Foshan Electrical and Lighting Co., Ltd. Interim Report 2019 (Summary)
Stock Code: 000541, 200541 Stock Name: FSL, FSL-B Announcement No. 2019-027
FOSHAN ELECTRICAL AND LIGHTING CO., LTD.
INTERIM REPORT 2019 (SUMMARY)
Part I Important Notes
This Summary is based on the full text of the 2019 Interim Report of Foshan Electrical and Lighting Co., Ltd.
(together with its consolidated subsidiaries, the “Company”, except where the context otherwise requires). In
order for a full understanding of the Company’s operating results, financial condition and future development
plans, investors should carefully read the aforesaid full text, which has been disclosed together with this Summary
on the media designated by the China Securities Regulatory Commission (the “CSRC”).
All the Company’s directors have attended the Board meeting for the review of this Report and its summary.
Independent auditor’s modified opinion:
□ Applicable √ Not applicable
Board-approved interim cash and/or stock dividend plan for ordinary shareholders:
□ Applicable √ Not applicable
The Company has no interim dividend plan, either in the form of cash or stock.
Board-approved interim cash and/or stock dividend plan for preferred shareholders:
□ Applicable √ Not applicable
Part II Key Corporate Information
1. Stock Profile
Stock name FSL, FSL-B Stock code 000541, 200541
Stock exchange for stock listing Shenzhen Stock Exchange
Contact information Board Secretary Securities Representative
Name He Yong Huang Yufen
Office address No. 64, Fenjiang North Road, Chancheng No. 64, Fenjiang North Road, Chancheng
District, Foshan City, Guangdong Province, District, Foshan City, Guangdong Province,
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Foshan Electrical and Lighting Co., Ltd. Interim Report 2019 (Summary)
P.R.China P.R.China
Tel. 0757-82810239 0757-82966028
E-mail address yh888@chinafsl.com fslhyf@163.com
2. Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
H1 2019 H1 2018 Change (%)
Operating revenue (RMB) 1,687,184,660.86 2,064,779,289.99 -18.29%
Net profit attributable to the listed
167,275,725.75 229,277,455.82 -27.04%
company’s shareholders (RMB)
Net profit attributable to the listed
company’s shareholders before exceptional 154,517,987.66 228,028,236.71 -32.24%
gains and losses (RMB)
Net cash generated from/used in operating
190,681,833.48 144,723,778.38 31.76%
activities (RMB)
Basic earnings per share (RMB/share) 0.1195 0.1638 -27.05%
Diluted earnings per share (RMB/share) 0.1195 0.1638 -27.05%
Weighted average return on equity (%) 3.77% 5.32% -1.55%
30 June 2019 31 December 2018 Change (%)
Total assets (RMB) 5,478,348,482.66 5,588,166,699.30 -1.97%
Equity attributable to the listed company’s
4,329,873,031.84 4,319,259,418.46 0.25%
shareholders (RMB)
3. Shareholders and Their Holdings as at 30 June 2019
Unit: share
Number of preferred
Number of ordinary shareholders 86,354 shareholders with resumed 0
voting rights (if any)
Top 10 shareholders
Name of Nature of Shareholding Number of Shares in pledge or frozen
Restricted shares
shareholder shareholder percentage shares Status Shares
Hong Kong Wah
Foreign legal
Shing Holding 13.47% 188,496,430 In pledge 92,363,251
person
Company Limited
Prosperity Lamps
Foreign legal
& Components 10.50% 146,934,857
person
Limited
Shenzhen Rising
Investment State-owned
5.12% 71,696,136 In pledge 35,800,000
Development Co., legal person
Ltd.
Guangdong
Electronics
State-owned
Information 4.74% 66,393,501 In pledge 32,532,815
legal person
Industry Group
Ltd.
Central Huijin State-owned
Asset 2.42% 33,878,900
legal person
Management Co.,
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Foshan Electrical and Lighting Co., Ltd. Interim Report 2019 (Summary)
Ltd.
Essence
International Foreign legal
2.14% 30,007,711
Securities (Hong person
Kong) Co., Ltd.
Rising Investment
Foreign legal
Development 1.82% 25,482,252
person
Limited
DBS Vickers
Foreign legal
(Hong Kong) Ltd 1.58% 22,102,137
person
A/C Clients
China Merchants
Foreign legal
Securities (Hong 0.87% 12,226,036
person
Kong) Co., Ltd
Foreign natural
Zhuang Jianyi 0.85% 11,903,509 8,927,632
person
Among the top 10 shareholders, Hong Kong Wah Shing Holding Company Limited, Shenzhen
Rising Investment Development Co., Ltd., Guangdong Electronics Information Industry Group
Ltd. and Rising Investment Development Limited are acting-in-concert parties; and Prosperity
Related or acting-in-concert parties
Lamps & Components Limited and Zhuang Jianyi are acting-in-concert parties. Apart from that,
among the shareholders above
it is unknown whether there is among the top 10 shareholders any other related parties or
acting-in-concert parties as defined in the Administrative Measures for the Acquisition of Listed
Companies.
