Stock Code: 688007 Stock Short Name: Appotronics
Appotronics Corporation Limited
Annual Report 2020
Hold Fast to Long-term Value Whenever to Change or Persevere
Dear Shareholders,
Like many other companies, Appotronics has experienced an extraordinary year of
2020. Our performance has inevitably been affected under the circumstances of the
pandemic.
The good news is that most of our business sectors were advancing steadily in the first
half of the year and the cinema sector quickly rebounded in the second half of the year.
And the overall annual revenue was basically the same as the previous year, which is more
than RMB100 million, demonstrating good resilience.
Instead of the figures in the annual report, I would like to share with you where such
strong resilience comes from, what we have done to seek a breakthrough in those days
when we were “besieged” by the pandemic, and what we have done to prepare for the next
year and even longer term.
Insist on Technology Innovation for Long-term Value
In 2020, the pandemic brought tremendous uncertainty to the world. For companies
like Appotronics who pursues long-term values, we experienced unprecedented pressure to
adhere to our original goal, which is insisting on technology innovation and striving to
continuous evolution. We believe that only by meeting basic needs of customers and
creating long-term profits for investors can we go through the ups and downs in this
turbulent market.
Since the original invention of ALPD® fluorescent laser display technology in 2007,
Appotronics has never stopped the evolution of this technology. We launched the world’s
first laser TV in 2013, installed the world’s first ALPD® laser cinema projector in 2014,
introduced the world’s first laser TV priced under RMB10,000 in 2017, became the first
company in China to manufacture laser digital cinema projectors with DCI certification in
2019, and launched the world’s first highly profitable Fresnel flexible screen in 2020, all of
which cannot materialize without the long-term technology innovation that we have been
pursuing.
While completing a number of “0 to 1” technological breakthroughs, we also
promoted the market applications, such as in the fields of cinema, engineering, education
and household markets, thus creating new fast-growing tracks.
Our efforts in technology innovation can be evidenced by the following figures: From
2016 to 2019, Appotronics invested RMB70.12 million, RMB93.30 million, RMB136
million and RMB201 million in R&D, respectively. Even in 2020, we still invested
RMB204 million in R&D, accounting for 10.49% of our annual revenue despite the
performance pressure.
By the end of 2020, Appotronics had a total of 2,191 patent applications worldwide, of
which about 70% are invention patents. The original ALPD® technology has been regarded
as the development direction of new-generation laser display by the international industry,
and has been cited by the industry and domestic and foreign enterprises more than 600
times.
From ALPD® 1.0 to ALPD® 4.0, Appotronics has continuously iterated and upgraded
the technology, not only by significantly improving visual effects such as brightness,
contrast ratio and color gamut, but also by achieving high efficiency in many areas such as
safety, energy saving and environmental protection, and industrialization. We are
developing ALPD®5.0 and ALPD®6.0 technologies, which will strengthen the laser
display effect and further reduce the cost of laser display, truly realizing the value creation
for users through continuous technology innovation.
All of the above builds up the confidence that we can maintain our profitability
fundamentals, adjust quickly in the crisis, and find a new growth curve in the midst of the
major changes brought about by the pandemic in 2020.
Capture Industry Trends and Explore New Growth Curves
In the first half of 2020, we kept an eye on the changes in the market. With the rise of
the “In-house Economy”, large-screen displays such as laser TVs and smart pico-projectors
begun to attract public attentions although the laser projection business, which has always
been our advantage, was greatly affected by the pandemic, and the global economic
downturn caused by the pandemic also affected our overseas business.
From this perspective, we continued to strengthen our advantages in core devices,
actively adjusted our business structure and focused on TO C business, recording revenue
of more than RMB1 billion from our consumer business during the year, accounting for
more than 50% of our total revenue for the first time.
We adopted the business division system for our operation. On the one hand, we
implemented separate accounting for each business unit, which can strengthen internal
competition, enhance the ability of independent management and decision-making, and
speed up our market response
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