Financial Performance - The company's total revenue for 2021 was approximately $126 million, a decrease of about 6.1% compared to approximately $134 million in 2020[49]. - Gross profit for the year was approximately $29 million[49]. - Revenue from North America decreased by approximately 29.9% to about $31.8 million[50]. - Sales in Europe increased by approximately 24.1% to about $47.6 million[51]. - Revenue from Asia decreased by approximately 14.7% to about $31.1 million, partly due to the strategy of discontinuing low-margin products[52]. - Revenue from Latin America increased by approximately 11.0% to about $15.5 million[53]. - Revenue for the year ended December 31, 2021, decreased by approximately 6.1% (about $8.2 million) compared to the previous year, primarily due to declines in North America and Asia, partially offset by increases in Europe[61]. - The company's sales cost for the year ended December 31, 2021, was approximately $97.0 million, accounting for about 77.0% of total revenue, compared to approximately $106.8 million (79.6%) for the previous year[64]. - The net profit for the year ended December 31, 2021, was approximately $3.8 million, an increase of about $0.1 million compared to approximately $3.7 million for the year ended December 31, 2020[78]. - The company's other income increased from approximately $0.7 million for the year ended December 31, 2020, to about $1.7 million for the year ended December 31, 2021, mainly due to gains from the sale of intangible assets and increased government grants[69]. Investment and Development - Continued investment in R&D, particularly in sustainable development, IoT, and other new business sectors[54]. - The company plans to continue investing in research and development, expanding the sales team, and improving the existing supply chain to address post-pandemic demand and component shortages[60]. - The company plans to invest in the development of OTT systems and smart home security products, with an allocation of approximately USD 2.93 million from the IPO proceeds[143]. - The company intends to expand its professional sales team to support business growth, with an expected allocation of approximately USD 1.76 million from the IPO proceeds[143]. - The company is focusing on research and development to expand its OTT product line and smart home product series, with an allocation of approximately USD 1.82 million from the IPO proceeds[143]. Cash Flow and Financial Position - The company’s cash and cash equivalents as of December 31, 2021, were approximately $17.6 million, indicating a solid financial position to support operations and foreseeable capital expenditures[80]. - Net cash flow from operating activities for the year ended December 31, 2021, was approximately $3.6 million, a decrease from $10.7 million in 2020[82]. - Cash used in investing activities for the year ended December 31, 2021, was approximately $1.5 million, primarily due to the purchase of property, plant, and equipment amounting to $2.3 million[84]. - Cash used in financing activities for the year ended December 31, 2021, was approximately $6.8 million, mainly attributed to repayment of interest-bearing bank loans of about $28.2 million[86]. - Current assets increased from approximately $16.9 million as of December 31, 2020, to approximately $22.9 million as of December 31, 2021, driven by an increase in inventory of about $13.8 million and trade receivables of about $17.4 million[87]. - The debt ratio as of December 31, 2021, was approximately 26.6%, down from 39.8% as of December 31, 2020[95]. - Capital expenditures for the year ended December 31, 2021, amounted to approximately $2.3 million, funded primarily through cash generated from operating activities[88]. - The company had bank loans of approximately $25.0 million as of December 31, 2021, compared to $27.7 million in 2020[90]. - The company has available bank financing of $24.45 million, with $22.75 million already drawn down as of December 31, 2021[92]. Governance and Board Composition - The company has a strong board composition with members having significant experience in finance and management across various industries[106]. - The board believes that Van Eck's independent status is maintained due to his lack of ownership in the company's shares and independence from management[111]. - The overall strategy planning is supported by the non-executive directors, ensuring a comprehensive approach to governance[104]. - The company continues to focus on enhancing its governance structure through independent oversight and strategic guidance from its board members[110]. - The board composition is considered balanced and suitable for the company's business[176]. - There are currently three independent non-executive directors, meeting the minimum requirement of one-third of the board[179]. Shareholder Information - The proposed final dividend is USD 0.0038 per ordinary share, subject to approval at the upcoming annual general meeting[147]. - As of December 31, 2021, the company's distributable reserves amounted to approximately $9,573,430, unchanged from 2020[153]. - The company has not issued any debt securities or convertible bonds during the year[157][158]. - No shares were purchased, sold, or redeemed by the company or its subsidiaries during the year ending December 31, 2021[159]. - The company adopted a share option scheme on May 1, 2015, allowing for the issuance of up to 40,841,584 shares, representing approximately 8.14% of the total issued shares as of December 31, 2021[163]. - A total of 5,016,337 reward shares were granted under the share reward plan, accounting for about 1.00% of the total issued shares at the time of grant[169]. - The share reward plan is effective for ten years from the adoption date, with a cap of 1.5% of the total issued shares at the time of adoption[169]. - The company has not canceled or modified the share option scheme during the year[164]. - The company has not entered into any significant contracts with its controlling shareholders during the year[155]. - The company has not issued any equity-linked agreements that would lead to the issuance of shares during the year[156]. - The company has not made any further grants of share options under the plan aside from those disclosed[166]. - As of December 31, 2021, the company has issued a total of 501,633,663 shares[191]. - The company granted a total of 5,016,337 shares under the share incentive plan, which remain unvested as of the report date[173]. - Alain Perrot, the Executive Director and CEO, holds 20,041,213 shares, representing approximately 4.00% of the company's equity[194]. - Morgan Stanley controlled entities hold 375,000,000 shares, representing 74.76% of the issued share capital[199]. - NHPEA IV Home Control is fully owned by Alain Perrot, with a 100% beneficial interest[196]. - The company has no other directors or senior executives with interests in the company or its associated entities as of December 31, 2021[197]. - The ownership structure includes multiple entities under Morgan Stanley, all holding the same number of shares[199]. - The beneficial ownership of NHPEA is also recorded as 375,000,000 shares, equating to 74.76%[199]. - The report indicates that all interests are held in good standing as of the reporting date[200]. - The company maintains compliance with the Securities and Futures Ordinance regarding the disclosure of interests[197]. Risks and Future Outlook - The company is facing various risks, including potential adverse impacts from COVID-19 on supply, sales, and profitability[136]. - The company expects better prospects for 2022 compared to the past two years, assuming correct assumptions regarding integrated circuit supply[60].
HOME CONTROL(01747) - 2021 - 年度财报