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Public company info - Sunfonda Group Holdings Limited , 01771.HK
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Sunfonda Group Holdings Limited, 01771.HK - Company Profile
Chairman Wu Tak Lam
Share Issued (share) 600,000,000
Par Currency U.S. Dollar
Par Value 1.0E-4
Industry Automobile Retailing, Maintenance & Repair
Corporate Profile Business Summary: The Group was principally engaged in the sale and service of motor vehicles in Mainland China. Performance for the year: Revenue for the year ended 31 December 2020 increased by 14.2% to RMB10,634.4 million as compared with the corresponding period in 2019. Gross profit for the year ended 31 December 2020 increased by 14.5% to RMB748.8 million as compared with the corresponding period in 2019. Gross profit margin for after-sales services decreased to 43.0% for the year ended 31 December 2020 from 44.2% for the year ended 31 December 2019. Profit for the year attributable to owners of the parent for the year ended 31 December 2020 increased by 21.1% to RMB145.2 million as compared with the corresponding period in 2019. Basic and diluted earnings per share attributable to ordinary equity holders of the parent for the year ended 31 December 2020 was RMB0.24. Business Review New Auto Sales Business In 2020, in response to the significant impact of the COVID-19 pandemic, the Group actively adjusted its operation strategies and proactively expanded new media and other sales models. While promoting traditional sales models, the Group opened accounts on various video platforms including Douyin, and tried new online sales methods such as live-streaming sales of automobiles. In 2020, thousands of live-streaming activities were launched across all the stores under the Group, attracting a total of 0.312 million followers. With the rapid recovery of the domestic economy, the Group, through a combination of online and offline sales, capitalized on the good momentum unleashed by market demand after the pandemic to seize sales opportunities and develop market resources. As a result, the retail sales recovered quickly. The Group took full advantage of the rebounding market and successively opened three new dealership stores to further fuel the Group’s overall increase in sales volume of new automobiles in 2020. For the year ended 31 December 2020, the Group realised a sales volume of new automobiles of 32,175 units, representing an increase of 9.7% year-on-year, and achieved revenue from sales of new automobiles of RMB9,491.7 million, representing an increase of 15.4% year-on-year. Most of the dealership stores of the Group are in an independent or continuously improving market environment, and the Group effectively increased their gross profit through strengthened sales process and full use of manufacturers’ policies. In addition to the increase in sales volume in 2020, the focus was placed on improving the horizontal value chain businesses, including decoration, finance, licensing and preferred products. In addition, by continuously launching various business trainings, the ability of employees were effectively improved, and business processes at the executive level were continuously optimized, thereby effectively improving the overall profitability of sales. After-sales Services Business Driven by the fast growth of car ownership volume, the automobile after-sales market in China is also developing rapidly. In the future, the auto after-sales market will become the main growth driver of the automotive industry. Adhering to the customer demand-centric service philosophy, the Group proactively adjusted its response measures against the impact of the pandemic to meet customer needs, actively promoted the resumption of work and production and endeavoured to build a good brand reputation. the Group continued to increase the Group's overall after-sales business volume by strengthening the repair and maintenance business, and the Group strived to improve the insurance accident repair business and expand the overall after-sales revenue scale. Through renovation of the Group's facilities the Group built a digital service experience, improved the efficiency of the Group's after-sales service and optimized the internal reception process of the Group's stores to ensure that customers receive the finest reception. As a result, the Group's customer retention rate continued to improve, thus laying a foundation for the further development of after-sales business. The Group stepped up its efforts in brand promotion and marketing while aggressively carrying out marketing for projects with high quality and actively planning and expanding business channels, including closer communication and cooperation with insurance companies. Through all staff’s comprehensive efforts, the overall business from after-sales services of the Group maintained its stable momentum and trend in 2020. For the year ended 31 December 2020, income from the Group’s after-sales services amounted to RMB1,142.7 million, representing an increase of 4.6% year-on-year. Used Car Business With the development of sales and after-sales replacement business, the Group continued to optimize its used car business structure and expanded its business scale. The Group also continued to explore and meet the replacement needs of new car customers and the resale needs of after-sales customers. By strengthening the growth of finance, insurance, insurance extension, decoration and other derivative businesses, the Group comprehensively improved its operating quality of used cars, and provided customers with higher quality service experience. The Group’s unremitting efforts in the first half of 2020 laid a solid foundation for the stably-improving operation for the second half. In the second half of the year, the Group always maintained a sense of crisis and hard