Financial Performance - The net profit attributable to the parent company for 2018 was CNY 60,243 thousand, resulting in a cumulative undistributed profit of CNY 197,587 thousand at the end of the year[6]. - The company's operating revenue for 2018 was CNY 336,472 million, representing a 6.66% increase compared to CNY 315,460 million in 2017[22]. - The net profit attributable to shareholders for 2018 was CNY 60 million, a significant decrease of 92.66% from CNY 821 million in 2017[22]. - The net cash flow from operating activities for 2018 was CNY 3,066 million, recovering from a negative cash flow of CNY -4,808 million in 2017[22]. - The total assets at the end of 2018 were CNY 128,940 million, an increase of 4.95% from CNY 122,857 million at the end of 2017[22]. - The basic earnings per share for 2018 was CNY 0.02, down 92.86% from CNY 0.28 in 2017[23]. - The weighted average return on equity for 2018 was 0.45%, a decrease of 5.83 percentage points from 6.28% in 2017[23]. - The company recognized government subsidies of CNY 8,862 million in 2018, compared to CNY 27,556 million in 2017[26]. - The fair value change of foreign exchange forward contracts positively impacted the profit by CNY 684 million in 2018[29]. - In 2018, the company achieved revenue of $50.437 billion, representing a year-on-year growth of 8.06%, and a net profit of $3.52 billion, which increased by 77.02%[45]. Dividend Policy - The company plans not to distribute cash dividends, issue bonus shares, or convert capital reserves into share capital for the 2018 fiscal year[6]. - The company has a cash dividend policy that mandates a minimum of 80% of profits to be distributed as cash dividends during mature phases without major capital expenditures[81]. - The company will distribute at least 30% of the average distributable profits over three years in cash dividends[82]. - The independent directors agreed that the profit distribution plan aligns with legal regulations and the company's long-term development interests[84]. - The undistributed profits are primarily intended to support the main business development and repay bank loans[87]. - The company has faced certain debt repayment pressures in 2019, which influenced the decision not to distribute dividends[88]. Risk Management - The management has outlined potential risks in the future development discussions, emphasizing the importance of risk control to ensure stable operations[8]. - The report includes a detailed description of risk factors that the company may face in the future, which can be found in the management discussion section[8]. - The company faces risks including currency fluctuation, high-end talent loss, rapid technological changes, and increasing market competition[78]. - The company is committed to optimizing resource allocation and enhancing risk control capabilities to maintain sustainable development[8]. Audit and Compliance - The company has received an unqualified audit report from PwC, with emphasis on certain matters related to going concern[5]. - The report indicates that the board of directors and management are responsible for the accuracy and completeness of the financial report[5]. - The audit report issued by PwC highlighted significant uncertainties regarding the company's ability to continue as a going concern[93]. - The company has emphasized its commitment to improving compliance and information disclosure practices following regulatory feedback[107]. Corporate Governance - The company is committed to protecting the legitimate rights and interests of minority shareholders[90]. - HNA Technology will ensure fair pricing in related transactions to avoid unfair advantages[90]. - The company committed to transparent disclosure of related party transactions and adherence to legal procedures[90]. - HNA Technology will not exploit its controlling shareholder status for improper benefits[90]. - The company has a commitment from its controlling shareholder to support its stable and healthy development, reflecting confidence in its future prospects[149]. Market and Strategic Initiatives - The company operates in the Tianjin Free Trade Zone, focusing on technology and logistics services[16]. - The company operates in IT product distribution and technology solutions, serving over 1800 suppliers globally[32]. - The company is focusing on enhancing its fourth-party logistics management capabilities to provide integrated logistics services[41]. - The company plans to leverage its overseas channels and best practices to help Chinese cloud vendors expand internationally, particularly in countries along the Belt and Road Initiative[43]. - The company aims to enhance its market position, with expected growth primarily from distribution, commercial logistics, and lifecycle services, alongside its cloud services[76]. Shareholder Information - The total number of ordinary shareholders at the end of the reporting period was 83,346, down from 93,109 at the end of the previous month[137]. - The top shareholder, HNA Technology Group Co., Ltd., held 602,006,689 shares, representing 20.76% of the total shares[139]. - A total of 95,560 shares were judicially frozen due to a contractual dispute, with an additional 2,444,440 shares under provisional freezing[141]. - The controlling shareholder, HNA Technology Group, had 3,850,000 shares frozen by the Shanghai First Intermediate People's Court and 22,636,475 shares frozen by the Shanghai Pudong New Area People's Court due to contract disputes[142]. Employee and Management Compensation - The total pre-tax compensation for the board members and senior management during the reporting period amounted to 542.5 million CNY[155]. - The chairman, Tong Fu, received a total pre-tax compensation of 60.44 million CNY[153]. - The total remuneration of 5.425 million yuan for all directors, supervisors, and senior management at the end of the reporting period[162]. Legal and Regulatory Matters - The company has reported significant litigation and arbitration matters during the year, with ongoing developments[103]. - The company has faced regulatory scrutiny for failing to disclose significant guarantees and loan repayment issues in a timely manner[166][167]. - The company is subject to ongoing legal proceedings affecting a portion of its shares, which may impact shareholder confidence[141]. Future Outlook - HNA Technology plans to expand its market presence in Southeast Asia, targeting a 25% increase in market share by 2020[158]. - The company is investing 300 million yuan in new product development, focusing on AI and cloud computing technologies[158]. - HNA Technology has outlined a performance guidance of 1.5 billion yuan in revenue for 2019, indicating a growth target of 25%[158]. - The company is exploring potential mergers and acquisitions to enhance its technological capabilities and market reach[158].