[年报]巨星科技(002444):2021年年度报告（英文版）
原标题:巨星科技:2021年年度报告（英文版） Hangzhou Great Star Industrial Co., Ltd The Annual Report for 2021 2022-012 April, 2022 Report
Section I Important Notes, Table of Contents and Interpretation The Board of Directors, the Board of Supervisors, and the Directors, Supervisors, and senior management of the Company guarantee the truthfulness, accuracy, and completeness of the contents of the annual report, and that there are no false records, misleading statements, or material omissions, and assume individual and joint legal responsibility. Qiu Jianping, the person in charge of the company, Ni Shuyi, the person in charge of accounting work, and Ni Shuyi, the person in charge of the accounting institution (accounting officer in charge), declare that they guarantee the truthfulness, accuracy, and completeness of the financial report in this annual report. All directors have attended the board meeting at which this report was considered. This annual report involves forward-looking statements such as future plans, which do not constitute material commitments by the Company to investors. Investors and related parties should maintain sufficient risk awareness in this regard and should understand the differences between plans, forecasts, and commitments. The Company plans not to pay cash dividends, not to grant bonus shares, and not to increase its share capital by transferring its provident fund. Table of Contents Section I Important Notes, Table of Contents and Interpretation ............................................. 5 Section II Company Profile and Key Financial Indicators ............................................................ 9 Section IIIDiscussion and Analysis by Management .................................................................... 14 Section IV Corporate Governance ................................................................................................. 75 Section V. Environmental and Social Responsibility .................................................................. 101 Section VI Important Matters ...................................................................................................... 103 Section VII. Changes in Shares and Shareholders ...................................................................... 121 Section VIII Preferred Stock Related Information ..................................................................... 130 Section IX Bond Related information .......................................................................................... 131 Section XFinancial Reports ........................................................................................................... 132 Catalog of Available Documents I. Financial statements containing the signatures and seals of the person in charge of the company, the person in charge of accounting work, and the person in charge of the accounting institution. II. The original audit report containing the seal of the accounting firm and the signature and seal of the certified public accountant. III. Original copies of all company documents and announcements that have been publicly disclosed in the newspapers designated by the CSRC during the reporting period. Hangzhou Great Star IndustrialCo., Ltd Chairman: Qiu Jianping April 11,2022 Paraphrase
Accounting firm hired by the company
√ Applicable □ Not Applicable
□ Applicable √ Not Applicable VI. Main Accounting Data and Financial Indicators Whether the company is required to retroactively adjust or restate the accounting data of previous years □ Yes √ No
negative, and the audit report for the latest year shows that there is uncertainty about the Company's ability to continue as a going concern □ Yes √ No The lower of net income before or after deducting non-recurring gains or losses is negative □ Yes √ No VII. Differences in Accounting Data under Domestic and Foreign Accounting Standards 1. Differences in net profit and net assets in financial reports disclosed simultaneously under IAS and under PRC GAAP □ Applicable √ Not Applicable There is no difference between the net profit and net assets of the company in the financial report disclosed in accordance with IAS and in accordance with PRC GAAP for the reporting period.
quarterly and semi-annual reports of the Company □ Yes √No IX. Items and Amounts of Non-recurring Gains and Losses √ Applicable □ Not Applicable Unit: Yuan
The Company does not have other details of gain or loss items that meet the definition of non-recurring gain or loss. Definition of non-recurring items of profit or loss listed in "Explanatory Announcement No. 1 on Disclosure of Information by Companies Issuing Public Securities - Non-recurring Profit or Loss" as recurring items of profit or loss □ Applicable √ Not Applicable The Company does not have any items of non-recurring gains and losses listed in the "Explanatory Announcement No. 1 on Disclosure of Information by Companies Issuing Public Securities - Non-recurring Gains and Losses" that are defined as items of recurring gains and losses. Section IIIDiscussion and Analysis by Management I. Situation of the industry in which the company operates during the reporting period The company is in the Tools & storage industry, and its main products include Hand Tools, Power Tools, Laser Measurement, and Storage, which are mainly used in the fields of household home maintenance, construction work, vehicle repair and maintenance, and map measurement and mapping. Among them, home construction and its related repair and maintenance industry is the most important application channel, which also accounts for the highest percentage. In North America and most parts of Europe, the large number of detached buildings and the large area per capita have resulted in costly and time-consuming repair and maintenance of residential houses. Due to the relatively high labor cost, residents in Europe and North America are more willing to carry out the repair and maintenance of their houses and ancillary buildings by themselves, thus giving rise to the famous DIY culture in Europe and America. At the same time, European and American families have a large number of cars, and the daily repair and maintenance of cars, including the inspection and replacement of vehicle parts, is also an important part of DIY in Europe and America. As one of the necessities for repair and maintenance, there is a large demand for professional and DIY level tools in North America and Europe, thus making North America and Europe the most important and largest market for the global tool industry. As