GITI TIRE CORP(SH:600182)2022-04-28 16:00Financial Performance - The net profit of GITI Tire Corporation for 2021 was -7.5486 million RMB, resulting in a distributable profit of 236.4588 million RMB as of December 31, 2021[7]. - The company's operating revenue for 2021 was CNY 3,341,881,316.25, representing a 19.22% increase compared to CNY 2,803,047,211.18 in 2020[22]. - The net profit attributable to shareholders for 2021 was CNY 36,142,503.59, a decrease of 39.40% from CNY 59,636,247.45 in 2020[22]. - The basic earnings per share for 2021 was CNY 0.1063, down 39.40% from CNY 0.1754 in 2020[23]. - The weighted average return on equity for 2021 was 3.57%, a decrease of 2.45 percentage points from 6.02% in 2020[23]. - The net cash flow from operating activities for 2021 was CNY 310,989,371.87, a decline of 21.31% compared to CNY 395,214,216.10 in 2020[22]. - The total assets at the end of 2021 were CNY 3,340,090,172.57, an increase of 13.15% from CNY 2,951,795,566.60 at the end of 2020[22]. - The company achieved a revenue of 3.34 billion RMB in 2021, representing a year-on-year increase of 19.22%[39]. - Net profit decreased to 78 million RMB, down 37.34% year-on-year, with net profit attributable to shareholders at 36 million RMB, a decline of 39.40%[39]. - The gross margin for the tire business was 11.14%, a decrease of 6.26 percentage points from the previous year, attributed to rising raw material costs and limited pricing adjustments[45]. Dividend Distribution - A cash dividend of 0.35 RMB per 10 shares will be distributed to shareholders, totaling 11.9 million RMB[7]. - The company has not proposed a capital reserve increase for 2021, focusing solely on cash dividends[120]. Audit and Compliance - The company received an audit report with a disclaimer of opinion from Yongtuo Accounting Firm, indicating significant issues in obtaining sufficient audit evidence[5]. - The company’s financial report for 2021 has been audited but lacks a clear opinion, which raises concerns about financial transparency[10]. - The company is facing a risk of delisting due to the issuance of an audit report with a disclaimer of opinion for the 2021 financial statements[158]. - The company has been warned by the China Securities Regulatory Commission regarding compliance issues, indicating potential regulatory scrutiny[162]. - The company faced a negative opinion from the auditor on the 2021 internal control audit report, prompting the supervisory board to urge the board of directors to take effective measures[114]. Related Party Transactions - The company plans to continue necessary related party transactions despite the failure to pass the 2020 and 2021 annual related party transaction plans[9]. - Significant related-party transactions exist, primarily for operational needs, and the company is committed to managing these transactions effectively[87]. - The company has faced challenges in obtaining shareholder approval for related party transactions, which has led to a reliance on these transactions to sustain operations and avoid significant losses[150]. - The total amount of related party transactions for 2021 was CNY 39.15 billion, with actual sales of goods to related parties reaching CNY 32.68 billion, which is within the expected limit of CNY 35 billion[163]. - Giti Tire's related party transactions for 2021 have not been approved by the shareholders' meeting, which is a significant issue affecting the financial statements[187]. Market and Industry Trends - The global economic growth in 2021 was 5.5%, but it is expected to decline to 4% in 2022 due to ongoing challenges from the pandemic and rising raw material prices[31]. - The company has faced challenges from rising raw material prices and trade protectionism, impacting overall profitability in the tire industry[33]. - The tire manufacturing industry in China has a relatively low concentration, with major production concentrated in Shandong and Jiangsu provinces[76]. - The trend towards globalization and group consolidation is evident, with large tire companies having stronger financial and R&D capabilities[77]. - The industry is seeing an increase in R&D investment, focusing on safety, energy efficiency, and environmentally friendly products[77]. Production and Sales - In 2021, the company's sales volume of semi-steel radial tires increased by 21.0%, with sales of products over 18 inches growing by 19.4% domestically[35]. - The total production of key member enterprises in the tire industry reached 529.22 million units in 2021, a year-on-year increase of 11.28%[32]. - The production of TBR tires reached 122.38 million units in 2021, a year-on-year increase of 4.12%[32]. - The company produced 1,461.95 million tires, a year-on-year increase of 20.62%, while sales volume reached 1,448.75 million tires, up 19.35%[46]. - The company’s full-steel radial tire sales volume grew by 6.1%, with a focus on the passenger transport market[35]. Environmental Initiatives - The company was recognized as a national-level "Green Factory" by the Ministry of Industry and Information Technology, highlighting its leadership in green manufacturing practices[38]. - The company completed the boiler ultra-low emission project modification in 2021, with the 5 boiler operational by July 2021 and the 4 boiler by December 2021[129]. - The actual concentration of SO2 emissions from the boiler was 110.10 mg/m3, significantly below the standard limit of 400 mg/m3[131]. - The company generated 20,040,178 KWh of electricity from its rooftop distributed photovoltaic project in 2021, reducing carbon emissions by 14,098.3 tons per year[141]. - The company operates a comprehensive online monitoring system for wastewater and boiler emissions, ensuring compliance with environmental regulations[135]. Management and Governance - The company has not completed the shareholding reform, which may pose policy risks in the future[10]. - The company has implemented measures to avoid competition with its subsidiaries, ensuring compliance with market regulations[89]. - The company is enhancing its internal control systems to align with regulatory requirements and improve financial reporting accuracy[86]. - The total number of employees in the parent company and major subsidiaries is 3,220, with 29 in the parent company and 3,191 in subsidiaries[115]. - The company has established a performance-based training system to enhance employee skills and meet future demands[118]. Strategic Focus - The company plans to adjust its marketing focus to increase the proportion of domestic sales and optimize product structure to mitigate the impact of rising costs[31]. - The company is focusing on upgrading its tire products to meet higher technological and performance standards due to market demand[62]. - The company aims to achieve full-process intelligent manufacturing in tire production through automation and big data systems[80]. - The company’s strategic focus includes customer-centricity, technology, digitalization, and talent development[79]. - The company has identified potential risks, including the impact of the COVID-19 pandemic and the need for ongoing communication with shareholders regarding related party transactions[81][82].