JINHUI(SH:603919)2022-03-15 16:00Financial Performance - The company achieved a net profit of RMB 289,181,830.60 for the year 2021, with a legal surplus reserve of RMB 28,918,183.06 deducted [3]. - The total undistributed profits at the end of 2021 amounted to RMB 1,181,227,077.21 after distributing cash dividends of RMB 121,742,399.28 for the year 2020 [3]. - A cash dividend of RMB 2.20 per 10 shares (including tax) will be distributed, totaling RMB 111,597,199.34, resulting in a cash dividend payout ratio of 34.37% [4]. - The company plans to carry forward the remaining undistributed profits of RMB 1,069,629,877.87 to the next fiscal year [4]. - The company achieved operating revenue of RMB 1.788 billion in 2021, a year-on-year increase of 3.34% [21]. - Net profit attributable to shareholders was RMB 324.84 million, a decrease of 1.95% compared to the previous year [21]. - The net cash flow from operating activities was RMB 279.26 million, down 17.17% year-on-year [21]. - The company's total assets increased by 6.83% to RMB 3.773 billion at the end of 2021 [21]. - The weighted average return on equity decreased by 1.21 percentage points to 11.32% in 2021 [22]. - The gross profit margin for the main business improved to 64.00%, an increase of 1.11 percentage points year-on-year [63]. - The company reported a net profit margin of 12%, up from 10% in the previous year [158]. Product and Market Development - High-end product revenue reached RMB 1.095 billion, growing 26.24% year-on-year, accounting for 62.11% of total revenue [29]. - The production of premium liquor increased by 18.26% in 2021, showcasing the company's production capacity advantages [31]. - The company established sales offices in Shanghai and Jiangsu to enhance its presence in the East China market [29]. - The company categorized its products into three tiers: low-end (below 30 RMB/500ml), mid-range (30 to 100 RMB/500ml), and high-end (above 100 RMB/500ml) [67]. - High-end product production increased by 7.48% to 5,027.69 thousand liters, while sales surged by 23.74% to 5,329.60 thousand liters [69]. - The company is expanding its sales network to enhance brand recognition and competitiveness in both Northwest and Eastern China markets [50]. - The company plans to continue optimizing its product structure with a focus on high-end products like Jin Hui 28 in 2022 [99]. - The sales revenue from the southeastern region of Gansu was 499,088,379.36 RMB, accounting for 28.31% of total sales [105]. Research and Development - The company has a dedicated R&D team led by national-level liquor judges, focusing on consumer-driven product development [40]. - Research and development expenses increased by 17.07% year-on-year, reflecting a focus on innovation and product quality [61]. - The company introduced a unique "solid-state brewing IoT monitoring system," which has been patented and won a national commercial technology progress award [53]. - The company is investing 50 million in R&D for new technologies aimed at enhancing product efficiency [158]. Risk Management - The company has outlined potential risks in its future development discussions [4]. - The company faces risks from changes in the industry operating environment, with potential significant declines in operating performance if product structure optimization and marketing network expansion are not timely addressed [122]. - There is a risk of talent loss, as the company relies on a stable technical team for sustainable development, despite having established attractive compensation and incentive policies [123]. - Market competition risk is heightened due to increasing consumer demands for brand and quality, which could lead to a loss of market share and declining revenues if effective measures are not taken [124]. - Environmental protection risks exist, as stricter regulations may require additional investments in environmental facilities and operational costs [125]. - The company is exposed to risks from rising raw material prices or supply shortages, which could adversely affect production costs if internal management optimization is not achieved [127]. - Food safety risks are present, as new regulations could impose higher quality requirements that the company must meet to avoid operational impacts [128]. - Safety production risks are significant, with the potential for major economic losses if safety management does not keep pace with production scale expansion [129]. - The company is monitoring the ongoing COVID-19 pandemic, which poses risks to production and operations due to potential restrictions on consumption scenarios [130]. Corporate Governance - The company adheres to legal and regulatory requirements for corporate governance, ensuring the protection of shareholder rights and interests [132]. - The board of directors has effectively operated within legal frameworks, holding 4 meetings and passing 34 resolutions during the reporting period [135]. - The company emphasizes stakeholder interests, ensuring a balance among shareholders, employees, partners, and society [139]. - The controlling shareholder operates independently from the company, with no adverse impact on operations from related party transactions [140]. - The company has received a B rating for its information disclosure practices from the Shanghai Stock Exchange, ensuring timely and accurate information release [141]. - The company actively engages with investors through performance briefings, site visits, and roadshows to maintain transparency [142]. - The company has established a robust internal control system to enhance risk management and operational efficiency [145]. - The company maintains independence from its controlling shareholder, despite some industry competition with Shede Liquor [147]. Employee and Remuneration Policies - The total remuneration for all directors, supervisors, and senior management at the end of the reporting period amounted to 6.0396 million yuan [165]. - The company has established a competitive salary system that aligns employee compensation with company performance, ensuring that at least 30% of the net profit is distributed as cash dividends [183][192]. - The employee composition includes 905 production staff, 738 sales personnel, and 260 technical staff, reflecting a diverse workforce [182]. - The company emphasizes a training program aimed at enhancing employee skills and aligning with strategic development goals [186]. - The company has implemented a performance evaluation mechanism for senior management, linking compensation to economic performance and annual operational goals [197]. Strategic Planning - The company aims to achieve operating revenue of CNY 2.5 billion in 2022, focusing on market expansion and brand building [119]. - The company plans to enhance its marketing strategy by integrating large customer operations and deep distribution channels [119]. - The company is considering strategic acquisitions to bolster its market position, with a budget of 100 million allocated for potential deals [158]. - The management emphasized a focus on sustainability initiatives, aiming to reduce operational costs by 10% over the next two years [158].