Financial Performance - The company's total revenue for the year reached RMB 494.96 million, representing a significant increase of 34.2% compared to RMB 368.91 million in the previous year[8]. - Profit before tax increased by 50.9% to RMB 14.66 million from RMB 9.71 million year-on-year[8]. - Net profit attributable to the owners of the company rose by 46.6% to RMB 13.60 million, up from RMB 9.27 million in the previous year[8]. - Basic and diluted earnings per share increased to RMB 2.72, an increase of RMB 0.87 from RMB 1.85[8]. - The total equity increased by 6.9% to RMB 215.39 million, indicating a stable financial position[8]. - Revenue from the Chinese market increased by approximately 35.0%, driven by strong demand from customers[23]. - Overseas market revenue grew by approximately 32.5%, as major overseas markets gradually recovered from the adverse effects of COVID-19[23]. - The sales of decorative paper, melamine-impregnated paper, and paint paper increased by approximately 39.7%, 39.9%, and 19.1% respectively[24]. - Gross profit increased by approximately RMB 10.2 million or 12.2% to about RMB 94.4 million, with a gross margin of approximately 19.1%, down from 22.8% in the previous year[27]. Cost and Asset Management - The cost of sales increased by approximately RMB 115.8 million or 40.7% to about RMB 400.6 million, mainly due to rising material prices and increased production volume[26]. - Non-current assets grew by 24.6% to RMB 376.16 million, while current assets increased by 9.4% to RMB 217.78 million[8]. - The group has approximately RMB 217.8 million in current assets as of December 31, 2021, an increase from RMB 199.1 million in 2020, while current liabilities rose to RMB 326.3 million from RMB 203.7 million, resulting in a current ratio of 0.67, down from 0.98 in 2020[42]. - The total bank borrowings of the group amounted to approximately RMB 190.1 million, a 36.8% increase from RMB 139.0 million in 2020, leading to a debt-to-equity ratio of 0.88 compared to 0.69 in the previous year[43]. - Inventory turnover days decreased to approximately 38.8 days from 58.6 days in 2020, with inventory value dropping by 8.2% to approximately RMB 40.8 million[44]. - Trade receivables increased by approximately RMB 8.9 million to RMB 111.4 million, with turnover days reduced to 78.9 days from 96.8 days in 2020 due to strict credit control[44]. Operational Developments - The construction of a new factory, including a main office building and fully equipped staff dormitories, has been completed, enhancing management and production processes[16]. - The relocation to the new facility is expected to optimize management and production processes, improving product quality and operational efficiency[16]. - The company plans to continue focusing on business expansion and upgrading R&D and production technologies to enhance shareholder returns[23]. - The company has invested significant resources in overseas markets, achieving notable business growth during the year[38]. - The company aims to enhance production efficiency and capacity through upgraded and automated facilities, focusing on sustainable strategies in the domestic and overseas markets[39]. - The group is actively negotiating with banks to ensure the renewal of short-term borrowings, with RMB 66.5 million due in mid-2022[184]. - The company is implementing key plans to improve liquidity and cash flow to maintain ongoing operations[184]. Corporate Governance - The board consists of four executive directors and three independent non-executive directors, responsible for corporate policy, business strategy, and risk management[147]. - The company has not established a corporate governance committee, with the board responsible for corporate governance tasks[148]. - All independent non-executive directors have confirmed their independence in accordance with GEM Listing Rules[150]. - The company encourages continuous professional development for all directors to enhance their knowledge and skills related to corporate governance[153]. - The board meets quarterly, ensuring all members receive adequate notice and materials for discussion[156]. - The company held 4 out of 4 board meetings and 1 out of 1 shareholder meetings attended by Mr. Sheng, Mr. Fang, and Mr. Ma, while independent non-executive directors Mr. Cao and Ms. Huang did not attend the shareholder meeting due to scheduling conflicts[157]. - The remuneration committee held one meeting during the year, with all members attending, and assessed the performance of executive directors, finding existing employment contracts to be fair and reasonable[162]. - The nomination committee was established on June 22, 2017, and held one meeting during the year, focusing on the selection and recommendation of director candidates based on qualifications and market conditions[163]. - The company has adopted a nomination policy that outlines the selection criteria and procedures for director candidates, considering factors such as character, qualifications, and commitment[166]. - The board is committed to maintaining ongoing dialogue with shareholders, particularly through annual general meetings to address shareholder inquiries and gather feedback[158]. - The company ensures that all board members have access to necessary resources and can seek external professional advice when needed[158]. - The company emphasizes the importance of good corporate governance for maintaining investor confidence and sustainable development[187]. Compliance and Risk Management - The company has complied with all relevant laws and regulations during the year, with no significant violations reported[104]. - The company has taken measures to monitor and assess transaction risks related to sanctioned countries and individuals[195]. - The board is responsible for maintaining the effectiveness of the internal control and risk management systems, which aim to manage risks rather than eliminate them[187]. - The company has implemented internal control procedures to protect assets from unauthorized use and ensure the reliability of financial information[188]. - The board has reviewed the effectiveness of the internal control and risk management systems, covering financial, operational, compliance, and risk management functions[194]. - The company has no immediate need to establish an internal audit function due to the current scale and complexity of its operations[187]. - The audit committee held four meetings during the year, with all members attending all meetings[176]. - The audit committee reviewed the group's financial statements, confirming compliance with applicable accounting standards[176]. Shareholder Information - The company reported a profit for the year, with total reserves available for distribution amounting to approximately RMB 102.7 million as of December 31, 2021, compared to RMB 104.7 million in 2020[100]. - The company did not recommend the distribution of a final dividend for the year[93]. - The company has adopted a dividend policy aimed at balancing shareholder expectations with prudent capital management, with the dividend payout ratio determined by the board[174]. - Shareholders holding at least 10% of the paid-up capital can request a special general meeting within two months[200]. - The company has confirmed that at least 25% of its issued shares are held by the public[135]. Employee and Management Information - The group has 417 employees as of December 31, 2021, with employee costs totaling approximately RMB 62.4 million, an increase from RMB 46.6 million in 2020[48]. - The company has a competitive compensation policy to attract and retain talented employees, with regular reviews of compensation packages[112]. - The management team includes experienced professionals, with over 20 years of experience in financial and accounting management[80].
盛龙锦秀国际(08481) - 2021 - 年度财报