Company code: Hunan Aihua Group Co.Ltd(603989) company abbreviation: Hunan Aihua Group Co.Ltd(603989) convertible bond Code: 113504 convertible bond abbreviation: Aihua convertible bond Hunan Aihua Group Co.Ltd(603989)
Annual report for 2021
A letter to shareholders
——The road ahead is clear. You and I have a good time together
Dear shareholders and investors, Hello!
In 2021, we have met new opportunities and faced multiple challenges. In the alternation of repeated epidemic, energy shortage and material price rise, we have broken the situation and sought a good supply balance, and the profits have increased steadily; And continuously improve the management system, maintain technological innovation and good quality internal control. In 2021, the group achieved a revenue of 3.234 billion, a year-on-year increase of 28.51%; The operating profit was 569 million, a year-on-year increase of 28.25%. The acceleration of adversity is due to Aihua’s constant focus on capacitor business and practical energy storage; Flying against the wind reflects Aihua’s strong internal force against risk, which is relaxed with the time.
After 37 years of development, we have a deep understanding of products, industry and market. In recent years, we have accumulated experience in connecting with the world. Aihua has become a Chinese company with international advanced level in the capacitor industry and will continue to create higher value for customers and shareholders.
Therefore, we follow the company’s development strategic objectives in terms of talent, management, products and market. In 2021, Aihua basically completed the layout and reconstruction, and built a management team that can carry things and win battles, laying a solid foundation for the future development of the company.
Now, we are committed to improving Aihua’s ability of sustainable development, focusing on leading technology, excellent quality, professional manufacturing and fine management, so as to truly add value to customers.
1、 Optimize the industrial structure and promote efficient market links.
In recent years, under the guidance of the national new energy policy and localization, we have focused on downstream demand, actively arranged the industrial structure system, and steadily expanded production and guaranteed supply. In 2021, it successfully entered the global leading enterprise supply chain in the photovoltaic market, forming a good trend of overall market share in vehicle mounted, industrial control, lighting, charging and other fields. The horizontal expansion and vertical deepening of our business have enabled us to accumulate more comprehensive product experience, have a sufficient understanding of various application markets, and improve Aihua’s customization ability and delivery ability of the whole product scheme.
In addition, in order to match the market layout, we will optimize the supply chain toughness in 2020 and further improve the supply chain strength in 2021. Build a safe ecological chain, lead the development of the whole camp of the industrial chain, and help improve the overall quality of China’s capacitor industry.
2、 Attach importance to leading technology and boost the intensive development of the industry.
The founder of Aihua is a technical engineer, which determines that Aihua’s development gene is the continuous exploration and innovation of technology research and development. Aihua has always served the market with leading technology and gained the trust and affirmation of customers. In 2021, we started the project-based upgrading of R & D, defined the technical objectives with the project concept, deepened the technical reserves with scientific thinking, harvested the high output of R & D achievements, and launched more excellent products to match the renewal iteration of the application market.
Aihua will also continue to increase R & D investment and optimize the existing technology in order to provide customers with better and more comprehensive solutions. The exploration of cutting-edge technologies in the industry is the responsibility of Aihua in the development of China’s capacitor industry. It must overcome difficulties and advance in the face of difficulties.
3、 Focus on quality control coverage and support the realization of product value.
The capacity of the global capacitor industry is being transferred to China, which puts forward higher requirements for the professionalism and quality attitude of Chinese manufacturing. Aihua’s quality concept is to “do it right for the first time” and win with quality. In 2021, we built a new management model for the whole group, in which the quality management module not only ensures the benchmarking of quality control standards to customers, but also accurately decomposes them to the supply side to strive for full coverage of quality control. Because we know that excellent terminal quality needs the improvement of the supply chain of the whole camp.
In the future, we will combine the market demand, give full play to our own advantages and actively radiate, so as to promote the high-quality development of the supply chain in terms of technical quality and management level.
4、 Take advantage of the cultural drive to explore higher-level management and assume social responsibility.
We believe that high-level management is reflected in high execution, which requires a group of people who can understand, be competent and believe to follow the practice. In the industry, Aihua, as a rapidly developing national enterprise, has precipitated 37 years of culture, and took the lead in refining it into a strong corporate culture – Aishang cleaning, which is implemented in all aspects of the enterprise and employees through the system of family culture, harmony culture and moral culture. Make us constantly self-conscious, change our behavior and open up the landing channel of management, so as to improve our execution and achieve a higher level of management.
Good corporate culture is the second productive force of enterprise development and the gene of sustainable development. This cultural system and scientific management model give us cultural self-confidence and a high sense of social responsibility, and make us more interested in the development of Aihua
Be confident. As long as manufacturing continues, the road of advanced management and technological exploration will not stop. In the future, Aihua will keep a clear strategy in its development, never forget to analyze calmly in difficulties, and adhere to intelligent response under challenges.
Throughout the “five year plan for the development of the group from 2020 to 2025”, 2022 is a crucial development year connecting the preceding and the following. We will always pay attention to the high matching of strategy and tactics, and continuously improve the execution ability, profitability and anti risk ability, so as to lay a solid foundation for Aihua’s centennial development plan and stand parallel to the position of world-class advanced enterprises.
For 37 years, we have never changed the track. This is not a routine, but a responsibility to go with the times; We are not complacent about the results. This is not to be anxious for success, but to make progress with wisdom. Our driving force is the recognition of customers, the trust of shareholders and investors, the satisfaction of employees and the progress of the industry.
