Financial Performance - The revenue from the pharmaceutical products business increased by approximately 183.6% to approximately RMB152.65 million in 2022, compared to RMB53.82 million in 2021[17]. - Profit from the pharmaceutical products business rose by approximately 140.6% to RMB70.90 million for the Reporting Period, up from approximately RMB29.47 million in 2021[17]. - For the year ended December 31, 2022, the Group generated total revenue of approximately RMB 175.92 million, representing an increase of approximately 160.2% compared to RMB 67.61 million for the year ended December 31, 2021[47][51]. - Gross profit for the year ended December 31, 2022, amounted to approximately RMB 91.68 million, with a gross profit margin of 52.1%, down from 60.0% in 2021[54][61]. - Profit attributable to owners of the Company was approximately RMB 29.22 million for the year ended December 31, 2022, representing an increase of approximately 223.6% compared to RMB 9.03 million in 2021[56][63]. Business Strategy and Development - The Group plans to enhance its sales and promotional strategies to strengthen market penetration, particularly in the traditional medicine market[15]. - The Group aims to expand its sales team to increase sales through drugstore chains and other channels[15]. - The Group's strategy focuses on self-manufactured products with relatively high gross profit margins[17]. - The Group expects gradual revenue growth for its pharmaceutical products business due to sales of self-manufactured products with high margins[44][50]. - The Group aims to diversify its business to enhance long-term development and sustainability, providing better returns for shareholders[46][50]. Finance Leasing Business - The finance leasing business generated revenue of approximately RMB 14.82 million (2021: RMB 9.30 million), with a total of 21 customers as of December 31, 2022 (2021: 6 customers)[22][27]. - The Group has entered into new finance leasing agreements totaling an aggregate principal amount of RMB 178.1 million with interest rates ranging from 6.0% to 7.0% per annum during the reporting period[33]. - The weighted average term of finance leases entered into is 1.4 years (2021: 1.7 years), with all leases requiring repayment by installments[34]. - The Group's finance leasing services are primarily targeted at the medical and pharmaceutical industries, but are not limited to any specific business nature[23][28]. - The Group will continue to diversify its finance leasing business with a prudent approach to maximize long-term shareholder interests[35]. Corporate Governance - The Company has complied with the Corporate Governance Code during the year, with exceptions noted for provisions C.2.1 and C.1.6[98]. - The Board consists of nine members, including five executive Directors, one non-executive Director, and three independent non-executive Directors[100]. - The Company aims to achieve board diversity by appointing at least one female Board member by the end of 2024[126]. - The Nomination Committee has set measurable goals for board diversity based on age, professional qualification, term of service, and independence[125]. - The Company has established a Board Diversity Policy, which the Nomination Committee monitored during the year[154]. Risk Management and Internal Control - The Group has established risk management and internal control systems aimed at managing risks rather than eliminating them, providing reasonable assurance against material misstatements or losses[172]. - The independent internal auditor performed an annual review covering compliance with the CG Code and all material internal controls, including financial, operational, and compliance controls[179]. - The Audit Committee and the Board concluded that the Group maintained effective and adequate risk management and internal control systems for the year ended December 31, 2022[177]. - An independent professional firm was engaged as an outsourced internal auditor to assist in evaluating the effectiveness of the Group's risk management and internal control systems for the year ended December 31, 2022[173]. - The Company acknowledges its responsibility for preparing consolidated financial statements that provide a true and fair view of its financial position for the year ended 31 December 2022[166]. Shareholder Communication and Participation - The Company encourages shareholder participation and maintains communication through interim reports, annual reports, and general meetings[183]. - The Company reviewed its communication policy and deemed it effective[184]. - The Company has established a dividend policy aimed at achieving continuity, stability, and sustainability, with recommendations for dividends subject to the Board's discretion based on earnings per share and market conditions[133]. - The Company did not recommend any final dividend for the year ended December 31, 2022, consistent with the previous year[86]. - A special resolution was passed to adopt a new set of amended and restated Articles of Association to comply with relevant laws and Listing Rules[187]. Leadership and Management - The executive director Mr. Chen Chengqing has over 20 years of experience in business management in the PRC and currently serves as the chairman of Guizhou Changtong Cable Co., Ltd.[193]. - Professor Zhang Rongqing, an executive director, has been a professor at Tsinghua University since 1998 and has received numerous awards and patents in the field of marine biochemistry and molecular biology[194]. - Mr. Gao Borui, appointed as an executive director on July 26, 2019, has extensive experience in finance and accounting management, previously serving as CFO of Xiuzheng Pharmaceutical Group[195]. - The company is focused on expanding its market presence and enhancing its product offerings through strategic management and leadership[193][194][195]. - The company’s leadership team comprises individuals with diverse backgrounds and extensive experience in their respective fields, contributing to its strategic direction[193][194][195].
三爱健康集团(01889) - 2022 - 年度财报