[中报]TCL科技(000100):2023年半年度报告（英文版）
原标题:TCL科技:2023年半年度报告（英文版） INTERIM REPORT 2023 August 29, 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 TCL Technology Group Corporation (hereinafter referred to as the “Company”) hereby guarantee the factuality, accuracy and completeness of the contents of this Report and its summary, and shall be jointly and severally liable for any misrepresentations, misleading statements or material omissions therein. Mr. Li Dongsheng, the Chairman of the Board, Ms. Li Jian, the person-in-charge of financial affairs (Chief Financial Officer), and Mr. Peng Pan, the person-in-charge of the financial department, hereby guarantee that the financial statements carried in this Interim Report are factual, accurate, and complete. All the Company’s directors attended the Board meeting for the review of this Interim Report and its summary. The future plans, development strategies or other forward-looking statements mentioned in this Report and its summary shall NOT be considered as promises of the Company to investors. Therefore, investors are kindly reminded to pay attention to possible investment risks. The Company has no interim dividend plan, either in the form of cash or stock, nor for the conversion of capital reserve into share capital. This Report and its summary have been prepared in both Chinese and 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 ................................................... 6? Part III Management Discussion and Analysis ............................................................................... 9? Part IV Corporate Governance ...................................................................................................... 32? Part V Environmental and Social Responsibility ......................................................................... 35 Part VI Significant Events ............................................................................................................... 43? Part VII Changes in Shares and Information about Shareholders ............................................. 53? Part VIII Preferred Shares ............................................................................................................. 60? Part IX Bonds ................................................................................................................................... 61? Part X Financial Report .................................................................................................................. 65? Documents Available for Reference (I) The financial statements signed and stamped by the person-in-charge of the Company, the Chief Financial Officer and person-in-charge of the financial department. (II) The originals of all company documents and announcements that were disclosed to the public during the Reporting Period. Definitions
Part II Corporate Information and Key Financial Information I. Corporate Information
1. Contact Information of the Company Whether the registered address, office address and their zip codes, website address and email address of the Company changed during the Reporting Period. □ Applicable √ Not applicable No changes occurred to the registered address, office address and their zip codes, website address, email address and other contact information of the Company during the Reporting Period. Please refer to the Annual Report 2022 for details. 2. Media for Information Disclosure and Place Where This Report is Lodged Whether the media for information disclosure and place where this report is lodged changed during the Reporting Period. □ Applicable √ Not applicable No changes occurred to the name and website of the stock exchange website and media on which the Company discloses its Interim Report and the place for lodging such reports during the Reporting Period. Please refer to the Annual Report 2022 for details. 3. Other Information Whether other information changed during the Reporting Period. □ Applicable √ Not applicable IV. Key Accounting Data and Financial Indicators √ Yes □ No Earnings per share in the first half of 2022 were adjusted due to the conversion of capital reserves into share capital during the Reporting Period
shareholders. The Company recalculated the basic earnings per share and diluted earnings per share for the first half of 2022 in accordance with accounting standards and other regulations. The total share capital of the Company at the end of the last trading session before the disclosure of this Report:
1. Differences in Net Profit and Equity under CAS and IFRS □ Applicable √ Not applicable 2. Differences in Net Profit and Equity under CAS and Foreign Accounting Standards □ Applicable √ Not applicable 3. Reasons for Accounting Data Differences Above □ Applicable √ Not applicable VI. Non-Recurring Gains and Losses √ Applicable □ Not applicable Unit: RMB
