2021-08-10-深交所-稳健医疗_2020年年度报告（英文版）_325页_5mb

Winner Medical Co., Ltd. 2020 Annual Report Summary

Core Content Overview

Winner Medical Co., Ltd. (stock code: 300888), established in 1990, is a health enterprise with three main brands: Winner Medical, Purcotton, and PureH2B. The company has evolved from a manufacturer of medical consumables into a comprehensive player in the medical and consumer goods sectors, focusing on quality, brand value, and social responsibility. The 2020 annual report highlights the company's significant role in the fight against the COVID-19 pandemic, its financial growth, and strategic initiatives for the future.

Key Financial Highlights

• Revenue in 2020 reached CNY 12.5 billion, up 173.99% from 2019.
• Net profits attributable to shareholders amounted to CNY 3.8 billion, a 597.50% increase from 2019.
• Net cash flow from operating activities was CNY 4.77 billion, up 694.88% from 2019.
• Basic EPS was CNY 9.80, a 575.86% increase from 2019.
• Total assets grew to CNY 13.0 billion, up 186.93% from 2019.
• Net assets attributable to shareholders reached CNY 10.45 billion, a 230.78% increase from 2019.

Main Business and Operations

1. Medical Consumables

Winner Medical is a leading enterprise in the domestic medical consumables industry, offering a wide range of products including:

• Wound care (high-end and traditional)
• Infection prevention and disinfection
• Operating room consumables
• Body surface cleaning products

The company has established a full industrial chain from cotton procurement to R&D, production, and direct export. Its products are certified by international standards such as CE, FDA, and Japanese Ministry of Health, and are exported to Europe, America, and Japan.

2. Purcotton (Consumer Goods)

Purcotton, a wholly-owned subsidiary, focuses on cotton-based consumer products such as tissues and sanitary pads. It has expanded its offline and online channels, with over 257 chain stores and a rapid growth in e-commerce sales. The company has also introduced digitalization systems to improve sales and delivery efficiency.

3. PureH2B (Health and Wellness)

PureH2B, based on the concept of "nature, science, and bodybuilding", develops home care and health products. It has successfully expanded into international markets, establishing cooperative relationships with multinational companies and large chain pharmacies.

Strategic Initiatives and Future Goals

• Innovation and Digital Transformation: Winner Medical launched a new reform in 2020, focusing on digital and intelligent manufacturing, and consumer-centric operations.
• Matrix Organizational Structure: Implemented to enhance customer and market responsiveness.
• Digital Strategies: Includes centralized commodity digital operation, omni-channel digital operation, smart logistics, and smart manufacturing.
• Brand Expansion: The company aims to transition from "made in China" to "created in China", and to become an international brand.
• Sustainable Development: Winner Medical emphasizes quality of life, health, and environmental protection, aligning with long-term value creation.

Pandemic Response and Impact

• Key Role in Pandemic: Winner Medical was one of the fastest responders to the COVID-19 outbreak, providing nearly 4 billion masks and over 86 million protective suits by the end of 2020.
• Government Recognition: The company was awarded the "National Advanced Unit for Fighting the COVID-19 Pandemic" by the CPC Central Committee and the State Council.
• Social Responsibility: The company prioritized quality over profit and social responsibility over corporate value, ensuring high-quality, low-cost products for medical workers and the public.

Shareholder Benefits and Corporate Governance

• Profit Distribution Plan: Based on 426,492,308 shares, the company distributed CNY 18 per share (tax included) as cash dividends for every 10 shares.
• Corporate Governance: The company adheres to strict governance standards, with all directors attending the board meeting for report review.
• Accounting and Audit: The financial report was audited by BDO China Shu Lun Pan CPAs, and the audit report indicated that the company’s going concern ability is uncertain based on net profit after deducting non-recurring items.

Risk and Caution

• Forward-looking Statements: The report includes future development strategies and performance plans, which are not profit forecasts and are subject to market changes and uncertainties.
• Investor Risks: The company warns investors about the risks associated with future development, emphasizing the need for awareness of market and operational uncertainties.

Key Subsidiaries and Partners

• Winner Medical (Huanggang), (Jiayu), and (Chongyang): Key subsidiaries that contributed significantly to the production of anti-pandemic products.
• Purcotton Subsidiaries: Includes Shenzhen Purcotton, Guangzhou Purcotton, Beijing Purcotton, Shanghai Purcotton, and Qianhai Purcotton.
• PureH2B Subsidiaries: Includes Shenzhen PureH2B Technology Co., Ltd. and Chengdu Wenjian Likang.
• Key Clients: Includes China Nepstar and LBX Pharmacy, among others.
• Partnerships: Collaborations with Tmall, JD.com, and Vipshop for e-commerce expansion.

Conclusion

Winner Medical Co., Ltd. demonstrated remarkable growth in 2020, driven by its response to the pandemic, strategic expansion, and digital transformation. The company continues to focus on quality, innovation, and social responsibility, aiming to become a global health leader. Despite financial success, the report highlights uncertainties in future performance and ongoing risks, urging investors to remain cautious.