Source: Midea

Substantial Growth in Revenue and Profit

According to Midea Group’s 2017 Annual Report, it achieved total revenue of RMB241.92 billion, up 51.35% compared to 2016; net profit of RMB18.61 billion, representing a year-on-year increase of 17.33%; net profit attributable to shareholders of the company of RMB17.28 billion, growing 17.70% compared to last year; and earnings per share (EPS) of RMB2.66. Midea Group's industry position has been steadily improved, its product and technology innovation capabilities continue to lead, its global operations and industrial layout have become more solid, its intelligent supply chain system has been increasingly perfected, and its digital-driven industrial Internet layout has further deepened, stimulating further advancement of Midea into a global technology leader in HVAC systems, consumer appliances, robotics and industrial automation systems, and smart supply chain (logistics).

High Cash Dividend Payout Ratio

For 2017, Midea Group intends to distribute a cash dividend of RMB12 per 10 shares, with the total dividend payouts reaching RMB7.9 billion, accounting for 45.7% of net profit attributable to shareholders of the company. Since its holistic listing in 2013, Midea Group’s accumulated dividend payouts have reached RMB27.1 billion, producing superior returns for its faithful shareholders. Underpinned by excellent operating performance, Midea Group enjoys an increasing market value, which has exceeded RMB350 billion as of the end of March 2018, representing a more than fivefold increase as compared to the figure at its holistic listing in September 2013.

Product –Leading by Being User-Oriented

Continuous investment in R&D innovation is key for Midea’s deepening transformation. Midea Group focuses on building a globally competitive multi-tier research and development system centering on user experience and product functions, which represents world-class R&D input and strength. With more than RMB20 billion invested in R&D over the past five years, the Group has set up a total of 20 research centers in nine countries including China, with its R&D employees over 10,000 and senior foreign experts over 300. As shown in the 2017 Top 100 Global Innovators released by Clarivate Analytics, Midea Group has patented the most inventions in the global household appliance sector for the past three years. In addition to strengthening its global R&D network, the Group has been in close cooperation with many top scientific research institutions at home and abroad. Up to the end of 2017, Midea Group possesses over 35,000 patents, of which 16,934 were obtained during 2017, including 7,714 invention patents. Superior strength in technology and responsiveness to development trends in the industry and the society enable Midea to further improve its human-machine collaboration in production and other social scenarios and thus strengthen its competitive edges.

Operational Excellence Across the Whole Value Chain by Digitalization

Upon years of a digitalized reform characterized by “One Midea, One System, One Standard”, Midea has successfully materialized operations driven by software and data through its value chain, connecting end to end and covering R&D, booking, scheduling, flexible manufacturing, procurement, follow-up of product quality, logistics, installation & after-sales services, etc. The Group’s cloud platform has made come true C2M flexible manufacturing, platform-based, modularized and digitalized production techniques, logistics simulation, intelligent logistics, digital marketing, digital customer service, etc. Besides applying these cloud platform solutions to its manufacturing bases across the world and tens of thousands of its products, the Group also markets these solutions to other companies and sectors. Therefore, it is safe to say Midea has a solid foundation regarding industrial internet systems.

Continuous Enhancement in Corporate Governance

During the year, Midea launched a series of multi-tier incentive schemes for its middle and senior management and key business personnels, including the Fourth Global Partner Scheme, the First Business Partner Scheme, 2018 Restricted Share Incentive Scheme, and the Fifth Stock Option Incentive Scheme. Covering over 1,750 key personnels and based on appraisals of the Group’s, the divisions’ and the individual employee’s performances in multiple dimensions, these plans will boost management’s sense of responsibility towards the Group’s long-term value growth. As such, the Group’s corporate governance will be further improved.