□ Applicable √ Not applicable The Company has no other profit and loss items that meet the definition of non-recurring profits and losses. Notes on non-recurring profit and loss items that which is listed in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Non-Recurring Gain/Loss shall be used to define Recurring Gain/Loss items □ Applicable √ Not applicable The Company does not have any non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Non-Recurring Gain/Loss that are defined as recurring profit and loss items. Part III Management Discussion and Analysis I. Company-related industry outlook in the Reporting Period In the first half of the year, the global economy slowed down significantly with continued geopolitical conflicts and a high rate of inflation. The complex and severe external environment has increased the uncertainty of domestic economic development. In response to these challenges, the Company continuously laid out its business in the pan-semiconductor industry on a basis of semiconductor displays, new energy photovoltaics, and semiconductor materials, enhanced the resilience of its business and optimized its business strategies to pursue sustainable high-quality development. During the Reporting Period, the Company achieved an operating revenue of RMB85.15 billion, with a year-on-year increase of 0.7%; net profit of RMB2.39 billion, with a year-on-year increase of 24.1%; net profit attributable to shareholders of the listed company of RMB0.34 billion; and a net operating cash flow of RMB10.42 billion. Benefiting from an improving industry landscape, the supply and demand relationship in the semiconductor display industry was optimized, inventories along the industry chain remained at a healthy level and mainstream product prices steadily increased, the operating revenue and profit in the Company's semiconductor display business significantly improved. The Company continued to consolidate its advantages in terms of product and technology leadership in new energy photovoltaics and semiconductor materials businesses, enhanced its industrial chain synergy, and achieved rapid growth in terms of operating revenue and profit. Maintaining strategic focus, optimizing the business strategy, enhancing differentiated competitiveness, and improving operational benefits. With the improved industrial concentration, the leading manufacturers illustrated their advantages in terms of economies of scale, and the semiconductor display industry entered a new stage of development. During the Reporting Period, the demand area steadily increased, product prices stabilized and rebounded, and the operating income of the semiconductor display business increased by 34.9% quarter-on-quarter in the second quarter, the profitability has steadily improved. TCL Zhonghuan implemented a differentiation strategy, which focused on the high-growth market such as N-type and G12 products in the field of photovoltaic materials. In doing so, it occupied leading global market share and achieved significant growth in revenue and profit. In the field of cells and modules, the Company further consolidated the technological advantages of the "G12+Shingled" dual-platform, and strengthened the competitiveness of the photovoltaic industry chain by adopting a differentiated layout. Building business barriers based on technological innovation, deepening intelligent and digital manufacturing capabilities, and accelerating high-quality industrial transformations and upgrades. During the Reporting Period, the Company invested RMB5.47 billion in R&D, a year-on-year increase of 4.1%. The Company also filed a total of 177 new international patent applications under the PCT, increasing the total number of applications filed to 14,927. The Company continued to lead product technology upgrades and built a leading technological advantage in the semiconductor display business in the fields of ultra-high definition, high refresh rates, large screen sizes and flexible displays, top global customers achieved a leap in industrial value through high-end product line of the company. In the new energy photovoltaic business, the Company continued to lead the industry upgrading in the field of large-size, thin slicing, thin line, shingled and other technical processes. The Company advanced the manufacturing transformation and upgrade through digitalization and intelligentization, and applied AI intelligent detection systems in the semiconductor display business to identify defects in LCD panel production, further improving production efficiency. In addition, the Company deepened the application of the industry 4.0 system in the new energy photovoltaic business, with industry-leading flexible manufacturing capabilities, thus promoting high-quality development within the industry. Pushing localized operations of the global industrial chain, strengthening the construction of overseas business platforms, and exploring a new globalization model. The Company actively promoted the localized operations of its industrial chain. The TCL CSOT India Display Module Factory continued to expand both its production and sales capacity. TCL Zhonghuan planned to establish production capacity of crystals and chips in the Middle East through establishing a joint venture with Saudi Vision Industries, and strengthened collaboration with partners in some target markets. The Company continued to strengthen its overseas business development and explored a new globalization model to enhance its competitiveness. The Company will respond to any challenges with its own operational capabilities and strategic management, continue to improve the profitability of semiconductor display business, and steadily by the transformations and upgrades in the technology manufacturing industry and the global energy structure, and shall continue to implement the business strategies of "improving operational quality and efficiency, enhancing strengths to shore up weaknesses, innovation-driven development as well as accelerating global expansion" in order to achieve sustainable, high-quality development and take a lead in the global market. II. Main businesses of the Company during the Reporting Period The Company focused on the development of the core business of semiconductor display, new energy photovoltaic and semiconductor materials, and committed to achieving the strategic goal of global leadership. (I) Semiconductor display business In the first half of the year, the downstream demand for displays remained sluggish, but it has increased quarter on quarter. The trend