HNAC(SZ:300490)2023-08-03 16:00Key Financial Data Core Financial Indicators In Q3 2022 and year-to-date, the company's operating revenue increased, but net profit experienced significant losses, with Q3 single-quarter revenue at RMB 394.11 million, up 2.20%, while net profit attributable to shareholders was a loss of RMB 38.30 million, down 543.71%, and year-to-date revenue reached RMB 1.26 billion, up 11.54%, with net profit attributable to shareholders at a loss of RMB 65.00 million, down 306.70%, alongside a substantial deterioration in net cash flow from operating activities | Indicator | Current Period (Q3) | Year-to-Date (YTD) | YTD YoY Change | | :--- | :--- | :--- | :--- | | Operating Revenue (RMB) | 394,112,115.09 | 1,260,814,032.49 | 11.54% | | Net Profit Attributable to Shareholders (RMB) | -38,303,384.88 | -65,001,508.66 | -306.70% | | Net Profit Attributable to Shareholders (Excluding Non-Recurring Items) (RMB) | -45,358,580.66 | -76,280,785.29 | -434.72% | | Net Cash Flow from Operating Activities (RMB) | - | -579,687,763.94 | -235.32% | | Basic Earnings Per Share (RMB/share) | -0.12 | -0.20 | -266.67% | | Weighted Average Return on Net Assets | -1.57% | -2.59% | -4.38% | | Total Assets (RMB) | 5,417,476,000.24 | 5,417,476,000.24 | 6.41% (vs. end of prior year) | | Shareholders' Equity Attributable to Parent Company (RMB) | 2,431,375,782.15 | 2,431,375,782.15 | -3.87% (vs. end of prior year) | Analysis of Non-Recurring Gains and Losses During the current period, total non-recurring gains and losses amounted to RMB 7.06 million, with a year-to-date cumulative total of RMB 11.28 million, primarily comprising government subsidies, offset by losses from futures and disposal of non-current assets | Item | Current Period Amount (RMB) | Year-to-Date Amount (RMB) | Description | | :--- | :--- | :--- | :--- | | Government Subsidies | 8,983,675.04 | 15,141,585.31 | Mainly government financial subsidies | | Fair Value Changes in Financial Assets/Liabilities | -628,584.68 | -802,447.93 | Losses from futures contracts | | Gains/Losses on Disposal of Non-Current Assets | -206,940.84 | -63,935.12 | - | | Total | 7,055,195.78 | 11,279,276.63 | -- | Analysis of Significant Changes in Financial Statement Items and Reasons At the end of the reporting period, the company's asset and liability structure significantly changed, with short-term borrowings increasing by 126.50% to supplement working capital, while profit was impacted by over 30% increases in administrative, R&D, and financial expenses, coupled with substantial declines in investment income and fair value change gains, leading to a 235.32% decrease in net cash flow from operating activities due to faster growth in outflows than inflows Analysis of Balance Sheet Item Changes The period-end balance sheet indicates increased financial pressure, with short-term borrowings surging 126.50% to RMB 988.20 million, while accounts receivable, contract assets, and other non-current assets (prepaid engineering and equipment costs) all grew by over 35%, reflecting capital tied up by business expansion, and contract liabilities increased by 74.99%, indicating healthy advance receipts | Balance Sheet Item | Period-End (RMB) | Change from Beginning of Period | Primary Reason | | :--- | :--- | :--- | :--- | | Short-term Borrowings | 988,199,903.40 | 126.50% | Increase in bank working capital loans | | Contract Liabilities | 301,793,137.01 | 74.99% | Increase in advance receipts from sales contracts | | Other Current Assets | 53,367,584.25 | 58.13% | Increase in deductible input VAT | | Other Non-Current Assets | 268,930,806.62 | 45.46% | Increase in prepaid engineering and equipment costs | | Notes Receivable | 168,405,734.91 | 43.66% | Increase in commercial and bank acceptance bills received | | Contract Assets | 316,569,988.37 | 35.81% | Increase in quality assurance deposits within contract warranty periods | | Cash and Cash Equivalents | 355,353,680.89 | -31.89% | Investment in convertible bond fundraising projects and increased operating cash outflows | Analysis of Income Statement Item Changes Year-to-date, the