Changhong Meiling (000521)’s 2020 semi-annual board of directors operating review contains the following content:
1. Overview
Under the influence of the new crown epidemic, the home appliance industry in 2020 Suffering unprecedented challenges, although the domestic economic situation improved in the second quarter, the impact in the first quarter was indelible, and the entire home appliance market remained pessimistic in the first half of the year. In terms of domestic sales, factors such as declining consumer income, falling confidence, and the sluggish real estate market on the demand side have inhibited the purchase of home appliances; competitive pressure on the supply side has increased significantly, and product prices have continued to rise from a continued downward trend, coupled with the impact of epidemic prevention and transportation costs. , the company's profitability is significantly weakened. As the "stay-at-home economy" heats up, factors such as consumers' increasing health demands and more rational consumer behavior have forced companies to accelerate product structure adjustments, product quality and service capabilities, and channel changes to accelerate innovation.
In terms of exports, the global epidemic has spread rapidly since March. Many countries have begun to adopt closure measures. Global trade activities have almost come to a standstill. The risk of uncertainty in Sino-US relations has only increased, which has increased the exports of the home appliance industry. Adverse effects: With the cancellation or postponement of large-scale exhibitions, export companies have been hindered from expanding new customers, and some countries have also adopted policies to restrict imports and impose additional tariffs. In addition, the epidemic has also brought opportunities. The epidemic situation in major overseas manufacturing countries is still severe, and orders are gradually shifting to China. Demand in different countries varies greatly, and segmented products are facing growth opportunities.
During the reporting period, the company followed the guiding ideology of “one side and two points”, that is, using commercial inventory as the core to drive the supply chain, manufacturing, logistics, etc., to improve overall efficiency; through benchmarking, the output was highly in line with the market Matching online and offline competition strategies and product strategies, and implementing the annual operating policy of "product leadership, marketing transformation, efficiency breakthroughs, and team activation". Faced with the impact of the epidemic, all business units of the company took the initiative to turn crises into opportunities. Focusing on the effective implementation of existing orders, they took advantage of opportunities or policies to seize new orders, ensuring the safety of the supply chain, and the production capacity utilization rate continued to increase. In the first quarter, the fight against the epidemic was At the end of the second quarter, the market stopped slipping and net profit increased compared with the same period in 2019, and it has entered the normal production and operation track.
In the first half of 2020, the company achieved operating income of 6.796 billion yuan, a year-on-year decrease of 25.59%; net profit attributable to the parent company was -210.1306 million yuan, a year-on-year decrease of 486.74%; among which, operating income in the first quarter of 2020 2.282 billion yuan, net profit attributable to the parent company -270.0081 million yuan, operating income in the second quarter of 2020 was 4.514 billion yuan, and net profit attributable to the parent company was 59.8775 million yuan.
2. Risks and countermeasures faced by the company (1) Possible risks and countermeasures In the second half of 2020, the home appliance industry as a whole will still face a severe and complex situation and unprecedented profound changes. At the same time, as the impact of the epidemic normalizes, the demand for home appliances market will be further released in the second half of the year. Facing objective factors such as more intense competition in the home appliance market, the environment for enterprises to survive will become even worse. The company will face risks such as weak macroeconomic growth, severe industry conditions, intensified competition, rising costs, the spread of the global COVID-19 epidemic, the Sino-US trade war, new business models and the impact of the Internet era. In response to the above risks, combined with the industry situation in the second half of the year and the shortcomings in the first half of the year, in the second half of 2020, the company will seize opportunities, turn crises into opportunities, and implement the business plan from the following aspects. (2) Business plan for the second half of the year Under the guidance of strategic planning, the company will use "one side and two points" as the guiding ideology. In the second half of 2020, it will continue to carry out operations and management work around "product leadership, marketing transformation, efficiency breakthroughs, and team activation". The product line must also do the following work in terms of market strategy: 1. In the domestic market of the refrigerator and cabinet industry, take "product leadership, channel transformation, organizational optimization, and efficiency improvement" as the core actions, and adhere to the "high-quality products" + cost that quality is king. We are the king of "hot products" strategy, focusing on creating Meiling's business card in the "fresh, thin and clean" industry, taking products as the leader to promote product and technology leadership and improvement of cost and efficiency; through hard-core scientific and technological research, we promote product iteration and innovation, and provide Product and brand empowerment, create high-profit products with their own traffic, and collaborate across all channels to form comparative advantages in mid-to-high-end products; rely on efficiency improvements to enhance product competitiveness through local product focus and the establishment of high-efficiency lines.