toward large-sized products has driven a steady increase in demand area. On the supply side, the large-size panel industry has become increasingly concentrated, industrial competition has shifted from rapid scale expansion and market share growth driven by investment to a focus on technology and profitability as key guiding factors, the industry achieved healthy development. The prices of large-sized panels have continued to rise since March this year, while the prices of small and medium-sized panels have gradually stabilized at a low level. During the Reporting Period, the Company achieved an operating revenue of RMB35.53 billion in its semiconductor display business, with a year-on-year decrease of 4.7%. Among this, the display business achieved an operating revenue of RMB20.41 billion in the second quarter, with a year-on-year increase of 18.5%, and a quarter-on-quarter increase of 34.9%. The net loss of display business in the second quarter reduced by RMB 2.15 billion compared to the first quarter. In its large-sized product business, TCL CSOT made the best use of its own strengths and industry chain advantages, and firmly adopted the strategies of large-sized and high-end TV panels while actively developing commercial displays, such as interactive whiteboards, digital signage, and splicing screens. The layout of TCL CSOT's high-generation production lines covered the factories of the G8 production lines of t1, t2, t9, and t10, and the factories of the G11 production lines (the highest generation in the world) of t6 and t7. The market share of TV panels steadily ranked among the top two in the world. By giving play to the production efficiency and cutting cost efficiency of high-generation production lines, the Company led the development of large-sized and high-end products in collaboration with strategic customers, and in doing so, improved the value of the whole industry chain. The Company's 55-inch TV panels and above increased to 78% in terms of sales area proportion, while the market share of 55-inch and 75-inch products ranked first in the world, the market share of 65-inch products ranked second in the world, and the market share of high-end TV panels such as shadowless screens and 120HZ screens steadily ranked first in the world. In commercial markets such as interactive whiteboards, digital signages, and splicing screens, TCL CSOT ranked among the top level in terms of global market share. In its medium-sized product business, TCL CSOT accelerated the layout of its new businesses, including IT and vehicle-mounted screen products, while enhancing product competitiveness and optimizing customer structure to create new driving forces for business growth. The G6 LTPS production line was expanded as planned, and the t9 production line, positioned at medium-size IT and vehicle-mounted screen products, successfully achieved a capacity increase in SoP, with brand customer introduced for commercial displays, monitor and laptops. TCL CSOT's medium-sized panel business developed rapidly, reaching a revenue share of 21%. The Company's shipments of monitors jumped to the top third in the world, with e-sports monitor having the largest market share globally. The market share of LTPS laptops and LTPS tablets ranked second globally. With the rapid penetration of LTPS panels in the field of new energy vehicles, the Company's shipment of LTPS vehicle-mounted screens also significantly increased. The Company's Mini-led backlight products for monitor, laptop, vehicle-mounted screen and other products achieved SoP to continuously satisfy the various needs of customers. LTPS mobile phone panels, drove the growth of the flexible OLED business with product innovations, and expanded the VR/AR and professional display markets. TCL CSOT ranked third in the world in terms of LTPS mobile panel shipments from the t3 production line. The independently developed 1512 PPI Mini-led LCD-VR screens achieved SoP. The Company actively expanded into professional display fields such as healthcare, smart homes, and learning machines. TCL CSOT ranked fifth in the world in terms of the shipments of flexible OLED mobile phone panels from the t4 production line. During the Reporting Period, TCL CSOT began cooperating with several new brands, which further improved its customer structure. Flexible OLED folding, LTPO, Pol-Less, and other new technologies have now reached an industry-leading level, and TCL CSOT has achieved SoP and supplied high-end flagship models to brand customers, with high-end products achieving remarkable progress and laying the foundation for business improvement. Looking ahead to the second half of the year, consumer demand is expected to rebound due to the seasonal effect. Currently, the prices of large-sized display products continue to rise, while the prices of some medium-sized products have begun to bottom out. Meanwhile, the prices of small-sized products have stabilized. Thanks to favorable industry trends and the optimization of the Company's business structure, the Company is confident that its semiconductor display business will achieve significant improvement in the second half of the year. In the long term, as major information carriers and interactive interfaces in the digital economy era, semiconductor displays will further increase in industrial value, the trend toward large-sized TVs will drive steady growth in the display demand area. Maintaining a reasonable level of profitability is the foundation for the sustainable development of the industry, the industry will move toward more rational competition. TCL CSOT will continue to promote the healthy and sustainable development of the industry. Efficiency and profitability