[年报]熵基科技(301330):熵基科技股份有限公司2022年年度报告（英文版）
原标题:熵基科技:熵基科技股份有限公司2022年年度报告（英文版） 2022 Annual Report Announcement No.: 2023-033 April 2023 Innovation Traversing the Cycle A Letter to Shareholders 2022 is the first year of listing of ZKTECO. We are well aware that listing is a new starting point for the development of ZKTECO, but we have been given higher expectations by our shareholders. The original intention and ideal of ZKTECO staff going public is to achieve sustainable development and become a respected innovative global enterprise in the field of "multimodal biometrics and multimodal computer vision". On behalf of the Board of Directors, I would like to express sincere gratitude to all colleagues, users, partners, especially institutional and individual investors of the Company! As of December 31, 2022, ZKTECO has nearly 4,000 global employees, including over 1,100 overseas employees, 95% of whom are local people. There are 42 branches and subsidiaries in China, covering major provinces and regions. There are 40 subsidiaries overseas, and the Company's products are sold in more than 100 countries and regions worldwide. We have established R&D centers in Bangalore, Xiamen, Dalian, and Dongguan and Shenzhen, with over 1,100 R&D personnel. We have established manufacturing centers in China and Thailand, and invested in the construction of the "American Manufacturing Factory Construction Project" in the United States. In 2022, ZKTECO achieved a consolidated operating revenue of over RMB 1.9 billion, which is basically the same as in 2021; the net profit attributable to the parent company exceeded RMB 190 million, an increase of 12.47% compared to the same period last year. In the current complex international environment and macroeconomic situation, overseas business has achieved stable growth, covering the gaps in insufficient domestic business growth and ensuring the overall business stability. Innovation Traversing the Cycle We often say that not investing in original R&D means building a house in someone else's house. No matter how big your business is, it will be someone else's sooner or later. Innovation driving is the driving force behind the development of ZKTECO. In 2022, we invested nearly RMB 190 million in R&D, accounting for 9.8% of the Company's operating revenue. ZKTECO is engaged in the core algorithm research and entrance scene empowerment, digital identity authentication, smart office and other businesses combining multimodal biometrics and computer vision. ZKTECO's technical team has developed core technical capabilities in technologies such as small data, multitasking, and multimodality after years of technical accumulation. In 2022, we combined zero sample, single sample, and small sample learning to construct a relatively unified model, and also established a multimodal artificial intelligence (AI) research and direction of "small data and multitasking". Now, I would like to report on our strengthened core capabilities and platform R&D over the past year: 1. Our technical team continues to invest in the research of multimodal hybrid biometric recognition algorithms: combining traditional pattern recognition with AI algorithms, utilizing blockchain technology to unify physical and digital iris, physical and digital fingerprint, physical and digital palm vein, physical and digital human image related physical biometric features with digital identity recognition in two dimensions, and conducting in-depth research on electronic payment hardware wallets. 2. We have made a substantial breakthrough in multimodal small sample offline computer vision. We have upgraded from the traditional biometric "Who are you?" to "I not only know who you are, but also can push services for you, interact with you according to the scene, and provide value-added services through the cool interactive experience of digital consumers." Our new generation of digital signage is about to be loaded with ZKTECO based BioCV pre AI capability, which empowers smart retail and catering scenarios. 3. In Bangalore, India and Xiamen, we have collaborated with Amazon to develop the next-generation Internet of Things (IoT) platform Minerva, which we call the Minerva Platform. With its powerful End-Edge-Cloud capabilities, it showcases excellent digital service capabilities for devices, phones, cloud services, and third-party ecosystems. ZKTECO Interconnection, ZKTECO Cloud Commerce, and ZKTECO Cloud Chain based on the IoT platform base have been launched. Adhering to Globalization Without Wavering Some people say that globalization has come to an end, but we have to say that the 2.0 version of globalization has just begun, and new opportunities for innovation/intelligent manufacturing/services to go global have arrived. Only by possessing a modern governance system, strengthening core competitiveness and comprehensive capabilities, focusing on long-term development, valuing stakeholder relationships, compliance and trustworthiness, and coordinating risk management and development can teams continue to develop under the new version of globalization. We believe that development brings challenges and challenges bring difficulties. As long as we firmly believe that human development is the development of civilization and the continuous evolution of time and space, globalization will definitely be the best choice for humanity. craftsmanship. If there is only one choice, we will choose the power of honesty, because honesty will continue to elevate our self-awareness, allowing the desire for knowledge to stimulate the humility and curiosity of ZKTECO staff, in order to drive our never-ending growth and improvement. Finally, thank all shareholders for their trust and support in the Company's management team! We will strive to achieve good results and not disappoint all investors through the integration and development of core technology innovation and main business innovation! Chairman Che