In terms of overseas markets, we will continue to optimize the product structure and strengthen the adaptability of product research and development to different regions; sort out the strategies for core markets and core customers to strengthen the ability to respond to different markets; increase investment in brand teams and products, and continue to promote overseas self-owned products. Brand building. 2. Air-conditioning industry: In terms of the domestic market, we will continue to promote the construction of the market in base areas, form a competition mechanism to strive for the upper reaches, and build a channel system based on self-owned channels; carry out model innovation in non-base area markets, and sort out the value chain. In terms of overseas markets, we will focus on key markets and important customers to become bigger and stronger; we will focus on developing countries to seek new business models; we will fill in blank market products and improve product definition and service capabilities. 3. Washing machine industry In the second half of the year, the washing machine industry will focus on effective channels to introduce new self-produced drums, focusing on the popular large-capacity pulsator to increase sales. Taking advantage of the core advantages of the pulsator washing machine's "one-click smart washing", "small size and large capacity" and the "thin" + "smart" front-loading washing machine, and fully leveraging the momentum of the self-produced front-loading washing machine launch conference, Meiling fully upgraded the category structure of the washing machine. . At the same time, relying on self-produced washing machines to expand overseas business, expand ODM/OEM customers, and achieve a rapid breakthrough in the scale of Meiling washing machines. 4. Kitchen, bathroom and small household appliances industry: Focus on the "water ecological home appliances" product line to expand industry influence. In the second half of the year, we will focus on promoting dual-brand technology and supply-side collaboration to enhance technological advantages and bargaining power, and enhance market competitiveness. Promote new marketing and build live broadcast rooms. On the one hand, we will improve our own live broadcast capabilities and store construction capabilities. Second, we will use the star effect of the platform to promote cooperation, achieve brand exposure, and increase sales. 5. Biomedical will unswervingly implement the development strategy of "based on related diversification in the biomedical field", focusing on the strategic layout of the three major businesses of life sciences, smart cold chain, and family health, and continue to promote the deepening of life science business channels, product upgrades, and quality Upgrade, relying on the life science channel system, steadily promote the expansion of smart cold chain business and channel extension, and at the same time promote the launch of home health products such as oxygen concentrators and the construction of channel systems to promote the company's scale growth. The above business plans and business targets do not represent the listed company's profit forecast for 2020. Whether it can be realized depends on changes in market conditions, the efforts of the management team and other factors. There is great uncertainty. Investors are requested to pay special attention. .
3. Analysis of core competitiveness (1) Brand capability The company is one of the well-known electrical appliance manufacturers in China, with multiple product lines such as refrigerators, freezers, air conditioners, washing machines, and small household appliances. The "Meiling" brand is listed as one of the most valuable brands in China. In recent years, the company has continued to build its brand's core competitiveness through measures such as reshaping its brand image, continuously innovating core technologies and developing high-end intelligent products. In terms of reshaping the brand image, in terms of continuous innovation in core technologies, the company, on the one hand, in order to comply with industry and market development needs, continuously promotes innovation in intelligent and frequency conversion technologies to maintain its leading position in the industry. On the other hand, driven by consumption upgrades, in order to meet the personalized, differentiated and diversified needs of consumers, Meiling has returned to the essence of refrigerator preservation through the application of "water molecule activated preservation technology"; through the development of comprehensive thin GLS integration technology , the first "1cm free embedding of refrigerators" to achieve the trinity of thin body, thin cabinet and thin door; at the same time, the original "multi-metal nano-catalytic odor purification technology" continuously purifies a variety of odor molecules through physical adsorption and chemical catalysis. Decomposes into carbon dioxide and water, thereby achieving long-lasting odor purification and active sterilization, achieving high speed, economy and very clean. The whole refrigerator can be deodorized in ten minutes, overcoming the shortcomings of traditional refrigerators such as slow odor purification speed, poor effect and short lifespan; Through the development of three black technologies: inner barrel tapered expansion technology, inclined cylinder stabilization technology, and cloud disk condensation technology, a "very thin" drum washing machine was developed to provide users with a new embedded experience solution. The continuous innovation of the company's key core technologies highlights Meiling's professional capabilities. In terms of high-end intelligent product development, product innovation is promoted through continuous technological innovation. In recent years, the company has successively released CHiQ intelligent series products, "M Xiansheng" series refrigerators, "M Xiansheng" comprehensive thin series products, and "Shifenjing" refrigerator products. Through the introduction of the aforementioned high-end intelligent products, it has created "Meiling Xiansheng". , "Meiling Bo" and "Meiling Jing" three brand business cards, which not only meet market demand in a timely manner, but also enrich and enhance the brand image.