will remain the cornerstone of its operations, allowing for the continuous improvement of its relative competitiveness. It will also improve the layout of small and medium-sized products, improve its customer structure and business performance, and accelerate its transformation and upgrade from the leading manufacturer of large-sized displays to a leading manufacturer of full-sized displays. (II) New energy photovoltaics and semiconductor materials business In the first half of the year, as the capacity of upstream raw materials and various links in the photovoltaic industry chain were released, product prices decreased. However, the economic viability of photovoltaic power generation improved, driving a steady increase in terminal demand. TCL Zhonghuan grasped the opportunity of the growing market, gave full play to its advanced production capacity and flexible manufacturing, and achieved rapid growth in production and sales scale. During the Reporting Period, TCL Zhonghuan achieved an operating revenue of RMB34.9 billion, with a year-on-year increase of 10.1%, and a net profit of RMB4.84 billion, with a year-on-year increase of 50%. Relying on its technical advantages of G12 and N-type photovoltaic materials, TCL Zhonghuan consolidated its leading position in the market, enhanced the layout of TOPCON batteries and shingled modules, and strengthened its differentiated competitiveness. The Company continued to expand its advanced production capacity, and gave full play to the scale advantages, cost advantages, and market advantages of G12 products to expand its leading position in the field of photovoltaic materials. At the end of the Reporting Period, the Company's total monocrystalline silicon capacity reached 165GW, with its market share of photovoltaic silicon wafers ranked top in the world. The Company led the upgrade of large-size, thin slicing, thin line process technologies for crystals and wafers. Metrics such as the consumption rate of silicone materials per crystalline unit, monthly crystal output per furnace, number of wafer output per kg, and other indicators, the Company managed to maintain a leading position in the industry. With the increasing demand for energy efficiency and upgrading photovoltaic products to N-type technology, the Company has built a deep technical barrier. The Company also built a smart factory for 25GW N-type TOPCON batteries and continuously improved the production capacity of shingled modules, leading to the development of a differentiated industrial chain based on next-generation technology, enhancing its competitiveness. TCL Zhonghuan increasingly applied Industry 4.0 technology in flexible manufacturing and accelerated the layout of its international business to seize a high-value market share. As global trade barriers increase, it is becoming much more important to build a global manufacturing layout. Having relied on long-term investment and development in smart manufacturing over the years, the Company has achieved industry-leading capabilities in applying Industry 4.0 in flexible manufacturing and has satisfied its customers' demands for customization and differentiation. enhance its end-to-end traceability capabilities, securing a significant share in high-premium markets. The Company has fully introduced the Industry 4.0 system in all links of the industrial chain, creating autonomously coordinated and highly efficient dark factories. This has allowed it to achieve industry- leading productivity and automated production, establishing a competitive advantage in localized manufacturing on a global scale. During the Reporting Period, the Company signed cooperation terms and lists with Vision Industries Company, with a view to jointly establish a joint venture and invest in a photovoltaic crystal and wafer factory in Saudi Arabia. This initiative marks the start of an overseas localized manufacturing strategy for crystals and wafers. The Company and Maxeon have achieved mutually promoted and coordinated development in terms of production and channels around the world. These efforts will further facilitate the accelerated growth of the Company's overseas business in the future. III. Analysis of core competitiveness Over the past 42 years, TCL TECH has developed an industrial layout that focuses on semiconductor displays, new energy photovoltaics, and semiconductor materials by maintaining innovation, change, and transformation, and has achieved leapfrog development in the pan-semiconductor segment from zero to one and one to N. In this process, TCL TECH has continued to enhance its own core competitiveness and sustainability. By upholding its mission of "leading technology and mutually beneficial cooperation", the Company has continued to increase its investment in leading technology to create a better life for people, and build an open and mutually beneficial industry ecosystem with partners characterized by a people-oriented approach and mutual cooperation. Leading in scale: rapid growth of production capacity and improvement of value chain layout As a global semiconductor display leader, the Company has two 11th-generation, four 8th-generation, and two 6th-generation semiconductor panel production lines, and is ranked second in the world in terms of capacity. The Company has continuously expanded its capacity through an endogenous growth and M&A strategy. By establishing two 8.5th-generation OEM lines, CSOT has secured its foothold in TV panels, further boosted its capacity in large-sized panels, and maintained production line. CSOT ranks among top 2 globally by market share of TV panels. In 2021, the Company established a mid-sized t9 production line with high added value to expedite