Shanghai Jahwa(600315)2023-08-28 16:00Net Profit Changes - Net profit of Shanghai Jahwa Sales Co., Ltd. decreased year-on-year due to a decline in offline channel traffic and lower average temperatures in the first half of the year, leading to reduced revenue. Additionally, the proportion of high-margin product sales decreased, and procurement costs increased, resulting in a year-on-year decline in gross margin[7] - Net profit of Shanghai Jahwa Hainan Daily Chemical Co., Ltd. increased year-on-year due to personnel restructuring, which reduced employee compensation and share-based payment expenses[7] - Net profit of Abundant Merit Limited decreased year-on-year due to persistent inflationary pressures in the UK since the beginning of the year, leading to a decline in consumer confidence and willingness to spend. The overall UK infant market also declined, and intensified competition in the feeding category caused distributors to reduce inventory, resulting in decreased revenue and gross margin[7] - Net profit rose to 300,997,104.25 yuan, a significant increase of 90.9% compared to 157,672,141.64 yuan in the prior period[62] - Net profit attributable to the parent company's owners was 464,000,385.16 RMB, compared to 65,063,377.16 RMB in the previous year[72] - Net profit attributable to shareholders of the listed company was 301 million yuan, an increase of 90.90% year-on-year[171] Intangible Assets - The company's intangible assets formed through internal R&D accounted for 3.38% of the total intangible assets balance at the end of the period[11] - The company's total book value of intangible assets at the end of the period was RMB 817,524,374.30, compared to RMB 790,259,580.90 at the beginning of the period[11] - Intangible assets include land use rights, computer software, trademarks, patents, R&D projects, and others, recognized when economic benefits are probable and costs are reliably measurable[135] - The expected useful lives of intangible assets are determined based on the period they can bring economic benefits to the company, with land use rights typically ranging from 30-50 years[155] - Internal R&D expenditures are classified into research and development phases, with development costs capitalized only if they meet specific criteria[153] Revenue and Sales Performance - The company's total social retail sales of consumer goods increased by 8.2% year-on-year from January to June 2023, with cosmetics sales increasing by 8.6% (above-quota retail sales of goods)[15] - The company achieved a skincare category revenue of 872 million yuan in the first half of 2023, a year-on-year increase of 7.16%[46] - Domestic business revenue reached 2.843 billion yuan in the first half of 2023, with a 10.20% year-on-year growth in the second quarter[46] - Overseas business revenue declined by 12.28% to 786 million yuan in the first half of 2023 due to inflation and market competition in the UK[46] - Total revenue for the first half of 2023 reached 1,779,340,449.53 RMB, an increase from 1,662,081,036.61 RMB in the same period last year[73] - Revenue for the reporting period was 3.629 billion yuan, a decrease of 2.30% year-on-year[171] - Revenue from skincare products was 871 million yuan, an increase of 7.16% year-on-year, accounting for 24.06% of total revenue[172] - Revenue from personal care and home cleaning products was 1.724 billion yuan, a decrease of 0.50% year-on-year, accounting for 47.59% of total revenue[172] - Revenue from maternal and child products was 911 million yuan, a decrease of 10.91% year-on-year, accounting for 25.14% of total revenue[172] - Domestic revenue accounted for 78.30% of total revenue, with online channels contributing 27.14% and offline channels contributing 51.16%[183] Financial Position and Assets - The company's total balance at the end of the period was RMB 4,959,536.83, compared to RMB 6,484,291.16 at the beginning of the period[5] - The company's total reduction in the current period was RMB 1,524,754.33, including RMB 1,979,346.43 from disposals and RMB -454,592.10 from foreign currency translation differences[5] - The company's total balance at the end of the period was RMB 2,834,392.00, compared to RMB 2,602,171.00 at the beginning of the period[11] - Total assets as of June 30, 2023, amounted to 6,429,692,211.51 RMB, with current assets including 1,146,390,540.79 RMB in cash and cash equivalents, 2,354,922,314.10 RMB in trading financial assets, and 1,319,035,280.98 RMB in accounts receivable[59] - Inventory as of June 30, 2023, was 1,022,532,646.65 RMB, with provisions for inventory write-downs due to obsolescence for raw materials and finished goods[51] - Prepaid expenses increased to 156,430,311.02 RMB as of June 30, 2023, compared to 72,376,159.49 RMB at the end of 2022[59] - Long-term equity investments stood at 424,814,735.37 RMB as of June 30, 2023, showing a