TINGYI(HK:00322)2023-03-27 08:36Financial Performance - Revenue for 2022 reached RMB 78,717,420 thousand, an increase of 6.26% compared to RMB 74,082,292 thousand in 2021[2] - Gross profit margin decreased to 29.09%, down by 1.30 percentage points from 30.39% in 2021[2] - EBITDA for 2022 was RMB 7,209,990 thousand, reflecting a decline of 14.07% from RMB 8,390,312 thousand in 2021[2] - Net profit for the year was RMB 3,075,834 thousand, a decrease of 29.83% compared to RMB 4,383,667 thousand in 2021[2] - Basic earnings per share fell to RMB 46.73, down by 20.84 cents from RMB 67.57 in 2021[2] - Total profit before tax for 2022 was RMB 4,148,804 thousand, compared to RMB 5,808,643 thousand in 2021, indicating a decrease of about 28.5%[17][18] - The net profit for 2022 was RMB 3,075,834 thousand, down from RMB 4,383,667 thousand in 2021, reflecting a decline of approximately 29.8%[17][18] - Interest income for 2022 was RMB 650,412 thousand, down from RMB 783,501 thousand in 2021, indicating a decrease of about 16.9%[21] - The company reported other income of RMB 874,820 thousand in 2022, compared to RMB 1,024,195 thousand in 2021, reflecting a decline of approximately 14.6%[21] - The financial expenses for 2022 totaled RMB 446,021 thousand, significantly higher than RMB 223,494 thousand in 2021, marking an increase of about 99.9%[22] - The income tax expense for 2022 was RMB 966,194 thousand, down from RMB 1,294,663 thousand in 2021, indicating a decrease of approximately 25.3%[23] Assets and Liabilities - Total assets decreased to RMB 58,449,306 thousand in 2022 from RMB 60,309,223 thousand in 2021[6] - Long-term interest-bearing loans increased to 8,415,871 from 6,350,369, representing a growth of approximately 32.5%[8] - Total liabilities rose to 41,633,831 from 37,900,723, marking an increase of about 7.7%[9] - Net current liabilities worsened to (7,677,469) from (4,158,264), indicating a decline in liquidity[9] - Total assets minus current liabilities decreased to 26,744,768 from 30,484,218, a drop of around 12.2%[9] - The company reported a significant increase in accounts payable, rising to 9,489,908 from 9,046,518, which is an increase of about 4.9%[9] - Accounts receivable decreased from RMB 2.044 billion in 2021 to RMB 1.808 billion in 2022[30] - The company's lease liabilities decreased to 145,448 from 195,519, reflecting a reduction of approximately 25.6%[8] - Deferred tax liabilities decreased to 1,298,948 from 1,449,910, a decline of about 10.4%[8] - The total assets and total liabilities of the group as of December 31, 2022, were RMB 58.449 billion and RMB 41.634 billion, respectively, with a debt ratio of 71.23%, an increase of 8.39 percentage points from the previous year[45][46] Business Strategy and Market Position - The company emphasized sustainable development and digital transformation initiatives in response to national carbon reduction policies[3] - The board expressed confidence in addressing market challenges in 2023 following the easing of pandemic controls[3] - The company is committed to optimizing its product mix and launching healthier options in line with consumer trends[3] - The company plans to continue its strategy of "consolidation, innovation, and development" to strengthen its core business and expand its product offerings in the instant noodle and beverage sectors[50] - The group aims to enhance its online and offline channel collaboration, focusing on traditional e-commerce and community group buying to meet diverse consumer needs[50] - The company is actively pursuing a reasonable pricing strategy and expanding consumer purchasing channels to adapt to market demands[39] - The company has established partnerships with 45 universities and 70 vocational schools to enhance talent cultivation and recruitment efforts[47] Product Performance - Instant noodle revenue grew by 4.17% to RMB 29.634 billion, accounting for 37.65% of total revenue[35] - Beverage revenue rose by 7.89% compared to the previous year[34] - The beverage segment achieved total revenue of RMB 48.336 billion in 2022, representing a year-on-year growth of 7.89%, accounting for 61.40% of the group's total revenue[39] - The gross profit margin for the beverage segment decreased by 1.88 percentage points year-on-year to 31.95% due to rising raw material prices and changes in product mix[39] - The net profit attributable to shareholders for the beverage segment fell by 25.00% year-on-year to RMB 1.378 billion[39] - The company launched new flavors such as "Ice Sugar Red Grapefruit" and "Ice Sugar Snow Pear" to enhance its juice product line, focusing on both traditional and modern consumption scenarios[42] - The instant tea segment introduced new products and collaborated with popular brand ambassadors to strengthen its brand image among younger consumers[40] - The carbonated beverage segment continued to innovate with new flavors and packaging, including the launch of "bubly" with new apple and strawberry flavors[41] - The instant noodle segment maintained strong sales growth by introducing new flavors and leveraging brand ambassadors to engage with younger demographics[36] Corporate Governance and Compliance - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange rules, with exceptions noted in sections B.2.2 and B.2.4[52] - All three independent non-executive directors have served on the board for over nine years, with tenures of 22 years, 18 years, and 11 years respectively, but the board believes their long service does not impair their independence[54] - The company has established a risk management framework based on the COSO model, focusing on risk assessment and internal controls to ensure operational efficiency and asset security[58] - The audit committee, consisting of three independent non-executive directors, recently reviewed the group's performance for the fiscal year 2022[57] - The company is committed to regularly reviewing and enhancing its corporate governance practices in line with the latest developments[55] - The company has confirmed that there are no significant uncertainties affecting its ability to continue as a going concern[55] - The company has implemented a rigorous self-assessment system for internal controls, with no significant deficiencies reported by the internal audit department[59] - The company has adopted the standard code for securities transactions by directors, confirming compliance during the review period[60] Shareholder Information - The company proposed a final dividend of RMB 0.2336 per ordinary share and a special final dividend of RMB 0.2336 per ordinary share for the year ended December 31, 2022, pending approval at the annual general meeting[69] - The dividend payments are expected to be made around July 12, 2023, subject to shareholder approval[69] - The company will suspend share registration from May 31 to June 5, 2023, to determine the list of shareholders eligible to attend the annual general meeting[69] - Shareholders must submit transfer documents by 4:30 PM on May 30, 2023, to ensure their right to attend the meeting[69] - The company will also suspend share registration from June 9 to June 13, 2023, to determine the list of shareholders eligible to receive dividends[69] - Shareholders must submit transfer documents by 4:30 PM on June 8, 2023, to ensure their right to receive dividends[69] Employee and Talent Development - The group had 64,302 employees as of December 31, 2022, and is investing in talent development and digital transformation[47] - The company continues to focus on employee stock options as part of its compensation strategy, with significant numbers of options still available for future exercise[67] - The average closing price of shares prior to the exercise of options indicates a potential gain for employees exercising their options[65] - The company maintains a robust stock option plan to incentivize employees and align their interests with shareholders[66] - The overall performance of the stock options reflects the company's strategic approach to employee compensation and retention[67]