Annual Report 2020

HOP FUNG GROUP HOLDINGS LIMITED 合豐集團控股有限公司 6 MANAGEMENT DISCUSSION AND ANALYSIS 管理層討論及分析 BUSINESS REVIEW The coronavirus pandemic slashed demand in the domestic market in the People’s Republic of China (the “PRC”) for corrugated packaging in the first half of 2020, and the Group’s average selling price and sales volume plunged, with revenue falling 45.7% compared to the first half of 2019. In the second half of 2020, the Group’s average selling price and sales volume both rebounded on the back of the Chinese economy stabilizing, and we were able to reasonably transfer rising raw materials costs to customers. As a result, revenue in the second half of 2020 rose by 120.7% compared to the first half of 2020 and rose by 19.9% compared to the second half of 2019. The Group’s upstream containerboard business produces corrugating medium and linerboard, mainly to supply the Group’s downstream corrugated packaging business manufacturing corrugated paperboards and boxes. Depending on market conditions, we may also directly sell our containerboard directly to customers. In 2020, the upstream and downstream businesses accounted for 42.5% and 57.5% of revenue. Upstream revenue fell during the year by 22.9% compared to 2019, and equipment utilization was at 50%; downstream revenue fell by 3.6% compared to 2019, with equipment utilization at 48%. The Group’s main raw materials, wastepaper and containerboard are sourced both in the domestic and overseas markets. Procurement costs fell in the first half of 2020 but rebounded in the second half, and, combined with the appreciation of the Renminbi, resulted in overall raw materials costs coming in at a slightly lower level in 2020 compared to 2019. Other than an increase in finance costs due to higher borrowing levels, selling and distribution expenses and administrative expenses both fell as a result of lower revenue, which resulted in the Group recording a slight profit for the full year. 業務回顧 於二零二零年上半年，中華人民共和國（「中國」）市場對瓦 楞包裝的需求因新冠肺炎疫情而減少，集團之平均銷售 價格及銷售量大幅下降，收益比二零一九年上半年下跌 45.7% ；而於二零二零年下半年集團之平均銷售價格及銷 售量隨著中國經濟回穩而上升，加上集團可合理地轉嫁上 升之原材料成本予客戶，集團下半年之收益與上半年收益 相比上升 120.7% ，相比二零一九年下半年則上升 19.9% 。 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，箱板紙也直接售予客戶。於二零二零年， 上下游業務分別佔收益的 42.5% 及 57.5% ，上游收益比去 年下跌 22.9% ，設備使用率約 50% ；而下游收益比去年 下跌 3.6% ，設備使用率約 48% 。 集團之主要原材料廢紙及箱板紙均在國內及海外採購，二 零二零年上半年之成本下跌，下半年成本回升及人民幣升 值，使整體原材料成本與二零一九年相比略低。除財務成 本因增加借貸而上升外，銷售及分銷成本與行政開支因收 益減少而下降，最終集團於二零二零年錄得微利。