[中报]东方精工(002611):2023年半年度报告（英文）
原标题:东方精工:2023年半年度报告（英文） 【Date of Disclosure】26 July 2023 Part I Important Notes, Table of Contents and Definitions The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors, supervisors and senior management of Guangdong Dongfang Precision Science & Technology Co., Ltd. (hereinafter referred to as the “Company”) hereby guarantee that the contents of this Report are true, accurate and complete and free of any misrepresentations, misleading statements, or material omissions, and collectively and individually accept legal responsibility for such contents. Tang Zhuolin, the Company’s legal representative, Shao Yongfeng, the Company’s Chief Financial Officer, and Yao Bin, the Head of the Company’s Accounting Department (equivalent to Financial Manager) hereby guarantee that the financial statements carried in this Report are truthful, accurate and complete. All directors of the Company attended in person the board meeting for the approval of this Report. For possible risks with respect to the Company, please refer to “X Risks Faced by the Company and Countermeasures” of “Part III Management Discussion and Analysis” herein. And investors are kindly advised to read through the aforesaid contents. The Company has no semi-annual dividend plan, either in the form of cash or stock. This Report has been prepared in Chinese and translated into English. Should there be any discrepancies or misunderstandings between the two versions, the Chinese version shall prevail. Table of Contents Part I Important Notes, Table of Contents and Definitions ........................................................... 2 Part II Corporate Information and Key Financial Information ................................................... 7 Part III Management Discussion and Analysis ............................................................................. 10 Part IV Corporate Governance ...................................................................................................... 67 Part V Environmental and Social Responsibilities ....................................................................... 70 Part VI Significant Events ............................................................................................................... 72 Part VII Share Changes and Shareholder Information ............................................................... 78 Part VIII Preference Shares ............................................................................................................ 86 Part IX Corporate Bonds ................................................................................................................ 87 Part X Corporate Financial Statements ......................................................................................... 88 Documents Available for Reference 1. The financial statements signed and sealed by the Company’s legal representative, Chief Financial Officer, and the person-in-charge of the financial organ. 2. All the originals of the Company’s announcements and documents that were disclosed to the public during the Reporting Period on the media designated by the CSRC for information disclosure. 3. The 2023 Semi-Annual Report carrying the signature of the legal representative. 4. The documents above are lodged in the Securities Department of the Company, 18A, China Merchants Plaza, 1166 Wanghai Road, Shekou, Shuiwan Community, Zhaoshang Street, Nanshan District, Shenzhen City, Guangdong Province, China. Definitions
Part II Corporate Information and Key Financial Information I Corporate Information
1. Contact information of the company Whether the company's registered address, company office address and its postal code, company website and e-mail address have changed during the reporting period. □ Applicable ? Not applicable The company's registered address, company office address and its postal code, the company's website and e-mail address remain unchanged during the reporting period, which can be found in the 2022 Annual report. 2. Information disclosure and location. Whether the information disclosure and location have changed during the reporting period. □ Applicable ? Not applicable The name of the information disclosure newspaper selected by the company, the URL of the website designated by the CSRC that publishes the semi-annual report, and the location where the semi-annual report lodges remain unchanged during the reporting period, which can be found in the 2022 Annual report. 3. Other relevant information □ Applicable √ Not applicable IV Key Financial Information Indicate whether there is any retrospectively restated datum in the table below. □ Yes √ No
1. Net Profit and Equity under CAS and IFRS □ Applicable ? Not applicable No difference for the Reporting Period. 2. Net Profit and Equity under CAS and Foreign Accounting Standards □ Applicable ? Not applicable No difference for the Reporting Period. VI Exceptional Gains and Losses ? Applicable □ Not applicable Unit: RMB yuan
Details of other profit and loss items that meet the definition of non-recurring profit or loss. □ Applicable ? Not applicable No such cases in the Reporting Period. Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss Items: □ Applicable ? Not applicable No such cases in the Reporting Period.
