First(SH:603806)2023-08-24 16:00Financial Performance - The company's operating revenue for the first half of 2023 was CNY 10.62 billion, an increase of 17.76% compared to CNY 9.02 billion in the same period last year[18]. - The net profit attributable to shareholders decreased by 16.31% to CNY 884.66 million, down from CNY 1.06 billion in the previous year[18]. - The net profit after deducting non-recurring gains and losses fell by 17.82% to CNY 823.38 million, compared to CNY 1.00 billion in the same period last year[18]. - The basic earnings per share decreased by 17.54% to CNY 0.47, down from CNY 0.57 in the same period last year[19]. - The weighted average return on net assets dropped to 6.14%, down from 8.32% in the previous year, a decrease of 2.18 percentage points[19]. - The decline in net profit was primarily attributed to a decrease in the gross margin of photovoltaic films[20]. - The increase in operating revenue was mainly due to higher sales volumes of photovoltaic films and back sheets[20]. - The company achieved operating revenue of CNY 1,061,591.24 million, a year-on-year increase of 17.76%[42]. - Net profit attributable to shareholders was CNY 88,466.04 million, a year-on-year decrease of 16.31%[42]. - The photovoltaic materials division shipped 96,724.20 million square meters of photovoltaic film, a year-on-year increase of 57.15%, generating revenue of CNY 951,750.09 million, up 18.53%[43]. - The company’s photovoltaic backsheet shipments reached 8,292.76 million square meters, a year-on-year increase of 46.77%, with revenue of CNY 73,455.33 million, up 10.77%[43]. - The company’s aluminum-plastic film shipments increased by 77.74% to 413.59 million square meters, with revenue rising by 81.00% to CNY 4,655.30 million[46]. Cash Flow and Financial Position - The net cash flow from operating activities was negative at CNY -1.89 billion, worsening from CNY -1.26 billion in the previous year[18]. - The company's total assets grew by 6.42% to CNY 21.49 billion, compared to CNY 20.19 billion at the end of the previous year[18]. - The net assets attributable to shareholders increased by 4.94% to CNY 14.67 billion, up from CNY 13.98 billion at the end of the previous year[18]. - Operating costs increased by 25.72% year-on-year, primarily due to higher sales volumes of photovoltaic film and backsheet[50]. - Research and development expenses rose by 6.66% year-on-year, mainly due to increases in employee salaries and testing costs[50]. - The company’s cash and cash equivalents as of June 30, 2023, amounted to RMB 5,135,233,893.60, down from RMB 6,265,957,361.09 at the end of 2022[141]. - The company’s accounts receivable increased to RMB 4,722,903,498.87 from RMB 3,776,155,547.92 at the end of 2022[141]. - The company’s inventory decreased to RMB 3,106,552,949.26 from RMB 3,515,598,210.73 at the end of 2022[141]. - The total liabilities reached ¥6,756,885,411.70, up from ¥6,184,187,061.55, marking a growth of around 9.2%[143]. - The company reported a debt-to-asset ratio of 31.44% as of June 30, 2023[138]. Market and Industry Insights - In the first half of 2023, China's photovoltaic installations reached 78.42 GW, a year-on-year increase of 154%[29]. - The global photovoltaic market is expected to continue its rapid growth, with IEA predicting that by 2027, cumulative installations will surpass all other power sources[29]. - The PCB market is projected to decline by 4.13% in 2023 due to economic pressures and geopolitical conflicts[32]. - The photovoltaic industry is experiencing increased market competition, with many companies announcing expansion plans across various segments, including photovoltaic film and glass[70]. Research and Development - The company has applied for 592 invention patents and 138 utility model patents, with 226 and 102 patents granted respectively[36]. - The company has established a strong R&D platform, including the Foster New Materials Research Institute, to enhance its technological advantages[36]. - The company aims to enhance its technological capabilities through ongoing research and development initiatives[167]. Environmental Responsibility - The company focuses on environmental protection, employing dedicated environmental managers to oversee management, statistics, and pollution control[93]. - The company has conducted environmental impact assessments for new and expanded projects, ensuring compliance with environmental regulations[91]. - The company has implemented strict management measures for pollution prevention facilities, ensuring they operate in sync with production facilities to maintain stable operation and efficiency[89]. - The company has established an annual environmental monitoring plan in accordance with discharge permits[93]. - The company has committed to maintaining environmental responsibility through technology innovation and cost control[95]. Corporate Governance and Shareholder Matters - The company did not propose any profit distribution or capital reserve fund increase for the first half of the year[84]. - The company held one annual general meeting and one extraordinary general meeting during the reporting period, with no resolutions rejected or changed[82]. - The company’s former deputy general manager, Mao Genxing, resigned due to personal reasons but will continue to serve as a senior advisor[83]. - The company plans to apply for a credit limit from banks for the year 2023[81]. - The company has committed to maintaining transparency and accountability in its financial disclosures and corporate governance practices[102]. Expansion Plans - The company plans to expand its production capacity in Thailand and initiate construction of a facility in Vietnam to meet growing market demand[41]. - The company is currently undertaking multiple expansion and new construction projects both domestically and internationally, which carry risks related to project completion and market conditions[74]. - The company plans to continue expanding production capacity and investing in technology research and development to enhance the competitive advantage of its photovoltaic film products[69]. Employee Stock Ownership Plans - The company implemented a fourth employee stock ownership plan, purchasing 2,606,820 shares at an average price of CNY 49.199 per share, totaling CNY 128,276,866.53[47]. - The company repurchased 926,700 shares, accounting for 0.05% of total share capital, with a total expenditure of CNY 29,994,802.68[48]. - The company’s employee stock ownership plans involve a total of up to 1,080 employees in the fourth plan, with 2 senior management personnel participating[87]. - The lock-up period for shares purchased under the fourth employee stock ownership plan is set for 12 months, starting from April 27, 2023[87]. Legal and Compliance Matters - The company reported no significant litigation or arbitration matters during the reporting period[109]. - There were no non-operating fund occupations by controlling shareholders or related parties during the reporting period[108]. - The company has not engaged in any activities that constitute competition with its subsidiaries, ensuring compliance with commitments made[107]. - The company has not disclosed any other environmental information during the reporting period[95].