Financial Performance - For the six months ended June 30, 2022, the Group's total revenue was RMB 909.3 million, remaining relatively stable compared to RMB 911.7 million in the same period of 2021[11]. - The Group achieved a net profit of RMB 7.8 million for the six months ended June 30, 2022, a significant improvement from a net loss of RMB 34.1 million in the same period of 2021[11]. - The gross profit margin improved from 7.4% for the six months ended June 30, 2021, to approximately 12.5% for the six months ended June 30, 2022[10]. - The earnings per share increased to RMB 0.79 for the six months ended June 30, 2022, compared to a loss per share of RMB 3.39 in the same period of 2021[11]. - Gross profit increased by 69.0% to RMB113.9 million for the six months ended 30 June 2022, with gross profit margin rising to 12.5% from 7.4% in the same period of 2021[24]. - The Group reported a profit before tax of RMB 12.5 million, a turnaround from a loss of RMB 31.9 million in the previous year[61]. - Profit for the period was RMB 7.8 million, compared to a loss of RMB 34.1 million for the same period in 2021[61]. Revenue Breakdown - Revenue from smartphones increased by 11.7% to RMB 676.5 million for the six months ended June 30, 2022, up from RMB 605.7 million in the same period of 2021, driven by increased sales in India and Korea[17]. - Revenue from IoT related products decreased by 19.3% to RMB 163.8 million for the six months ended June 30, 2022, down from RMB 202.9 million in the same period of 2021, primarily due to reduced sales orders from a major customer in China[20]. - Revenue from PCBAs increased to RMB 9.9 million for the six months ended June 30, 2022, from nil in the same period of 2021, as customers shifted orders to mobile phones[20]. - Revenue from India increased by 6.2% to RMB 511.5 million for the six months ended June 30, 2022, compared to RMB 481.5 million in the same period of 2021, attributed to higher demand for smartphones[23]. - Revenue from Pakistan surged by 572.7% to RMB 7.4 million for the six months ended June 30, 2022, from RMB 1.1 million in the same period of 2021, driven by increased demand for feature phones[23]. - Revenue from the People's Republic of Bangladesh decreased by 26.3% to RMB 79.3 million for the six months ended June 30, 2022, down from RMB 107.6 million in the same period of 2021, due to a decline in smartphone sales orders from a major customer[23]. - Revenue from the PRC decreased by 5.8% to RMB 286.7 million for the six months ended June 30, 2022, from RMB 304.4 million in the same period of 2021, primarily due to reduced sales orders for IoT related products[23]. Operational Insights - The Group continued to focus on research and development, designing, manufacturing, and selling mobile phones and IoT-related products, targeting emerging markets[10]. - The Group's operations were minimally impacted by the new wave of COVID-19 in March 2022 due to effective strategies implemented from previous experiences[10]. - The rapid roll-out of 5G telecommunication networks globally is expected to drive demand for smartphones and IoT-related products in the future[12]. - The Group plans to leverage the easing global shortage of electronic components to reduce costs and improve profitability[10]. - The Group's strategic focus includes expanding its market presence in emerging markets and enhancing its product offerings[10]. - The Group's management remains optimistic about future growth opportunities despite the challenges in the ODM mobile phone market[12]. Expenses and Costs - Selling expenses remained stable at RMB21.1 million for the six months ended June 30, 2022, compared to RMB20.4 million for the same period in 2021[26]. - Administrative and other expenses were relatively stable at RMB30.7 million for the six months ended June 30, 2022, compared to RMB31.5 million for the same period in 2021[30]. - Research and development expenses remained stable at RMB60.0 million for the six months ended June 30, 2022, compared to RMB61.8 million for the same period in 2021[31]. - Finance costs increased by 271.0% to RMB11.5 million for the six months ended June 30, 2022, up from RMB3.1 million in the same period of 2021[32]. - Income tax expenses rose by 113.6% to RMB4.7 million for the six months ended June 30, 2022, compared to RMB2.2 million for the same period in 2021[33]. Assets and Liabilities - Trade and bills receivables amounted to RMB230.4 million as at 30 June 2022, slightly up from RMB226.0 million as at 31 December 2021[42]. - Trade and bills payables increased to RMB902.1 million as at 30 June 2022, compared to RMB524.1 million as at 31 December 2021[45]. - As of June 30, 2022, the Group had net current assets of RMB 220.1 million, a slight increase from RMB 218.7 million as of December 31, 2021[49]. - Cash and cash equivalents amounted to RMB 85.4 million, up from RMB 82.9 million as of December 31, 2021[49]. - Pledged bank deposits increased significantly to RMB 661.0 million from RMB 219.2 million as of December 31, 2021[49]. - Total borrowings rose to RMB 81.1 million from RMB 58.2 million as of December 31, 2021[49]. - The Group's current ratio was 1.2 times, down from 1.3 times as of December 31, 2021, while the gearing ratio increased to 0.3 from 0.2[49]. - The Group's unutilized borrowing facilities amounted to RMB 80.9 million as of June 30, 2022, down from RMB 120.9 million as of December 31, 2021[49]. Shareholder Information - As of June 30, 2022, Mr. Li Chengjun held 369,967,204 shares, representing 37.0% of the company's shareholding[156]. - Mr. Xiong Bin held 305,032,256 shares, representing 30.5% of the company's shareholding as of June 30, 2022[156]. - The company has a significant concentration of ownership, with the top two shareholders holding over 67.5% of the shares[162]. - The company has not disclosed any new strategies or market expansions in the recent reporting period[166]. - The company maintains compliance with the Listing Rules regarding the disclosure of directors' interests[170]. Share Option Scheme - The share option scheme allows for the granting of 69,100,000 shares, with 30% of options exercisable from July 1, 2021, and another 30% from July 1, 2022[130]. - The maximum number of shares that can be granted under the Share Option Scheme is capped at 10% of the shares in issue as of the Listing Date, which equates to 100,000,000 shares[179]. - The remaining life of the Share Option Scheme as of June 30, 2022, is approximately seven years and 3.5 months[186]. - The exercise price of share options granted under the Share Option Scheme must be at least the highest of the closing price on the date of grant, the average closing price for the preceding five business days, or the nominal value of a share[185]. - The eligible participants for the Share Option Scheme include full-time or part-time employees, executives, directors, and other contributors as determined by the Board[178]. Litigation and Legal Matters - The company made a provision for litigation loss of approximately RMB 1,766,000 in 2019, which accumulated to RMB 2,093,000 by the end of 2020[148]. - Shenzhen Sprocomm paid a total of RMB 31,138,000 to settle a litigation claim, which included principal, interest, and legal costs[149]. - The company recognized a litigation settlement of RMB 31,138,000, net of a prior receipt of approximately RMB 21,663,000 from the First Defendant, which was legally offset against the claim[150]. - An accumulated provision for litigation losses in prior years was approximately RMB 2,093,000, with an additional RMB 7,382,000 recognized as a loss during the year ended December 31, 2021[150]. - The Group recognized indemnification for litigation loss of approximately RMB 9,475,000 from the Controlling Shareholders upon settlement of the litigation during the year ended December 31, 2021[153].
SPROCOMM INTEL(01401) - 2022 - 中期财报