(II) Industry overview 1. Industry of the smart corrugated packaging equipment and digital printer business (1) Demand side: The downstream industry of the Company’s core business, “smart corrugated packaging equipment”, is the corrugated packaging industry, and the main customers include cardboard plants, box plants, and other business- end (B-end) customers. As a machinery supplier, the Company provides various single machine and complete production line products for cardboard and box production and manufacturing, which is relevant to the development of the downstream paper packaging industry. The corrugated box field is one of the major fields of the paper packaging industry, of which the terminal demand is relevant to the prosperity of consumption and business activities. Corrugated packaging products are used in a vast number of fields, including food and beverage, household chemicals, e-commerce, and express, and are inelastically demanded by consumers. Concerning the growth rate of demand in these fields for corrugated packaging, the express and logistics field has grown rapidly, with its share in the total downstream corrugated box share continuously increasing between 2017 and 2021. Between 2017 and 2021, the domestic express business recorded rapid growth, with a compound annual growth rate (CAGR) of approximately 28%. Despite a slight drop in growth in 2022, the volume of express business across China still maintained growth. By estimation, with the recovery of GDP growth in 2023, the growth of the volume of express business is expected to get back onto the rapid growth track. This will boost the development of the corrugated packaging industry. Movements in the Business Volume of Express Enterprises above the Designated Size in China between 2016 and 2022
in July 2023, the express delivery industry maintained a stable foundation and steady growth in the first half of 2023, demonstrating strong resilience and good potential. Express delivery volume exceeded 60 billion pieces in the first half, up over 17% YoY. Online promotions were frequent during multiple holidays in the first half, especially during the "618" online shopping festival, with daily collection volume exceeding 400 million pieces each day from 16-20 June. In the second half, the industry is still expected to grow as new infrastructure operates normally and the expansion of networks to rural areas accelerates. The steady growth of the express delivery industry continues to have a positive impact on the domestic corrugated packaging industry. The terminal market demand is constantly unleashed, increasing the demand for the expansion of the industry’s capacity: Over the past few years, the scale of China’s express corrugated packaging market has been on the rise. According to the data released by the China Paper Association, the express corrugated packaging market is continuously scaled up in China. By the forecast of Qianzhan Industry Research Institute, the scale of China’s express corrugated packaging market will continue to rise in the upcoming years and is estimated to reach RMB86.4 billion by 2025 (CAGR for 2019 to 2025: Approximately 15%). Terminal markets, including the express, electronics, and household chemicals terminal markets, show an increasing demand for corrugated box and board packaging, which will drive the expansion of the capacity of corrugated packaging enterprises and thus increase the demand for corrugated packaging machinery, benefiting the machinery manufacturers. Robust overseas demand: In recent years, corrugated packaging markets in Europe and the US have operated at high levels due to factors like global supply chain restructuring, onshoring of manufacturing in Europe and the US, and increased overseas consumer online spending. Based on financial analysis of major listed corrugated packaging companies in Europe and the US, Capex expenditures (including equipment, land, factories, etc.) of major corrugated packaging companies hit record highs in absolute terms in 2022. According to China Customs statistics, China's exports of printing equipment totalled USD3.109 billion in 2022, up 8% YoY, of which printer exports were USD1.873 billion, up 16% YoY. From January to March 2023, China's printing equipment exports were USD734 million, up 10% over the same period in 2022, of which printer exports were USD441 million, up 13% YoY. In recent years when environmental pollution becomes more and more serious, growing environmental awareness has led to “plastic bans and restrictions” across the world, providing a major boost to paper as an alternative to plastic. England announced a ban on single-use plastics starting October 2023, covering items like disposable plastic plates, trays, bowls and utensils. France is phasing in bans on single-use plastic packaging for around 30 fruits and vegetables starting January 2022. The U.S. Department of the Interior announced that single- use plastics will be gradually phased out in national parks and other public lands by 2032. The global green packaging market is projected to grow from USD262.27 billion in 2023 to USD381.98 billion in 2028, with a compound annual growth rate of 7.81% during the forecast period (2023-2028). Phase and clear out machinery with backward capacity and continue to upgrade machinery: China’s paper packaging industry market shows a low concentration degree. In 2021, the CR5 of paper packaging enterprises above the designated size was only 14%. Additionally, the industry has a number of low-end small and medium box plants, presenting a highly decentralized competitive landscape. With the brand-based development and upgrading of the downstream terminal consumer industry, the requirements of corporate customers for corrugated boxes gradually increase. Concurrently, the supply-side upgrading of the industry is an inevitable trend, and the industry