On behalf of Hunan Aihua Group Co.Ltd(603989) , I would like to thank all employees, customers, investors, shareholders and every friend walking side by side. Thank you and us for your long journey, using electronic technology to bring efficient intelligent experience to mankind and create a better life. In 2022, challenges are inevitable, but hope is the same. Born in time, we are always ready; If we rise to the occasion, our mission will be achieved. The road ahead is clear. I look forward to you and me taking advantage of the wind.
Hunan Aihua Group Co.Ltd(603989) President: AI Liang April 6, 2022
Important tips
1、 The board of directors, board of supervisors, directors, supervisors and senior managers of the company guarantee the authenticity, accuracy and integrity of the contents of the annual report, and there are no false records, misleading statements or major omissions, and bear individual and joint legal liabilities.
2、 All directors of the company attended the board meeting. 3、 Tianzhi International Certified Public Accountants (special general partnership) issued a standard unqualified audit report for the company. 4、 AI Lihua, the person in charge of the company, Wu Songqing, the person in charge of accounting, and Gong Ni, the person in charge of the accounting organization (Accounting Supervisor), declare that they guarantee the authenticity, accuracy and completeness of the financial report in the annual report. 5、 The profit distribution plan or the plan of converting accumulation fund into share capital in the reporting period adopted by the resolution of the board of directors
The company plans to distribute a discovery bonus of 3 yuan (including tax) to all shareholders for every 10 shares based on the total share capital registered on the equity distribution registration date minus the balance of shares in the company’s special repurchase account. As of April 1, 2022, the total share capital of the company is 400814733 shares. After deducting 2280043 shares of the company’s current repurchase account, the total cash dividend to be distributed is 119560407 yuan (including tax). The amount of share repurchase implemented by the company in 2021 is 5261617456 yuan (excluding stamp duty, transaction commission and other related expenses). In 2021, the total amount of repurchase and cash dividend to be distributed by the company accounted for 35.33% of the audited net profit attributable to shareholders of the parent company in 2021. Since the “Aihua convertible bonds” issued by the company in 2018 are in the stock conversion period, and the number of shares of the company held in the company’s special securities repurchase account may still change, the annual equity distribution of the company in 2021 shall be subject to the total share capital that can participate in the profit distribution on the equity registration date of the profit distribution plan, and the total distribution amount shall be adjusted according to the principle of unchanged distribution amount per share. This plan shall be submitted to the 2021 annual general meeting of shareholders of the company for approval. 6、 Risk statement of forward-looking statements √ applicable □ not applicable
The future plans, development strategies and other forward-looking descriptions involved in this report do not constitute the company’s substantive commitment to investors. Please pay attention to investment risks. 7、 Whether there is any non operational occupation of funds by the controlling shareholders and their related parties? VIII. Whether there is any external guarantee in violation of the specified decision-making procedures? IX. whether more than half of the directors cannot guarantee the authenticity, accuracy and integrity of the annual report disclosed by the company? No
10、 Major risk tips
The company has described the possible risks in detail in this report. Please refer to the possible risks in “section III Management Discussion and analysis” of this report. 11、 Others □ applicable √ not applicable
catalogue
Section 1 interpretation seven
Section II Company Profile and main financial indicators 8 section III Management Discussion and Analysis Section IV corporate governance 35 Section V environmental and social responsibility 54 section VI important matters Section VII changes in shares and shareholders 84 Section VIII preferred shares 90 section IX relevant information of bonds 91 section x financial reporting ninety-five
The annual financial statements containing the signatures and seals of the legal representative of the company, the person in charge of accounting and the person in charge of accounting institutions
The catalogue of documents for future reference contains the original of the annual audit report sealed by the accounting firm and signed and sealed by the certified public accountant
Originals of all company documents and announcements disclosed by the company in newspapers designated by the CSRC during the reporting period
Section I interpretation
1、 Interpretation in this report, unless the context otherwise requires, the following words have the following meanings: Interpretation of common words
Hunan Aihua Group Co.Ltd(603989) / the company / the company / the group refers to Hunan Aihua Group Co.Ltd(603989)
CSRC refers to the China Securities Regulatory Commission
Board of directors means the board of directors of Hunan Aihua Group Co.Ltd(603989) company
Board of supervisors refers to Hunan Aihua Group Co.Ltd(603989) board of supervisors
Prospectus refers to the prospectus of the company’s initial public offering of shares and listing
Aihua convertible bonds refer to Hunan Aihua Group Co.Ltd(603989) convertible corporate bonds
The name of the former shareholder of Aihua Investment Co., Ltd. refers to Hunan Aihua Investment Co., Ltd.
Aihua holding refers to Hunan Aihua Holding Co., Ltd., which is the parent company and controlling shareholder of Hunan Aihua Investment Co., Ltd.
Mianyang Zijiang refers to Mianyang high tech Zone Zijiang electronic components Co., Ltd., a subsidiary of the company
Sichuan Aihua refers to Sichuan Aihua Electronics Co., Ltd., a subsidiary of the company
Aihuafuxian refers to Yiyang aihuafuxian Electronics Co., Ltd., a holding subsidiary of the company
Jiangsu Lifu refers to Jiangsu Lifu electrode foil Co., Ltd., a holding subsidiary of the company
Xinjiang Rongze refers to Xinjiang Rongze aluminum foil manufacturing Co., Ltd., a subsidiary of the company
Company Law refers to the company law of the people’s Republic of China
Securities Law refers to the securities law of the people’s Republic of China
The articles of association refers to the Hunan Aihua Group Co.Ltd(603989) articles of association
The reporting period refers to the period from January 1, 2021 to December 31, 2021
Yuan and 10000 yuan refer to RMB yuan and 10000 yuan
Section II Company Profile and main financial indicators
1、 Company information
Chinese name of the company
