WLM(SZ:300591)2021-04-27 16:00Financial Performance - The company reported a significant loss due to the impact of the COVID-19 pandemic, with group purchase sales accounting for 76.53% of total revenue, leading to a backlog of products worth CNY 47.2158 million awaiting delivery as of December 31, 2020[5]. - The company's operating revenue for 2020 was ¥343,593,789.63, a decrease of 49.14% compared to ¥675,535,587.07 in 2019[22]. - The net profit attributable to shareholders in 2020 was -¥145,205,499.79, representing a decline of 705.05% from a profit of ¥23,998,807.09 in 2019[22]. - The net cash flow from operating activities was -¥4,495,280.53 in 2020, down 114.79% from ¥30,402,148.82 in 2019[22]. - The total assets at the end of 2020 were ¥1,053,633,083.92, a decrease of 17.10% from ¥1,270,991,770.48 at the end of 2019[22]. - The net assets attributable to shareholders decreased by 13.95% to ¥489,535,047.10 at the end of 2020 from ¥568,892,778.66 at the end of 2019[22]. - The basic earnings per share for 2020 was -¥0.4654, compared to ¥0.0769 in 2019, reflecting a decline of 705.20%[22]. - The company reported a significant increase in non-operating losses, with total non-recurring gains and losses amounting to ¥8,666,185.32 in 2020[28]. - The company has indicated uncertainty regarding its ability to continue as a going concern due to negative net profits in recent years[22]. Market Outlook - The footwear and apparel industry is expected to gradually recover as COVID-19 is effectively controlled and consumer confidence returns, indicating a positive outlook for the sector[6]. - The company is facing increasing competition in the industry, which is transitioning towards a survival of the fittest scenario[6]. - The overall industry faced intense competition, with the leather and footwear industry experiencing a 14.5% decline in operating revenue[76]. - The market for leather goods in China is expected to grow significantly as disposable income increases, providing substantial growth opportunities for the company[58]. - The company is positioned in a market where high-end products are more sensitive to economic cycles, while lower-priced products are less affected, indicating a diverse market strategy[59]. Business Strategy - The company continues to explore market expansion opportunities and new strategies to enhance its competitive position in the industry[6]. - The company plans to focus on new product development and market expansion strategies to improve future performance[22]. - The company has adopted an ODM model to produce handbags for internationally renowned enterprises and provides comprehensive e-commerce services through its subsidiary, Chaoqi Technology[32]. - The company has established a "3+N" multi-brand structure, consisting of three proprietary brands and multiple agency brands, to cater to different market segments[37]. - The company is focusing on expanding its product offerings through the ODM model, which involves developing and producing products based on specifications from foreign brand owners[51]. - The company aims to enhance brand image and service through effective marketing strategies and supply chain management[151]. - The company plans to invest in automation and smart upgrades in production to enhance efficiency and product quality[162]. Sales Channels - The company has formed five main sales channels: group purchasing, direct sales, e-commerce, wholesale agents, and ODM, driving steady revenue growth[45]. - The group purchasing business has a stable customer base, primarily in the military and state-owned enterprises, with military clients accounting for the largest share[45]. - The direct sales channel is focused on major urban centers, enhancing customer experience and brand image while expanding market share[47]. - The e-commerce channel has become a significant platform for sales, leveraging online marketplaces like Taobao, Tmall, and JD.com for product distribution[48]. - The company has established partnerships with various brands, including SUUNTO and ON, focusing on outdoor and sports products, with price ranges starting from 5000 RMB and 1400 RMB respectively[110]. Production and Inventory - The overall production capacity was affected by delayed resumption of work, resulting in a decrease in finished goods inventory compared to the previous year, which negatively impacted gross profit margins[6]. - The main raw material used in production is leather, predominantly cowhide, and the company employs an "order + forecast" procurement model for its materials[39]. - The company adopts a "order + forecast" production model, combining self-production and outsourcing to optimize capacity[42]. - The total inventory balance at the end of the period is ¥200,027,900, with a provision for inventory depreciation of ¥22,862,400[107]. - The company reported an increase in inventory in the e-commerce sector by 44.01% to 261,435 units due to the shift of sales from physical stores to online channels[92]. Research and Development - The company invested ¥3,273.86 million in R&D during the reporting period, representing 9.53% of total revenue[83]. - The company has established partnerships with universities and research institutions to enhance its R&D capabilities and accelerate the commercialization of technological innovations[83]. - The company is committed to continuous R&D investment to maintain its technological and product leadership in the industry, adapting to new customer demands[112]. - The company's R&D investment in 2020 amounted to ¥32,738,621.51, representing 9.53% of its operating revenue, a significant increase from 4.84% in 2019[114]. Risk Management - The company emphasizes the importance of risk awareness regarding forward-looking statements related to future plans and performance forecasts[7]. - The company recognizes the risk of market demand fluctuations due to economic downturns and aims to enhance brand value to mitigate these risks[174]. - The company has established a strong supplier network to mitigate risks from raw material price fluctuations[180]. - The company has implemented measures to mitigate risks from various factors, including macroeconomic conditions and supply chain dynamics, to ensure business continuity[200]. Dividend Policy - The company plans not to distribute cash dividends or issue bonus shares for the reporting period[9]. - The company has not proposed any cash dividend distribution plan despite having positive profits available for distribution to ordinary shareholders[193]. - The company plans to distribute cash dividends amounting to at least 20% of the annual distributable profits, with a cumulative distribution of no less than 30% of the average annual distributable profits over three consecutive years[196]. - The company will provide detailed explanations for any decision not to distribute cash dividends, including the reasons and intended use of retained earnings[197].