work, focused on customer experience, and strengthened detail management to ensure the leading position in the severe market environment. With the development of the sales replacement and after-sale markets and the opening of the Group’s new brand stores, the Group continued to optimize the Group's used vehicle car structure and expanded the Group's business scale. The Group’s overall used car business maintained a good development trend and achieved better breakthroughs in 2020. While maintaining stable business operations of its used car business, the Group has further formulated and improved the standards for process management of used cars, strengthened risk management and control, and continuously improved the capabilities of the used car service team, thus bringing customers a more reliable and professional service experience. Decoration Business In the front-end decoration business, the Group stayed abreast of manufacturers’ policies and market changes, adjusted its strategy in a timely manner, optimized its package model, strengthened its second recommendation, deeply explored customers’ vehicle needs and improved customer satisfaction. In terms of after-sales decoration products, while consolidating its fundamental business and further improving customer experience and satisfaction, the Group increased its efforts in the after-sales development of automobile decoration projects, and developed a deep understanding in the modification and renovation needs of its after-sales and used car customers, thereby delivering improved penetration rate of its after-sales decoration business and steady growth in its gross profit. Insurance Agency Business In terms of insurance business, in accordance with the requirements of the China Banking and Insurance Regulatory Commission, the Group further strengthened cooperation with insurance companies in the context of the comprehensive fee reform. Insurance companies were invited to the store to provide assistance, and the Group's in-store insurance renewal capacity was enhanced, leading to increasing scale of premiums, thereby providing strong support for the continuous improvement of the Group's after-sales maintenance business. Financing Agency Business In 2020, the Group gradually established a standardized management system for its financing agency business, and further integrated the resources of all of its stores. By drawing upon its advantages of scale to develop broader and deeper strategic cooperation with banks, the Group continuously promoted the steady improvement of its performance. Network Development and Expansion As of 31 December 2020, the Group had 14 brand distribution agency rights (including 9 luxury and ultra-luxury brands) with further optimized brand structure, continuously expand the business network of superior brands, with a focus on the development of Shaanxi Province to cover the Great Northwest Region as well as Jiangsu Province, a major economic province in China. In 2020, the Group was newly authorized by the BMW brand in Wuhan, Hubei Province, which further expanded the Group’s business network to cover 8 provinces and 14 cities across the country, enabling the Group to gain a more prominently leading position among luxury and ultra-luxury automotive dealers in China. In 2020, the Group opened a new Xi’an Lexus 4S store, a new Xi’an GAC Toyota 4S store and a new Nanjing GAC Toyota 4S store. In addition, in order to further optimize its brand structure, the Group has made branding adjustments to Geely New Energy and SAIC Skoda. As of 31 December 2020, the Group had 37 sale points in operation. As of 31 December 2020, among the Group’s brands in operations, Audi, BMW, Mercedes-Benz, Porsche, Lexus, FAW Toyota, imported Volkswagen, SAIC Volkswagen and Hongqi all had new energy models in operation, with increasing sales volume year by year. These automobile manufacturers have increased their efforts in strategic deployment of new energy vehicles, and their advantages, from supply chain system, research and development system to sales channel building and brand communication, have become increasingly prominent. In addition, the Group continued to aggressively strive for agency authorization for the electric vehicle business of superior brands, racing to seize market shares. Prospects: On top of actively expanding the Group's business, the Group will remain devoted to the strict implementation of its management systems and conduct effective supervision and inspection. the Group aim to pay more attention to environmental protection, energy saving and emission reduction, while minimising the use of natural resources. the Group's staff is one of the Group's key resources, hence the Group will continue to strengthen the health and safety management of employees and conduct training on professionalism and business skills on a scheduled and non-scheduled basis. the Group will also attach great importance to the long-term development of employees and offer them sustainable career paths. In terms of operations, the Group will have to enhance supplier management and monitoring on an ongoing basis, exercise reasonable control over operating costs and improve operational efficiency. More importantly, it will have to keep focusing on customer satisfaction, further identity demands from customers and spare no efforts to serve them well. The Group will foster better communication and interaction with stakeholders and provide them with better returns. In the course of development, it will stay true to its mission and keep on participating in community and public welfare activities, thereby continuously enhancing the sense of corporate social responsibility. The Group is confident that the above series of measures will improve the Group's environmental, social and governance performance in 2021.

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