Financial Performance - The company's operating revenue for the first half of 2014 was ¥201,959,631.15, a decrease of 16.51% compared to ¥241,907,524.12 in the same period last year[21]. - The net profit attributable to shareholders was a loss of ¥11,234,675.40, representing a decline of 165.77% from a profit of ¥17,081,328.51 in the previous year[21]. - The basic earnings per share were -¥0.04, a decrease of 166.67% compared to ¥0.06 in the same period last year[21]. - The diluted earnings per share were also -¥0.04, reflecting the same decline of 166.67%[21]. - The weighted average return on net assets was -1.50%, down 3.78% from 2.28% in the previous year[21]. - The company reported total revenue of CNY 201.96 million, a decrease of 16.51% compared to the same period last year[28]. - Operating profit was CNY -13.19 million, down 163.70% year-on-year, while net profit attributable to shareholders was CNY -11.23 million, a decline of 165.77%[28]. - The company reported a net profit of -8,816,508.26 CNY for the first half of 2014, compared to a net profit of 12,592,357.23 CNY in the same period of 2013, indicating a significant decline in profitability[139]. - The total comprehensive income for the period was -8,816,508.26 CNY, reflecting the same loss as the net profit due to no other comprehensive income reported[139]. Cash Flow and Liquidity - The net cash flow from operating activities was ¥79,214,854.35, a significant increase of 406.22% compared to a negative cash flow of ¥25,868,588.67 in the same period last year[21]. - The company's cash and cash equivalents increased to ¥291,727,985.86 from ¥234,975,205.49, representing a growth of approximately 24.1%[128]. - The company’s cash and cash equivalents at the end of the period increased to 291,727,985.86 CNY from 207,087,828.69 CNY, marking a growth of approximately 40.7%[143]. - The company raised 58,000,000.00 CNY through borrowings in the first half of 2014, compared to 20,000,000.00 CNY in the same period of 2013, showing a significant increase in financing activities[143]. Assets and Liabilities - The total assets at the end of the reporting period were ¥1,012,949,607.04, down 8.88% from ¥1,111,639,220.81 at the end of the previous year[21]. - The company's total assets decreased to CNY 924,508,969.65 from CNY 983,831,574.51, a reduction of approximately 6%[133]. - Current liabilities decreased from ¥292,000,000.00 to ¥278,000,000.00, a decrease of about 4.8%[129]. - The company's total liabilities increased, impacting its financial leverage, although specific figures were not disclosed in the provided documents[139]. Investment and Capital Expenditure - The company plans to issue up to 80 million A-shares, raising a total of no more than 936 million RMB, to acquire equity in a U.S. oilfield company and for subsequent cooperative development projects[108]. - The total amount of raised funds was CNY 385.54 million, with CNY 58.75 million utilized in the reporting period[49]. - The company utilized a total of RMB 189,782,370.00 from the oversubscription funds, with RMB 51,782,370.00 allocated for permanent working capital and RMB 53,000,000.00 for repaying bank loans[56]. - The company invested a total of RMB 22,302,094.59 in the drilling fluid technology service capacity construction project, with RMB 21,928,584.33 allocated specifically for this purpose[60]. Market and Operational Challenges - The overall market competition intensified, leading to a decline in contract prices for drilling fluid services due to reduced work volume[33]. - The company experienced a significant increase in financial expenses, rising by 2,647.47% to CNY 1.64 million due to increased bank loan interest[31]. - The company faced a decline in business volume for the drilling fluid technical service capacity construction project due to changes in client investment scale, impacting profitability[55]. - The company's core business profitability has significantly declined due to cost-cutting measures and optimization strategies implemented by major clients, leading to a substantial decrease in contract prices for drilling fluid technical services[73]. Shareholder and Equity Information - The company distributed a cash dividend of RMB 0.30 per share, totaling RMB 5,149,350, and increased its total share capital by 102,987,000 shares through a capital reserve conversion[75]. - The total number of shares increased from 171,645,000 to 274,632,000 after the implementation of the 2013 profit distribution plan on July 17, 2014[112]. - The largest shareholder, Qian Zhongliang, holds 13.57% of shares, totaling 23,297,550 shares[116]. - The company has a total guarantee amount of 2,000 million yuan, which accounts for 2.68% of the company's net assets[101]. Corporate Governance and Compliance - The company has not engaged in any major litigation or arbitration during the reporting period[82]. - The company has not made any asset acquisitions or sales during the reporting period[86][87]. - The company has not implemented any equity incentive plans during the reporting period[89]. - The company has no significant related party transactions during the reporting period[90]. Future Outlook and Strategic Plans - The company is actively seeking opportunities for international market expansion amid domestic economic pressures[28]. - The company plans to focus on expanding its market presence and enhancing its service offerings, although specific strategies were not detailed in the financial report[139]. - The company plans not to distribute cash dividends or issue bonus shares for the semi-annual period[77].

