2022-05-17-深交所-泸州老窖_2021年年度报告（英文版）_266页_2mb

Luzhou Laojiao Co., Ltd. 2021 Annual Report Summary

Core Content and Key Information

Luzhou Laojiao Co., Ltd. is a Chinese company listed on the Shenzhen Stock Exchange with the stock code 000568. The annual report for 2021 was prepared in both Chinese and English, with the Chinese version taking precedence in case of discrepancies. The report includes important statements from the Board of Directors and senior management, affirming the accuracy and completeness of the information provided.

The company's registered address is Guojiao Square, Luzhou City, Sichuan Province, and its business address is the Luzhou Laojiao Marketing Network Command Center on Nanguang Road. The legal representative is Liu Miao, and the company's website is www.lzlj.com, with contact email Izlj@Izlj.com.

The 2021 annual report outlines key financial data, including a significant increase in operating revenue and net profit. The company's operating revenue reached CNY 20,642,261,724.37, up 23.96% year-on-year, while net profit attributable to shareholders amounted to CNY 7,955,554,351.73, an increase of 32.47% year-on-year. Net cash flows from operating activities also rose by 56.60% to CNY 7,698,648,104.51. The company's total assets and net assets both increased, with total assets at CNY 43,211,782,005.68 and net assets at CNY 28,040,247,005.94.

The profit distribution plan for 2021 included a cash dividend of CNY 32.44 per 10 shares, with no bonus shares or conversion of reserves into share capital. The report also outlines the company's non-recurring profits and losses, including government grants and impairment reversals, which contributed to a total of CNY 71,170,296.13 in non-recurring items.

Key Financial Indicators

Main Business and Sales Models

The company primarily operates in the baijiu (Chinese liquor) industry, focusing on the design, production, and sales of baijiu products such as "National Cellar 1573" and "Luzhou Laojiao". It employs two main sales models:

1. Traditional Channel Operation Model: Authorized distribution through offline distributors, with direct supply to distributors and sales to consumers and terminal outlets.
2. Emerging Channel Operation Model: Online sales via e-commerce platforms like JD.com and Tmall, including flagship stores, specialty stores, and live streaming.

Production and Inventory

• Mid- and High-end Baijiu:

  • Production volume: 48,662.90 tons (+100.13% YoY)
  • Sales volume: 31,765.82 tons (+25.42% YoY)
  • Inventory: 39,177.05 tons (+75.84% YoY)
  • The increase in production and inventory was due to adjustments in production plans.

• Other Baijiu:

  • Production volume: 46,155.34 tons (-47.01% YoY)
  • Sales volume: 46,054.68 tons (-51.82% YoY)
  • Inventory: 13,675.50 tons (+0.74% YoY)
  • The decrease in production and sales was attributed to the reduced sales volume of Erqu products.

• Inventory at the end of the reporting period:

  • Finished baijiu: 52,852.55 tons
  • Semi-finished baijiu: 385,727.12 tons

• Production Capacity:

  • Design capacity for baijiu: 170,000 tons
  • Actual capacity: 170,000 tons
  • Capacity in progress: 0 tons

Core Competitiveness

A. Geographical Advantage

Luzhou City, where the company is located, has a sub-tropical climate and fertile soil, ideal for growing the grains used in baijiu production. The company uses local loessal clay for its cellars, which are known for their strong viscosity, rich minerals, and moisture retention. The region also has abundant and quality water, contributing to the unique geographical advantage of the company's baijiu production.

B. Cellars and Brewing Technique

The company's cellars, including the National Treasure 1573 Cellars (founded in 1573), were recognized as Cultural Relics of National Importance in 1996 and 2013. The traditional brewing technique of Luzhou Laojiao, a 24-generation inheritance, was selected as the first batch of National Intangible Cultural Heritage in 2006. These resources are critical for the quality of the company's baijiu.

C. Brand Advantage

The company has strong brand recognition, with "National Cellar 1573" being a world-famous high-end brand and "Luzhou Laojiao Tequ" being one of the four most famous baijiu brands in China. The brand system of "dual brands, three product series, and major single products" has been effectively implemented, enhancing brand influence and customer base.

D. Quality and R&D Advantage

The company is committed to producing high-quality baijiu and has established several research platforms, including the National Engineering Research Center of Solid-State Brewing and the National Liquor Test Center. It has also focused on technological innovation and automation, leading to numerous patents and improvements in production efficiency and base baijiu quality.

E. Talent Advantage

The company has a team of highly skilled professionals, including 1 inheritor of national intangible cultural heritage, 4 Chinese brewing masters, and 11 senior professor engineers. This talent pool supports the company's sustainable development and innovation.

Summary of Major Business Actions in 2021

• Precision Marketing: The company expanded its market presence and base market development, significantly reducing marketing expenses while increasing profits and customer base.
• Brand Building: The company introduced a "bottled vintage baijiu" product, the first of its kind in the industry, and launched the "Chinese Flavor" product in core cities.
• Capacity Upgrade: The Huangyi Brewery Eco-Park was fully operational, increasing production capacity with a new annual storage capacity of 380,000 tons of baijiu.
• Digital and Intelligent Innovation: The company focused on brewing informatization and automation, enhancing production efficiency and product quality.