the oldest industry, it can be said that the tool industry has developed with the birth of mankind, and has been in the process of rising in size in recent centuries as the global population continues to grow. Thanks to the characteristics of the product just demand and short replacement cycle, the industry growth rate is relatively stable, even if encountered the financial crisis in 2008, the industry can still maintain positive growth after a short period of volatility. During 2015-2019, the global tool market maintained a steady growth trend, with the market size exceeding USD 80 billion. Since the onset of the COVID-19 in 2020, the global macroeconomy has been significantly negatively impacted, with the European and North American economies experiencing a temporary decline and the global tool market experiencing brief volatility; subsequently, the European and North American economies were gradually recovered and the North American and European construction industries saw stronger growth in 2021.In 2021, the global tools market benefited from the growth of the construction industry, and industry demand was very strong, with growth reaching a new high in the past decade and exceeding $90 billion in size for the first time. According to the Frost & Sullivan report, the global tools market is expected to maintain an annual growth rate of around 5% in the next five years, driven by continued urbanization in emerging economies and economic recovery in developed countries. II. Main business of the Company during the reporting period During the reporting period, the company continued to develop its main business around the global tool consumption field, continued to increase the market share of hand tools, rapidly developed the field of laser measurement and tool cabinets, and strengthened the foundation of the power tool business development. Investment in new product development continued to increase, and non-hand tool products became the key direction of research and development.In terms of channels, in addition to continuing to maintain high double-digit revenue growth in the North American and European cross-border e-commerce direct sales channel, the company has also expanded its e-commerce direct sales channel targeting Southeast Asia and other regions; meanwhile, with the normalization of the epidemic related to Europe and North America, the local retail distribution channel has gradually recovered, which also brings new opportunities and challenges for the company's business development. 1. Hand Tools Business During the reporting period, the Company seized the strategic opportunities brought by the changes in the global hand tool market demand and supply chain pattern, and continued to increase its market share with its stable supply chain, R&D advantages and channel management capabilities. During the reporting period, the number of new products independently developed by the Company reached a record high and gradually entered more product categories. The competitive advantages of the company's products continued to be strengthened, and the output value of independently developed new products achieved growth beyond expectations. Important progress was also made in new customer development and new market expansion, and the acquisition of SK, a high-end auto repair tool brand, was completed to strengthen the company's product and brand matrix.Although the shipment volume of the Southeast Asia manufacturing base was far below expectations due to the repeated impact of the epidemic, the company ensured stable business growth by transferring orders from Southeast Asia to domestic shipments in a timely manner, while successfully completing the commissioning of the new base in Thailand and the second phase of the base in Vietnam. As a strategic focus of the company, cross-border e-commerce continued to maintain rapid growth and gradually went online the power tool product line, with revenue scale exceeding USD 100 million for the first time. In FY 2021, the sales revenue of hand tool business was RMB 6.553 billion,an increase of 14.52% year-on-year. 2. Power Tools Business During the reporting period, the company gradually restored the vacuum cleaner business based on shop-vac's original production capacity and utilized its own R&D and channel advantages, and acquired the European power nail gun BEA business to increase the power tool product line, and utilized BEA's sales network to strengthen the European sales network system and enhance the company's channel resources. For the online market, the company innovated and developed a 20V lithium battery platform, gradually launched a full range of power tool products, and achieved an important breakthrough in power tool online sales. The power tools business achieved sales revenue of 1.021 billion yuan in FY 2021, an increase of 453.77% year-on-year. 3. Laser Measurement Business During the reporting period, the company's laser measurement business, with several years of technology accumulation, gained recognition from international giants and achieved rapid growth. The smooth delivery of the company's new platform and new products for laser tools has enhanced the company's influence in the field of laser tools in North America and laid the foundation for customer diversification and business increment. Meanwhile, in response to the needs of the domestic market, the Laser Division actively adjusted its product positioning, grasped the cost performance and steadily promoted the layout of the domestic market. Special laser instruments such as LIDAR also successfully achieved mass production and use, laying the foundation for the company's new future performance growth. In FY 2021, laser measurement instruments achieved sales revenue of RMB889 million, an increase of 73.13% year-on-year. 4. Storage Cabinet Business During the reporting period, the company's storage cabinet business market share increased significantly, the original European Lista business recovered strongly, and orders in the U.S. market continued to grow; the company completed the acquisition of 100% of the shares of Kilon in July, and through the active integration of research and development, supply chain management and production capacity, etc., became the world's leading manufacturer of storage cabinets. At the same time, the company actively researches and develops and expands its storage cabinet products. In addition to the original cabinet products for garage workplace, the company also 2.Channel Advantages the giant star. The company's diversified product structure