Securities Times Li Yingquan
On the afternoon of May 31, Gree Electric (000651) held the 2021 annual performance briefing through online video live broadcast. Dong Mingzhu, chairman of Gree Electric, took the C position and became the focus of the audience.
A reporter from Securities Times e company noticed that almost all investors' questions at the meeting were answered by Dong Mingzhu.
In the exchange, Dong Mingzhu tried to downplay the "air conditioner" label of Gree Electric Appliances, and introduced more about the company's layout in new energy, small household appliances and other business sectors, and even publicly "bring goods" at the meeting, talking about Gree dehumidifiers, Functional details of small household appliances such as fans and washing machines.
Talking about performance: raw material prices have a big impact
The 2021 annual report shows that Gree Electric achieved operating income of 187.869 billion yuan last year, a year-on-year increase of 11.69%; net profit attributable to the parent was 23.064 billion yuan, a year-on-year increase of 4.01%.
Before that, Gree Electric's first-phase employee stock ownership plan launched last year set a performance target of a 10% year-on-year increase in net profit in 2021.
"In 2021, we originally expected a 10% profit growth, but the result was unsatisfactory. There are many uncertain factors, such as the international situation, repeated epidemics, etc., and a more important issue is the price increase of raw materials. Materials have risen. price, the product may not be able to increase the price (by the same amount), we can only make appropriate adjustments to the price under the premise of ensuring the stability of the product quality, in order to ensure the competitiveness in the market. But even so, Gree is still a competitive A powerful enterprise, we have achieved full coverage of the entire consumer household appliances from a single air conditioner, which will be a good growth highlight in the future." Dong Mingzhu said.
For the main business of air conditioners, Dong Mingzhu admitted that the homogenization competition is fierce. In this context, Gree Electric's breakthrough is energy saving.
"Gree's air conditioners can save consumers tens of yuan in electricity bills every month. Although it doesn't seem much, it brings huge energy savings to the whole society. As the country promotes the 'double carbon' goal, Gree Electric has developed 10 Photovoltaic air conditioners and optical storage air conditioners in 2018 can make a huge contribution to the realization of the 'dual carbon' goal. Now optical storage air conditioners can be implemented in several large projects, such as the medical device industry, the electronics industry, and big data centers."
Dong Mingzhu introduced that Gree Electric has now become the chairman of the ISO/TC86/SC4 Refrigeration Compressor Sub-Committee of the International Organization for Standardization Refrigeration and Air Conditioning Technical Committee, which reflects the leadership of Gree Electric in the research and development of the industry, and exports Chinese solutions for international standards.
"In terms of patents, Gree ranks among the top five in the national patent (quantity) ranking. At the same time, we also pay more attention to the quality of patents and its core competitiveness, because many of our technologies are unique."
Regarding the performance of Gree Electric Appliances in the capital market, Dong Mingzhu bluntly stated that the company adheres to the idea of long-term dividend distribution, and hopes that investors will adhere to long-term investment.
"Recently, a senior economist called me and said that Gree Electric ranked first in the amount of dividends among non-public listed companies. I still remember that Gree Electric's initial listing raised 5 billion yuan, but the accumulated dividends in the past exceeded more than 100 billion yuan, which also shows that long-term investment in Gree is valuable."
Dong Mingzhu also publicly responded to the employee stock ownership plan that has recently been discussed in the market: "The company launched the first phase of the employee stock ownership plan last year. The price at that time was relatively high. ; The company's original plan was to launch one phase in the first half of last year and the second half of the year, but considering the market situation, the second phase was postponed to this year. The original intention of our equity incentive is to make employees motivated, but not based on letting employees buy low and high Selling 'make the difference', we want our employees to enjoy the rewards through long-term dividends, just like long-term investors."
Talking about Marketing Reform: Revolutionizing Your Own Life
At the exchange meeting, Gree's marketing reform was a matter of great concern to investors.
Dong Mingzhu responded to this: "Reform, first of all, is to destroy one's own life. Gree's past marketing model was created by me, and there has not been much change in more than 20 years. But the background of today's era is completely different from that of the year. The arrival is indeed a huge challenge for Gree. It is not an easy task for our huge (dealers) team to let everyone move forward in the process of reform and benefit everyone. But we can't just It's not our approach to throw away dealers across the board for our own sake."
Dong Mingzhu said that after the outbreak of the new crown epidemic, the trend of onlineization has been further accelerated. Against this background, Gree has launched a marketing reform.
"As you can see, I have been doing live broadcasts for the past two years. The live broadcasts are not because of how much I want to sell, but because I want to understand the market and let the dealers realize that the way of doing business in the past can no longer work. In the past two years, everyone said Gree’s sales performance did not meet expectations, and the change in channels has a certain impact, but it has little impact, because we have changed the perception of dealers in the process.”
"Now, Gree requires distributors to not only open physical stores, but also to be able to do live broadcasts, combining online and offline. For example, in the past, offline sales required millions of products. Now this problem has been solved. With online orders and instant delivery, 300,000 to 500,000 items are enough, which brings greater convenience to consumers.”
Dong Mingzhu also pointed out that the biggest problem with online consumption at present is that the goods are not on the right board and the quality is different.
"In the context of the sharp rise in raw material prices, Gree still insists on stable product quality and does not cut corners. Naturally, the cost is higher than others, and the price cannot be achieved (low price). The concept of online consumers should be changed from 'pursuit' It takes time to change from low price to 'quality focus'." She said with a smile that in the current home appliance recycling market, Gree's air conditioners are often about 200 yuan more expensive than other brands, which also shows that Gree products have more "real" products. material".
But Dong Mingzhu also mentioned that Gree's biggest gain in live broadcasting is not air conditioners, but household appliances.
"Now in online sales, our household appliances have been greatly recognized by consumers."
Talking about Diversification: Leading New Energy Technology
"Although the company has not reached the 10% growth target in 2021, the company has become more resilient, and it is stronger in the company's industrial sector, the most important of which is the new energy sector." Dong Mingzhu said.
"The lithium titanate technology of Gree Titanium (Note: Former Zhuhai Yinlong), as far as we know, only two companies in the world have it, one is Toshiba and the other is Gree Titanium. There are three advantages of lithium titanate technology, one is the service life. Long, up to 30 years, no attenuation; second, high safety, can achieve high temperature without fire, no explosion; third, wide operating width, normal operation at high temperature and low temperature. What is the disadvantage? The energy density is relatively low. "
Dong Mingzhu pointed out that although lithium titanate batteries are not as good as the mainstream ternary lithium batteries and lithium iron phosphate products in the market in terms of energy density, three obvious advantages enable them to play a great role in the field of energy storage.
Calculated with a 30-year service cycle, considering the capacity attenuation problem, ternary or lithium iron phosphate products require multiple battery replacements, and the overall cost may be more than three times that of lithium titanate.
"In 2021, after Gree became the major shareholder of (Gree Titanium), it has carried out a substantial reform of its organizational structure, including personnel adjustment, optimization of technology research and development and adjustment of the sales system. We believe that in the next few years, it will become Gree Electric Appliances. A very good growth point." Dong Mingzhu said.
(e company)