Elegant(SH:603221)2022-04-22 16:00Financial Performance - The company's operating revenue for 2021 was approximately CNY 1,078.47 million, a slight increase of 0.08% compared to CNY 1,077.56 million in 2020[19]. - The net profit attributable to shareholders of the listed company for 2021 was CNY 5.88 million, representing a significant decrease of 92.59% from CNY 79.30 million in 2020[19]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was a loss of CNY 4.60 million, compared to a profit of CNY 74.36 million in the previous year, marking a decline of 106.18%[19]. - The company's basic and diluted earnings per share were both 0.02 RMB, down 94.29% from 0.35 RMB in 2020[20]. - The weighted average return on net assets decreased to 0.41%, down 5.91 percentage points from 6.32% in 2020[20]. - The total assets at the end of 2021 were 1,866.54 million RMB, an increase of 5.38% compared to the end of 2020[22]. - The net cash flow from operating activities was -18.09 million RMB, indicating a significant cash outflow during the year[22]. - The total profit for the year was CNY -1.02 million, a significant decrease of 101.02% year-on-year[80]. - The gross margin for the furniture manufacturing segment decreased by 10.05% due to rising raw material prices[84]. Dividend Distribution - The company plans to distribute a cash dividend of CNY 0.3 per 10 shares based on a total share capital of 240 million shares as of December 31, 2021[4]. - The company distributed cash dividends amounting to 122.45% of the net profit attributable to ordinary shareholders in 2021, reflecting strong shareholder returns[131]. - The company plans to distribute a cash dividend of 1.00 yuan (including tax) for every 10 shares, totaling 24,000,000.00 yuan, which represents 30.30% of the 2020 net profit available for distribution[165]. - As of December 31, 2021, the company proposed a cash dividend of 0.30 yuan (including tax) per 10 shares, pending approval at the annual shareholders' meeting[166]. Operational Integrity and Governance - The company has received a standard unqualified audit report from its accounting firm, indicating the accuracy and completeness of its financial statements[7]. - The company has maintained its operational integrity, with all board members present at the board meeting to ensure the authenticity of the annual report[7]. - The company has not faced any violations in decision-making procedures regarding external guarantees[6]. - The company has established a comprehensive internal control system to enhance compliance and risk management, ensuring effective execution across all operational aspects[170]. - The company has a structured governance framework with a clear delineation of roles and responsibilities among its board members[143]. - The company’s governance practices are in compliance with relevant regulations and standards[146]. Market and Product Development - The company is advancing its fundraising projects, with the first phase of the smart manufacturing base nearly completed and the second phase of the PVC flooring automation project progressing smoothly, which will significantly enhance production capacity and efficiency[31]. - The company has made significant breakthroughs in product development, with new products like the dual-lock flooring and floating 2.0 product entering the market, which have gained customer recognition and are expected to become new profit growth points[34]. - The company is focusing on digital transformation and automation to optimize production processes and improve operational efficiency, thereby enhancing its competitive edge in the market[33]. - The company has established a wholly-owned subsidiary for domestic trade, building a team to explore new sales models and expanding its domestic market presence[37]. - The company is expanding its production capacity globally by establishing a joint venture in the U.S. with HMTX to enhance supply capabilities and reduce risks associated with logistics and political factors[38]. Research and Development - The company has established a comprehensive quality control system in accordance with ISO9001:2015 standards, enhancing its core competitive advantage[76]. - Research and development expenses increased by 4.71% to CNY 29.60 million, reflecting the company's commitment to innovation[81]. - The company aims to enhance its R&D capabilities and innovation awareness, focusing on new materials and improving product development efficiency[116]. - The company holds 26 authorized patents, including 8 invention patents and 14 utility model patents, with several invention patents currently under application[66]. Environmental Responsibility - The company has increased its investment in environmental protection and has integrated green development concepts into every stage of product development, production, and sales[136]. - The solar power project generated approximately 2.5 million kWh of electricity in 2021, reducing carbon emissions by 805 tons[184]. - The company has been committed to "green, human-centered, and innovative" business philosophy since its establishment in 1999, focusing on PVC elastic flooring which is eco-friendly and meets strict indoor air emission standards in Europe and the US[186]. - The company has achieved various certifications including ISO9001, ISO14001, UL Green Guard Gold, and EU IAC Health Gold, ensuring product quality and environmental management[186]. Strategic Partnerships and Market Position - The company has established stable partnerships with international flooring traders and has been recognized as a "Best Partner" for several consecutive years[56]. - The company has a long-term cooperation framework agreement with VERTEX, which grants it preferred supplier status, ensuring stable supply chain relationships[122]. - The company has established a joint venture, American Flooring LLC, with HMTX to enhance its supply capabilities and service in the North American market[74]. - The company’s revenue from the US market accounted for 73.30% of total sales, indicating a significant reliance on this region[123]. Challenges and Risks - The company faced increased costs due to rising prices of key raw materials, including PVC resin and plasticizers[30]. - The company experienced a foreign exchange loss of 6.61 million yuan due to the appreciation of the RMB against the USD, which impacted overall performance[126]. - The export tax rebate rate for the company's products was adjusted from 16% to 13%, which could significantly affect future operating performance[127]. - The company faced challenges with inventory buildup due to increased shipping costs and port congestion, impacting operational performance[125].