[年报]熵基科技(301330):熵基科技股份有限公司2023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2023年年度报告英文版 2023 Annual Report Announcement No.: 2024-011 April 2024 Adhering to integrity, innovation and stable development, seeing far and wide to win the future A Letter to Shareholders The year 2023 is the first complete accounting year since the listing of ZKTeco. This year, we continue to adhere to the globalization strategy, and continuously improve our core competitiveness driven by innovation. In 2023, the Company achieved an operating revenue of RMB 1.9701837 billion, a YoY increase of 2.69%, and a net profit attributable to the owners of the parent company of RMB 177.2637 million, a YoY decrease of 7.92%. Excluding the impact of share-based payment fees, the net profit attributable to the owners of the parent company was RMB 215.4326 million, a YoY increase of 9.04%. ZKTeco is committed to becoming a world-class enterprise for technological innovation and sustainable development in the access control industry. Through continuous R&D investment and market expansion, it has achieved stable business growth and global layout. On behalf of the Board of Directors, I would like to express sincere gratitude to all colleagues, users, partners, as well as investors of the Company! In 2023, we still focused on the Company's main business, deeply cultivating the three major business sectors of smart entrance and exit, smart identity verification, and smart office. Driven by the market and consumers, we deepened our main business, refined our services, and expanded our ecosystem horizontally. In 2023, also known as the "Year of Artificial Intelligence", we officially entered the field of smart retail cloud services. It is an innovative business sector newly developed by ZKTeco, and we have integrated the Company's accumulated technology and business capabilities over the years, focusing on the "AI+Digital Signage" field and accelerating the transformation of traditional retail industry to data-driven smart retail. In the era of AI, ZKTeco continues to focus on edge based multimodal AI for small devices, empowering industries such as home, community, enterprise, and education with technologies such as human-computer interaction, knowledge learning, multimodal fusion, and offline proxy experts. The Company continues to invest in the research of multimodal hybrid biometric recognition algorithms, promoting technological innovation and product upgrades. We ensure continuous leadership in technology and R&D advantages. Looking ahead to 2024, stability, innovation and surpassing will be the main keynote of our development. 1. Being stable and practical, simple and responsible, focusing on customer value creation We always uphold the corporate spirit of simplicity, honesty and practicality, which is not only the cultural gene of the Company, but also the cornerstone of its stable development. In 2024, ZKTeco will continue to deeply cultivate the access control industry, continuously meeting and exceeding customer expectations by providing high-quality products and services. The Company will adhere to the development goals of "being more refined, wider and higher", and achieve continuous optimization and innovation of products and services through refined management and in-depth understanding of consumer needs. Meanwhile, ZKTeco will take on the social responsibility of the enterprise, not only pursuing profit maximization in commercial activities, but also focusing on creating long-term value for customers, employees, society and the environment. The Company will continue to promote sustainable development strategies, reduce environmental impact through the application of green production and environmental protection technologies, and achieve a win-win situation of economic benefits and social responsibility. 2. Leaping forward in innovation, adhering to and practicing dreams, enhancing core competitiveness We firmly believe that innovation is the core driving force for enterprise development. The Company will continue to increase R&D investment, especially in the fields of computer vision and edge side multimodal AI human-computer interaction technology. Through continuous technological innovation, ZKTeco will drive the upgrading of products and solutions, thereby enhancing its core competitiveness. 3. Surpassing while setting sail, deepening cultivation while constantly surpassing, seizing historical opportunities of multimodal AI We will still be committed to seizing the historic opportunities brought by multimodal AI technology in the "cloud-edge-end-server" for access control. The Company will continuously education, and achieve diversified development of products and services through technological innovation and cross-border cooperation. We will adhere to the strategy of "agile evolution", respond quickly to market changes and customer needs, and continuously explore innovative products and services. The Company will work together with its partners to build an agile ecosystem, achieving rapid innovation and market response through digital transformation and cross-organizational collaboration. We will grow together with our partners to achieve resource sharing and mutual benefit. Finally, thank all shareholders for their trust and support in the Company's management team! We will develop through the integration of core technology innovation and main business track innovation, and look forward to the power of vigorous and upward evolution, becoming a leading enterprise in world-class access control industries, and satisfying all investors! Chairman Che Quanhong 2023 Annual Report Section I Important Notes, Contents and Definitions The Board of Directors, the Board of Supervisors, directors, supervisors and senior managers 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 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 total share capital on the registration date of future equity distribution, after deducting the repurchased shares in the Company's repurchase account, the Company proposed to distribute cash dividend of RMB 4.5 (tax inclusive) per 10 shares to all shareholders. There will be no bonus shares or conversion of capital reserve into share capital. 