Company Overview - Fountain Set Group is one of the world's largest fabric manufacturers, producing knitted fabric and garments through vertically integrated operations[3]. - The company operates 7 production facilities in the PRC, Sri Lanka, and Indonesia, employing close to 7,900 staff globally[4]. - Chinatex Corporation Limited has been the largest shareholder of the company since 2012, indicating strong backing from a state-owned enterprise[5]. - The company emphasizes research and development, collaborating with brands to create innovative fabric and garment products[4]. - The company has a strong global marketing network with representative offices in 4 countries[4]. Financial Performance - Revenue for 2021 reached HK$6,751.3 million, a 36.4% increase from HK$4,943.2 million in 2020[14]. - Profit attributable to owners of the company was HK$241.3 million, up 181.5% from HK$85.7 million in 2020[14]. - Profit margin improved to 3.6% in 2021, compared to 1.7% in 2020[14]. - Basic and diluted earnings per share increased to 19.7 HK cents, up from 7.0 HK cents in 2020[14]. - Proposed final dividend per share is 16.00 HK cents, significantly higher than 7.00 HK cents in 2020[14]. - Net current assets at year-end were HK$2,248.8 million, an increase from HK$2,059.3 million in 2020[14]. - Total assets rose to HK$5,748.4 million, compared to HK$5,425.7 million in 2020[14]. - Total bank borrowings increased to HK$327.3 million from HK$236.7 million in 2020[14]. - Return on equity improved to 7.2% in 2021, up from 2.8% in 2020[14]. - The Company reported a profit before income tax expense of HK$337,450,000 for the year ended 31 December 2021, compared to HK$122,145,000 in 2020[30]. Operational Insights - The management discussion and analysis section provides insights into operational strategies and market conditions affecting the company[9]. - The consolidated statement of profit or loss and other comprehensive income will provide a detailed view of the company's financial performance[9]. - Future outlook and performance guidance will be discussed in the chairman's statement and management analysis sections[9]. - The Group's operational strategy of "production, supply and sales integration" effectively responded to market risks[90]. - The manufacturing costs increased due to tightened supply and rising procurement costs, which were passed on to clients[95]. Sustainability and Corporate Governance - The Group's sustainability initiatives include the establishment of a "Sustainability Development and Enhancement Committee" to drive sustainability objectives and set ambitious targets[79]. - The company has been recognized as an Approved Licensee of Supima and a Certified Licensee of COTTON USA™[35]. - The company achieved ISO 50001:2018 Energy Management System Certification from Beijing Zhongjing Quality Certification Co., Ltd[44]. - The company obtained ISO 14001:2015 Environmental Management System Certification from Beijing Zhongjing Quality Certification Co., Ltd[44]. - The Group acknowledges the importance of corporate governance in enhancing shareholder value and is committed to improving its policies[89]. Market Conditions and Future Outlook - The global economy is expected to decelerate from a growth rate of 5.5% in 2021 to 4.1% in 2022 and further to 3.2% in 2023 according to the World Bank[76]. - Rising inequality and security challenges are particularly harmful for developing countries, potentially leading to a more difficult operating environment for corporations[76]. - The recovery of the end consumer apparel market supports strong customer order demand, with solid order visibility and encouraging business results seen in Q1 2022 compared to the same period in 2021[172]. - Rising raw material costs and potential disruptions from the Omicron variant may lead to inflation in consumer prices and affect supply chain stability[172]. Innovations and Product Development - The Group developed 1,300 product samples across more than 400 special varieties, enhancing market competitiveness and significantly increasing order value[98]. - The introduction of DuPont Sorona®Plus elastic cool fiber knitted fabric marked a significant advancement in functional fabrics, which has been put into mass production[111]. - The development of multi-layer composite fabrics has progressed from three-layer to five-layer structures, enhancing product variety and performance, with these fabrics becoming a main product line[115]. - Continuous investment in R&D will focus on functional fabrics, multi-fiber composite fabrics, and green environmental clothing to improve product variety and quality[178]. Corporate Governance Structure - As of December 31, 2021, the board of directors comprised 11 members, including 5 executive directors, 2 non-executive directors, and 4 independent non-executive directors, with NEDs and INEDs representing approximately 55% of the board[181]. - The company has established a governance framework that adheres to the corporate governance code as per the Hong Kong Stock Exchange's listing rules, ensuring shareholder and stakeholder interests are maintained[180]. - The board is responsible for the leadership and control of the company and its subsidiaries, focusing on promoting the success of the group through strategic direction and performance monitoring[184].
福田实业(00420) - 2021 - 年度财报