Through the continuous upgrading of products to promote the reshaping of brand capabilities, Meiling will achieve a younger, international, and professional brand image. Through the gradual creation of a better origin, a better life circle, and a better ecosystem, Meiling will become a more humane white brand. Electronic artists, smarter technology experts, and more trustworthy life stewards. (2) Product Capabilities For more than 30 years, the company has focused on the refrigeration industry and has developed a number of different models of refrigerator products, including series products under the three brands of "MELNG, CHiQ, and Athena". It mainly includes the "M Fresh" series of fresh-keeping refrigerators equipped with water molecule activated fresh-keeping technology, the "Shifenjing" series of fresh-keeping and pure-flavor refrigerators, the comprehensive thin product extension 503 series refrigerators, the CHiQ series of high-end smart refrigerators and air conditioners, and the 0.1-degree dual-precision inverter refrigerators. , North American air-cooled products, vertical display cabinets, YC-90EL low-temperature medical refrigerators, etc. In particular, the "Shijing" series of odor-free refrigerators released by the company apply "multiple metal nanocatalytic odor-free technology" and use a catalyst made with a special process to efficiently catalyze the active oxygen generated in the air to quickly remove odors and disinfect bacteria. The company has a relatively advanced and complete R&D and quality assurance system, and has passed ISO9001, ISO14001, OHSAS18001 and other management system certifications. The company's products are characterized by high quality and reliable performance. In terms of technology development, the company has a national technology center and a national industrial design center, and has invested heavily in basic technology research. In terms of intelligence, air cooling, freshness preservation, odor removal, frequency conversion, thin wall, and cryogenics, the company has advanced and leading Core technologies of peers. In terms of product development, the company combines technological research results and consumption upgrading needs to update the annual product planning and development outline. The product structure is increasingly upgraded, increasing the focus on air-cooling, large volume, frequency conversion, intelligence, freshness, clean taste, thin wall, and deep cooling. We will increase our efforts in the development of mid-to-high-end products, develop competitive core products, and significantly upgrade our product structure. (3) Operational capabilities The company continues to carry out “benchmarking” work and continuously improves internal management capabilities. A hierarchical sharing system with clear goals, quantified indicators, performance-oriented performance appraisal and decentralized incentives has been established to activate internal productivity. With value chain management as the main line, we will continue to carry out value creation work and enhance the company's competitiveness. Continuously improve the internal control system and improve the ability to prevent risks. (4) Marketing capabilities The company has established a relatively complete sales network and service system, accelerated marketing transformation, and realized marketing transformation from product line-oriented sales management to channel and user operation services, from single category marketing to full category marketing, focusing on We will work on organizations, systems, systems, processes, accounts sets, etc., and actively research smart transaction models to accumulate strength for subsequent development; in overseas markets, we will increase investment in overseas own brands, marketing agencies, R&D bases, production bases, etc., and cooperate with international Cooperate with well-known home appliance brands and dealers to optimize customer structure and improve product structure, actively grab orders and develop overseas markets.