will boost its concentration through market competition, capacity upgrading, and M&A. This trend will boost the upgrading and iteration of technologies and machinery and accelerate industry integration. Additionally, it is estimated that the line machinery that is more intelligent and productive will replace the existing corrugated cardboard production lines and corrugated box printing and packaging production line equipment in the upcoming five to ten years. By statistics, there are over 6,000 existing corrugated cardboard production lines in the domestic market, and more corrugated box printing and packaging machinery, which will be replaced by more intelligent ones with higher production efficiency in the next five to ten years. Data show that the domestic market share of the 15 listed corrugated packaging companies in China combined has risen from 5.7% in 2017 to 10.1% in 2022, indicating the continued concentration of the domestic corrugated packaging industry and the steadily increasing market share of major manufacturers. In 2022, the new additions to the domestic corrugated and liner board capacity were 5.24 million tonnes, and the phased-out capacity was 1.84 million tonnes, resulting in a net new capacity of 3.4 million tonnes. Digital and intelligent upgrading of the paper packaging and printing industry bring new development opportunities: The traditional production mode has caused domestic paper packaging and printing enterprises to be overly dependent on skilled technicians at critical positions and slow to identify the outdated management mode. The “strategy of robot assembling line” and “smart factory” are increasingly recognized by the industry. Amid intelligent manufacturing, the paper packaging and printing industry will usher in industrial upgrading and transformation. Additionally, leading packaging enterprises, including Xiamen Hexing Packaging Printing Co., Ltd. (HXPP), MYS Group Co. Ltd. (MYS), Shenzhen YUTO Packaging Technology Co., Ltd., and Shenzhen Jinjia Group Co., Ltd., have pushed ahead with Internet-based development in recent years by entering into intelligent manufacturing, cloud printing, or other markets, expected to launch a revolution in the Internet-based development of the paper packaging and printing industry and injecting new impetus into industry integration. Concurrently, amid intelligent manufacturing and Internet-based packaging, leading enterprises engaged in corrugated packaging machinery are also expected to embrace new development opportunities. By estimate, the scale of the global corrugated packaging machinery market is approximately RMB30 to 40 billion. (2) Supply side: A. World-leading comprehensive strength Corrugated cardboard production lines: Major manufacturers of corrugated cardboard production lines around the world include Fosber Group, BHS (Germany), Marquip (a wholly-owned subsidiary of the American Barry- Wehmiller), and J.S. Machine. Among them, Fosber Group and its major rival from Germany, BHS, lead the others and are leaders in the global middle- and high-end corrugated cardboard production line field. Fosber Group holds approximately 30% of the global middle- and high-end corrugated cardboard production line market and more than 50% of the North American market. Corrugated rollers, key components of corrugated cardboard production lines: The subsidiary Tiru?a Group is a time-honoured and prestigious corrugated roller supplier, specializing in the production of corrugated rollers and pressure rollers for industrial corrugated cardboards. It leads the global market. Corrugated box printing and packaging production line equipment: Major manufacturers in this field include Dongfang Precision, Bobst (Switzerland), Gopfert (Germany), Ward (a wholly-owned subsidiary of the American Barry-Wehmiller), Ding Long (Shanghai), and Guangzhou Keshenglong. Dongfang Precision is an industry leader in China and is competitive with the global industry leader, Bobst, from Switzerland. With an advantage in global resource coordination, leading design concept, excellent overall R&D strength, and a product system featuring complete categories and rich specifications, the Company can produce products that meet dozens of specifications and different market positioning, covering fixed/open-close type, top printing/bottom printing, and complete production line (inline) products/single machine, and has the completest product lines and richest product base of the corrugated box printing and packaging production line equipment worldwide. Digital printing: Major manufacturers include Wonder Digital, Hanway (China), Atexco, HP (the US), and EFI (the US). The subsidiary, Wonder Digital, takes the lead among global suppliers of digital printing solutions in applying high-speed inkjet printing technology to corrugated packaging and is committed to extending digital printing technology to such fields as home building materials, label printing, and advertising. Digital printers under the brand Wonder has been sold at home and abroad since Wonder Digital was established in 2011. Statistically, more than 1,400 pieces of machinery have been sold to over 80 countries around the world. In conclusion, Dongfang Precision leads the world in terms of its comprehensive strength in smart corrugated packaging equipment business and can provide downstream customers such as cardboard plants and box plants with “one-stop” machinery and service support that covers each production process, including corrugated cardboard production, corrugated box production, and pre-printing and post-printing production processes, and different technology roadmaps, including flexographic printing and digital printing. In terms of the size of revenue, Dongfang Precision’s corrugated packaging machinery business accounts for approximately 10% of the global industry market, ranking first among domestic