Annual Report 2021

06 HOP FUNG GROUP HOLDINGS LIMITED • Annual Report 2021 MANAGEMENT DISCUSSION AND ANALYSIS 管 理 層 討 論 及 分 析 BUSINESS REVIEW In the first half of 2021, the demand for corrugated packaging in the PRC market slowly recovered as COVID-19 pandemic alleviated. The Group’s average selling price and sales volume increased, and revenue increased by 26.4% compared with the first half of 2020. In the second half of 2021, despite the increase in the Group’s average selling price, it is still slower than the increase in raw material costs. As for the sale volume, it has declined mainly because the Group’s upstream business being affected by local policies, resulted in temporary suspension of production. As a result, the Group’s revenue in the second half of the year decreased by 15.7% compared with the first half of the year, and decreased by 51.7% compared with the second half of 2020 and revenue decreased 27.4% for the year. The Group’s upstream containerboard business produces corrugating medium and linerboard, mainly supplied to the Group’s downstream corrugated packaging business (manufacturing of corrugated paperboards and carton boxes), and directly sold to customers in response to changes in market demand. In 2021, the upstream and downstream businesses accounted for 14.2% and 85.8% of the revenue respectively, mainly due to the temporary suspension of production of the Qingyuan Factory. The upstream revenue decreased by 75.7% compared with last year, while the downstream revenue increased by 8.4% compared with last year. The Group’s main raw materials, waste paper and containerboard are sourced both in the domestic and overseas markets. Due to the shortage of raw material supply, and the prices of bulk commodities and shipping costs continued to rise, these resulted in high overall raw material costs in 2021. In addition, affected by the sharp fall in the sales volume of the Group’s upstream business, although the sales and distribution costs and administrative expenses decreased due to the decrease in revenue, the proportion of recurring overhead costs remained high, resulting in the Group recording a loss for the year. 業務回顧 於二零二一年上半年，中國市場對瓦楞包裝 的需求因新冠肺炎疫情緩和而慢慢復蘇，集 團之平均銷售價格及銷售量有所上升，收益 比二零二零年上半年上升 26.4% ；而於二零 二一年下半年集團之平均銷售價格雖有所增 長，但仍低於原材料成本的上漲，而銷售量 方面下跌，主要因為集團上游業務受當地政 策的影響，而需暫停生產所致。集團下半年 之收益與上半年收益相比下跌 15.7% ，相比 二零二零年下半年則下跌 51.7% 。全年收益 下跌 27.4% 。 集團上游箱板紙業務生產之瓦楞芯紙及牛 咭，主要提供予集團下游的瓦楞包裝業務（製 造瓦楞紙板及紙箱），另因應市場需求變化 而直接售予客戶。於二零二一年，上下游業 務分別佔收益的 14.2% 及 85.8% ，主要受到 清遠廠房暫時停產影響，上游收益比去年下 跌 75.7% ；而下游收益比去年上升 8.4% 。 集團之主要原材料廢紙及箱板紙分別在國內 及海外採購，由於原材料供應短缺，大宗商 品價格及海運費用持續高漲，以致二零二一 年整體原材料成本高企。加上受累於集團上 游業務銷售量大跌，雖然銷售及分銷成本與 行政開支因收益減少而有所下降，但經常性 開支佔比偏高，最終集團錄得虧損。