slight increase from 414,783,637.24 RMB at the end of 2022[59] - Fixed assets decreased to 845,300,402.46 RMB as of June 30, 2023, from 863,393,441.45 RMB at the end of 2022[59] - Total assets grew to 11,050,398,817.24 yuan, up 5.0% from 10,521,803,972.73 yuan at the end of 2022[65][67] - Current assets increased to 5,534,295,106.47 yuan, a 6.6% rise from 5,190,136,949.87 yuan at the end of 2022[65][67] - Long-term equity investments reached 3,053,305,894.89 yuan, slightly up from 3,049,173,351.73 yuan at the end of 2022[67] - Accounts receivable decreased to 1,704,867,908.77 yuan, down 0.8% from 1,718,327,854.14 yuan at the end of 2022[65] - Inventory increased to 634,220,222.22 yuan, up 19.5% from 530,686,297.03 yuan at the end of 2022[65] - Total non-current assets: 6,037,835,870.26[83] - Total assets: 12,467,528,081.77[83] Liabilities and Equity - The company's total guarantee amount (including guarantees for subsidiaries) was 731.456 million yuan, accounting for 9.65% of net assets[40] - The company provided guarantees for subsidiaries, with a total guarantee amount of 2,669,841.24 RMB during the reporting period, and the balance of guarantees for subsidiaries was 0 as of the end of the reporting period[54] - Total liabilities as of the reporting period amounted to 4,888,071,751.83 RMB, slightly lower than the previous year's 5,020,001,233.87 RMB[70] - Total equity attributable to the parent company's owners was 7,579,456,329.94 RMB, an increase from 7,249,484,579.10 RMB in the previous year[70] - Current liabilities rose to 2,534,868,903.78 yuan, a 26.0% increase from 2,011,569,527.84 yuan at the end of 2022[67] - Total current liabilities: 3,661,761,316.40[83] - Long-term borrowings: 512,019,200.00[83] - Total liabilities increased to 3,034,828,512.18 RMB from 2,532,021,301.31 RMB, reflecting a significant rise in the company's debt obligations[86] - Total owner's equity slightly increased to 8,015,570,305.06 RMB from 7,989,782,671.42 RMB, indicating stable equity growth[86] - The company's deferred income decreased to 465,461,729.88 RMB from 484,877,192.90 RMB, indicating a reduction in future income obligations[86] - The company's long-term employee benefits payable decreased to 11,519,591.88 RMB from 12,467,130.52 RMB, reflecting a reduction in long-term liabilities[86] - The company's estimated liabilities remained relatively stable at 22,116,090.76 RMB compared to 22,119,404.18 RMB in the previous period[86] - The company's total non-current liabilities increased to 499,959,608.40 RMB from 520,451,773.47 RMB, showing a slight decrease in long-term liabilities[86] Cash Flow and Investments - The company's investment in Ping An Consumer Technology Fund (Phase I and III) contributed to an increase in non-recurring gains[45] - The company's operating cash flow decreased due to a 28.07 million GBP payment for equity incentive exercises and increased marketing and R&D expenses[45] - Operating cash flow net amount: 65,628,098.57[76] - Investment cash inflow subtotal: 980,509,623.04[76] - Investment cash outflow subtotal: 1,358,366,050.67[76] - Net cash flow from investment activities: -377,856,427.63[76] - Net cash flow from financing activities: -244,606,044.12[76] - Net increase in cash and cash equivalents: -538,802,195.39[76] - Operating cash flow for the reporting period was 65.63 million yuan, a decrease of 84.91% year-on-year[171] Expenses and Costs - The company's prepaid taxes increased to 47.15 million yuan from 16.72 million yuan at the beginning of the period[36] - The company's bank deposits and interest due within one year amounted to 325.89 million yuan[36] - The company's total development expenditure for infant care products and maternal and infant feeding products was 2.11 billion yuan[30] - Sales expenses for the first half of 2023 were 494,009,175.07 RMB, significantly higher than the 309,741,402.41 RMB in the same period last year[73] - R&D expenses increased to 68,599,355.76 RMB in the first half of 2023, up from 57,212,823.31 RMB in the previous year[73] - R&D expenses increased to 77,528,542.90 yuan, up 18.4% from 65,485,885.86 yuan in the previous period[62] - Total operating costs for the first half of 2023 were 3,422,862,715.58 RMB, down from 3,504,737,788.06 RMB in the previous year[86] - Sales expenses for the first half of 2023 were 1,579,715,589.92 RMB, a decrease from 1,606,941,203.67 RMB in the same period last year[86] - Management expenses for the first half of 2023 were 302,997,124.56 RMB, down from 319,261,702.04 RMB in the previous year[86] Other Financial Metrics - The company's total social retail sales of consumer goods increased by 8.2% year-on-year from January to June 2023, with cosmetics sales increasing by 8.6% (above-quota retail sales of goods)[15] - The company's main brands include Herborist, Yuesai, GF, Maxam, Diancui, Twin Lotus, Chinfie, Tommee