enterprises of the same type and second in the global market. B. The rapid development of digital printing brings more development opportunities for the industry. According to the report The Future of Inkjet Printing to 2023 released by the research institution, Smithers Pira, in the global presswork and packaging field, the market scale of inkjet printing technology between 2013 and 2018 increased from USD43.4 billion to USD69.6 billion and is expected to reach USD109 billion in 2023, with a CAGR of nearly 10%. The percentage of inkjet printing in the entire printing market is expected to increase to 13.0% in 2023. Scale of the Inkjet Printing Market in the Global Presswork and Packaging Field According to the latest report The Future of Inkjet Printing to 2027 by Smithers Pira, the market value of inkjet printing in graphic printing and package printing globally reached USD86.8 billion in 2022. The inkjet printing market has grown strongly over the past 5 years. Total inkjet printing output in 2022 was 46.2% higher compared to 2017, with printed volume growing by over two-thirds. The report forecasts that growth of inkjet printing in shipment quantity and 16.3% by value. Digital inkjet printing without the need to produce costly and time-consuming printing plates or rollers, and has a more comprehensive data variability, higher packaging flexibility, lower operating costs, in the production of small orders, digital printing than the traditional analog printing technology (flatbed printing, letterpress, gravure, silkscreen, etc.), more cost-effective, more economical. Digital printing was initially used for short-run printing and then gradually expanded to long-run printing. Digital printing can be better for business users to provide flexible and rapid response capabilities, support and can be better on-demand printing business model. In the field of label printing, digital printing has occupied a significant share of the market. Other application areas of digital printing technology include home decoration, textile printing, ceramics, electronics, glass, automotive, biomedical, 3D printing, and so on. Wonder Digital’s digital printing technology enables the documents on the computer/mobile phone to be directly printed on corrugated cardboards, offset cartons, and other packaging materials. The technology allows one- sheet printing and can present the effects of the finished products without platemaking, imposition, and colour calibration. Additionally, the technology enables immediate problem remediation, variable printing, and printing on demand. The major advantages of the technology are shown as follows: (1) Convenient and fast Digital printing enjoys an absolute advantage in small and medium batches of printing and urgent printing needs as it saves tedious processes, such as platemaking, imposition, and colour calibration. It enables electronic documents generated via typesetting software, design software, and office applications to be directly output to digital printers. (2) Cost-saving Digital printers require no platemaking, so no platemaking fees will be incurred. Additionally, there are multi- pass and single-pass digital printers, and the volume of waste ink every month is only 1 L to 20 L. (3) More user-friendly and easier-to-operate with human-machine interaction Wonder Digital’s digital printers feature high levels of system integration and human-machine interaction in product design and technical implementation. Compared to traditional package printers, they are more user-friendly and easier-to-operate. Traditional package printers require highly skilled and experienced operators, who need long training periods to become proficient. Wonder Digital’s digital printers can be operated after simple training, with just one person needed to operate a multi-pass digital printer and two to run a single-pass inline for mass production. (4) One-sheet printing Although it does not take long to complete small batches of printing orders, such orders still share the same complex and time-consuming printing commissioning process with large batches of printing orders. Therefore, box printing and colour printing usually have standards for the base number of sheets for printing. If the base number cannot be met, the printing cost of a single sheet will be increased. Digital printing enables one-sheet printing and immediate availability. Additionally, it can flexibly perform small and medium batches of production. Moreover, one piece of neutral machinery can be fully operated by one person and covers less production space. (5) Product quality Digital printing adopts inkjet printing technology. It can be divided into water-based ink printing and UV printing in terms of the ink type and printing effects. As digital printing technology constantly improves, Wonder Digital’s WD200 series can rival traditional HD water-based ink printing in terms of printing effects, while Wonder Digital’s WDUV series achieves the spot colour effects of traditional offset printing. (6) Product quality Digital printing adopts inkjet printing technology. It can be divided into UV printing (including colour printing & pre-printing, with printing effects close to colour offset printing) and water-based ink printing (including colour printing & pre-printing, with water-based dye/pigment inks, etc.) in terms of the ink type and printing effects. With continuous improvements in technology, the printing effects of Wonder Digital’s WD200++ digital printer series approach those of traditional HD water-based ink printing, while the printing effects of Wonder Digital’s WDUV200++ digital printer series rival those of traditional colour offset printing. (7) Printing efficiency The printing process of traditional printers is complex, with a long order-to-delivery time. From design - customer review – plate making - plate exposure - sampling - customer approval - printer imposition - plate exposure - plate adjustment - colour matching - completion, it takes at least three days. With digital inkjet printing technology, there are just three steps: design - customer review - completion, greatly improving printing efficiency. 