its strategic layout across all product sizes. At present, products from the t9 production line have been delivered to IT brand customers. The Company has successfully increased its competitiveness in its mid-sized business, which is evidenced by securing first place by market share of e-sport MNT products and second place by market share of LTPS tablets and LTPS notebooks globally. In addition, the Company has also maintained high-speed development in vehicle-mounted devices. In the small-sized segment, the Company has focused on mid and high-end products in LTPS and flexible OLED technologies through its two 6th-generation production lines, i.e. t3 and t4. In the first half of the year, the Company ranked third by market share of LTPS mobile panels, and fifth by flexible OLED mobile panels. The Company has also actively extended its value chain, increased module capacity, acquired Moka Technology, and further scaled up its position along the value chain and in terms of profitability. Based on its upgraded scale, management, and synergy with the industrial chain, the Company will further shore up its industry status and overall competitiveness in the future. Leading in technology and ecology: Actively laying the groundwork for next-generation display technologies and materials, building a first-mover advantage through ecological leadership Relying on TCL CSOT, the Company has accelerated its vertical layout of the industrial chain and continuously improved its upstream capacity for technological innovation. The Company has strategically focused on building an ecosystem in areas such as basic materials, next-generation display materials, and critical equipment for new manufacturing processes. This is aimed at creating a TCL ecosystem within the display market to establish a leading advantage based on next-generation display technology. The Company has actively invested in quantum dot display technologies, and increased its research and industrial cooperation efforts in areas such as quantum dot display materials, new device structures, and ink-jet printing. In doing so, it aims to tap into the key technologies of the next generation of displays. The subsidiary of the Company, Guangdong Juhua, has the only national innovation center "National Printing and Flexible Display Innovation Center" in the display industry within China, which has provided a globally-leading public platform for G4.5 printed display R&D. This has helped integrate industrial chain resources from all links, including materials, techniques, development into industrial applications. In addition, the Company has continued to invest in Micro- LED display technologies to help promote the Company's ecological layout in this field from materials, techniques, equipment, and production line solutions to independent intellectual property. New Strategic Growth Engines: Seizing Development Opportunities and Promoting the Rapid Development of the New Energy Photovoltaic Industry The Company has boosted the rapid development of TCL Zhonghuan based on its excellent management experience that it has accumulated from the high-tech, asset-heavy, and long-cycle industry for years. By invigorating the organization through systematic and institutional reform, the Company has optimized its assets structure to enhance its operation efficiency, and has unleashed the growth potential of new energy photovoltaics business through industrial synergy. TCL Zhonghuan has further consolidated its leading position in the industry, with high-quality and growth performance, and has become one of the key engines driving the Company's core businesses. In 2022, TCL Zhonghuan was awarded the title of "National Championship Enterprises with Leading Products in the Manufacturing Industry", and was ranked top in the world in terms of its capacity and shipment of photovoltaic monocrystalline silicon wafers. Furthermore, it secured the leading market share worldwide for G12 large-size photovoltaic monocrystalline silicon wafers. Driven by its efforts in semiconductor displays and new energy photovoltaics, the Company aims to become a world-leading tech conglomerate. Upgrading Corporate Culture: Taking the Company to a New Development Stage by upholding the Mission and Vision of "Leading Technology and Mutually Beneficial Cooperation" The Company put forward its mission of "leading technology and mutually beneficial cooperation" in the new period. Guided by this mission, the Company is committed to creating an organizational culture of "reform, innovation, responsibility, and excellence", and continues to deepen its team building and improve its corporate culture. TCL Technology will continue to invest in fields closely related to human life (such as intelligence, health, carbon reduction, and energy saving), and build its leading advantages in technology and products to deliver a wonderful experience and better life to people. Bearing the sustainable development and people-oriented approach in mind, the Company is dedicated to environmental friendliness, employee engagement, Company has also joined hands with stakeholders to develop an open and win-win industrial eco-system that emphasizes healthy competition and synergistic development. IV. Analysis of Core Businesses Overview Is it the same as the disclosure of the Company's main business during the reporting period? √ Yes □ No See the relevant contents in "I. Main businesses of the Company during the reporting period". Year-on-year changes in key financial data Unit: RMB
No significant changes to the profit structure or sources of the Company during the Reporting Period. Breakdown of revenue: Unit: RMB
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