Stock Code: 000553(200553) Stock Abbreviations: ADAMA A(B) Announcement No.2023-10
Abstract of the 2022 Annual Report of ADAMA Ltd.
I. Important Reminder
The Abstract is from the full text of the Annual Report. Investors are advised to read the full text of the AnnualReport published on the media designated by China Securities Regulatory Commission for having a roundunderstand of the Company’s performance, financial status and future development plan.
All the directors attended the Board of Directors meeting to review the Annual Report. No disagreement was raisedby the directors, supervisors, and senior managements.
Non-standard auditor report
□ Applicable √Not applicable
Plan approved by the Board of Directors for dividend distribution of ordinary shares or increasing the capital bythe transfer of capital reserves.
√Applicable □Not applicable
Whether increase the capital by the transfer of capital reserves
□Yes √No
The pre-plan of the dividend distribution approved by the meeting of the Board of Directors refers to the totaloutstanding 2,329,811,766 shares of the Company as the basis for the distribution as cash dividend of RMB 0.27(before tax) per 10 shares, to all the shareholders of the Company. No shares will be distributed as share dividend,and no reserve will be transferred to equity capital.
Plan approved by the Board of Directors for dividend distribution of preferred shares
□ Applicable √ Not applicable
II. Basic information about the Company
1. Company profile
| Stock name | ADAMA A, ADAMA B | Stock code | 000553, 200553 | |
| Stock exchange | Shenzhen Stock Exchange | |||
| Contact Information | Board Secretary | Securities Affairs Representative & Investor Relations Manager | ||
| Name | Guo Zhi | Wang Zhujun | ||
| Address | 6/F, No.7 Office Building, No.10 Courtyard, Chaoyang Park South Road, Chaoyang District, Beijing | |||
| Tel. | 010-56718110 | 010-56718110 | ||
| irchina@adama.com | irchina@adama.com | |||
2. Main Business or Products during the Reporting Period
Main Business and ProductsThe Company is a global leader in crop protection, engaging in the development, manufacturing andcommercialization of a wide range of crop protection products, that are largely off-patent. The Company provides
solutions to farmers to combat weeds, insects and disease, and sells its products in over 100 countries, throughapproximately 60 subsidiaries worldwide.
The Company's business model integrates end-customer access, regulatory expertise, state-of-the art global R&D,production and formulation facilities, thereby providing the Company a significant competitive edge and allowingit to launch new and differentiated products that meet local farmers and customer needs in key markets.
The Company's primary operations are global, spanning activities in Europe, North America, Latin America, Asia-Pacific (including China) and India, the Middle-East and Africa.
The Company also utilizes its expertise to adapt such products also for the development, manufacturing andcommercialization of similar products for non-agricultural purposes (Consumer and Professional Solutions).
In addition, the Company leverages its core capabilities in the agricultural and chemical fields and operates inseveral other non-agricultural areas, none of which, individually, is material for the Company. These activities,collectively reported as Intermediates and Ingredients, include primarily, (a) the manufacturing and marketing ofdietary supplements, food colors, texture and flavor enhancers, and food fortification ingredients; (b) fragranceproducts for the perfume, cosmetics, body care and detergents industries; (c) the manufacturing of industrialproducts and (d) other non-material activities.
General crop protection market environmentDuring 2022, crop prices reached record levels in May 2022, driven by tight stocks, adverse weather conditions andthe Ukraine-Russia conflict which disrupted the supply of commodities. Prices have since declined but are expectedto remain above pre-pandemic levels. The high crop prices drove strong farmer income, despite the higher costenvironment (fertilizer, chemicals, labor, energy) faced by farmers. As a result, crop protection demand stayedstrong in 2022 and farmers were able to absorb crop protection price increases. Going into 2023, crop protectionchannel inventories in some regions are above average, which may dampen demand in the near future.
