名臣健康(002919) - 2021 Q4 - 年度财报

Important Notice, Table of Contents, and Definitions This section includes important disclaimers, the report's table of contents, and the company's proposed profit distribution plan Important Notice The board guarantees report accuracy, forward-looking statements are not commitments, and the 2021 profit distribution plan is presented - The company's 2021 profit distribution plan proposes a cash dividend of 3.00 yuan (tax inclusive) per 10 shares and a capital reserve transfer of 4 shares per 10 shares to all shareholders, based on 122,135,745 shares[4] Company Profile and Key Financial Indicators This section provides an overview of the company's business transformation and key financial performance indicators for the reporting period Company Information and Key Financial Indicators In 2021, the company achieved 744 million yuan in revenue and 133 million yuan in net profit, transitioning to a dual-core business model of daily chemicals and online gaming Key Accounting Data and Financial Indicators for 2021 | Indicator | 2021 | 2020 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue (Yuan) | 744,148,561.43 | 680,571,308.29 | 9.34% | | Net Profit Attributable to Shareholders (Yuan) | 133,493,915.47 | 102,240,267.90 | 30.57% | | Net Profit Attributable to Shareholders Excluding Non-recurring Items (Yuan) | 109,582,759.28 | 91,722,575.51 | 19.47% | | Net Cash Flow from Operating Activities (Yuan) | 79,866,171.40 | 170,972,764.94 | -53.29% | | Basic Earnings Per Share (Yuan/Share) | 1.09 | 0.84 | 29.76% | | Weighted Average Return on Net Assets | 18.96% | 16.78% | 2.18% | | Total Assets (Yuan) | 970,345,939.68 | 879,177,170.27 | 10.37% | | Net Assets Attributable to Shareholders (Yuan) | 757,810,648.61 | 655,461,348.12 | 15.61% | - The company entered the online gaming business through equity investments in gaming companies like Hainan Huaduo Network Technology Co., Ltd., establishing a dual-core business model of daily chemicals and online gaming[17] - Total non-recurring gains and losses in 2021 amounted to 23.9112 million yuan, primarily from the 19.24 million yuan gain on disposal of non-current assets from transferring 100% equity of Shantou Jiasheng Printing Co., Ltd[23][24] Management Discussion and Analysis This section analyzes the company's industry landscape, business operations, core competencies, financial performance, and future outlook Industry Overview During the Reporting Period The daily chemical industry shows segmentation and diversified channels, while the gaming industry experiences steady growth with increasing self-developed game capabilities - Daily chemical industry trends include category segmentation, multi-channel marketing (especially online and live streaming e-commerce), and decreasing consumer brand loyalty[28] - Gaming industry trends show steady market growth, with the domestic market reaching 296.513 billion yuan (+6.4%) and 666 million users (+0.22%) in 2021; self-developed game capabilities are improving, and overseas market revenue growth (+16.59%) outpaces domestic growth (+6.51%)[29] Company's Main Businesses During the Reporting Period The company operates a dual-core business model encompassing daily chemicals, with established brands like "Dihua Zhixiu," and online gaming, focusing on R&D and expanding into publishing - The company operates a dual-core business model of daily chemicals and online gaming, with the gaming business acquired through external mergers and acquisitions in August 2020[30] - Key daily chemical brands include Dihua Zhixiu and Meiwang, with products covering hair care, skincare, oral care, and home care[32] - The gaming business primarily focuses on R&D, successfully developing popular titles like "King's Realm" and "Bailong Baye," and began exploring game publishing in Q4 2021 to achieve self-development and self-publishing[30][33] Analysis of Core Competencies The company's core strengths lie in its established daily chemical brands, extensive distribution network, strong R&D capabilities, and a stable, efficient gaming development team - Daily chemical business advantages include well-known trademarks like "Dihua Zhixiu" and "Meiwang," a nationwide distribution network with approximately 40,000 retail outlets, and 47 technical invention patents with an R&D center certified by CNAS[39][40] - Gaming business advantages include an efficient, stable, and strong