Shenzhou International Group Holdings Limited · HKEX:2313
Shenzhou International — H1 2022 Earnings Presentation
26 slides from Shenzhou International's earnings presentation, August 2022
Slide 1: Interim Results 2022
INTERIM RESULTS 2022 August 2022
Slide 2: Agenda
Agenda Financial Highlights Business Review Strategies & Plans Open Forum
Slide 3: Financial Highlights
SHENZHOU INTERNATIONAL CO GROUP HOLDINGS LIMITED Financial Highlights FAN Ea BAS Se HEAR A RA] * Stock Code Afi #a5%: 2313
Slide 4: Financial Highlights
Financial Highlights For the 6 months ended 30 Jun (RMB '000) 2022 2021 Change Sales 13,592,789 11,368,606 +19.6% Gross profit 3,065,607 3,372,167 -9.1% Profit attributable to owners of the parent 2,366,616 2,226,278 +6.3% Basic EPS (RMB) 1.57 1.48 +6.1% Interim dividend per share (HK$) 1.06 1.06 --
Slide 5: Sales Analysis
Sales Analysis Sales Profit Attributable to Equity Holders (RMB million) (RMB million) 3,000 15,000 2,366.60 13,592.80 2,226.30 11,368.60 2,000 10,000 1,000 5,000 0 0 1H 2021 1H 2022 1H 2021 1H 2022 ❖ Recorded a stable increase in revenue ❖ Mainly attributable to the other ❖ Further expansion of the
Slide 6: Profit Margin Analysis
Profit Margin Analysis Gross Profit Net Profit Attributable to Equity Holders (RMB million) (RMB million) 2,500 2,366.6 25% 3,500 3,372.2 35% 2,226.3 29.7% 3,065.6 19.6% 2,000 20% 2,800 28% 17.4% 1,500 15% 2,100 22.6% 21% 1,000 10% 1,400 14% 500 5% 700 7% 0 0% 0 0% 1H 2021 1H 2022 1H 2021 1H 2022 GP
Slide 7: Operating Expenses Analysis
Operating Expenses Analysis For the 6 months ended 30 Jun (RMB '000) 2022 2021 Change Selling & distribution expenses 124,736 73,926 +68.7% Administrative expenses 1,002,415 953,356 +5.1% Finance cost 103,557 51,501 +101.1% 1,230,708 1,078,783 +14.1% % to Revenue 9.05% 9.49% -0.44p.p
Slide 8: Net Profit Analysis
Net Profit Analysis For the 6 months ended 30 Jun (RMB '000) 2022 2021 Change Net Profit to Equity Holders 2,366,616 2,226,278 +6.3% Less: Government Incentives 162,598 155,256 +4.7% : Net Exchange Gain/ (Loss) 617,230 (60,168) +1,126% Net Profit Excluding Government Incentives & Exchange Gain & 1,5
Slide 9: Expenses Analysis by Nature
Expenses Analysis by Nature For the 6 months ended 30 Jun (RMB '000) 2022 2021 Change Employee benefit expenses: Wages and salaries 3,600,922 3,225,207 +11.6% Retirement benefit contributions 344,538 308,910 +11.5% Other benefits 173,472 146,672 +18.3% Total 4,118,932 3,680,789 +11.9% Depreciation,
Slide 10: Dividend and Payout Ratio
Dividend and Payout Ration (HK$) 2.2 60.3% 2.0 60% 56.3% 53.40% 53.36% 1.8 50.70% 50.67% 50.50% 51.18% 48.70% 50% 46.55% 45.73% 1.6 45.71% 1.10 1.4 1.00 0.57 40% 0.90 1.2 31.35% 30.62% 29.97% 29.60% 0.75 1.0 30% 0.8 0.85 0.72 20% 0.65 0.6 1.06 1.06 0.50 0.55 0.90 0.90 0.4 0.85 10% 0.50 0.2 0.35 0.36
Slide 11: Domestic and International Cotton Prices
Domestic and International Cotton Prices (RMB/tonne) 28,000 CC Index3128B（中等级） 170.00 26,000 FC Index M（中等级进口棉价格指数） 1%关税 24,000 FC Index M（中等级进口棉价格指数） 滑准税 150.00 国际CotlookA(远东) 1%关税 22,000 国际CotlookA(远东) 滑准税 20,000 130.00 18,000 110.00 16,000 14,000 90.00 12,000 70.00 10,000 8,000 50.00
Slide 12: Turnover Breakdown by Products
Turnover Breakdown by Products ❖ Revenue from sales of sportswear increased mainly attributable to the increase in sportswear products order demand in both the US and European markets ❖ Slight decrease in casual wear sales was led by the decrease in demand in the PRC and Japan market ❖ Revenue drop
Slide 13: Turnover Breakdown by Regions
