Despite increased raw material costs, China’s declining real estate market, recurring COVID-19 infections and surging shipping cost in 2021, Haier Smart Home’s revenue and profit hit record highs
Haier Smart Home (06690.HK), a Chinese company principally engaged in the research, development, manufacture, and sales of household appliances, released its annual report for 2021 on March 29.
The subsidiary of Haier Group, China’s leading producer of home appliances, recorded a revenue of CNY 227.56 billion (USD 35.77 billion) in the fiscal year ended December 31, 2021, up 15.8% year on year.
Meanwhile, the net profit attributable to the owners of the parent company increased to CNY 13.07 billion, registering a year-on-year increase of 47.1%.
The company also reported that cash flow from operating activities grew by 31.4% over 2020 to CNY 23.13 billion. Profits of the overseas business segment hit a record high, as Casarte’s revenue reached CNY 12.9 billion, an increase of 43.99% from the same period the previous year.
Public information shows that the home appliances industry faced pressure from rising raw material prices in 2021. The prices of steel, aluminum and copper shot up over 40% in Q2 and Q3.
Haier Smart Home’s performance beat market expectations. As its digital transformation reduced costs and improved operating efficiency, the expense ratio decreased by 1.6 percentage points and the customer acquisition rate per sales staff member increased to 38% compared with last year.
To date, Haier Smart Home operates 10 R&D centers, 122 manufacturing centers, and 108 marketing centers globally. The R&D expense was CNY 8.36 billion in 2021, up 21.95% compared with previous year.
Haier Smart Home is facing stiff competition from established traditional white goods manufacturers such as Gree (Chinese: 格力电器), Midea (Chinese: 美的电器) , AUX (Chinese: 奥克斯) and even Xiaomi in the domestic market. Also, it is also increasingly finding itself up against the likes of Siemens and Samsung in the global market.