Hikvision records 40% net profit uplift for 1H21 despite of COVID-19 and political conflict
Chinese video surveillance manufacturer Hikvision has reported it generated 6.48 billion yuan in total profit, a 40% increase from last year's 4.62 billion yuan for the first half of 2021 financial year.
For the period to 30 June, the company also experienced a near 40% year-on-year uplift in operating income that came in just shy of 34 billion yuan. Of the total, sales of products and services accounted for more than 80%, or 28 billion yuan, an increase from last year's 21.5 billion yuan.
The rest was made up of its smart home and robotic businesses, as well as "other innovative" businesses, made of a number of subsidiaries including EZVIZ, HikRobot, HikAuto, HikMicro, HikStorage, HikImaging, HikFire, HikRayin, and their related business or products.
"With solid accumulation of algorithm and strong hardware and software development capabilities, Hikrobot focused on mobile robot and machine vision business, and continued to help the development of global intelligent manufacturing," Hikvision said.
"Other innovative businesses continued to develop rapidly and gradually opening up new opportunities. The innovative businesses, as a whole, accounted for 16.46% of the company's revenue in the first half year of 2021 and is gradually becoming a new driving force for the company's further development."
The company's revenue in overseas markets amounted to 9.47 billion yuan, following a 25.5% increase year-on-year.
During the half-year, Hikvision said it continued to expand its investment in R&D, investing a total of 3.88 billion yuan, which accounted for just over 11% of total operating income.
"In terms of hardware, the company continued to strengthen its dominant position in the field of video products, and actively implemented intellectualised upgrade of non-video products," the company said.
"In terms of software, the company continued to build its supporting capacities for large system software so as to support the rapid development and iteration of industry applications. Hikvision continues to improve its technology system with IoT perception, artificial intelligence, and big data as the core, and its comprehensive competitiveness is further enhanced."
The company also cited R&D remained a priority due to challenges faced by the company arising from the COVID-19 pandemic and political conflict.
Hikvision is among a collection of Chinese companies that have been blacklisted from trading in the United States.for its alleged involvement in the repression of Uyghur Muslims and other predominantly Muslim ethnic minorities residing in China.
"In the first half year of 2021, some countries and regions continued to suffer periodical economic stagnation and recession as the outbreak of COVID-19 epidemic was not effectively controlled. At the same time, the US government continued to put pressure on Chinese science-and-technology enterprises, which further affected global supply chains and market conditions," the company said.
"In the face of the conflicts and changes in the global environment, the company has always taken technological innovation as the most important means for its survival and development, and has continued to promote its sound development."
The company further added that in a bid to further adhere to its own so-called business philosophy of "professionalism, integrity, and honesty", it has been making shifts to improve its internal compliance system.
"Facing external pressure, the company has strengthened its cost control and optimisation efforts and strived to improve its internal operation. Meanwhile, the company continues to promote the construction of a global compliance system to further drive internationalisation of the company's governance system and control level, and to ensure a healthy and sustainable business development," it said.