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 ............................................................................................... 18 Section IV Corporate Governance ........................................................................................................................ 92 Section V Environmental and Social Responsibility ............................................................................................ 115 Section VI Significant Events................................................................................................................................. 116 Section VII Changes in Shares and Information about Shareholders ............................................................... 140 Section VIII Information of Preferred Shares ..................................................................................................... 155 Section IX Bonds ..................................................................................................................................................... 156 Section X Financial Report .................................................................................................................................... 157 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
1.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. 2.This report has been prepared in both Chinese and English. Should there be any discrepancies or misunderstandings between the two versions, the Chinese version shall prevail. 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 Reasons for retroactive adjustment or restatement of the previous accounting data Accounting policy change
On November 30, 2022, the Ministry of Finance issued and implemented the "Interpretation No. 16 of the Accounting Standards for Business Enterprises", which stipulates that "deferred income tax related to assets and liabilities arising from individual transactions shall not be subject to the accounting treatment of initial recognition exemption". The Company shall implement it from January 1, 2023. For the lease liabilities and right-of-use assets recognized due to the application of this regulation in the earliest period of financial statement presentation for the first time, as well as the estimated liabilities and corresponding assets related to the disposal obligation recognized, which generate taxable temporary differences and deductible temporary differences, the Company shall adjust the cumulative impact to present the initial retained earnings and other related financial statement items for the earliest period in the financial statements in accordance with this regulation and the provisions of "Accounting Standards for Enterprises No. 18 - Income Tax". 2. During the reporting period, the Company increased its total share capital by RMB 44,547,615.00 due to the conversion of capital reserve to share capital, but it did not affect the amount of shareholder equity. According to the "Accounting Standards for Enterprises No. 34- EPS", the latest share capital adjustments were made and the basic EPS and diluted EPS for the past three years were reported. The lower of the Company's net profit before and after deducting non-recurring profits and losses in the past three fiscal years is 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
related 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, smart retail products and solutions. The Company is mainly committed to integrating core biometric technologies such as fingerprints, palm veins, palmprints, facial features, finger veins, and iris with computer vision, radio frequency, IoT, cloud computing and other technologies. It provides smart terminals, industry application software, and platforms with object detection, 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 2023 (1) Global market overview In 2023, the global biometric market reached a scale of USD 39 billion. Looking ahead, it is expected that the market size will reach USD 144 billion by 2032, and the compound annual growth rate (CAGR) from 2024 to 2032 will reach 15.2%. The continuous progress of technology and innovation, the strengthening of border controls and travel security, and the increasing focus on maintaining workplace security to reduce the risk of unauthorized access are some of the main factors driving the market. (Data source: IMARC Group) The main driving factor in the global market is the increasing number of data theft incidents among numerous enterprises. This has encouraged some organizations to invest heavily in the deployment of biometric systems, thereby driving the development of the market. Meanwhile, continuous technological progress and the widespread integration of the Internet of Things (IoT) and biometric technology are creating positive market prospects. Due to the sudden outbreak of COVID-19, the demand for non-contact biometric solutions in the entire healthcare industry has rapidly increased. In addition, biometric technology is increasingly integrated into consumer electronics products, including smartphones and laptops, which largely supports global demand. With the emergence of cloud based automatic biometric systems (ABIS), law enforcement agencies and government agencies are also adopting biometric devices, which in turn is a major growth inducing factor. Other factors, including rapid urbanization and industrialization, sustained product innovation, and extensive R&D activities by key participants, also have a positive impact on the market. (2) Global development of biometric technology The demand for biometric technology continues to grow as it eliminates the need to remember passwords or carry ID cards, making authentication more convenient and driving market growth. The increasing integration of biometric technology in the （未完）  |