R&D team with core members having over 8 years of industry experience, an experienced management team with successful projects generating over 100 million yuan in monthly revenue, and long-term stable cooperation with mainstream domestic mobile game publishers[41] Analysis of Main Business In 2021, revenue grew by 9.34% to 744 million yuan, driven by a 75.53% increase in gaming revenue, while daily chemical revenue declined, and R&D expenses significantly rose Revenue and Cost In 2021, the company's revenue composition shifted significantly, with online gaming revenue growing by 75.53% to 211 million yuan, increasing its share to 28.33%, while daily chemical revenue decreased by 4.67% Revenue Composition by Industry | Industry | 2021 Amount (Yuan) | Proportion of Revenue | YoY Change | | :--- | :--- | :--- | :--- | | Chemical Raw Materials and Chemical Products Manufacturing | 528,061,226.20 | 70.96% | -4.67% | | Software and Information Technology Services | 210,830,713.39 | 28.33% | 75.53% | Gross Profit Margin by Product | Product | Revenue (Yuan) | Cost of Revenue (Yuan) | Gross Profit Margin | | :--- | :--- | :--- | :--- | | Daily Chemical Products | 527,038,749.04 | 350,105,629.93 | 33.57% | | Online Games | 210,810,230.80 | 13,109,077.32 | 93.78% | - During the reporting period, the company established 4 new subsidiaries, including Hainan Xingxuan Shikong Network Technology Co., Ltd., which were included in the consolidated financial statements[52] Expenses In 2021, the company experienced significant expense changes, with R&D and administrative expenses increasing due to the consolidation of gaming subsidiaries, while financial expenses decreased due to reduced short-term borrowing interest 2021 Expense Changes | Expense Item | 2021 (Yuan) | 2020 (Yuan) | YoY Change | Explanation of Significant Change | | :--- | :--- | :--- | :--- | :--- | | Selling Expenses | 83,331,914.95 | 74,744,945.83 | 11.49% | - | | Administrative Expenses | 71,160,475.20 | 51,856,341.85 | 37.23% | Primarily due to different consolidation periods for gaming subsidiaries | | Financial Expenses | -328,762.61 | 436,580.20 | -175.30% | Primarily due to reduced short-term borrowing interest expenses during the reporting period | | R&D Expenses | 98,507,662.89 | 46,269,566.37 | 112.90% | Primarily due to different consolidation periods for gaming subsidiaries | R&D Investment In 2021, the company's R&D investment surged by 112.90% to 98.5077 million yuan, representing 13.24% of revenue, with a growing R&D team focused on both daily chemical and diverse gaming projects R&D Investment Status | Indicator | 2021 | 2020 | Change Percentage | | :--- | :--- | :--- | :--- | | R&D Investment Amount (Yuan) | 98,507,662.89 | 46,269,566.37 | 112.90% | | R&D Investment as % of Revenue | 13.24% | 6.80% | 6.44% | - The company's in-development game projects include 3D MMORPG "My War Alliance," ACGN card-based turn-based mobile game "Anchor Point Descend," and simulation management card-based mobile game "Star King," aiming for product diversification and new market expansion[58] Cash Flow In 2021, operating cash flow significantly decreased by 53.29% to 79.8662 million yuan due to subsidiary consolidation, while investment cash flow turned positive, and financing cash flow declined sharply from repayment of short-term bank loans Key Cash Flow Statement Items | Item | 2021 (Yuan) | 2020 (Yuan) | YoY Change | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 79,866,171.40 | 170,972,764.94 | -53.29% | | Net Cash Flow from Investing Activities | 49,629,692.22 | -270,201,282.25 | 118.37% | | Net Cash Flow from Financing Activities | -77,309,436.49 | -23,551,692.63 | -228.25% | | Net Increase in Cash and Cash Equivalents | 52,186,427.13 | -122,780,209.94 | 142.50% | Analysis of Assets and Liabilities As of year-end 2021, total assets grew by 10.37% to 970 million yuan, with a significant reduction in short-term borrowings and a portion of assets restricted due to collateral - As of the end of 2021, the company's total assets were 970 million yuan, an increase of 10.37% from the beginning of the year, with cash and cash equivalents accounting for 25.86%, accounts receivable for 21.61%, and inventories for 13.71%[19][64] - Short-term borrowings at year-end were 0, a decrease of 39.0459 million yuan from the beginning of the period, reducing their proportion of total assets from 4.30% to 0%[65] - As