company's expenses significantly increased, with administrative, R&D, and financial expenses growing by 34.96%, 37.01%, and 39.81% respectively, primarily due to equity incentive amortization, increased R&D investment, and higher bank loan interest, while investment income and fair value change gains (futures contract losses) sharply declined, exacerbating losses | Income Statement Item | Current Period Amount (RMB) | Change from Prior Period | Primary Reason | | :--- | :--- | :--- | :--- | | Fair Value Change Gains | -909,500.00 | -9775.53% | Decrease in fair value change gains/losses from futures contracts | | Non-Operating Income | 1,365,553.39 | 170.72% | Increase in contract penalty income | | Investment Income | -182,241.90 | -107.07% | Decrease in debt restructuring gains | | Credit Impairment Losses | -11,231,899.83 | 78.24% | Increase in impairment provisions for accounts receivable and other receivables | | Financial Expenses | 29,884,656.25 | 39.81% | Increase in bank loan interest | | R&D Expenses | 102,410,669.23 | 37.01% | Company increased R&D investment | | Administrative Expenses | 137,392,455.57 | 34.96% | Increase in equity incentive expense amortization and personnel compensation | Analysis of Cash Flow Statement Item Changes Year-to-date, net cash flow from operating activities was a RMB 580 million outflow, a 235.32% year-over-year decrease, primarily due to a faster increase in cash outflows for goods, services, and taxes (56.65%) compared to cash inflows from sales (24.78%), while net cash flow from financing activities increased by 144.83% due to reduced debt repayments | Cash Flow Statement Item | Current Period Amount (RMB) | Change from Prior Period | Primary Reason | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -579,687,763.94 | -235.32% | Growth in operating cash outflows exceeded growth in inflows | | Net Cash Flow from Financing Activities | 691,674,128.42 | 144.83% | Financing cash outflows decreased compared to the prior year | | Total Operating Cash Outflows | 1,788,900,870.59 | 56.65% | Increase in cash paid for goods, services, and various taxes | | Total Operating Cash Inflows | 1,209,213,106.65 | 24.78% | Increase in cash received from sales of goods and services | Shareholder Information Major Shareholder Holdings As of the end of the reporting period, the company had 40,221 common shareholders, with controlling shareholder Changsha Huaneng Automatic Control Group Co Ltd holding 25.68% of shares, of which approximately 78% (66,110,179 shares) are pledged, and the actual controller Huang Wenbao and his concerted parties (Wang Xiaobing, Guo Xudong) are concerted parties with the controlling shareholder - Total common shareholders at the end of the reporting period were 40,221 accounts20 - Controlling shareholder Changsha Huaneng Automatic Control Group Co Ltd holds 84,673,031 shares, accounting for 25.68% of total share capital20 - Of the shares held by the controlling shareholder, 66,110,179 shares (78.08% of its holdings) are pledged20 - The company's actual controller Huang Wenbao, along with Wang Xiaobing, Guo Xudong, and controlling shareholder Changsha Huaneng Automatic Control Group Co Ltd, are concerted parties20 Changes in Restricted Shares During the reporting period, the company's total restricted shares increased from 6,306,327 at the beginning of the period to 6,580,577 at the end, a net increase of 274,250 shares, primarily due to an increase in executive lock-up shares and equity incentive restricted shares involving multiple executives | Item | Number of Shares (shares) | | :--- | :--- | | Restricted Shares at Beginning of Period | 6,306,327 | | Restricted Shares Increased This Period | 274,250 | | Restricted Shares Released This Period | 0 | | Restricted Shares at End of Period | 6,580,577 | - Reasons for restriction primarily include executive lock-up shares and equity incentive restricted shares2324 Other Significant Matters During the reporting period, the company advanced its application for a private placement of shares, responding to the Shenzhen Stock Exchange's inquiry, and implemented