and continuous innovation ability not only can meet the one-stop purchasing needs of channel customers to the greatest extent, but also continuously save the purchasing cost and management cost of channel customers, and continuously improve the stickiness of channel customers. The company has become one of the largest suppliers of Tools and Storage to many large supermarket chains such as HOME DEPOT, WALMART, LOWES, Kingfisher, CTC, and so on, and is constantly expanding new product categories. At present, there are more than 20,000 large hardware, building materials, auto parts and other supermarket chains selling the company's various products at the same time, which effectively ensure the rapid development of the company's various innovative products.During the reporting period, the company acquired the channel resources of Joh. Friedrich Behrens AG in Europe through the acquisition of its relevant assets, enhancing the company's warehouse and logistics distribution system throughout Europe and expanding its market boundaries. These channels have effectively ensured the rapid development of the Company's various innovative products. At the same time, the company continues to make efforts in the new sales channel of cross-border e-commerce, which has become the most important sales channel for the GreatStar in addition to the traditional large supermarket chains. As an effective supplement to traditional channels, this channel not only provides a new market for the company to develop its own brand, but also allows the company to better exploit its advantages of rapid innovation, forming a product development model with positive cycle of product development - online validation - secondary development - offline pop-ups. 3. Supply Chain Advantages After decades of development, the Company has established a global supply chain management system with China as the core, and has established good cooperation with thousands of suppliers worldwide, ensuring that the company can respond quickly to market demand and complete timely delivery of various large orders without being limited to its own production capacity. Even in the face of the adverse impact of the COVID-19, as a global tool industry leader with roots in China, the Company can still maintain a stable supply capacity thanks to China's supply chain system, which is the most complete in the world in terms of basic categories, laying the foundation for the company to continue to boost its market share. At the same time, the efficiency and flexibility brought by China's large volume and ultra-detailed supply chain network also allows the company to centralize procurement in China and distribute it globally, which greatly reduces the comprehensive procurement cost and enhances the market competitiveness of the company's products. At present, the company has 21 manufacturing bases around the world, which can fully meet various demands and cope with the complex external environment of each. 4. Brand Advantages The company's main products are durable consumer goods for families and industrial-grade products for professionals, while the brand is the most effective guarantee for the company to provide products and services to consumers in the long term, so the company has long been committed to the creation and development of its own brand. During the reporting period, the company continued to improve its own brand matrix and strengthen the advantages of its own brands. Undertook the professional-grade power fastening tool brand BeA by acquiring the related assets of Joh. Friedrich Behrens AG and completed the acquisition of high-end auto repair tool brand SK. Own brands, especially e-commerce brands, continued to grow, with sales revenue of WORKPRO, PONY JORGENSE, DURATECH, SWISSTECH and other brands increasing significantly year-on-year and sales revenue of own brands reaching RMB 3.8 billion for the first time. Brand advantages not only further enhance the international competitiveness of the company's products, but also effectively improve the company's gross profit margin and business stability, providing assurance for the long-term healthy development of the company. 5. International Advantages During the reporting period, the domestic and international economic situation was complicated. As a company with international development layout, the company made full use of the manufacturing capacity and sales market in different regions of the world to actively cope with the risks and look for opportunities. During the reporting period, the company continued to improve its global manufacturing division of labor. Facing the background of the New Crown epidemic affecting the production capacity of the Southeast Asian manufacturing base, the company actively promoted the production of the Southeast Asian manufacturing base as soon as possible and transferred some orders to domestic production and delivery in a timely manner, fully same time, in the face of the stagnant international staff flow, the company actively takes advantage of the local team in Europe and the United States to continue to provide customers with a perfect service system in the vicinity, ensuring the mutual matching of orders and after-sales service. The internationalization advantage effectively ensures that the company is able to compete with other international competitors by leveraging the advantages of China's manufacturing clusters while taking advantage of manufacturing costs in Southeast Asia and local channel services in the European and American markets, thereby building stronger core competitiveness. The company is accelerating to become a global resource allocation company integrating local services in Europe and America, manufacturing in Asian industry chain and management R&D in China. IV. Main Business Analysis 1. Overview In 2021, the global economy produced many profound changes and continued turbulence against the backdrop of the ongoing and repeated outbreak of COVID-19 continuing to increase its unprecedented impact on the world and increasing international frictions, and the global tool market continued to see a number of changes in the demand and supply chain landscape that favored the Company's long-term competitiveness, which mainly include the following aspects. Due to the strong growth of China's economy and excellent control of the epidemic, the value of the RMB continued to rise relative to the currencies of other major economies, objectively causing a reduction in RMB revenue for Chinese foreign exporters.The U.S. real estate market continues