Quanhong 2022 Annual Report Section I Important Notes, Contents and Definitions The Board of Directors, the Board of Supervisors, directors, supervisors, and senior management guarantee that the information presented in this report is true, accurate and complete without any false records, misleading statements or material omissions, and will undertake individual and joint legal liabilities. The Company's legal representative, Jin Hairong, the person in charge of the accounting work, Wang Youwu, and the person in charge of accounting institution (accounting supervisor), Fang Li, hereby declare that the financial information in this report is true, accuracy, and complete. All directors have attended the board meeting to review this report. The forward-looking statements regarding future plans in this annual report , which do not constitute substantial commitments of the Company to investors. Investors are advised to pay attention to investment risks. Investors are advised to refer to the full text of this annual report and pay special attention to the content of "Section III Management Discussion and Analysis XI. Prospects for the Future Development of the Company (III) Possible Risks and Countermeasures" in this annual report. The profit distribution proposal passed upon deliberation at the meeting of the Board of Directors is set out as follows: Based on the Company’s current total share capital of 148,492,051 shares, the Company proposed to distribute cash dividend of RMB 3.5 (tax inclusive) per each 10 shares to all shareholders, No bonus shares will be issued, and use capital reserve to increase 3 shares per each 10 shares to all shareholders. Table of Contents Section I Important Notes, Contents and Definitions................................................................................... 5 Section II Company Profile and Key Financial Indicators ........................................................................ 12 Section III Management Discussion and Analysis ...................................................................................... 17 Section IV Corporate Governance ............................................................................................................... 78 Section V Environmental and Social Responsibility ................................................................................ 105 Section VI Significant Events ..................................................................................................................... 109 Section VII Changes in Shares and Information about Shareholders .................................................... 135 Section VIII Information of Preferred Shares .......................................................................................... 146 Section IX Bonds.......................................................................................................................................... 147 Section X Financial Report ......................................................................................................................... 148 Documents Available for Inspection I. Financial statements affixed with official stamps and the signatures of the Company’s legal representative, the person in charge of accounting and the charge of accounting institution (accounting supervisor) of the Company. II. Original of the audit report affixed with the stamp of the accounting firm as well as stamps and signatures of the certified public accountants. III. All original copies of the Company’s documents and the original drafts of the Company’s announcements as disclosed on websites designated by the CSRC during the reporting period. IV. Other relevant documents. Place for document inspection: Office of the Company's Board of Directors Definitions
Note: If there is a discrepancy between the total count and the sum of the sub item values in any table of this annual report, it is due to rounding reasons. Section II Company Profile and Key Financial Indicators I. Company Information
Accounting firm engaged by the Company
?Applicable □ Not applicable
□ Applicable ? Not applicable V. Main Accounting Data and Financial Indicators Whether the Company performed a retroactive adjustment or restatement of the previous accounting data □ Yes ? No
negative, and the audit report in the last year shows that there is uncertainty in the Company's ability to continue as a going concern □ Yes ? No The lower of the net profit before and after deducting non-recurring profits and losses is negative □ Yes ? No VI. Main Financial Indicators by Quarter Unit: RMB
to the disclosed quarterly and semi-annual reports of the Company □ 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 in accordance with international accounting standards and Chinese accounting standards □ Applicable ? Not applicable During the reporting period, there were no differences in net profit and net assets between the financial reports disclosed in accordance with international accounting standards and Chinese accounting standards. 2. Differences in net profit and net assets in financial reports disclosed in accordance with foreign accounting standards and Chinese accounting standards □ Applicable ? Not applicable During the reporting period, there were no differences in net profit and net assets between the financial reports disclosed in accordance with foreign accounting standards and Chinese accounting standards. VIII. Items and Amounts of Non-recurring Gains and Losses ?Applicable □ Not applicable Unit: RMB