the 2021 Restricted Stock Incentive Plan, completing the vesting of Class II restricted shares and the unlocking of Class I restricted shares, with all related shares now listed and tradable - The company's application for a private placement of shares has been accepted by the Shenzhen Stock Exchange, and inquiries have been responded to25 - The company processed the vesting of 1.8756 million Class II restricted shares for 275 incentive recipients, which were listed and tradable on July 22, 202225 - The company processed the unlocking of 0.18 million Class I restricted shares for 3 incentive recipients, which were listed and tradable on September 6, 202226 Quarterly Financial Statements (Unaudited) Consolidated Balance Sheet As of September 30, 2022, the company's total assets were RMB 5.42 billion, up 6.41% from the beginning of the year, total liabilities were RMB 2.90 billion, up 16.35%, and shareholders' equity attributable to the parent company was RMB 2.43 billion, down 3.87%, with asset growth driven by accounts receivable and inventory, and liability growth primarily from a significant increase in short-term borrowings | Key Balance Sheet Items | September 30, 2022 (RMB) | January 1, 2022 (RMB) | Change | | :--- | :--- | :--- | :--- | | Total Assets | 5,417,476,000.24 | 5,091,192,660.58 | +6.41% | | Total Current Assets | 3,327,374,061.04 | 3,134,666,761.69 | +6.15% | | Total Non-Current Assets | 2,090,101,939.20 | 1,956,525,898.89 | +6.83% | | Total Liabilities | 2,897,689,961.48 | 2,490,374,694.44 | +16.35% | | Short-term Borrowings | 988,199,903.40 | 436,288,616.14 | +126.50% | | Total Owners' Equity | 2,519,786,038.76 | 2,600,817,966.14 | -3.12% | | Owners' Equity Attributable to Parent Company | 2,431,375,782.15 | 2,529,153,785.08 | -3.87% | Consolidated Income Statement For the first three quarters of 2022, the company achieved operating revenue of RMB 1.26 billion, an 11.54% year-over-year increase, but due to increased operating costs (20.0% growth) and various expenses (selling, administrative, R&D), coupled with losses from investment income and fair value changes, operating profit was a RMB 91.85 million loss, resulting in a net loss attributable to parent company shareholders of RMB 65.00 million, a significant year-over-year reversal to loss | Key Income Statement Items (Year-to-Date) | Current Period Amount (RMB) | Prior Period Amount (RMB) | Change | | :--- | :--- | :--- | :--- | | Total Operating Revenue | 1,260,814,032.49 | 1,130,327,126.07 | +11.54% | | Total Operating Costs | 1,353,355,810.88 | 1,107,039,998.81 | +22.25% | | Of which: Operating Costs | 965,038,996.47 | 804,378,256.55 | +20.00% | | R&D Expenses | 102,410,669.23 | 74,745,884.45 | +37.01% | | Operating Profit | -91,852,689.48 | 27,671,582.41 | -431.9% | | Total Profit | -90,759,276.19 | 27,972,689.10 | -424.5% | | Net Profit | -79,550,494.11 | 21,637,864.86 | -467.7% | | Net Profit Attributable to Parent Company Shareholders | -65,001,508.66 | 31,447,419.52 | -306.7% | Consolidated Cash Flow Statement For the first three quarters of 2022, net cash flow from operating activities was a RMB 580 million outflow, a 235.32% year-over-year decrease, primarily due to a significant increase in cash paid for goods and services, while net cash flow from investing activities was a RMB 133 million outflow, and net cash flow from financing activities was a RMB 692 million inflow, up 144.83% due to increased borrowings and reduced debt repayments, with cash and cash equivalents at period-end totaling RMB 236 million | Key Cash Flow Statement Items (Year-to-Date) | Current Period Amount (RMB) | Prior Period Amount (RMB) | Change | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -579,687,763.94 | -172,878,140.15 | -235.32% | | Net Cash Flow from Investing Activities | -132,696,449.34 | -158,040,054.44 | +16.04% | | Net Cash Flow from Financing Activities | 691,674,128.42 | 282,515,975.01 | +144.83% | | Net Increase in Cash and Cash Equivalents | -20,628,194.99 | -48,467,918.23 | +57.44% | | Cash and Cash Equivalents at Period-End | 236,327,940.98 | 237,693,069.31 | -0.57% |