2. Industry of the industrial Internet industry solutions business According to the Classification of Strategic Emerging Industries (2018), Dongfang Precision’s “industrial Internet industry solutions” business division falls under the “industrial Internet and supporting services” industry. Policy side: The Guiding Opinions of the State Council on Deepening the “Internet plus Advanced Manufacturing” and Developing the Industrial Internet released by the State Council in 2017 marked China’s official entry into digital development from information-based development in terms of industries. “Accelerate the development of the industrial Internet” was proposed for the first time in the report on government work in 2018 and became a frequent visitor in the reports on government work for the next five years. In 2020, the National Development and Reform Commission stated that, as one of the new network infrastructure types, the industrial Internet is a part of the new infrastructure. Under the guidance of a range of policies, the industrial Internet and smart factory have become the strategic development orientation of the transformation and upgrading of China’s manufacturing. Market side: China is the only country in the world whose industries cover all industrial categories in the United Nations’ industrial classification. Concurrently, it is expected to grow into the world’s largest industrial digitalization market. For the current manufacturing industry of China, digital transformation is no longer an “option” but a “compulsory course” that is critical to its survival and long-term development. As the manufacturing industry enters the “Industry 4.0” era, an increasing number of manufacturing enterprises have realized that buying production equipment, enterprise resource planning (ERP) systems, or manufacturing executive systems (MES) cannot meet the systematic requirements of intelligent manufacturing. By contrast, industrial Internet platforms can systematically resolve all critical issues that cannot be handled through traditional means. According to the Bluebook on the Digital Transformation of Enterprises--Empowering the Low-carbon and Green Transformation of the Real Economy with New IT released by the China Academy of Information and Communications Technology, after relevant manufacturing enterprises complete digital transformation, on average, their production efficiency will be boosted by 37.6%, their operating expenses will be lowered by 21.2%, and their energy utilisation rate will be improved by 16.1%. Concurrently, with the rapid development and continuous iteration of the new-generation information technology, the cost of digital transformation of enterprises is gradually decreasing, and more and more industrial enterprises will implement industrial Internet-based digital transformation. According to the data released by Frost & Sullivan, the scale of the market of industrial Internet platforms and relevant solutions in China by 2025 is estimated to reach RMB193.12 billion. Between 2021 and 2025, the CAGR of the market of industrial Internet platforms and relevant solutions in China is approximately 45.3%. The Scale of the Market of Industrial Internet Platforms and Relevant Solutions and Forecast between 2020 and 2025
in China (2022), participants in the construction of industrial Internet platforms in China are diversified. Leading manufacturing enterprises, information and communications enterprises, and Internet-based enterprises build industrial Internet platforms in different dimensions and from different perspectives based on their own comparative advantages, enabling China’s industrial Internet industry to enjoy industrial enterprises, ICT enterprises, and Internet enterprises at the same time. The key technologies and industries that the industrial Internet involves are extensive and complex and can hardly be fully covered by enterprises. Thus, developing the industrial Internet by relying on industrial manufacturing enterprises becomes a typical development path of industrial Internet enterprises, such as Root Cloud, Midea Cloud, and Baosight. In the packaging field, major manufacturers that provide industrial Internet-related products and solutions services include Yunyin, Dongfang Digicom, and wantit. The subsidiary Dongfang Digicom, carrying Dongfang Precision’s missions of expanding into the industrial
global outboard motor market trends toward stable growth. Considering the development of China’s water tourism and recreational industry and the emphasis of the government on maritime rights, the Chinese government agencies at all levels have granted vigorous policy support to ship-related industries. For example, the National Development and Reform Commission has included high-performance ships, such as superyachts, luxury cruise ships, marine surveillance vessels, and small-waterplane-area twin hulls, among items for encouragement. The Ministry of Industry and Information Technology has proposed developing brand products, such as luxury superyachts, sightseeing boats, and official boats. The State Council has also proposed vigorously developing marine tourism, manufacturing localised tourism equipment such as cruises and cruise yachts, and vigorously developing cruise yacht tourism. Under the guidance of policies, China’s yacht industry will usher in rapid development. According to the report released by Global Market Insights Research Private Limited, an international market research institution, in terms of sale volume, the sale volume of the global outboard motors in 2022 reached 888,600 （未完）  |