□ Applicable ? Not applicable The Company has no specific situation of other profit and loss items that meet the definition of non-recurring profits and losses. Description on defining the non-recurring profit and loss items listed in the "Explanatory Announcement for Information Disclosure by Companies that Issue Securities to the Public No. 1 - Non-recurring Profits and Losses" as recurring profit and loss items □ Applicable ? Not applicable The Company has no situation where the non-recurring profit and loss items listed in the "Explanatory Announcement for Information Disclosure by Companies that Issue Securities to the Public No. 1 - Non-recurring Profits and Losses" are defined as recurring profit and loss items. Section III Management Discussion and Analysis I. Industry situation of the Company during the reporting period (I) Basic situation of the industry of the Company The Company is an international enterprise in the field of multimodal "Computer Vision and Biometrics" (BioCV), and is a national high-tech enterprise specializing in providing smart entrance and exit management, smart identity verification, smart office products and solutions. The Company is mainly committed to integrating core biometric technologies such as fingerprints, palm veins, facial features, veins, and iris with computer vision, radio frequency, IoT, and other technologies. It provides smart terminals, industry application software, and platforms with identity recognition and verification functions to multiple fields such as commerce, transportation, finance, education, healthcare, and government affairs. Relying on the global ecosystem of R&D, manufacturing, and sales services, the Company actively deploys the field of smart retail cloud services while deeply cultivating the three major business sectors of smart entrance and exit, smart identity verification, and smart office, providing digital products and services for users in the public service field, enterprises, and personal users. The downstream end users of the Company involve numerous industries, diverse customer types and a wide range of application scenarios. Therefore, there is no obvious periodicity. (II) Industry development status of the main application areas of the products 1. Global biometric industry situation in 2022 (1) Global market overview In 2022, despite the influence of many factors such as domestic and international economic situation, Trade disputes between China and the United States, Russia-Ukraine conflict and so on, the global biometric technology application market would continue to develop at a high speed. In 2022, the global biometric market size would be USD 33.2 billion, and it is expected to reach USD 87.4 billion in 2028, with a compound annual growth rate of 17.36%. (Data source: IMARC Group) (2) Global development of biometric technology In the global biometric market structure, fingerprint recognition (58% share) and facial recognition (18% share) still dominate, followed closely by iris recognition (7% share), and vein recognition, voiceprint recognition, and signature recognition have also made some progress in market share. The multimodal biometrics driven by this has gradually become a true mainstream application due to its higher accuracy and reliability. (Data source: Chinese Academy of Industry Economy Research) The performance of hybrid biometrics in the market is outstanding, especially in member self-service scenarios such as retail, catering, and FMCG chains. Multiple retailers around the world have launched self-service retail solutions, all of which combine hybrid biometrics identification with computer vision, greatly improving customers' offline shopping experience. AI showcases its skills in smart consumption scenarios from the virtual interaction between front-end perception smart devices and brands in four dimensions of sound, text, video, and image. (3) The application situation of the global biometric industry The main application entities in the international biometric market, sorted by market size, are: government (including police), military, finance and banking, consumer electronics, health, commercial security, and logistics. The main application scenarios for global biometrics in 2022 are non-contact applications, mixed online and offline identity authentication, while others are still dominated by traditional applications, continuing the trend of application in recent years. The market acceptance of biometric technology has also greatly improved. In May 2022, a survey led by VISA showed that 86% of consumers approve of using biometric technology for identity authentication and online payments, 70% of consumers gave the reason that biometric authentication is more convenient, and 46% of consumers believe that biometric authentication is much safer than various passwords. The increase in market acceptance has laid a solid foundation for the wider application of biometric technology in the future. Multiple banks have launched biometric payment credit cards, which have performed outstandingly in the international market. In addition, due to the surging trend of digital currency, the physical offline encryption "hardware wallets" of digital currency have all used biometric technology without exception, becoming a beautiful scenery. The biometric technology develops towards diversification. According to a report by Grand View Research, a leading research organization in the United States, "Analyzing the Size, Share, and Trend of the Medical Biometric Market from the Perspective of Technology (Facial Recognition, Fingerprint Recognition, Iris Recognition, Vein Recognition) and Segmentation Prediction from 2013 to 2024". The report shows that the global medical biometric market is expected to reach USD 11.7 billion by 2024. According to CB Insights' Industry Analyst Consumer research, the global market for automotive biometric technology is expected to reach USD 303 million by 2024, with a compound annual growth rate of nearly 17%. Due to the significant differences in accuracy, security, stability, recognition speed, convenience, cost, power consumption, and other aspects among different biometric technologies, they also have their own unique characteristics and advantages and disadvantages in different application fields. We believe that the integration of （未完）  |