Business Operations - The company operates as a global manufacturer of ultra-high power graphite electrodes, serving over 25 countries including major electric arc furnace steel manufacturers in the Americas, EMEA, Asia-Pacific, and China[11]. - The company has a total production capacity of 46,000 tons annually, allowing it to flexibly meet customer demands worldwide and provide support and technical services[13]. - The company has established regional sales teams focused on the Americas, EMEA, Asia-Pacific, and China markets to support various customer needs[13]. - The company emphasizes the importance of a strong sales and distribution network to ensure product availability for customers at all times[13]. - The company is actively engaged in research and development of new products and technologies to enhance its market position[11]. - The company is exploring market expansion opportunities to strengthen its global footprint[11]. - The company is considering strategic mergers and acquisitions to enhance its competitive advantage in the industry[11]. Financial Performance - For the fiscal year ending December 31, 2024, the company reported revenue of $56.951 million, a decrease of approximately 21.2% compared to $72.292 million in 2023[19]. - The company experienced a sales volume increase of over 6%, rising from 17,015 metric tons in 2023 to 18,141 metric tons in 2024[22]. - The average unit sales cost was reduced by 2.6% compared to the fiscal year 2023, attributed to production cost control measures[22]. - The company recorded a gross loss margin of approximately 30.3% for the fiscal year 2024, down from a gross profit margin of about 1.2% in 2023[23]. - The company faced significant pricing pressure, with the average selling price of products decreasing by 26.1% due to market volatility in Europe[23]. - The company reported a loss attributable to shareholders of $40.984 million for the fiscal year 2024, compared to a loss of $15.476 million in 2023[19]. - Revenue from the Americas was $13.368 million, accounting for 23.5% of total revenue, down from $19.326 million (26.7%) in 2023[20]. - Revenue from EMEA was $32.941 million, representing 57.8% of total revenue, compared to $38.319 million (53.0%) in 2023[20]. - The company is preparing to capitalize on the expected recovery in the graphite electrode and steel industries in the second half of 2025[17]. - Revenue decreased from approximately $72.3 million in FY2023 to about $57.0 million in FY2024[27]. - Cost of sales increased from approximately $71.5 million in FY2023 to about $74.2 million in FY2024, influenced by increased sales volume and inventory provisions[27]. - Average selling price of graphite electrodes dropped from approximately $4,249 per ton in FY2023 to about $3,139 per ton in FY2024[28]. - Gross loss increased significantly from approximately $0.8 million in FY2023 to about $17.3 million in FY2024, with a gross margin decline from approximately 1.2% to a gross loss margin of about 30.3%[30]. - Administrative expenses rose by approximately 23.0% to about $14.8 million in FY2024, primarily due to increased employee and professional costs[31]. - The company recorded a loss attributable to owners of approximately $41.0 million in FY2024, mainly due to significant gross loss and increased administrative expenses[33]. - Cash used in operating activities was $3.1 million in FY2024, down from $6.1 million in FY2023[36]. - The company anticipates a gradual recovery in demand for graphite electrodes by 2025, supported by a projected 1.9% growth in steel demand in developed countries[25]. - The company is focused on improving gross margins and profitability through strategic business plans and cost control measures[25]. - The company is optimistic about long-term growth driven by global carbon neutrality initiatives and aims to position itself as a resilient partner in the sustainable steel value chain[26]. Assets and Liabilities - As of December 31, 2024, the group's cash and cash equivalents amounted to approximately $16.4 million, a decrease from approximately $29.6 million as of December 31, 2023[37]. - The total interest-bearing bank and other borrowings as of December 31, 2024, were approximately $29.7 million, down from approximately $38.7 million as of December 31, 2023[37]. - The group's equity and liabilities as of December 31, 2024, were approximately $105.8 million and $68.2 million, respectively, compared to approximately $148.5 million and $77.6 million as of December 31, 2023[37]. - The debt-to-equity ratio increased from approximately 26.1% on December 31, 2023, to approximately 28.1% on December 31, 2024, primarily due to a decrease in equity[38]. - Capital expenditures for the fiscal year 2024 were approximately $5.0 million, primarily for the acquisition of properties, plants, and equipment[40]. - The group has no significant contingent liabilities as of December 31, 2024[41]. - The acquisition of Tai Gu assets was completed in August 2023 for approximately RMB 80.5 million, with RMB 40 million paid at the time of the agreement[43]. - The joint venture with Huixian Construction Investment Co., Ltd. was voluntarily terminated in November 2024 due to changing market conditions, with no significant adverse impact on the group's financial performance[44]. - As of December 31, 2024, the group had no significant investments exceeding 5% of total assets[45]. Corporate Governance - The company has a focus on optimizing manufacturing, maintenance, and operational procedures to enhance cost efficiency[52]. - The management team includes members with significant experience in legal, financial, and operational roles, enhancing the company's governance[53]. - The company is focused on product innovation and market expansion strategies to drive future growth[50]. - The board comprises individuals with diverse backgrounds in finance, management, and engineering, contributing to a well-rounded strategic direction[56]. - The company has established a remuneration committee to review its compensation policies and structures for directors and senior management[129]. - The board consists of seven directors, including three executive directors, one non-executive director, and three independent non-executive directors[142]. - The audit committee, composed of three independent non-executive directors, has reviewed the accounting principles and practices adopted by the group[136]. - The company maintains a sufficient level of public float as required by listing rules[135]. - The company has purchased and maintained appropriate insurance to protect directors and senior officers against legal liabilities[134]. - The board is responsible for leading and controlling the