Among the top 10 unrestricted shareholders, Shenzhen Xingsen Asset Management Co.,
Shareholders involved in securities Ltd—Phase II Private Fund of Xingsen holds 0 shares in the Company through its common stock
margin trading (if any) accounts and 8,616,776 shares in the Company through its accounts of collateral securities for
margin trading, representing a total holding of 8,616,776 shares in the Company.
4. Change of the Controlling Shareholder or the Actual Controller in the Reporting Period
Change of the controlling shareholder in the Reporting Period:
□ Applicable √ Not applicable
The controlling shareholder remained the same in the Reporting Period.
Change of the actual controller in the Reporting Period:
□ Applicable √ Not applicable
The actual controller remained the same in the Reporting Period.
5. Number of Preferred Shareholders and Shareholdings of Top 10 of Them
□ Applicable √ Not applicable
No preferred shareholders in the Reporting Period.
6. Corporate bonds
Does the Company have any corporate bonds publicly offered on the stock exchange, which were outstanding
before the date of this Report’s approval or were due but could not be redeemed in full?
No.
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Foshan Electrical and Lighting Co., Ltd. Interim Report 2019 (Summary)
Part III Operating Performance Discussion and Analysis
1. Business Overview of the Reporting Period
Is the Company subject to any industry-specific disclosure requirements?
No.
In the first half of 2019, China’s economy was under great pressure for growth. From an international perspective,
global economic growth slowed down, US-China trade conflicts continued to escalate, the international trade was
in confusion, and overseas market demand played a weaker role in driving China’s economic development; from a
domestic perspective, real estate regulation policies remained tight, disparity among manufacturers was getting
increasingly evident, and many challenges posed a threat to economic development. For lighting companies, on
one hand, LED lighting has developed at a fast pace, the penetration rate of LED lighting products has continued
to increase, and the growth of market demand has slowed down in recent years. On the other hand, companies
have released their expanded capacity one after another, resulting in continuously sliding retail prices of lighting
products and increasingly fierce competition between industries. In light of the macroeconomic pressure, slowed
industrial growth and fierce market competition environment, the Company continued to deepen technical
renovations and the upgrading of intelligent manufacturing for its main products by centering around the strategic
goal of “Cutting-edge Technology, International Brand and Market and Large-scale Production” raised by the
board of directors. Additionally, it dealt with the pressure of market competition through internal reorganization
and team coordination and the integration of various advantaged resources. For the Reporting Period, the
Company achieved operating revenue of RMB1687.1847 million, a year-on-year decrease of 18.29 %; and a net
profit attributable to the listed company’s shareholders of RMB167.2757 million, a year-on-year decrease of
27.04 %.
In the first half of 2019, the Company mainly focused on the following work:
1. Integrated internal resources and developed market potentials in each segment
In the first half of 2019, the Company implemented the BU system reform. It set up four business units including
R&D and sales, adjusted the BU organizational structure and talent structure, and sorted out BU process and
authorization to enable fast response to changing goals of market. At the same time, it improved the remuneration
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Foshan Electrical and Lighting Co., Ltd. Interim Report 2019 (Summary)
and incentive system of business units, proactively mobilized staff enthusiasm, strengthened the development of
leadership, and kept exploring and innovating in incentive mechanism. It encouraged the orientation by problem
solving and the joint creation of value and sharing of results by everyone who should have a sense of engagement.
In terms of domestic sales, the Company explored and promoted the high-end development of its products, set up
stores for the experience of a high-end, intelligent and healthy household life, and enhanced the image of Foshan
Lighting in consumers’ mind through the export at the windows of the experience stores; it proactively developed
engineering channel business with a focus on education, real estate, rail transit and brand franchising to increase
its market shares on engineering channel; it continued to develop high quality automotive lamp projects and new
LED module projects and increase LED module application vehicle models in an attempt to raise its markets
shares in lamp factories and main device factories. In terms of overseas sales, to deal with the impact of US-China
trade conflicts, the Company beefed up the promotion of intelligent products and made joint efforts to develop
new products based on the demands of key accounts; it made active steps to explore overseas e-commerce channel
and further expanded marketing channels; it made use of the development opportunities brought by “Belt and
Road” to vigorously expand the markets in “Belt and Road” countries, strengthen brand promotion overseas,
enhance the influence of self-owned brands, and propel the pace of brand internationalization.
