Kingking(002094)2022-04-29 16:00Financial Performance - The company's operating revenue for 2021 was ¥3,153,044,393.97, a decrease of 21.21% compared to ¥4,001,716,786.57 in 2020[21]. - The net profit attributable to shareholders was ¥16,342,034.00, a significant recovery from a loss of ¥428,744,846.41 in 2020[21]. - The net profit after deducting non-recurring gains and losses was ¥8,563,963.92, compared to a loss of ¥436,169,419.87 in the previous year[21]. - The company's total assets decreased by 4.92% to ¥4,569,066,424.12 at the end of 2021 from ¥4,805,511,403.76 at the end of 2020[21]. - The net assets attributable to shareholders decreased by 9.80% to ¥2,223,861,566.84 from ¥2,465,427,007.14 in 2020[21]. - The basic earnings per share for 2021 was ¥0.0237, recovering from a loss of ¥0.620 in 2020[21]. - The weighted average return on equity was 0.66%, a recovery from -15.97% in the previous year[21]. - The total revenue for 2021 was CNY 3,153,044,393.97, a decrease of 21.21% compared to the previous year[46]. - The cosmetics segment generated revenue of CNY 1,563,991,278.03, accounting for 49.60% of total revenue, with a year-on-year decline of 5.13%[48]. - Revenue from new materials, candles, and aromatherapy products increased by 45.10% to CNY 919,222,093.70, representing 29.15% of total revenue[48]. - The supply chain segment saw a significant decline in revenue, dropping 61.05% to CNY 669,831,022.24, which accounted for 21.24% of total revenue[48]. - The company achieved a net profit of CNY 5,632.15 million, a substantial increase compared to the previous year, despite a consolidated net loss of CNY 1,758.60 million due to the impact of the pandemic on joint ventures[46]. - The gross margin for the cosmetics segment was 12.92%, down 12.61% year-on-year, while the gross margin for new materials and aromatherapy products was 21.24%[50]. - The overseas revenue increased by 51.72% to CNY 898,643,231.39, while domestic revenue decreased by 33.88% to CNY 2,254,401,162.58[49]. Business Operations - The company operates in the chemical industry, facing risks such as fluctuations in raw material prices and labor shortages[5]. - The company operates in three main business segments: new material candles and aromatherapy, cosmetics, and supply chain, with a stable growth outlook for the candle and aromatherapy market[31]. - The cosmetics industry is experiencing rapid growth in chain specialty stores and e-commerce channels, indicating a shift in consumer behavior towards more specialized retail formats[32]. - In 2021, the retail sales of cosmetics in China reached CNY 402.6 billion, representing a year-on-year growth of 14%[34]. - The Chinese cosmetics market is projected to reach USD 119.9 billion by 2024, with a compound annual growth rate (CAGR) of 13% from 2020 to 2024[34]. - The company has a production capacity of 17.58 million units for craft candles, with a utilization rate of 87.89%[41]. - The average price of wax, a key raw material, increased significantly from CNY 5,857.44 in the first half to CNY 7,264.96 in the second half of 2021[41]. - The company has established a comprehensive cosmetics industry chain, integrating R&D, production, sales, and brand operation[39]. - The company’s subsidiary, Shanghai Yuefeng, focuses on offline direct sales channels, targeting high-growth retail chains like Watsons and Sephora[40]. - The company has developed the "LANCHEN依露" lipstick series, which is now available across various sales channels[40]. - The company is leveraging Tencent's technology to enhance its new retail operations, improving in-store traffic analysis and sales conversion rates[42]. - The company has opened a cross-border e-commerce channel with Jimo Customs, integrating with existing store operations for enhanced customer experience[43]. - The company maintains a strong competitive position as a leading manufacturer of new material candles, recognized as the largest in Asia and among the top globally[42]. Research and Development - R&D expenses increased by 21.37% to ¥39,289,225.58, representing 1.25% of operating revenue[61]. - The number of R&D personnel decreased by 8.62% to 159, with a notable drop in the number of personnel under 30 years old[61]. - The company completed several R&D projects aimed at improving product characteristics and reducing production costs, enhancing its technological advantages[60]. - The company is investing in new technology development, allocating 50 million RMB towards R&D initiatives in the upcoming year[109]. Corporate Governance - The financial report is guaranteed to be true, accurate, and complete by the company's management[4]. - The company emphasizes compliance with governance standards and equal treatment of all shareholders, ensuring that minority shareholders can fully exercise their rights[94]. - The board of directors consists of 7 members, including 3 independent directors, complying with legal and regulatory requirements[95]. - The company held 5 board meetings during the reporting period, with all directors attending and fulfilling their responsibilities diligently[95]. - The company maintains complete independence from its controlling shareholder in terms of business, personnel, assets, and finance, ensuring no competition exists[97]. - The company has established an independent financial accounting system and strictly separates its financial operations from those of the controlling shareholder[98]. - The company has a transparent performance evaluation and incentive mechanism linking the compensation of directors and senior management to company performance[95]. - The company has designated specific newspapers and websites for information disclosure, ensuring timely and accurate communication with shareholders[96]. - The company respects and protects the legitimate rights of stakeholders, balancing interests among shareholders, employees, and society[96]. - The company has a complete procurement, production, and sales system, independently managing its supply chain[97]. - The company has not provided guarantees or loans to its controlling shareholder or related parties, maintaining financial independence[98]. - The company held its annual general meeting with a participation rate of 26.73% on May 