Midea Group Co., Ltd.: history, ownership, mission, how it works & makes money

A Brief History of Midea Group Co., Ltd.

Founded in 1968 in Beijiao, Shunde District, Guangdong Province, China, Midea Group has grown from a small workshop producing plastic injection molds into a global leader in consumer appliances, HVAC systems, and industrial automation. The company was listed on the Shenzhen Stock Exchange in 2013, under the ticker symbol 000333.SZ.

In 2017, Midea achieved a milestone by acquiring a majority stake in German robotics firm KUKA AG, valued at approximately €4.5 billion. This acquisition aimed to enhance Midea's technological capabilities in automation and robotics, aligning with its strategy to integrate smart technology into manufacturing.

In 2022, Midea reported total revenue of approximately RMB 402.7 billion (around USD 62.2 billion), representing a year-on-year increase of 10.2%. The company's net profit attributable to shareholders for the same year stood at RMB 28.3 billion (approximately USD 4.4 billion), a growth of 12.3% compared to 2021.

As of 2023, Midea operates in over 200 countries and regions, boasting more than 150,000 employees globally. The company's product portfolio includes refrigerators, washing machines, air conditioners, and kitchen appliances, reaching millions of consumers each year.

Midea has emphasized research and development (R&D), committing about 5.5% of its annual revenue to innovation. In 2022, Midea's R&D investment totaled approximately RMB 22 billion (about USD 3.4 billion), highlighting its dedication to enhancing product quality and technological advancement.

In the stock market, Midea Group's shares have shown resilience. The stock price has varied, with a 52-week range from RMB 55.10 to RMB 85.30. The company maintained a strong market capitalization, nearing RMB 400 billion (around USD 62 billion) as of the end of Q2 2023.

Midea is committed to sustainability, targeting a 20% reduction in greenhouse gas emissions by 2025. This initiative underscores Midea's alignment with global sustainability trends and environmental responsibility.

A Who Owns Midea Group Co., Ltd.

Midea Group Co., Ltd. is a major player in the home appliance industry, headquartered in Beijiao, China. As of October 2023, Midea is publicly traded on the Shenzhen Stock Exchange under the ticker 000333.SZ. The ownership structure of Midea Group reflects a mix of institutional and individual shareholders.

As of the latest reports, the largest shareholders of Midea Group include:

• He Xiangjian: Approximately 29.42% direct ownership, making him the primary shareholder.
• Midea Group Co., Ltd. Employee Stock Ownership Plan: Holds around 6.01%.
• China National Chemical Corporation: Owns about 4.88%.

The following table illustrates the top institutional shareholders in Midea Group, along with their respective ownership percentages:

In addition to equity ownership, Midea Group operates through a diverse portfolio of brands and subsidiaries, including Midea, Little Swan, and Donlim. The company reported total revenue of approximately USD 33.95 billion in 2022, reflecting a growth rate of about 7.3% year-over-year.

Moreover, Midea's market capitalization was estimated at around USD 50 billion as of October 2023. The company has positioned itself as one of the top manufacturers in the global home appliance sector, with an extensive distribution network and a robust product line that includes air conditioners, refrigerators, washing machines, and small kitchen appliances.

Midea's share price has shown significant variability, with a 52-week high of approximately USD 31.72 and a low of USD 23.50. This indicates a volatility range of around 34.9%.

Investors are keenly observing Midea's strategies in automation and the integration of artificial intelligence into its production processes, which the company believes will drive future growth.

Midea Group Co., Ltd. Mission Statement

Midea Group Co., Ltd., one of China's leading manufacturers of consumer appliances and HVAC (heating, ventilation, and air conditioning) systems, has a clearly defined mission statement that emphasizes innovation, quality, and customer satisfaction.

The company's mission is to “provide consumers with high-quality products and services through advanced technology and continuous innovation.” This commitment to innovation resonates in their substantial annual research and development investments.

As of 2022, Midea Group reported approximately RMB 10.24 billion (about $1.54 billion) allocated to research and development. This figure represented an increase of 9.1% from the previous year's budget.

Midea's vision extends beyond traditional appliances; it aims to integrate artificial intelligence and smart home technology across its product lines. The company has invested heavily in creating a connected ecosystem, which aligns with its mission of enhancing consumer experiences.

Midea Group's strategic initiatives and mission are reflected in its financial performance. In 2022, Midea reported a total revenue of RMB 234.58 billion (approximately $36.44 billion), a year-over-year increase of 10.5%. The net profit attributable to shareholders was around RMB 19.52 billion (about $3.01 billion), marking an increase of 8.7%.

In alignment with its mission, Midea Group places a strong emphasis on sustainability. The company has set ambitious goals to reduce carbon emissions and has committed to using 100% renewable energy sources in its production facilities by 2025.