2. Improved intelligent product technologies and product categories, resulting in considerable growth in the sales
of intelligent products
During the Reporting Period, the Company continued to enrich the categories of intelligent products and
maintained the upgrading and improvement of intelligent control technologies. It connected with more influential
mainstream cloud platforms both at home and abroad, including China’s Huawei, Alibaba, Tencent and Jingdong,
and foreign Amazon, Google, WIZ and key accounts platforms. Meanwhile, it upgraded its own cloud platform
and continued to provide users with solutions from the intelligent control of single product to scenario-based
intelligent household solutions. During the Reporting Period, the Company proactively carried out
interdisciplinary cooperation with other platform enterprises in the field of intelligence. It made use of Huawei’s
HiLink intelligent technology to connect with Huawei’s intelligent ecological chain and carried out in-depth
cooperation with Huawei in intelligent household lighting; it took the initiative to discuss deep cooperation with
Baidu and Alibaba Cloud in intelligent household life. In the first half of 2019, the Company achieved sales
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Foshan Electrical and Lighting Co., Ltd. Interim Report 2019 (Summary)
revenue of RMB20,305,900 from its intelligent products, including a centralized purchase order of one million
lamps by Alibaba’s Tmall Genie and a new sales revenue of RMB754,000 from intelligent electrical products.
3. Strengthened efforts in intelligent manufacturing to speed up fast response
The Company’s production automation has improved substantially over recent years’ continuous development in
production automation. On the basis of that, the Company continued to center around the goal of “Automation,
Flexibility and Large Scale”, optimized process automation for some production lines based on the actual
production conditions, and tried to push the standard and modular process from front end to back end, in an effort
to enhance the flexibility and compatibility of production automation. At the same time, the Company accelerated
the level of information building. On the basis of the existing SAP system, OA system and HR system, it
established the SRM (supply chain) system, WMS (warehouse) system and PDM (R&D) system and promoted the
integration of its automated production lines and information systems, aiming to achieve inter-connectivity and
integration and open up its business data chains in different segments, including R&D, purchase, manufacturing,
warehousing and sales. Thus, it will help the Company’s management to quickly understand production
conditions, expedite the adjustment of its production according to market demands and enhance its overall
response speed and management abilities, providing customers with better delivery experience and achieving the
goal of win-win results between the Company and its customers.
2. Matters Related to Financial Reporting
(1) Changes to Accounting Policies, Accounting Estimates or Measurement Methods Compared to the Last
Accounting Period
√ Applicable □ Not applicable
In 2017, the Ministry of Finance revised and issued the Accounting Standards for Business Enterprises
No.22-Recognition and Measurement of Financial Instruments, Accounting Standards for Business Enterprises
No.24-Hedge Accounting, Accounting Standards for Business Enterprises No.37-Presentation of Financial
Instruments and required enterprises listed both domestically and overseas as well as companies listed overseas
with financial report prepared in accordance with International Financial Reporting Standards or Accounting
Standards for Business Enterprises to carry out the revised accounting standards since 1 January 2018, required
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Foshan Electrical and Lighting Co., Ltd. Interim Report 2019 (Summary)
other domestically listed companies to carry out the revised standards since 1 January 2019, and required unlisted
enterprises implementing Accounting Standards for Business Enterprises to carry out the revised standards since 1
January 2021. Thus the Company starts to implement the changed new standards governing financial instruments
since 1 January 2019. For details, refer to the Announcement on Changes in Accounting Policies (Announcement
No.: 2019-020) disclosed on cninfo.com.cn.
(2) Retrospective Restatements due to the Correction of Material Accounting Errors in the Reporting
Period
□ Applicable √ Not applicable
No such cases.
(3) Changes to the Scope of Consolidated Financial Statements Compared to the Last Accounting Period
√ Applicable □ Not applicable
The Company convened the 26th Meeting of the 8th Board of Directors on 7 September 2018, which reviewed and
approved the Proposal on the De-Registration of Wholly-owned Subsidiary Guangdong Fozhao Finance Lease
Co., Ltd. (hereinafter referred to as “Fozhao Lease”). Upon the receipt of the Notice on Approval of
De-Registration from the Foshan Administration for Market Regulation on 26 March 2019, the de-registration
procedure of Fozhao Lease has been completed and Fozhao Lease has been excluded from the scope of the
Company’s consolidated financial statements.
The Board of Directors
Foshan Electrical and Lighting Co., Ltd.
28 August 2019
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