB 3,243.4 million in 2019[52]. - The company faced a cross-default event due to an unpaid principal amount of USD 165,114,400 (approximately RMB 1,077 million) on its 2020 notes[56]. - The company is currently negotiating with creditors regarding the restructuring of existing notes, which involves over 25% of the total outstanding principal[59]. - The company has reclassified non-current borrowings related to cross-default loans as current liabilities as of December 31, 2020[59]. - The company has established a health, safety, and environmental management system to ensure operations do not harm the environment and comply with health and safety policies[200]. Corporate Governance - The company has adopted the corporate governance code as per the Hong Kong Stock Exchange regulations, ensuring compliance and transparency in operations[105]. - The board of directors includes experienced professionals with diverse backgrounds in engineering, finance, and management, ensuring robust governance[87]. - The company emphasizes high standards of corporate governance and has established clear written guidelines for the responsibilities of its committees[139]. - The board has established three committees: Audit Committee, Remuneration Committee, and Nomination Committee, with most members being independent non-executive directors[139]. - The company has committed to providing independent professional advice to directors when necessary, with costs covered by the company[131]. Risk Management - The company has established a risk management system aligned with its strategic objectives, ensuring compliance with relevant laws and regulations[175]. - The internal audit team regularly evaluates the effectiveness of the risk management system and reports findings to the audit committee and board every six months[181]. - The company has a comprehensive risk identification and assessment process to manage significant risks impacting its operations[176][177]. - The risk response strategy prioritizes risks based on assessment results and continuously strengthens monitoring functions[178]. Research and Development - In 2020, the company emphasized R&D across all business segments, focusing on high-strength drill pipe products and corrosion resistance[76]. - The company is investing $H million in R&D for new technologies, aiming to improve product offerings and maintain competitive advantage[91]. - New product development initiatives are underway, with a focus on innovative technologies aimed at enhancing operational efficiency and market competitiveness[99].
海隆控股(01623) - 2020 - 年度财报