of the end of the reporting period, 19.4634 million yuan of the company's assets were restricted, primarily fixed assets and intangible assets used as collateral for bank credit[67] Analysis of Investment Status The company had no major investments during the reporting period, and it terminated the "Marketing Network Construction Project," reallocating the remaining 93.1751 million yuan in raised funds to permanent working capital - The company terminated the "Marketing Network Construction Project" and permanently supplemented working capital with the remaining 93.1751 million yuan of raised funds from the project[75] - The termination of the "Marketing Network Construction Project" was due to changes in the domestic daily chemical market, intense industry competition, low brand loyalty among young consumers, and the impact of emerging channels, leading the company to believe that substantial investment might not yield corresponding returns[79] Outlook on Company's Future Development The company plans to deepen its dual-core business strategy by optimizing daily chemical channels and expanding into game publishing, while acknowledging risks such as brand image, distribution models, and intense industry competition - Future plans for the daily chemical business include optimizing traditional distribution channels, advancing the "258" project to add advantageous outlets, and leveraging new media and e-commerce channels to promote brand youthfulness and specialization[85][86] - Future plans for the gaming business include adhering to boutique R&D, launching new products opportunely, expanding into overseas markets, and entering the game publishing sector to strive for self-development and self-publishing[86][87] - The company faces key risks including potential damage to brand image, risks associated with the distribution model, uncertainty of advertising effectiveness, intense competition in the gaming industry, and potential bad debt risks due to long accounts receivable cycles in the gaming business[87][88][89][90] Corporate Governance This section details the company's governance structure, including the board, supervisors, and senior management, as well as its profit distribution policies Basic Status of Corporate Governance The company has established a sound governance structure with clear responsibilities and independent operations, ensuring compliance with regulatory requirements - The company's governance structure is sound, with the general meeting of shareholders, board of directors, supervisory board, and senior management each performing their duties and operating in a standardized manner[94] - The company maintains independence from its controlling shareholder in terms of business, personnel, assets, organization, and finance, with no horizontal competition[95][97][98][99][100] Information on Directors, Supervisors, and Senior Management During the reporting period, the company completed the re-election of its board and supervisory board, with Mr. Chen Jianming succeeding his father as Chairman and General Manager, and disclosed the compensation of its current executives - The company completed the re-election of its board of directors, with former Chairman Chen Qinfu stepping down and Chen Jianming elected as the new Chairman and appointed as General Manager[104][106] Compensation of Selected Directors, Supervisors, and Senior Management (2021) | Name | Position | Total Pre-tax Compensation from Company (Million Yuan) | | :--- | :--- | :--- | | Chen Jianming | Chairman, General Manager | 0.4486 | | Peng Xiaoqing | Vice Chairman, Deputy General Manager and CFO | 0.4486 | | Chen Dongsong | Director, Deputy General Manager, Board Secretary | 0.3414 | | Zeng Xusheng | Director | 0.7848 | | Total | -- | 3.5925 | Company's Profit Distribution and Capital Reserve to Share Capital Increase The company's 2021 profit distribution plan proposes a cash dividend of 3.00 yuan per 10 shares and a capital reserve transfer of 4 shares per 10 shares, totaling 36.6407 million yuan in cash dividends 2021 Profit Distribution and Capital Reserve to Share Capital Increase Plan | Item | Content | | :--- | :--- | | Number of Bonus Shares per 10 Shares (Shares) | 0 | | Cash Dividend per 10 Shares (Yuan) (Tax Inclusive) | 3.00 | | Number of Shares Transferred from Capital Reserve per 10 Shares (Shares) | 4 | | Share Capital Base for Distribution Plan (Shares) | 