Tippee, Liushen, and Jiean, as well as cooperative brands such as Pien Tze Huang (oral care), Femfresh, and Batiste[15] - The company donated over 100,000 yuan worth of products to healthcare workers in Shanghai and 30,000 yuan worth of daily necessities to a children's aid center in Anhui[25] - Bad debt provisions as of June 30, 2023, totaled 12,979,055.95 RMB, with a decrease of 4,669,106.64 RMB in provisions during the period[60] - Other comprehensive income after tax improved significantly to 163,003,280.91 yuan, compared to -92,608,764.48 yuan in the previous period[62] - Other comprehensive income that will be reclassified to profit or loss was 171,404,961.36 RMB, compared to a loss of 91,513,862.02 RMB in the previous year[72] - Gross profit margin increased by 0.34 percentage points to 60.25%[171] - Inventory at the end of the reporting period was 1.023 billion yuan, with inventory turnover days increasing by 13 days[171] - Accounts receivable at the end of the reporting period was 1.319 billion yuan, with accounts receivable turnover days increasing by 2 days[171] - Other receivables with a total book value of 62,515,032.05 RMB, broken down by age: within 1 year (36,768,084.63 RMB), 1-2 years (3,917,896.90 RMB), 2-3 years (11,687,587.38 RMB), and over 3 years (10,141,463.14 RMB)[184] - Bad debt provision for other receivables decreased by 4,669,106.64 RMB, resulting in a total provision of 12,979,055.95 RMB at the end of the period[186] - The company provides internal retirement benefits, which are treated similarly to severance benefits, with liabilities recognized and expensed when the conditions for severance benefits are met[187] - The company uses the Black-Scholes option pricing model to determine the fair value of equity-settled share-based payments[189] - The company recognizes revenue from services based on the progress of completed services, with adjustments made at each balance sheet date to reflect changes in performance[192] - Government grants related to daily activities are included in operating profit, while those unrelated are recorded as non-operating income or expenses[194] - Deferred tax assets and liabilities are recognized based on temporary differences between the tax base and the book value of assets and liabilities, with adjustments made at each balance sheet date[195] - The company recognizes estimated liabilities for quality assurance and loss contracts when it is probable that economic benefits will flow out and the amount can be reliably measured[200] Accounting Policies and Practices - Financial assets are terminated when the contractual rights to cash flows cease, risks and rewards are transferred, or control is relinquished[108] - Financial liabilities are classified as either measured at amortized cost or at fair value with changes in profit or loss[110] - Inventory is initially measured at cost, including purchase, processing, and other costs, with specific valuation methods for different types of inventory[112] - Inventory impairment is recognized when the cost exceeds the net realizable value, calculated based on estimated selling price minus costs to complete and sell[113] - Long-term equity investments include investments in subsidiaries and associates, with different accounting methods applied[114][115] - Fixed assets are depreciated using the straight-line method over their useful lives, with annual reviews of useful life, residual value, and depreciation method[119][120] - Borrowing costs are capitalized when directly attributable to the acquisition, construction, or production of qualifying assets, and cease when the asset is ready for use[123] - Control over an investee is determined by the power to influence returns through participation in relevant activities[127] - Joint control requires unanimous agreement among parties sharing control over an arrangement[128] - Fixed assets are recognized only when it is probable that the associated economic benefits will flow to the company and the cost can be reliably measured[129] - Long-term prepaid expenses, such as insurance premiums and leasehold improvements, are amortized over their expected benefit periods[144] - Employee benefits include short-term compensation, post-employment benefits, termination benefits, and other long-term benefits[145] - The company's post-employment benefits are primarily defined contribution plans, including basic pension and unemployment insurance[151] - Non-current asset disposal losses amounted to -34,353.98 RMB during the reporting period[150] - The company conducts impairment tests for long-term assets, including goodwill, and recognizes impairment losses if the recoverable amount is lower than the carrying amount[158] - Short-term employee benefits, such as salaries, bonuses, and allowances, are recognized as liabilities and expensed in the period they are incurred[161]