20, 2021, and a temporary meeting with a participation rate of 33.42% on September 15, 2021[99]. Risk Management - The company has a risk of market and macroeconomic policy fluctuations[5]. - The company faces risks from raw material price fluctuations, particularly in paraffin, which directly impacts profit margins[87]. - The company has established strong cooperative relationships in oil trading, but faces risks from commodity price volatility affecting order fulfillment and inventory levels[88]. - The company has experienced currency exchange losses due to the appreciation of the RMB against the USD, and is taking measures to mitigate this risk[88]. - The domestic cosmetics market is expected to maintain stable growth, but economic cycles and consumer preferences may pose challenges[90]. - The company is committed to improving employee welfare and addressing labor shortages through long-term partnerships with educational institutions[88]. Future Outlook - The company aims to achieve operating revenue exceeding 3.5 billion RMB in 2022, focusing on improving revenue structure and enhancing profitability[83]. - The company is committed to building a "Beauty Economy Industry Circle" platform, integrating self-owned brand development, channel distribution, e-commerce operations, and brand management[79]. - The company plans to strengthen online business layout and terminal retail brand building, exploring various new retail business models centered on user operations[80]. - The company will enhance its supply chain advantages and deepen upstream and downstream cooperation to cover the entire cosmetics industry chain[82]. - The company intends to leverage digital new retail service platforms to support the rise of quality domestic brands while introducing high-quality overseas brands[82]. - The company is focused on developing smart supply chain and retail-related information technologies, utilizing big data and AI to improve operational efficiency[80]. - The company will increase talent investment to attract experienced professionals in supply chain management, retail organization, and data operations[83]. - The company has established a diversified and efficient sales network, becoming one of the largest supply chain service platforms in the Chinese cosmetics industry[79]. - The company will actively develop and introduce exclusive custom brands and support the rise of domestic brands while enhancing the market share of existing brands[82]. - The company plans to optimize brand structure and channel resources, transitioning from product operation to a customer lifecycle-oriented new retail operation model[84]. - The company reported a positive outlook for the next fiscal year, projecting a revenue growth of 10% to 12%[111]. - New product launches are expected to contribute an additional 200 million RMB in revenue, with a focus on innovative cosmetic solutions[110]. - Market expansion plans include entering three new provinces, aiming to increase market share by 5% in these regions[111]. - The company is considering strategic acquisitions to enhance its supply chain efficiency, with a budget of 100 million RMB earmarked for potential deals[110]. - A new marketing strategy is being implemented, targeting a 30% increase in brand awareness through digital channels[109]. Employee and Stakeholder Relations - The company employed a total of 2,628 staff members at the end of the reporting period, with 1,260 in sales and 498 in production[123]. - The number of employees receiving salaries during the reporting period was 3,681[123]. - The company has established a competitive salary structure that includes fixed wages, bonuses, and benefits[124]. - The total remuneration for directors, supervisors, and senior management during the reporting period amounted to 2.6448 million CNY[114]. - The independent directors received an annual allowance of 80,000 CNY each, totaling 240,000 CNY for three independent directors[113]. - The educational background of employees shows that 367 hold a bachelor's degree or higher, while 1,689 have less than a college degree[123]. Internal Control and Compliance - The internal control system covers all business segments related to financial reporting and information disclosure, ensuring effective governance and risk management[130]. - The internal audit department conducts regular audits on the integrity and effectiveness of internal controls, including financial reports and performance forecasts[131]. - The company has established a zero-tolerance policy towards corruption, supported by a comprehensive anti-fraud system[131]. - The total assets of units included in the internal control evaluation report account for 90.51% of the company's consolidated total assets[133]. - The total assets accounted for 91.01% of the consolidated revenue in the financial report[134]. - There were no significant defects identified in the financial report or non-financial report[135]. - The internal control audit report confirmed the effectiveness of financial reporting controls as of December 31, 2021[138]. - The company has recognized and addressed deficiencies related to related party transactions, with all funds returned by the related party[140]. - The company plans to strengthen internal control measures to prevent future related party fund occupation[140]. - The internal control audit report was disclosed on April 30, 2022, with a standard unqualified opinion[140]. - The company aims to enhance internal control supervision mechanisms to promote sustainable development[140]. - The company is committed to maintaining effective internal controls in all material aspects[138]. - The internal control self-assessment report reflects the company's commitment to transparency and compliance[138]. Environmental and Social Responsibility - The company invested over 2 million yuan in environmental protection technology upgrades, achieving significant results in reducing carbon emissions[143]. - The company actively responded to national poverty alleviation initiatives, focusing on education and elderly care in disadvantaged areas[147]. - There were no major safety incidents reported during the reporting period, with effective safety checks and hazard assessments conducted[146].