KNT(SZ:300225)2021-08-05 16:00Financial Performance - The company's operating revenue for the first half of 2021 was ¥479,506,144.83, representing a 42.39% increase compared to ¥336,761,435.66 in the same period last year[32]. - The net profit attributable to shareholders was -¥17,768,567.29, a decrease of 215.71% from ¥15,355,959.38 in the previous year[32]. - The net cash flow from operating activities was -¥171,079,718.36, a decline of 311.07% compared to ¥81,052,943.56 in the same period last year[32]. - The total assets at the end of the reporting period were ¥1,465,632,865.47, reflecting a 2.54% increase from ¥1,429,321,443.08 at the end of the previous year[32]. - The company's main business revenue increased by 40%-45% compared to the same period last year, reaching a historical high since its listing[81]. - In the first half of 2021, the company's electrophoretic coating business generated revenue of 264 million yuan, a year-on-year increase of 26.44%, while the topcoat business revenue reached 203 million yuan, up 68.06% year-on-year[85]. - The electrophoretic coating business accounted for 55.15% of total revenue, while the topcoat business represented 42.25%, reflecting a strategic shift towards higher-margin products[85]. - Operating costs increased by 67.75% to ¥397.03 million from ¥236.68 million, primarily due to rising global chemical raw material prices and increased procurement costs[100]. - Research and development expenses rose by 10.15% to ¥16.18 million from ¥14.69 million, attributed to the implementation of a stock incentive plan[100]. - The gross profit margin for the main business was 24.95%, a decrease of 7.60% compared to the previous year[103]. Market and Industry Trends - The company's main revenue source is automotive OEM coatings, which are closely tied to the macroeconomic environment and the automotive industry's performance, indicating potential risks from economic fluctuations[6]. - The automotive paint industry is experiencing a shift towards environmentally friendly products, with new national standards for VOCs implemented in December 2020 and February 2021, guiding the industry's development direction[77]. - The demand for automotive coatings is expected to grow, driven by factors such as economic development, increased consumer income, and favorable policies for new energy vehicles[79]. - In the first half of 2021, the automotive market showed a stable growth trend, with production and sales of automobiles reaching 12.57 million and 12.89 million units, respectively, representing year-on-year growth of 24.2% and 25.6%[79]. Raw Material and Procurement Challenges - In the first half of 2021, the company experienced a significant increase in raw material procurement costs, with major materials like epoxy resin and bisphenol A reaching historical highs, impacting gross margins negatively[5]. - The prices of key raw materials such as epoxy resin and bisphenol A have surged, with bisphenol A increasing by 129.03% year-on-year, reaching a historical high of 30 yuan/kg in April 2021[78]. - The company's procurement strategy includes locking in raw material prices when they are low, particularly for bulk materials like epoxy resin and bisphenol A[57]. - The company faces risks from rising raw material prices, which have significantly increased compared to the same period last year, impacting gross margins[126]. Environmental and Safety Compliance - The company is committed to enhancing safety production measures, given the inherent risks associated with chemical manufacturing processes[10]. - Environmental protection regulations are becoming stricter, which may lead to increased operational costs for the company[12]. - The company emphasizes environmental protection and plans to increase investments in environmental compliance due to stricter regulations, which may impact operational performance[133]. - The company has implemented a comprehensive environmental monitoring plan, with monthly and quarterly testing for various pollutants, ensuring compliance with emission standards[149]. - The company has established a comprehensive waste management system, including physical and biological treatment processes for wastewater before discharge[149]. - The total emissions of non-methane total hydrocarbons from the company were 0.021 tons, well below the approved limit of 0.633 tons, indicating no exceedance[144]. - The company reported a total wastewater COD emission of 0.3294 tons, significantly lower than the approved limit of 4.64 tons, with no exceedance[144]. - The company has a total nitrogen wastewater emission of 0.0023 tons, which is well below the approved limit of 11.184 tons, indicating no exceedance[144]. - The company has received environmental impact evaluation approvals for its automotive paint research and production base, with the latest approval obtained in November 2020[149]. Research and Development Initiatives - The company is focusing on developing high solid content coatings (HSC) to meet environmental standards and improve product performance[24]. - The company has a high-quality R&D team that focuses on practical product technology upgrades based on customer needs, enhancing the technical content and application value of its products[70]. - The company is actively developing water-based B1B2 process topcoats for passenger vehicles, which have been successfully launched in multiple customer lines[89]. - The intelligent coating laboratory, operational since April 2020, integrates advanced spraying technology and provides robust support for future business expansion and quality control, particularly for water-based paint products[67]. - The company has committed to improving the proportion of water-based paints in its product offerings and enhancing R&D efforts in this area[133]. Strategic Developments and Corporate Governance - The company plans not to distribute cash dividends or issue bonus shares for the reporting period, indicating a focus on reinvestment[13]. - The company appointed a new president, Yuan Xiang, on May 28, 2021, to focus on governance and strategic development[137]. - The company has established "Jinlitai University" to enhance talent development, offering 139 courses and training 933 employees since its launch in May 2021[98]. - The company is transitioning from a traditional manufacturing profit model to a "full coating solution service provider," enhancing its service offerings to meet customer demands[61]. - The core management team, with backgrounds from leading companies like Nippon Paint and BASF, is focused on enhancing the company's competitive edge through strategic planning and technology[62]. Legal and Regulatory Matters - The company is currently involved in a significant arbitration case with a claim amount of 26.699 million RMB, which is not expected to result in liabilities[162]. - The actual controller of the company is under investigation for alleged contract fraud, with the case currently under review by the prosecution[163]. - The company has not experienced any non-operating fund occupation by controlling shareholders or related parties during the reporting period[156]. - The company has not engaged in any major related party transactions during the reporting period[164]. - The company has not undergone any bankruptcy reorganization during the reporting period[160]. - The company has not issued any major guarantees during the reporting period[173]. Community Engagement - The company donated 150,000 RMB to the local government for poverty alleviation and elderly welfare in Q2 2021[152].