group, focusing on overall strategy and monitoring financial performance[141]. - The company has adhered to the corporate governance code during the fiscal year 2024[140]. - The company emphasizes high standards of business ethics and corporate governance to protect shareholder interests and enhance corporate value[139]. - The board of directors has appointed at least three independent non-executive directors, constituting at least one-third of the board, with one possessing appropriate professional qualifications in accounting or related financial management[145]. - The company held a total of 5 board meetings and 1 annual general meeting during the fiscal year 2024, with attendance rates for executive and non-executive directors documented[152]. - The remuneration committee includes one executive director and two independent non-executive directors, responsible for reviewing the remuneration terms for directors and senior management[153]. - All directors participated in appropriate continuous professional development activities during their tenure, including attending training sessions and reviewing relevant materials[151]. - The company has arranged appropriate insurance coverage for legal claims against directors and senior officers, ensuring adequate protection[149]. - The board is responsible for developing and reviewing corporate governance policies and practices, ensuring compliance with legal and regulatory requirements[147]. - Independent non-executive directors have fixed terms of appointment, with initial terms set at one year, subject to renewal unless specified otherwise[146]. - The company encourages directors to stay updated on relevant matters and participate in appropriate briefings and training courses[150]. - The board meetings are scheduled with at least 14 days' notice, allowing directors sufficient time to review documents prior to meetings[148]. - The company has received annual confirmations from independent non-executive directors regarding their independence as per listing rules[145]. Risk Management and Compliance - The board is responsible for ensuring the establishment and maintenance of effective risk management and internal control systems[175]. - The environmental, social, and governance (ESG) committee was established on December 16, 2022, to support the board in developing ESG policies and strategies[168]. - The company conducted a significant assessment to identify and prioritize major ESG issues[169]. - The audit committee reviewed the company's financial performance for the fiscal year 2023 and the interim report for the six months ending June 30, 2024[167]. - The company has adopted the standard code of conduct for securities trading as per the listing rules[170]. - The board confirmed its responsibility for the preparation of the financial statements for the fiscal year 2024[172]. - The company engaged external auditors to report on the financial statements, ensuring accountability and transparency[173]. - The board of directors is responsible for the overall risk management and internal control system of the group, with annual reviews conducted to monitor effectiveness[176]. - The group identified multiple key risks during the annual risk assessment, prioritizing them based on severity and potential impact on strategic objectives[177]. - An external professional firm was engaged to review the effectiveness of the internal audit function and significant controls for the fiscal year 2024[178]. - The board believes that the group has maintained a sound, effective, and adequate risk management and internal control system for the fiscal year 2024[178]. - The company has established a policy for the disclosure and management of inside information, ensuring confidentiality and compliance with relevant regulations[179]. - The company emphasizes the importance of shareholder privacy and will not disclose shareholder information without consent, except as required by law[182]. Shareholder Communication - The company has multiple communication channels for shareholders, including annual general meetings where directors and external auditors can address shareholder inquiries[182]. - The company has appointed specific board members and senior management to maintain regular communication with institutional investors and financial analysts[184]. - The board has reviewed the effectiveness of existing shareholder communication policies and activities[185]. - Shareholders holding at least one-tenth of the paid-up capital have the right to request the board to convene a special general meeting within two months of submission[186]. Employee and Community Engagement - The group engaged in charitable donations amounting to RMB 57,000 during the fiscal year 2024 to support local community development[84]. - The company has not faced any significant disputes with employees, customers, or suppliers during the fiscal year 2024, indicating stable relationships[80]. - The group emphasizes compliance with relevant laws and regulations, reporting no significant violations that impacted business operations in fiscal year 2024[78]. - The company is committed to environmental policies and ensures all operations comply with relevant environmental regulations[79]. - The group employed 188 staff as of December 31, 2024, down from 211 staff in 2023[129]. - Employee costs for the fiscal year 2024 are approximately $11.0 million, a decrease from $14.4 million in 2023[129]. - The company has established a remuneration committee to review its compensation policies and structures for directors and senior management[129]. Future Outlook - The company has outlined a future outlook with a projected revenue growth of 20% for the next fiscal year[67]. - New product development initiatives are underway, focusing on sustainable technology solutions, with an investment of $50 million allocated for R&D[67]. - The company plans to expand its market presence in Southeast Asia, targeting a 30% increase in market share by 2025[67]. - A strategic acquisition is in progress, aimed at enhancing the company's technological capabilities, with an estimated cost of $200 million[67]. - The board has approved a new strategy to enhance corporate governance and sustainability practices, aligning with global standards[67]. - The company has achieved a 10% reduction in operational costs through efficiency improvements in the last fiscal year[67]. - The independent directors have been actively involved in providing insights on corporate governance, enhancing the decision-making process[67]. - The company is committed to maintaining a strong financial position, with a cash reserve of $100 million to support future growth initiatives[67].
昇能集团(02459) - 2024 - 年度财报