Financial Performance - Revenue for the six months ended June 30, 2022, was RMB 24,800,954 thousand, representing a 10.8% increase from RMB 22,385,163 thousand in the same period of 2021[3] - Gross profit decreased to RMB 700,880 thousand, down 42.8% from RMB 1,225,230 thousand year-on-year[3] - Total comprehensive income for the period was RMB 158,486 thousand, a decline of 66.2% compared to RMB 468,264 thousand in the previous year[3] - The company recorded a net profit of approximately RMB 158.5 million for the six months ended June 30, 2022, a decrease of about 66.2% compared to RMB 468.3 million for the same period in 2021[42] - Operating profit for the six months ended June 30, 2022, was RMB 300,851 thousand, down from RMB 726,960 thousand in the same period of 2021[86] - The company reported a net profit of RMB 158,486 thousand for the six months ended June 30, 2022, compared to RMB 468,264 thousand in the same period of 2021, a decrease of approximately 66.2%[86] - The profit attributable to equity holders for the six months ended June 30, 2022, was RMB 149,114,000, a decrease of 67.2% compared to RMB 454,216,000 in 2021[163] - The basic earnings per share for the six months ended June 30, 2022, was RMB 0.12, down from RMB 0.36 in the same period of 2021[161] - The diluted earnings per share for the six months ended June 30, 2022, was RMB 0.12, down 66.7% from RMB 0.36 in 2021[163] Sales and Production - Stainless steel sales volume decreased by 9.1% to 865,358 tons, while carbon steel sales volume increased by 11.4% to 1,755,596 tons[8] - The stainless steel processing business saw a sales volume decrease from approximately 952,000 tons to about 865,000 tons, a reduction of approximately 9.1%[42] - The carbon steel processing business experienced an increase in sales volume from approximately 1,575,000 tons to about 1,755,600 tons, an increase of approximately 11.4%[42] - The company’s processing volume for carbon steel increased from approximately 1,851,000 tons to about 1,924,000 tons, an increase of approximately 4.0%[42] - Revenue from metal material processing services was RMB 23,056,785 thousand, up from RMB 20,962,514 thousand, reflecting a growth of 9.4% year-over-year[141] Costs and Expenses - Gross profit decreased from approximately RMB 1.25 billion for the six months ended June 30, 2021, to approximately RMB 709 million for the same period in 2022, primarily due to the adverse impact of the COVID-19 pandemic[65] - Distribution costs decreased from approximately RMB 264.3 million to approximately RMB 231.5 million, attributed to reduced employee bonus expenses[67] - Administrative expenses decreased from approximately RMB 247.5 million to approximately RMB 175.2 million, also due to reduced employee bonus expenses[68] - Financing costs decreased from approximately RMB 111.6 million to approximately RMB 81.5 million, mainly due to increased foreign exchange gains during the period[69] - The cost of sales for the six months ended June 30, 2022, was RMB 24,506,780 thousand, an increase from RMB 21,671,755 thousand in the same period of 2021[149] - The company reported a decrease in employee benefits expenses, including director remuneration, to RMB 528,828 thousand from RMB 640,002 thousand year-over-year[149] Assets and Liabilities - The company’s assets totaled approximately RMB 14.34 billion as of June 30, 2022, with equity attributable to shareholders amounting to about RMB 3.49 billion[49] - Total liabilities increased to RMB 10,500,741 thousand as of June 30, 2022, from RMB 8,209,041 thousand on December 31, 2021[83] - The group’s current liabilities exceeded its current assets by approximately RMB 137,467,000 as of June 30, 2022[98] - The debt-to-equity ratio as of June 30, 2022, was 66.68%, compared to 64.65% on December 31, 2021[76] - The company’s total liabilities increased to RMB 7,500,000,000 as of June 30, 2022, from RMB 6,500,000,000 as of December 31, 2021, representing a rise of about 15.4%[118] Inventory and Receivables - As of June 30, 2022, total inventory amounted to RMB 4,283,955,000, an increase from RMB 3,724,944,000 as of December 31, 2021, reflecting a year-over-year growth of approximately 15%[119] - The group recorded a loss of RMB 122,411,000 from inventory write-downs to net realizable value for the six months ended June 30, 2022, compared to RMB 19,869,000 for the same period in 2021[119] - The company's accounts receivable as of June 30, 2022, totaled RMB 697,072,000, compared to RMB 518,117,000 as of December 31, 2021, indicating a year-over-year increase of about 34.6%[123] - The group’s prepayments for raw materials reached RMB 935,954,000 as of June 30, 2022, up from RMB 707,449,000 as of December 31, 2021, reflecting a growth of approximately 32.3%[128] Shareholder Information - The company has a total of 793,435,000 shares held by Lianhao Group Limited, representing 62.25% of the issued share capital[193] - China Baowu Steel Group holds 207,500,000 shares, accounting for 16.28% of the issued share capital[193] - Baosteel Stainless (International) Co., Ltd. and Taiyuan Iron and Steel (Group) Co., Ltd. each hold 103,750,000 shares, each representing 8.14% of the issued share capital[193] - The major shareholders include Zhou Keming and Xu Xia, who collectively own 62.26% of the shares through Lianhao Group Limited[193] - Zhou Keming holds 793,551,000 shares, which is 62.26% of the issued share capital, while Xu Xia holds 384,000 shares, representing 0.03%[186] Corporate Governance - The company has maintained compliance with the corporate governance code as per the Hong Kong Stock Exchange regulations[171] - The company has not purchased, sold, or redeemed any of its listed securities during the six months ended June 30, 2022[175] - The company has adopted a share option scheme since November 9, 2010, with a total of 12,800,000 options outstanding as of June 30, 2022[180] - The company’s remuneration policy for employees is based on performance, skills, and market trends, with regular reviews by the remuneration committee[184]
大明国际(01090) - 2022 - 中期财报