Generous! A cross-border e-commerce company gives out 100 million yuan in equity to reward employees

In order to enhance the core strength and cohesion of employees, major companies will adopt various incentive measures, and equity incentives are one of the common ones.

Recently , another cross-border retailer offered hundreds of millions of shares to incentivize its employees.

Big deal! Huabao New Energy launches stock incentive plan

On June 6, 2023, Shenzhen Huabao New Energy Co., Ltd. (hereinafter referred to as "Huabao New Energy") held the 2023 Equity Incentive Conference .

Huabao New Energy 's Chairman Sun Zhongwei officially announced the company's previously announced " 2023 Restricted Stock Incentive Plan (Draft)".

According to the announcement, in order to attract and retain outstanding talents and fully mobilize the enthusiasm of the company's backbone employees and core teams , Huabao New Energy will implement a restricted stock incentive plan for the company's core management personnel and core backbone personnel. It plans to grant approximately 3.3822 million restricted shares to the incentive targets at a price of RMB 40.12 per share, accounting for 2.71% of the company's total share capital of approximately 125 million shares.

It is understood that the equity incentive plan of Huabao New Energy has granted a total of 111 people for the first time, mainly core management personnel and backbone personnel of the company, excluding independent directors, supervisors, shareholders or actual controllers who hold more than 5% of the company's shares individually or in total, and their spouses, parents, and children. According to the different time of employment of the incentive targets, they are divided into two categories: A and B.

On the day of the equity incentive meeting, Huabao New Energy's share price was 77.88 yuan per share. If it were purchased at 40.12 yuan per share , it would be almost equivalent to directly allowing employees to buy shares at half price . The total cost that Huabao New Energy will have to amortize is about 128 million yuan . It has to be said that Huabao New Energy is indeed generous.

However , for eligible employees, it still takes a certain amount of time and conditions to successfully hold shares.

The equity incentive plan will be assessed for the three fiscal years from 2023 to 2025. The performance assessment targets only involve operating income, and do not involve net profit representing profitability.

The performance evaluation targets are all based on the operating income in 2022. The target for 2023 is an operating income growth rate of no less than 10% , the target for 2024 is an operating income growth rate of no less than 27 % , and the target for 2025 is an operating income growth rate of no less than 45 % .

According to the financial report data previously released by Huabao New Energy, the company's revenue in 2022 was 3.203 billion yuan, a year-on-year increase of 38.35%; net profit attributable to shareholders was 287 million yuan, a year-on-year increase of 2.64%; non-net profit was 271 million yuan, a year-on-year increase of 0.46%.

This means that the assessment of Huabao New Energy’s equity incentives in the past three years will be based on the 2022 revenue of 3.203 billion yuan.

However, in the first quarter of 2023, Huabao New Energy's revenue showed a significant decline, lower than market expectations.

In the first quarter of 2023, Huabao New Energy achieved revenue of 448 million yuan, a year-on-year decrease of 26.77% and a month-on-month decrease of 53.94%.

At the same time, in the first quarter, Huabao New Energy's non-net profit was approximately -45.6825 million yuan, and its net profit was approximately -29.6729 million yuan, turning from profit to loss year-on-year.

Regarding the reasons for the significant decline in performance, Huabao New Energy stated that the first quarter is usually the off-season for the company's product sales, and as the energy crisis becomes normalized, consumers' shopping becomes more rational, and the company's sales revenue has returned to normal levels in the first quarter.

Some industry insiders speculated that this equity incentive may be related to the decline in Huabao New Energy’s revenue and profits in the first quarter.

Haineng Industrial granted 1.725 million restricted shares to employees

Equity incentive is one of the most commonly used incentive methods for cross-border e-commerce sellers to retain core talents . If the equity incentive assessment formulated by the seller reaches the target, employees can obtain unlocked stocks and profits, but if it does not reach the target, employees can get the original investment amount and the interest on bank deposits during the same period , which is very beneficial to both parties.

In addition to Huabao New Energy, Haineng Industrial also recently launched an equity incentive plan for core employees .

Haineng Industrial takes June 5, 2023 as the first grant date, and grants 1.725 million restricted shares to 34 incentive targets who meet the initial grant conditions at a grant price of RMB 10.01 per share.

On June 5, the share price of Haineng Industrial was 20.30 yuan per share. If it were purchased at 10.01 yuan per share , it would basically be half price . The total expenses that Haineng Industrial will have to amortize are approximately 17.75 million yuan .

It is understood that the incentive targets of Haineng Industrial 's equity incentive plan are core technical personnel and other core backbones serving in the company's (including subsidiaries) energy storage product line, excluding the company's directors (including independent directors), supervisors, senior management, shareholders or actual controllers who hold more than 5% of the company's shares individually or in total, and their spouses, parents, children and foreign employees.

The assessment covers the three fiscal years from 2023 to 2025. Different vesting periods have different assessment targets , as shown in the following figure:

Haineng Industrial Co., Ltd. was established in July 2009 and listed on the Shenzhen Stock Exchange in August 2019 .

Haineng Industrial 's main products cover three categories: consumer electronics, new energy and smart home , and are used in smart mobile communications, audio and video equipment, PCs, smart wearable devices and various electronic terminal products .

As a well- known 3C accessories exporter in the industry , Haineng Industrial has seen rapid growth in both operating income and net profit in the past three years and has maintained a good development momentum.

From 2020 to 2022, the company's operating income was RMB 1.566 billion , RMB 2.080 billion , and RMB 2.386 billion , respectively ; the net profit attributable to shareholders of listed companies was RMB 114 million, RMB 186 million , and RMB 326 million , respectively .

In addition, Haineng Industrial has excellent profitability and is at the leading level among its peers.

As an electronics manufacturing company, Haineng Industrial is highly dependent on talent. The equity incentive plan launched by Haineng Industrial will also be beneficial to the company's future development.

As for equity incentives, many big sellers have already put them into practice. Not only Huabao New Energy and Haineng Industrial , but also a number of big sellers such as Huakai Yibai , Xinghui Shares , Kuailetong, Jihong Shares, Aosen E-commerce, and JIMI Technology have all spent millions or even tens of millions of shares for equity incentives.

The purpose of listed companies' equity incentives is to motivate company executives to use all their talents and energy to actively strive for the company's performance growth goals. Equity incentives can make employees work harder and be more conducive to the future development of the company.

From the average data analysis given by the big sellers, as long as the incentives are true, the results achieved are basically favorable. Some sellers said: "I have not seen any actual unfavorable cases." Occasionally, there will be unfavorable cases in the future due to external factors.

Talent is the key factor for the stable development of an enterprise. Many successful enterprises have tried their best to retain talents. These big sellers have offered equity rewards to core employees , which to a certain extent proves their sincerity in retaining talents and can fully mobilize the enthusiasm and creativity of employees, which will greatly promote the future development of the enterprise.

Equity Rewards

Huabao New Energy