The cost environment has improved throughout the second half of 2022, as raw material and active ingredient pricesin China continued to decline, logistic prices normalized and energy prices eased. However, costs are still higherthan pre-pandemic levels, with some areas still experiencing especially high costs, like European co-formulants andinland transportation.
Market Competition and the Company’s Market ShareThe global crop protection market is dominated by seven multinational companies, including the Group, five ofwhich are originator companies. In the past decade, a number of mergers and acquisitions were completed amongthe largest players in the crop protection industry. Nonetheless, the crop protection industry as a whole is relativelydecentralized, with a number of local manufacturers competing in each country against the global multinationalcompanies. The Group believes that entry barriers for the crop protection market are relatively high, although theyvary from region to region.
ADAMA is a leading company (in sales terms) among the crop-protection companies that focus on off-patent cropprotection solutions. The Company’s global crop protection market share was approximately 6.5% in 2022, basedon AgBio Investor’s preliminary estimation of the global agrochemical industry in 2022 (compared with 6.0% in2021).
3. Main Accounting Data and Financial Indicators
(1) Main Accounting Data and Financial Indicators of the Latest Three Years
Whether the Company performed any retroactive adjustments to or restatement of its accounting data
√Yes □No
Reasons for Retroactive Adjustments or Restatement of the Accounting Data: Changes to the Accounting Policies
Unit: RMB’000
| 2022 | 2021 | +/- (%) | 2020 | |||
| adjustment | adjustment | adjustment | adjustment | |||
| Operating revenue (RMB’000) | 37,381,915 | 31,038,605 | 31,038,605 | 20.44% | 28,444,833 | 28,444,833 |
| Net profit attributable to the shareholders (RMB’000) | 609,391 | 157,397 | 157,397 | 287.17% | 352,753 | 352,753 |
| Net profit attributable to the shareholders, excluding non-recurring profit and loss (RMB’000) | 490,428 | 77,853 | 77,853 | 529.94% | 287,724 | 287,724 |
| Net cash flows from operating activities (RMB’000) | 940,745 | 4,561,875 | 4,561,875 | -79.38% | 2,023,015 | 2,023,015 |
| Basic EPS (RMB/share) | 0.2616 | 0.0676 | 0.0676 | 286.98% | 0.1505 | 0.1505 |
| Diluted EPS (RMB/share) | N/A | N/A | N/A | N/A | N/A | N/A |
| Weighted average return on equity | 2.76% | 0.74% | 0.74% | 2.02% | 1.61% | 1.61% |
| 31.12.2022 | 31.12.2021 | +/- (%) | 31.12.2020 | |||
| Before adjustment | After adjustment | Before adjustment | After adjustment | |||
| Total assets (RMB’000) | 57,980,489 | 50,235,308 | 50,235,308 | 15.42% | 46,801,034 | 46,801,034 |
| Net assets attributable to the shareholders (RMB’000) | 23,124,655 | 21,075,083 | 21,075,083 | 9.73% | 21,353,752 | 21,353,752 |
Reason for retroactive adjustments: According to ASBE 22 - Financial Instruments Recognition and Measurement,starting from 2022 the Group recorded the gain or loss from the disposal of derivative instruments in the “Gain(loss)from Changes in Fair Value”. Before 2022, the Group recorded the abovementioned gain of loss in the “Investmentincome, net”. The Company reclassified the “Gain(loss) from Changes in Fair Value” and the “Investment income,net” in the corresponding period in 2021. Such change did not impact the operating results or net assets of thereporting period.