to remain buoyant and prosperous, bringing a steady upswing in demand for various tools. Since the second quarter, the prices of raw materials and commodities have been rising, global freight rates have been increasing and international logistics capacity has been tight, which has had a significant negative impact on the company's profitability but has highlighted the advantages of the company's global layout and has continued to gain market share. Although some international small and medium-sized tooling companies relied on the market boom to obtain orders, due to the cost rise much faster than the rise in revenue, resulting in a continuous deterioration of cash flow, following the early 2020, the second half of 2021 saw a wave of bankruptcy, the industry further got clear. Under these profound changes, the Company continued to gain market share by virtue of its comprehensive competitiveness, and its annual operating revenue achieved more than expected growth, while net profit was basically the same as the same period last year due to three negative factors: RMB exchange rate, raw material price and international shipping cost. During the reporting period, the company achieved total operating revenue of 10.920 billion yuan, an increase of 27.80% year-on-year, and net profit attributable to shareholders of the listed company was 1.270 billion yuan, a decrease of 5.93% year-on-year. The performance of each business segment is as follows: 1. Hand Tools Business During the reporting period, the Company seized the opportunity of rising demand but continuous supply voidance in the industry, gave full play to its advantages in innovation, supply chain, brand, channel and internationalization, accelerated product innovation and category expansion, and continued to invest in cross-border e-commerce business and private brand construction, achieving further increase in market share. During the reporting period, on the basis of the rapid growth of the existing business, the Company made a breakthrough in the expansion of innovative products and new categories, and obtained a large number of large orders for garden hand tools and outdoor products, and the sales and share of core customers also continued to increase, further deepening the partnership.The company's own brand sales hit a new record high, and acquired SK, a professional-level auto repair tool brand, and continued to improve the professional-level tool brand matrix.The company's cross-border e-commerce business maintained rapid development, and continued to carry out social media promotion of brand sponsorship and public welfare activities, maintaining high growth in brand exposure and crowd reach, and increasing online brand awareness.The company also pushed forward the layout of globalization platform, and the number of inbound platforms and new stores continued to grow. With the continuous improvement of the company's own brand matrix and the continuous growth of cross-border e-commerce business, the company's own brand sales exceeded RMB 3.8 billion for the first time, an increase of 46.06% year-on-year. Against the backdrop of sluggish global capacity additions, the company continued to promote global capacity layout, basically completed the first round of capacity layout in Southeast Asia, and acquired capacity in China and Europe through acquisitions.Finally, the company's R&D expenditure continued to reach a record high, which strongly supported the construction of the company's own brand and the acquisition of market share. The hand tool business achieved sales revenue of RMB 6.553 billion for the year, an increase of 14.52% year-on-year. 2. Power Tools Business During the reporting period, the company re-invested in the development of power tools product line, synchronized the online and offline layout, accelerated the product innovation and channel expansion of power tools with electric vacuum cleaners and power nail guns as the core products, and launched a new 20V platform with a full range of lithium battery power tools product line. The company completed the layout and optimization of electric vacuum cleaner production capacity at the beginning of the year and resumed sales in North America in the second half of the year, and quickly resumed production capacity and orders for power nail guns in Europe after completing the acquisition of BeA's assets in June, laying a good foundation for the company's power tool business. At the same time, we launched a full range of power tool products online, and achieved good reputation in the market, especially the new lithium battery products once out of stock. As the first booming year of the company's power tools in 2021, the sales revenue of power tools business was 1.021 billion yuan, an increase of 453.77% year-on-year. 3. Laser Measurement Business During the reporting period, the company continued to promote product development, mass production and delivery for key customers, made breakthroughs in new products and channel expansion, obtained exclusive long-term orders from important customers, and gradually established the international market influence of the company's laser tools. For the domestic market, the company readjusted its brand, product positioning and business direction, innovated specific products and achieved good growth. LIDAR products continued to go to market and customized products continued to be landed, with deliveries increasing by more than 100% year-on-year. The annual sales revenue of laser measuring instrument business was RMB889 million, an increase of 73.13% year-on-year. 4. Storage Cabinet Business During the reporting period, the European market recovered well and LISTA business returned to growth, with annual revenue growth of more than 30%. Important progress was made in the expansion of new categories and channels in the U.S. market, and the order volume continued to increase. After completing the acquisition of Keelong, the company and Keelong carried out full integration in the existing business. Although Keelong suffered certain losses in the second half of the year due to raw material prices and freight costs, the company actively optimized costs and believes it will achieve better growth in the new year. At the same time, the company's Thailand box and cabinet production base was fully put into operation, laying the foundation of production capacity for growth in FY22. The annual storage container business achieved sales revenue of 2.371 billion yuan, an increase of 152.36% year-on-year.
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