2021-08-27-深交所-深康佳Ｂ_2021年半年度报告（英文版）_266页_1mb

KONKA GROUP CO., LTD. INTERIM REPORT 2021 SUMMARY

Core Content Overview

This document is the Interim Report 2021 of Konka Group Co., Ltd., covering the period from January to June 2021. It includes important notes, corporate information, key financial data, and an analysis of the company's business operations and core competitiveness.

Key Information

I. Important Notes

• The Board of Directors, Supervisory Committee, and senior management guarantee the factual accuracy and completeness of the report and its summary.
• The Company’s legal representative (Zhou Bin), CFO (Li Chunlei), and head of the financial department (Guo Zhihua) also confirm the accuracy of the financial statements.
• All directors have reviewed the report.
• The report contains forward-looking statements, which are not absolute promises to investors.
• There is no interim dividend plan.
• The Chinese version of the report takes precedence in case of discrepancies between the Chinese and English versions.

Corporate Information

• Stock Name: Konka Group-A, Konka Group-B
• Stock Code: 000016, 200016
• Stock Exchange: Shenzhen Stock Exchange
• Company Name (Chinese): 康佳集团股份有限公司
• Company Name (English): KONKA GROUP CO., LTD
• Legal Representative: Zhou Bin
• Board Secretary: Wu Yongjun
• Securities Representative: Miao Leiqiang
• Address: 24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science and Technology Park, Yuehai Street, Nanshan District, Shenzhen, Guangdong Province, China
• Contact Info:
  • Tel: 0755-26609138
  • Fax: 0755-26601139
  • Email: szkonka@konka.com

Key Financial Information

Key Business Divisions and Performance

I. Consumer Electronic Division

• Composed of Multimedia Sub-Division and White Goods Sub-Division.

• Multimedia Sub-Division:

  • Offers color TVs and Internet TV services.
  • Domestic sales are mainly through B2B and B2C channels.
  • International sales focus on B2B, targeting Asia Pacific, Middle East, Central & South America, East Europe, etc.
  • AVC data shows that in H1 2021, 17.81 million sets of color TVs were sold, a 14.7% YoY decrease.
  • Sales amounted to RMB59.4 billion, an 15.1% YoY increase.
  • The division earns from price margins on color TVs.
  • The Internet TV business is central to the company’s "hardware + software" and "smart TV + end users" transformation strategy.

• White Goods Sub-Division:

  • Produces refrigerators, washing machines, air conditioners, freezers, etc.
  • Sales are mainly domestic, through B2B and B2C.
  • The company acquired the Frestec brand to strengthen its white goods brand foundation.
  • AVC data shows retail sales of RMB176.7 billion in H1 2021, an 13.3% YoY increase.
  • 65.75 million units were sold, a 4.4% YoY increase.
  • Air conditioners saw a 5.7% YoY decline, while refrigerators had a 5.9% YoY increase.
  • Freezers, washing machines, and clothes dryers showed significant YoY growth.
  • The company optimized internal processes and integrated external channels to improve online sales performance.

II. Industry Trade Business

• The company engages in purchasing and processing IC chips, LCD screens, etc., from upstream suppliers and selling to downstream customers.
• This business helps build relationships with suppliers and customers and monitor material prices for better cost control.
• It also supports the semiconductor business by accumulating customer resources, providing sales channels, and matching market demand with R&D efforts, thus reducing product development time and R&D risk.

III. Environmental Protection Division

• Focuses on water treatment, renewable resource recycling, and glass ceramic materials.
• Engages in PPP projects under BOT or EPC models.
• The "14th Five-Year Plan" highlights water pollution control, urban sewage treatment, and ecological restoration as key tasks.
• The sewage treatment industry has seen steady growth over the past three years due to policy support, capital investment, and technological innovation.
• Future growth is expected due to accelerating urbanization and industrial progress.

IV. Semiconductor Division

• Engaged in storage and optoelectronics.
• In storage, the company designs and markets master storage chips and engages in packaging and testing.
• In optoelectronics, the company develops Micro LED-related products.

Core Competitiveness

• The company's core competitiveness is built on:
  • Strong R&D capabilities with a three-level R&D system (Konka Research Institute, Multimedia R&D Center, specialized design institutes).
  • Collaboration with major universities and scientific institutions in AI, IoT, and 5G Ultra HD.
  • Academician workstation and technology research alliances aligned with industrial layout.
  • Approximately 100 core technologies and 150 R&D talents.

Notes on Exceptional Gains and Losses

• The report includes exceptional gains and losses, which are reclassified as recurrent due to their nature.
• Software tax rebates are considered recurrent and are included in government subsidies.
• Total exceptional gains and losses amounted to RMB795,574,557.42 in H1 2021.
• Income tax effects were RMB229,844,293.22, and non-controlling interests effects were RMB83,841,010.78.

Summary of Key Points

• The report confirms factual accuracy of all data and statements.
• No dividend plans were announced.
• Financial performance shows increased revenue but declining net profit.
• Core business divisions include consumer electronics, industry trade, environmental protection, and semiconductors.
• Strategic focus is on Internet TV, smart home, and environmental solutions.
• The company is actively enhancing R&D capabilities, brand strength, and market channels.
• Environmental protection is a growth sector with policy-driven expansion.