Financial Performance - Total revenue for 2022 was RMB 1,142.9 million, a decrease from RMB 1,667.5 million in 2021, representing a decline of approximately 31.4%[17] - Gross profit for the overall business was RMB 9.3 million in 2022, down from RMB 132.0 million in 2021, indicating a significant drop of about 92%[18] - The overall gross profit margin decreased to 1.8% in 2022 from 11.6% in 2021, reflecting a decline of 84.4%[19] - The Group's revenue for the year ended 31 December 2022 decreased by approximately RMB618.3 million, or approximately 54.1%, from approximately RMB1,142.9 million to approximately RMB524.6 million[52] - Revenue for the year ended December 31, 2022, decreased by approximately RMB618.3 million, or approximately 54.1%, to approximately RMB524.6 million from approximately RMB1,142.9 million for the year ended December 31, 2021[58] - Construction services revenue declined by approximately RMB541.2 million, or approximately 63.3%, to approximately RMB313.6 million for the year ended December 31, 2022, compared to approximately RMB854.8 million for the previous year[58] - Revenue from equipment operation services decreased by approximately RMB39.5 million, or approximately 16.2%, to approximately RMB204.3 million for the year ended December 31, 2022[58] - The Group recorded other net loss of approximately RMB56.1 million for the year ended December 31, 2022, compared to a net gain of approximately RMB51.2 million in 2021[67] - The Group incurred a net loss of approximately RMB216.1 million for the year ended 31 December 2022, compared to a loss of approximately RMB94.0 million in 2021[128] - Basic and diluted loss per share for the year ended 31 December 2022 was RMB0.35, up from RMB0.15 per share in 2021[131] Profitability and Efficiency - The return on equity (ROE) was -21.9% in 2022, worsening from -8.6% in 2021, showing a decline in profitability[26] - The return on total assets (ROA) decreased to -9.9% in 2022 from -4.1% in 2021, indicating reduced efficiency in asset utilization[28] - The overall cost of sales decreased by approximately RMB495.6 million, or approximately 49.0%, to approximately RMB515.3 million for the year ended December 31, 2022[60] - The overall gross profit margin decreased by 9.8 percentage points, from 11.6% in 2021 to 1.8% in 2022[65] Financial Position and Leverage - The gearing ratio increased to 40.6% in 2022 from 24.6% in 2021, indicating a rise in financial leverage[22] - The Group's gearing ratio decreased from 40.6% as of 31 December 2021 to 24.6% as of 31 December 2022[36] - The gearing ratio improved to approximately 24.6% as of 31 December 2022, compared to approximately 40.6% in 2021[134] - The Group's net current assets decreased to approximately RMB374.2 million as of 31 December 2022, down from approximately RMB472.1 million as of 31 December 2021[133] Cash Flow and Investments - The Group generated a net operating cash inflow of approximately RMB211.5 million in 2022, down from approximately RMB274.2 million in 2021[38] - The Group's payments for the purchase of property, plant, and equipment decreased by approximately 90.1%, from around RMB290.4 million in 2021 to around RMB28.7 million in 2022[46] - Proceeds from the disposal of property, plant, and equipment increased by approximately 89.4%, from approximately RMB48.3 million in 2021 to around RMB91.5 million in 2022[34] - The Group acquired property, plant, and equipment at a cost of RMB13.5 million during the year ended 31 December 2022, significantly lower than RMB295.4 million in 2021[137] - As of 31 December 2022, the Group had no significant capital commitments contracted but not provided for in the financial statements, compared to approximately RMB12.4 million in 2021[143] Operational Efficiency and Cost Management - The company is focusing on improving operational efficiency and exploring new market opportunities to enhance future performance[31] - Research and development costs reduced by approximately 67.6%, from approximately RMB62.9 million in 2021 to approximately RMB20.4 million in 2022[45] - Administrative and other expenses decreased by approximately 4.3%, from approximately RMB65.1 million to approximately RMB62.3 million[45] - Administrative and other expenses decreased by approximately RMB2.8 million from RMB65.1 million in 2021 to RMB62.3 million in 2022, due to cost reduction measures[73][76] - The finance costs decreased from RMB34.9 million for the year ended December 31, 2021, to RMB24.9 million for the year ended December 31, 2022, indicating improved financial management[121] Credit Risk and Receivables - As of December 31, 2022, the gross carrying amount of trade receivables, bills receivable, and contract assets was approximately RMB1,275.983 million, down from RMB1,510.038 million in 2021[81][82] - Approximately RMB814.4 million of the gross carrying amount was past due as of December 31, 2022, compared to RMB843.5 million in 2021[82] - The Group's credit risk is primarily attributable to trade receivables, bills receivable, and contract assets, mainly from real estate companies and main contractors in China[75][78] - The expected loss rates for trade receivables were 11.5% for current receivables, 17.9% for those less than 12 months past due, and 26.8% for those more than 12 months past due[99] - The accumulated individual loss allowance increased to RMB149.1 million as of December 31, 2022, compared to RMB84.3 million in 2021, reflecting a significant rise in credit risk exposure[105] - The loss allowance for expected credit losses (ECLs) rose from approximately RMB217.7 million as of December 31, 2021, to approximately RMB222.8 million as of December 31, 2022, due to an increase in long-aged debtors[111] Management and Governance - Mr. Yang Kaifa has extensive experience in securities management and the PRC capital markets, having served in various roles at Anhui Conch Cement Company Limited from July 1996 to July 2017[182] - Mr. Wang Wei has over 20 years of experience in the PRC construction industry and has held several positions at Anhui Conch Cement Company Limited since July 1992[190] - Mr. Xun Liangbao served as a deputy officer-in-charge and officer-in-charge at the Anhui Bengbu Municipal People's Government Office from March 1993 to March 2018[191] - Mr. Sze Irons has been an independent non-executive director of several listed companies, including Best Mart 360 Holdings Limited and ST International Holdings Company Limited[199] - Mr. Sze has been a director of Hang Tung Resources Holding Limited since March 1984, responsible for day-to-day management and strategic planning[198] Taxation and Compliance - The Group recognized an income tax credit of approximately RMB8.2 million during the year ended December 31, 2022, down from approximately RMB24.0 million in 2021, due to deferred tax assets and liabilities[124] - Jianzhong Construction Technology obtained state-level approval for High-tech Enterprise qualification in December 2022, entitling it to a reduced tax rate of 15% for three years from 2022 to 2024[125] Strategic Changes - The Group has ceased tendering for construction projects with certain real estate developers to mitigate credit risk exposure[105] - A more prudent approach in tendering for new construction projects has been adopted, including credit evaluations and background checks on potential customers[114] - The Group's debt collection policy involves monthly assessments of construction work performed and follow-ups on outstanding debts, with legal action considered after 180 days of non-payment[120] Employment and Workforce - The Group had a total of 256 full-time employees as of 31 December 2022, a decrease from 483 employees in 2021[148]
建中建设(00589) - 2022 - 年度财报