(2) Main Accounting Data by Quarter
Unit: RMB’000
| Q1 2022 | Q2 2022 | Q3 2022 | Q4 2022 | |
| Operating revenue | 9,015,991 | 9,779,837 | 9,281,986 | 9,304,101 |
| Net profit attributable to the shareholders | 427,652 | 304,446 | 36,046 | (158,753) |
| Net profit attributable to the shareholders excluding non-recurring profit and loss | 413,345 | 241,678 | 4,353 | (168,948) |
| Net cash flows from operating activities | (1,813,846) | 467,985 | (212,839) | 2,499,445 |
Any material differences between the financial indicators above or their summations and those which have beendisclosed in quarterly or semi-annual reports
□ Yes √ No
4. Shares and Shareholders
(1) Number of Common Shareholders and Preferred Shareholders with Vote Right Restored and
Shareholding Table of Top-10 Shareholders
Unit: share
| Total number of shareholders at the reporting period | 39,975 | Total number of shareholders on the 30th trading day before the disclosure date of the annual report | 40,664 | Total number of preferred stockholder with vote right restored | 0 | Total number of preferred stockholder with vote right restored on the 30th trading day before the disclosure date of the annual report | 0 |
| Shareholding of Top-10 Shareholders | ||||||
| Name of shareholder | Nature of shareholder | Holding percentage | Number of shares | Number of shares held subject to trading moratorium | Pledged or frozen shares | |
| Status of shares | Amount | |||||
| Syngenta Group Co., Ltd. | legal person | 78.47% | 1,828,137,961 | -- | -- | -- |
| China Cinda Asset Management Co., Ltd. | State-owned legal person | 1.34% | 31,115,916 | -- | -- | -- |
| Portfolio No.503 of National Social Security Fund | Others | 0.56% | 13,000,000 | -- | -- | -- |
| CITIC Securities - Huarong Ruitong Equity Investment Management Co., Ltd. - CITIC Securities - Changfeng Single Asset Management Plan | Others | 0.55% | 12,885,900 | -- | -- | -- |
| Hong Kong Securities Clearing Company Ltd. (HKSCC) | Overseas legal person | 0.46% | 10,606,080 | -- | -- | -- |
| Wang Xiuqin | Domestic Individual | 0.36% | 8,487,715 | -- | -- | -- |
| Bosera Funds-China Merchants Bank- Bosera Funds Xincheng No.2 Collective Asset Management Plan | Others | 0.28% | 6,500,000 | -- | -- | -- |
| Bosera Funds-Postal Savings Bank- Bosera Funds Xincheng No.3 Collective Asset Management Plan | Others | 0.26% | 6,000,000 | -- | -- | -- |
| Wu Feng | Domestic Individual | 0.24% | 5,479,915 | -- | -- | -- |
| China Universal Fund-Industrial Bank-China Universal-Strategic Enhancement No.3 Collective Asset Management Plan | Others | 0.19% | 4,400,000 | -- | -- | -- |
| Explanation on associated relationship or/and persons | Syngenta Group Co., Ltd. is not related party or acting-in-concert party as prescribed in the Administrative Methods for Acquisition of Listed Companies to other shareholders. It is unknown to the Company whether shareholders above are related parties or acting-in-concert parties as prescribed in the Administrative Methods for Acquisition of Listed Companies. | |||||
| Particular about shareholder participate in the securities lending and borrowing business ( if any) | Shareholder Wang Xiuqin held 616,261 shares through an ordinary securities trading account and 7,871,454 shares through a credit collateral securities trading account, thus holding a total of 8,487,715 shares of the Company. Shareholder Wu Feng held 3,967,889 shares through an ordinary securities trading account and 1,512,026 shares through a credit collateral securities trading account, thus holding a total of 5,479,915 shares of the Company. | |||||
(2) Number of Preferred Shareholders and Shareholding Table of Top-10 Preferred Shareholders
□ Applicable √ Not applicable
None in the Reporting Period.
(3) Block Diagram of Equity and Control Relationship between the Company and Actual controller
5. Corporate Bonds on the Reporting Date
□ Applicable √ Not applicable
III. Important MattersNone.For introduction to Company business during the reporting period, please refer to Section III. ManagementDiscussion and Analysis of the full text of 2022 Annual Report.
ADAMA Ltd.Legal Representative：Ignacio Dominguez
March 19
th, 2023