SVG(SZ:300331)2022-04-26 16:00Financial Performance - The company achieved operating revenue of 1,736.79 million yuan in 2021, an increase of 24.74% compared to the previous year[4] - The operating profit was -376.91 million yuan, a decline of 792.49% year-on-year, while the net profit attributable to shareholders was -349.63 million yuan, down 761.95%[4] - The decline in performance was primarily due to a significant drop in sales of high-margin products, particularly micro-prism reflective materials, affected by rising commodity prices and project delays caused by the pandemic[4] - The parent company reported a net profit of -134.17 million yuan, a year-on-year decrease of 445.91%, mainly due to underperformance of the subsidiary Huarisheng[5] - The company made a substantial impairment provision of 309.62 million yuan for goodwill based on Huarisheng's revenue and profit situation[4] - The net profit attributable to shareholders was -¥349,626,181.80, a decrease of 761.95% from ¥52,817,506.16 in the previous year[20] - The net profit attributable to shareholders after deducting non-recurring gains and losses was -¥380,039,999.21, a decline of 4,038.44% compared to ¥9,649,500.81 in 2020[20] - The net cash flow from operating activities was ¥10,914,216.81, down 77.70% from ¥48,942,107.60 in the previous year[20] - The total assets at the end of 2021 were ¥3,591,159,026.01, an increase of 16.46% from ¥3,083,562,965.19 at the end of 2020[20] - The net assets attributable to shareholders increased by 28.55% to ¥1,997,522,482.62 from ¥1,553,864,246.08 in 2020[20] - The basic earnings per share for 2021 was -¥1.4396, a decrease of 716.00% from ¥0.2337 in 2020[20] - The company reported a quarterly operating revenue of ¥558,749,396.71 in Q4 2021, the highest among the four quarters[23] - The company experienced a significant decline in net profit in Q4 2021, reporting -¥402,179,199.12 attributable to shareholders[23] - The weighted average return on net assets was -20.47% in 2021, a decrease of 23.92% from 3.45% in 2020[20] - The company reported a government subsidy of ¥30,042,019.72 in 2021, an increase of 41.3% from ¥21,259,137.89 in 2020[26] Subsidiary Performance - The subsidiary Weiwang Technology's light guide material business grew by 59.13% in revenue, but profit growth was only 33.14% due to rising raw material costs[5] - The company’s subsidiary, Weiwang Technology, has seen rapid revenue growth and increased market share in the light guide materials sector, with a 10%-20% improvement in light efficiency for LCD backlight modules[35] - The company’s subsidiary, Weiyida, achieved revenue of 106.96 million CNY, a year-on-year increase of 61.25%[65] - Changzhou Huari Sheng Reflective Materials reported a revenue of 353.95 million yuan but faced a net loss of 72.14 million yuan[137] - Suzhou Weiyeda Touch Technology reported a revenue of 106.96 million yuan but incurred a net loss of 33.34 million yuan[134] - Jiangsu Weige New Materials Technology generated a revenue of 149.93 million yuan with a net profit of 20.73 million yuan[135] - Suzhou Maita Optoelectronics had a revenue of 18.99 million yuan with a net loss of 9.87 million yuan[138] Product Development and Innovation - The company has made breakthroughs in consumer electronics businesses such as light guide plates and conductive films, with ongoing developments detailed in the report[5] - The company has developed an environmentally friendly 3D transfer material for packaging, which is biodegradable and has a surface structure depth of up to 50 microns[34] - The company’s new optical printing materials are primarily used in the packaging of tobacco and cosmetics, with stable demand driven by the growth of the consumer goods market[34] - The company is actively expanding into the large-size touch device market, with its flexible touch products gaining recognition from major brands like Hisense and BOE[36] - The company is focusing on technological innovation to meet downstream market demands, launching products in public safety materials and new printing materials[32] - The company has invested in a micro-nano optical light guide plate industrialization project, which has broken previous capacity bottlenecks and supports ongoing revenue growth[35] - The company aims to focus on innovation and has developed a core equipment for the micro-nano manufacturing industry, namely the lithography machine[140] - The company plans to explore applications of micro-nano structured products in new fields, including large-size flexible displays and augmented/virtual reality[140] Market and Competitive Position - The company is the sole designated supplier of anti-counterfeiting films for driving licenses and vehicle registration certificates in China, with an annual demand exceeding 100 million units[33] - The company has established four major business segments: public safety and new printing materials, consumer electronics new materials, reflective materials, and high-end intelligent equipment, leveraging strong R&D capabilities[40] - The company has established business relationships with major panel manufacturers, including Microsoft and Huawei, enhancing its market presence in the new display optical materials sector[82] - The company plans to strengthen marketing efforts for micro-prism products and aims to break the monopoly of foreign companies in the reflective materials market[81] - The company is committed to becoming a leading domestic and internationally renowned manufacturer of micro-nano functional devices and high-end intelligent equipment[140] Financial Management and Governance - The board approved a profit distribution plan with no cash dividends or bonus shares, and no capital reserve conversion to shares[6] - The company highlighted potential risks in its future operations and outlined corresponding countermeasures in the management discussion section[6] - The company emphasizes that any forward-looking statements regarding future plans and performance forecasts do not constitute commitments to investors[5] - The company has implemented various governance structures and internal controls to ensure compliance with legal and regulatory requirements[154] - The board of directors has established specialized committees to oversee strategic, audit, and compensation matters, ensuring effective governance[155] - The company maintains independence from its controlling shareholder in terms of operations, assets, and finances, ensuring autonomous business capabilities[156] - The company has a structured remuneration decision-making process based on performance evaluations and profitability[170] - The total remuneration paid to directors, supervisors, and senior management in 2021 amounted to CNY 2.8094 million[170] Risks and Challenges - The company acknowledges risks from macroeconomic changes and COVID-19, and will adjust operations accordingly while seizing opportunities in remote work and infrastructure markets[147] - The company faces management risks due to rapid expansion and acquisitions, necessitating improved operational management and market development strategies[147] - Financial risks are present due to significant debt levels, with funding for projects relying on debt financing, necessitating careful financial planning[149] - The company is exposed to foreign exchange risks as export transactions are primarily settled in USD, which could adversely affect profits if the RMB depreciates significantly[149] - Increased environmental protection expenditures are anticipated due to stricter regulations, which may also present new market opportunities[150] Employee and Organizational Structure - The total number of employees at the end of the reporting period was 2,773, with 306 in the parent company and 2,467 in major subsidiaries[183] - The professional composition includes 2,071 production personnel, 112 sales personnel, 416 technical personnel, 41 financial personnel, and 133 administrative personnel[183] - The educational background of employees shows 15 with doctoral degrees, 63 with master's degrees, 316 with bachelor's degrees, and 2,379 with associate degrees or other qualifications[183] - The company adheres to a performance-based salary distribution mechanism, which includes basic salary, performance salary, and position salary for certain roles[184] - The company complies with national laws and regulations regarding social insurance and housing provident fund contributions for employees[185] Internal Control and Audit - The internal control self-evaluation report was fully disclosed on April 27, 2022[200] - Major defects in internal control are identified if they significantly reduce work efficiency or increase uncertainty[200] - The audit committee and internal audit's supervision of internal controls were found to be ineffective[200] - The company has not rectified major defects in internal control within a reasonable timeframe[200] - The report indicates that there are other internal control deficiencies beyond major and important defects[200]