122,135,745 | | Cash Dividend Amount (Yuan) (Tax Inclusive) | 36,640,723.50 | Environmental and Social Responsibility This section outlines the company's commitment to environmental protection, investor and employee rights, partner relations, and social welfare, while maintaining a robust safety management system Overview of Environmental and Social Responsibility The company is not a key polluter, has no environmental penalties, actively protects stakeholders' rights, engages in philanthropy, and maintains a comprehensive safety production management system - The company and its subsidiaries are not classified as key polluting entities by environmental protection authorities and received no environmental administrative penalties during the reporting period[144] - The company actively fulfills its social responsibilities, including protecting investor rights, valuing employee rights, maintaining partner relationships, and participating in social welfare activities[145][146][147] - The company has established a comprehensive safety production management system, including "Safety Production Management Regulations" and "Emergency Response System," to ensure safe operations[148] Significant Matters This section details significant accounting policy changes, related party transactions, major contracts, and subsidiary-related matters during the reporting period Explanation of Changes in Accounting Policies, Accounting Estimates, or Correction of Significant Accounting Errors Compared to Last Year's Financial Report Effective January 1, 2021, the company adopted the new lease accounting standard, recognizing right-of-use assets and lease liabilities for most leases, which impacted the consolidated balance sheet - The company adopted the new lease accounting standard effective January 1, 2021, making corresponding adjustments to its accounting policies[158][435] Impact of Adopting New Lease Standard on Consolidated Balance Sheet Items as of January 1, 2021 | Item | Adjustment Amount (Yuan) | | :--- | :--- | | Right-of-use Assets | +28,899,058.27 | | Long-term Deferred Expenses | -410,319.00 | | Non-current Liabilities Due Within One Year | +4,737,114.11 | | Lease Liabilities | +23,751,625.16 | Significant Related Party Transactions The company completed a significant related party transaction by transferring 100% equity of its wholly-owned subsidiary, Shantou Jiasheng Printing Co., Ltd., for 28.2913 million yuan, generating a 19.366 million yuan investment gain - The company transferred 100% equity of its wholly-owned subsidiary, Shantou Jiasheng Printing Co., Ltd., to related party Ms. Cai Xu (spouse of former Vice Chairman Mr. Xu Shaobi) for 28.2913 million yuan[173] - This equity transfer transaction generated an investment gain of 19.366 million yuan for the company[173] Significant Contracts and Their Performance The company signed a major acquisition contract to acquire 100% equity of Kashi Aoshu Network Technology Co., Ltd. for 219 million yuan, but the resolution for this acquisition has been postponed - On October 29, 2021, the company signed a contract to acquire 100% equity of Kashi Aoshu Network Technology Co., Ltd. for 219 million yuan[189] - This acquisition requires approval from the company's general meeting of shareholders, but the resolution has been postponed[189][195] Significant Matters Concerning Company's Subsidiaries During the reporting period, the company established a new wholly-owned subsidiary, Hainan Xingxuan Shikong Network Technology Co., Ltd., and divested Shantou Jiasheng Printing Co., Ltd - The company established a new wholly-owned subsidiary, Hainan Xingxuan Shikong Network Technology Co., Ltd., with a registered capital of 10 million yuan[196] - The company transferred 100% equity of its wholly-owned subsidiary, Shantou Jiasheng Printing Co., Ltd., which is no longer included in the consolidated financial statements[197] Changes in Shares and Shareholder Information This section details the changes in the company's share structure, particularly the reduction in restricted shares, and provides information on its shareholders and actual controller Changes in Shareholding During the reporting period, the company's total share capital remained unchanged at 122,135,745 shares, but restricted shares significantly decreased from 44.00% to 1.55% due to executive departures and annual unlocking Share Structure Changes | Share Type | Number