Hyea Aromas(300886)2024-04-22 13:01Financial Performance - The company achieved operating revenue of 269.42 million yuan, an increase of 5.72% compared to the same period last year[5]. - The net profit attributable to ordinary shareholders was -3.95 million yuan, a decrease of 118.99% year-on-year[5]. - The company's operating revenue for 2023 was CNY 269,418,412.06, an increase of 5.72% compared to CNY 254,836,775.96 in 2022[25]. - The net profit attributable to shareholders for 2023 was a loss of CNY 3,945,839.45, representing a decrease of 118.99% from a profit of CNY 20,783,528.87 in 2022[25]. - The net cash flow from operating activities increased by 83.60% to CNY 39,419,395.19 in 2023, up from CNY 21,470,305.04 in 2022[25]. - The total assets at the end of 2023 were CNY 602,320,218.77, a decrease of 2.25% from CNY 616,169,061.01 at the end of 2022[25]. - The company reported a basic earnings per share of -CNY 0.0529 for 2023, down 118.97% from CNY 0.2788 in 2022[25]. - The gross profit margin for the fragrance and flavor industry was 17.03%, a decrease of 5.42% compared to the previous year[56]. - The company reported revenue of 246.41 million, 254.84 million, and 269.42 million for the years 2021, 2022, and 2023 respectively, indicating a growth trend[105]. - The net profit attributable to the parent company was 10.74 million, 14.13 million, and -7.25 million for the same years, highlighting significant volatility in performance[105]. Market and Industry Insights - The market size of the global flavor and fragrance industry in 2023 was approximately USD 30.6 billion, with a year-on-year growth of 2.3%[35]. - The Chinese flavor and fragrance industry market size in 2023 was CNY 43.9 billion, reflecting a year-on-year growth of 2.6%[35]. - The company exports over 60% of its products internationally and has established stable business relationships with renowned companies such as Firmenich and Givaudan[38]. - The company has been recognized as one of the top ten enterprises in the Chinese flavor industry for several consecutive years[38]. - The company is positioned as a vice-chairman unit of the China Flavor and Fragrance Association, indicating its significant industry influence[38]. - The company’s overseas sales accounted for 64.40% of total sales, with major markets including Singapore, the USA, the EU, Switzerland, and India[104]. - Direct export sales revenue reached 173.49 million, also representing 64.40% of total revenue, with the primary currency for transactions being USD[106]. Risks and Challenges - Major risks highlighted include fluctuations in raw material prices, market competition, and operational risks due to natural disasters[6]. - The company emphasizes the need for investors to be aware of the risks associated with future plans and forecasts[6]. - The company faces risks from increased competition in the flavor and fragrance industry, necessitating enhancements in R&D and brand recognition[101]. - The company faces risks related to market sales due to significant capacity expansion from a new project aimed at producing 3,000 tons of synthetic flavoring agents annually[103]. - Exchange rate fluctuations resulted in a foreign exchange gain of 1.19 million during the reporting period, with potential risks from further currency volatility[106]. Research and Development - The total R&D expenditure for 2023 was 14,851,731.62 yuan, accounting for 5.51% of operating revenue, down from 6.05% in 2022[67]. - The company applied for 20 new patents in 2023, including 14 invention patents, and was recognized as a national intellectual property demonstration enterprise[50]. - The company holds 33 invention patents and 37 utility model patents as of December 31, 2023, and has been recognized as a "National Intellectual Property Demonstration Enterprise" and awarded the "Anhui Province Patent Excellence Award"[44]. - The company is committed to enhancing its R&D capabilities by focusing on technology innovation and collaboration with academic institutions[96]. - The company is actively engaged in the "production, learning, and research" integration approach to continuously absorb advanced technologies domestically and internationally[40]. Production and Operations - The company achieved an actual production capacity of 5,868 tons in 2023, with a designed capacity of 6,795 tons per year and a utilization rate of 79.67%[41]. - The company is currently constructing a project with a production capacity of 3,000 tons of n-valerolactone series synthetic flavors, with parts of the production line expected to be operational in the second half of 2023[41]. - The company successfully completed the second phase of the production project for 1,200 tons of butyrolactone in Hefei, enhancing the scale advantage of its leading products[48]. - The sales volume of products increased by 16.08% compared to the previous year, with the market share of leading products further enhanced[49]. - The production volume for 2023 was 4,674,838.5 kg, which is a 6.86% increase from 2022[59]. Environmental and Sustainability Efforts - The company has been awarded the "Green Factory" title by Anhui Province in 2022 and by the national government in 2023, reflecting its commitment to environmental sustainability[45]. - The company has implemented various environmental protection laws and standards, including the Air Pollution Prevention and Control Law and the Water Pollution Prevention and Control Law[159]. - The company’s environmental protection measures include continuous monitoring and compliance with national and local emission standards[160]. - The company has successfully passed environmental assessments and acceptance checks for its operations[159]. - The company has increased its environmental protection investments and regularly pays environmental protection taxes in accordance with the law[170]. Governance and Management - The company has a robust management team with extensive industry experience, ensuring effective governance and strategic direction for long-term growth[47]. - The company has a governance structure in place with a mix of current and independent directors, ensuring compliance with regulations[118]. - The management team is actively involved in strategic planning to drive the company's growth and market expansion[118]. - The company has undergone a board and supervisory committee restructuring, reflecting its commitment to governance and strategic oversight[120]. - The company emphasizes the importance of internal control in improving management and enhancing risk prevention for sustainable development[153]. Shareholder and Investor Relations - The company plans not to distribute cash dividends, issue bonus shares, or convert reserves into share capital[7]. - The company reported a total distributable profit of CNY 194,163,434.54, with no cash dividends distributed, resulting in a cash dividend ratio of 0.00%[147]. - The company has established a stable profit distribution policy and actively returns profits to shareholders[175]. - The company maintains a 100% response rate on the "Interactive Easy" platform for investor inquiries[175]. - The company has committed to repurchasing all newly issued shares from its initial public offering (IPO) if certain conditions are met[199].