Additionally, Midea Group's mission to enhance consumer satisfaction is substantiated by its service metrics. The company boasts a customer satisfaction rate of 92% across its major product lines, as per a 2022 survey, indicating effective product delivery and after-sales support.

Midea's commitment to corporate social responsibility is another pillar of its mission statement. In 2022, the company undertook initiatives that impacted approximately 1.5 million people through various community service projects, demonstrating its dedication to societal well-being.

In conclusion, Midea Group Co., Ltd.'s mission statement is not just a theoretical framework but is backed by substantial financial and operational metrics that reflect its commitment to innovation, customer satisfaction, and social responsibility.

How Midea Group Co., Ltd. Works

Midea Group Co., Ltd. operates as a leading global manufacturer of consumer appliances and HVAC (heating, ventilation, and air conditioning) systems. The company is headquartered in Foshan, Guangdong, China, and boasts a diversified product range that includes home appliances, kitchen appliances, and robotics.

As of 2022, Midea reported total revenues of approximately ¥340.56 billion (around $52.9 billion), showcasing a growth of 11.3% year-on-year. The company has expanded its market presence in over 200 countries and regions, highlighting its global reach.

With a focus on innovation, Midea invests significantly in R&D. The company's R&D expenditure was reported at about ¥20 billion in 2022, accounting for roughly 5.9% of its total revenue. This strategic investment aims to enhance product offerings and technological advancements, especially in AI and IoT (Internet of Things) applications.

Midea Group operates through several major segments:

• Home Appliances
• Heating, Ventilation, and Air Conditioning (HVAC)
• Robotics and Automation
• Smart Home Solutions

In the home appliances segment, Midea focuses on energy-efficient products, producing items like refrigerators, washing machines, and air conditioners. The HVAC division has shown notable growth, attributed to the increasing demand for energy-efficient cooling and heating systems.

Midea’s commitment to sustainability has led it to adopt green practices, including the reduction of greenhouse gas emissions by 20% per product by 2025. The company aims to use 100% recyclable materials in its packaging by 2023, underscoring its dedication to environmental responsibility.

The company also engages in strategic partnerships and acquisitions to enhance its technology base. In 2021, Midea acquired a controlling stake in Gree Electric Appliances, enhancing its market position in the HVAC sector.

Financially, Midea Group maintains strong profitability metrics, with a gross profit margin of approximately 29.6% and a net profit margin of about 8.3% as of 2022. The firm's operating income stood at around ¥30 billion, demonstrating effective cost management and operational efficiencies.

Midea’s stock performance has also shown resilience. As of October 2023, the company's stock price is approximately ¥64.12, having grown by over 15% year-to-date, reflecting investor confidence and strong quarterly earnings.

To support its global operations, Midea employs over 150,000 employees worldwide and has established numerous production facilities across China, Vietnam, and Brazil, enabling localized manufacturing and enhanced supply chain efficiency.

The company is also known for its strong brand positioning; Midea ranks among the top three appliance brands in China and has received accolades for product innovation and customer satisfaction.

How Midea Group Co., Ltd. Makes Money

Midea Group Co., Ltd. operates primarily in the manufacturing and sale of home appliances and HVAC (Heating, Ventilation, and Air Conditioning) systems. In 2022, Midea reported total revenue of approximately USD 41.9 billion, marking a year-on-year growth of 6.2%.

The company's revenue is generated through several key segments:

• Home Appliances
• HVAC Systems
• Robotics and Automation
• Smart Supply Chain Solutions

The Home Appliances segment is the largest contributor to Midea's revenue, accounting for about 70% of total sales. This includes products such as refrigerators, washing machines, and kitchen appliances. Within this segment, the sales of refrigerators alone contributed approximately USD 8 billion in 2022.

The HVAC segment also plays a significant role in Midea's revenue, generating approximately USD 10.5 billion in 2022. Midea is one of the leading suppliers of HVAC systems in China and has been expanding its presence in international markets, including North America and Europe.

Midea's international sales have been growing, contributing significantly to its overall revenue. In 2022, approximately 35% of Midea’s total revenue came from international markets, with Europe and North America being the largest regions. The company is actively pursuing growth opportunities in emerging markets, which are expected to yield higher returns in the coming years.

Additionally, Midea has been investing in research and development (R&D) to innovate and improve its product offerings. In 2022, Midea allocated around USD 1.2 billion for R&D, emphasizing smart appliances and energy-efficient technologies, which aligns with global trends in sustainability and energy consumption.

The company also leverages automation and robotics in its production facilities, resulting in enhanced efficiency and reduced operational costs. This strategic move not only lowers production costs but also increases the company’s production capacity to meet growing demand.

Overall, Midea Group's diverse product offerings, strong market presence, and emphasis on innovation and automation are key drivers of its revenue generation, positioning the company well for future growth in both domestic and international markets.