of Shares Before Change (Shares) | Proportion | Number of Shares After Change (Shares) | Proportion | | :--- | :--- | :--- | :--- | :--- | | Restricted Shares | 53,738,375 | 44.00% | 1,889,250 | 1.55% | | Unrestricted Shares | 68,397,370 | 56.00% | 120,246,495 | 98.45% | | Total Shares | 122,135,745 | 100.00% | 122,135,745 | 100.00% | Shareholders and Actual Controller Information As of year-end 2021, the company had 4,677 common shareholders, with Mr. Chen Qinfu remaining the controlling shareholder and actual controller despite a reduction in his shareholding - The controlling shareholder and actual controller is Chen Qinfu, holding 37.00% of the shares at year-end[205][207] - During the reporting period, controlling shareholder Chen Qinfu reduced his holdings by 15,064,500 shares[205] - Liu Xiaowei became the second-largest shareholder, holding 15,064,500 shares, accounting for 12.33% of the total share capital[205] Information on Preferred Shares This section confirms that the company had no preferred shares during the reporting period Preferred Shares The company had no preferred shares during the reporting period - The company had no preferred shares during the reporting period[211] Information on Bonds This section confirms that the company had no bonds during the reporting period Bonds The company had no bonds during the reporting period - The company had no bonds during the reporting period[214] Financial Report This section presents the audited financial statements, including the audit report and detailed notes on consolidated financial statement items and changes in consolidation scope Audit Report Zhitong Certified Public Accountants (Special General Partnership) issued a standard unqualified audit opinion on the company's 2021 financial statements, highlighting key audit matters including revenue recognition, goodwill impairment, and expected credit losses for accounts receivable - The audit firm issued a standard unqualified audit opinion[216] - Key audit matters include: - Revenue Recognition: Due to revenue being a key performance indicator and the large volume of data in the online gaming business, inherent risks exist[218][220] - Goodwill Impairment Testing: The acquisition of Hainan Huaduo and Hangzhou Leiyan resulted in 118 million yuan in goodwill, and its impairment testing involves significant judgment[224] - Determination of Expected Credit Losses for Accounts Receivable: Given the significant amount of accounts receivable, determining their expected credit losses involves significant accounting estimates[227] Notes to Consolidated Financial Statements The financial statement notes detail account balances and changes, including 230 million yuan in accounts receivable (92.76% from gaming), a 321.31% increase in prepayments for game revenue sharing, and 65.7 million yuan in other non-current assets for an equity transfer prepayment - The year-end balance of accounts receivable was 230 million yuan, with daily chemical business customers accounting for 7.24% and online gaming business customers for 92.76%[470] - Prepayments increased by 321.31% year-on-year, primarily due to increased prepayments for game revenue sharing by subsidiaries[478] - The original book value of goodwill was 117.6575 million yuan, formed from the acquisition of Hangzhou Leiyan (91.5709 million yuan) and Hainan Huaduo (26.0866 million yuan); no goodwill impairment provision was made this year after impairment testing[517][520][521] - The year-end balance of other non-current assets was 65.7 million yuan, a significant increase from 2.1 million yuan at the beginning of the period, primarily due to the prepayment for the equity transfer of Kashi Aoshu Network Technology Co., Ltd. as per contract[534] Changes in Consolidation Scope During the reporting period, the company's consolidation scope changed due to the disposal of its wholly-owned subsidiary, Shantou Jiasheng Printing Co., Ltd., and the establishment of four new subsidiaries to expand its gaming business - The company disposed of its wholly-owned subsidiary, Shantou Jiasheng Printing Co., Ltd., for 28.2913 million yuan, and it was no longer included in the consolidation scope as of December 31, 2021[609][610] - During the reporting period, 4 new subsidiaries were established, including Hainan Xingxuan Shikong Network Technology Co., Ltd., all of which were included in the consolidation scope[611][612]