Turnover Breakdown by Regions ❖ Both US and European market recorded increase in sales, which were primarily attributable to the increase in demands for sportswear ❖ Recorded a decrease in revenue in the Japanese market mainly due to a drop in demand of lingerie wear and casual wear ❖ A slightly sal
Slide 14: Key Financial Indicators
Key Financial Indicators 2022.06.30 2021.12.31 2021.06.30 Inventory turnover days 125 116 125 Debtor turnover days 55 59 62 Creditor turnover days 24 25 25 2022.06.30 2021.12.31 2021.06.30 Gross gearing ratio (debt to equity) (%) 33.5 38.1 28.0 Current ratio (times) 2.2 2.0 2.5 Cash and cash equival
Slide 15: Inventory Turnover Days Analysis
Inventory Turnover Days Analysis 160 (Day) 140 139 140 135 129 125 124 124 122 125 125 120 116 116 120 100 80 60 40 20 0 2016 2016 2017 2017 2018 2018 2019 2019 2020 2020 2021 2021 2022 June Dec June Dec June Dec June Dec June Dec June Dec June
Slide 16: Inventory
Inventory (RMB’000) 30-Jun-22 31-Dec-21 % 30-Jun-21 % Raw materials 1,522,526 1,567,062 -2.8 1,290,540 +18.0 Work in progress 3,620,438 3,065,628 +18.1 2,750,546 +31.6 Finished goods 2,886,946 2,138,783 +35.0 2,296,400 +25.7 8,029,910 6,771,473 +18.6 6,337,486 +26.7 Provision (152,193) (135,868) +12
Slide 17: Treasury Management
Treasury Management (RMB’000) 30 Jun 2022 30 Jun 2021 Change Bank Interest Income 119,356 104,304 15,052 Other Interest Income/ Fair Value Gain 22,750 21,159 1,591 142,106 125,463 16,643 Less: Bank Interest Expenses 100,866 48,670 52,196 Other Interest Expenses on lease 2,691 2,831 (140) liabilities
Slide 18: Treasury Management (Cont'd)
Treasury Management (Cont’d) (RMB’000) 30 Jun 2022 31 Dec 2021 Change Cash & Cash Equivalents 6,809,218 6,687,623 +121,595 Less: Bank Loan (9,962,672) (10,588,679) +626,007 Net (Debts)/ Cash (3,153,454) (3,901,056) +747,602 Long Time Deposits (+1 year) 960,000 1,710,000 (750,000) Bank Deposit (+3 mo
Slide 19: Business Review
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Slide 20: Major Achievements in 1H2022
Major Achievements in 1H2022 Expansion of overseas production facilities ❖ Already eliminated the adverse effect by the pandemic as productions and operations have been recovered Fabric Factory Garment Factory Garment Factory Vietnam Vietnam Cambodia ❖ Daily production ❖ Civil project and the ❖ Cons
Slide 21: Major Achievements in 1H2022 (Cont'd)
Major Achievements in 1H2022 (Cont’d) Implemented a series of ESG measure Established a reclaimed water recycling project at the fabric factory in Vietnam, which has a daily processing capability of 5,000 tons and has commenced operation in July 2022 Further expanded the application of the rooftop P
Slide 22: Major Achievements in 1H2022 (Cont'd)
Major Achievements in 1H2022 (Cont’d) Highly recognized ESG achievement suppliers IR excellence
Slide 23: Optimization of Product Structure
Optimization of Product Structure Sportswear customers Casual wear customers ❖ Strengthened cooperation with strategic customers by prioritizing the allocation of production resources and reducing the orders the Group obtained from small-to medium-sized customers, the Group also introduced certain q
Slide 24: Strategies & Plans
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Slide 25: Future Strategies
Future Strategies ❖ Attaches great ❖ Enhance diversity, importance to and functionality and promotes sustainable refinement of new development fabric development, as well as the comprehensive Continuous service capability to improvement Enhance customers of cooperate product sustainability developme
Slide 26: Open Forum
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Shenzhou International Group Holdings — H1 2022 Earnings Presentation on 6ix