Financial Performance - The Group's turnover for the six months ended June 30, 2022, was approximately RMB 6,168.3 million, representing a 19.1% increase from RMB 5,180.5 million in the same period of 2021[13]. - Gross profit for the same period was RMB 685.4 million, a decrease of 8.0% compared to RMB 744.9 million in 2021[13]. - Profit for the period increased by 116.9% to RMB 96.5 million, up from RMB 44.5 million in the previous year[13]. - Profit attributable to owners of the parent reached RMB 80.0 million, marking a significant increase of 174.3% from RMB 29.2 million in 2021[13]. - Basic earnings per share for the period was RMB 0.06, compared to RMB 0.02 in the same period last year[15]. - Other income and gains surged by 617.0% to RMB 114.5 million, mainly driven by increased exchange gains and government grants[83]. - Profit before tax rose to RMB 144.5 million, compared to RMB 55.5 million for the same period in 2021[93]. - Income tax expenses increased by 335.4% to RMB 48.1 million, attributed to a rise in assessable profit[94]. - Total comprehensive income for the period reached RMB 132,295,000, a significant increase of 167% compared to RMB 49,545,000 in the same period last year[193]. Revenue Breakdown - Revenue from the Power Solutions business amounted to RMB 4,911.2 million, a 15.6% increase from RMB 4,248.0 million in the same period last year[33]. - The Recycled Lead business generated revenue of RMB 1,257.1 million, reflecting a 34.8% increase from RMB 932.5 million in the corresponding period of 2021[44]. - The reserve power battery business accounted for 47.7% of total sales, with sales revenue of RMB 2,945.4 million, up 45.2% from RMB 2,028.1 million in the previous year[37]. - The SLI battery business contributed 22.8% of total sales, with revenue of RMB 1,406.9 million, a slight decrease of 1.3% from RMB 1,425.9 million in the same period last year[39]. - The motive power battery segment represented 8.7% of total sales, with revenue of RMB 534.6 million, down 2.4% from RMB 547.9 million in the previous year[42]. - The Group's recycled lead business contributed 20.4% of total sales, but rising costs of scrap batteries negatively impacted gross profit margins[44]. Operational Overview - The Group operates over 80 sales offices and centers globally, serving battery customers in more than 100 countries[24]. - The Group has eleven manufacturing facilities located in the PRC, Vietnam, Malaysia, India, and Sri Lanka[24]. - The Power Solutions business is categorized into three major applications: reserve power batteries, SLI batteries, and motive power batteries[24]. - The Group is also engaged in the recycled lead business in the People's Republic of China[23]. Cost and Expenses - Selling and distribution expenses increased by 21.9% to RMB 301.7 million, primarily due to rising freight charges and export-related expenses[84]. - Research and development costs decreased by 29.1% to RMB 122.2 million, mainly due to the completion of recycling skill improvements[90]. - The Group's cost of sales increased by 23.6% to RMB 5,482.9 million, primarily due to increased sales volume[78]. - Gross profit decreased by 8.0% to RMB 685.4 million, with a gross profit margin of 11.1%, down from 14.4% in the previous year[81]. Economic Context - Global economic growth is projected to slow from around 6% last year to 3.2% in 2022, with inflation revised up to 8.3% due to rising food and energy prices[48]. - The PRC government has adjusted its GDP growth target for 2022 from "around 5.5%" to a focus on stabilizing employment and prices[49]. - China's reserve power batteries shipment grew by over 30% in tonnage compared to the same period in 2021, indicating strong market demand[52]. Shareholder Information - Dr. DONG Li beneficially owns 1,009,513,000 shares, representing 74.35% of the issued share capital[134]. - Ms. YIN Haiyan has been granted options for 1,500,000 shares and 1,000,000 shares under the 2010 Share Option Scheme and the New Share Option Scheme respectively[134]. - Mr. CAO Yixiong Alan and Mr. LAU Chi Kit have both been granted options for 800,000 shares under the 2010 Share Option Scheme[134]. - The total issued shares as of June 30, 2022, was 1,357,854,666 shares[134]. - The New Share Option Scheme allows the issuance of a maximum of 135,764,466 shares, representing 10% of the issued shares as of the extraordinary general meeting on October 30, 2020[150]. Corporate Governance - The Company has confirmed compliance with the Model Code for Securities Transactions by Directors during the reporting period[166]. - The Company has maintained high standards of corporate governance, meeting the provisions of the Corporate Governance Code during the period[169]. - The Audit Committee has reviewed the unaudited financial statements and discussed accounting principles and internal control matters with management and auditors[170].
理士国际(00842) - 2022 - 中期财报