Financial Performance - The company's operating revenue for Q1 2014 was ¥77,218,922.17, a decrease of 25.95% compared to ¥104,286,064.21 in the same period last year[8]. - The net profit attributable to shareholders was a loss of ¥16,585,393.18, representing a decline of 434.27% from a profit of ¥4,961,668.40 in the previous year[8]. - The company's basic earnings per share were -¥0.1, a decrease of 433.33% from ¥0.03 in the same period last year[8]. - The weighted average return on net assets was -2.22%, a decline of 2.88% compared to 0.66% in the previous year[8]. - Operating profit, total profit, and net profit saw a significant decline, primarily due to reduced investment scale in the Southwest market by Sinopec, leading to decreased operating revenue[16]. - The company expects a net loss of between -12 million to -10 million RMB for the first half of 2014, a significant decline compared to a net profit of 17.08 million RMB in the same period of 2013[27]. Cash Flow and Investments - The net cash flow from operating activities increased significantly to ¥114,683,784.33, a rise of 9,572.02% compared to a negative cash flow of ¥1,210,763.86 in the same period last year[8]. - Cash received from sales of goods and services increased by 60.64% year-on-year, mainly due to a significant increase in the recovery of sales payments from customers[17]. - Cash received related to operating activities grew by 102.24% compared to the same period last year, primarily due to the recovery of performance guarantees from customers[19]. - Net cash flow from operating activities surged by 9,572.02% year-on-year, driven by a substantial increase in cash inflows from operating activities[19]. - Cash flow from investing activities decreased by 74.17% year-on-year, primarily due to increased cash outflows from investment activities[19]. - Cash received from borrowings increased by 10 million yuan compared to the same period last year, as new bank borrowings were made[19]. - Cash paid for debt repayment increased by 10 million yuan year-on-year, reflecting the repayment of bank borrowings[19]. - Cash paid for dividends, profits, or interest increased by 312.96% compared to the previous year, mainly due to a 90 million yuan increase in borrowing balance leading to higher interest expenses[20]. Shareholder Information - The number of shareholders at the end of the reporting period was 15,563, with the largest shareholder holding 13.57% of the shares[11]. Tax and Financial Expenses - Income tax expenses decreased by 98.27% compared to the same period last year, primarily due to operating losses in the current period that did not require income tax provisions[17]. - The company reported a significant increase in financial expenses, which rose by 2,971.03% due to a substantial increase in bank borrowings compared to the previous year[16]. Business Operations and Market Conditions - The primary reason for the loss is a nearly 50% decrease in service workload for drilling fluid technology due to reduced investment scale in the Southwest market[27]. - The oilfield environmental protection business experienced an approximate 11% decline in workload, further contributing to the profit reduction[27]. - The company's core business profitability for drilling fluid technology services has significantly decreased due to substantial reductions in contract prices[27]. - The company is actively expanding into new markets and businesses, which has resulted in increased exploration costs without immediate profitability[27]. - The company is currently planning a significant asset acquisition in the United States, with due diligence by intermediaries nearly completed, although the process has faced delays due to various factors[21]. Non-Operating Income - The company experienced a 740.49% increase in non-operating income, attributed to refunds from the local tax bureau and research funding from the technology bureau[16].

Financial Performance - The company's operating revenue for 2013 was ¥605,859,969.61, a decrease of 6.64% compared to ¥648,956,921.81 in 2012[22]. - The net profit attributable to shareholders for 2013 was ¥33,157,523.00, down 59.41% from ¥81,686,220.93 in 2012[22]. - Basic earnings per share decreased to ¥0.19, down 59.57% from ¥0.47 in the previous year[22]. - The total profit amounted to ¥40,788,748.27, reflecting a significant decline of 58.60% compared to the previous year[35]. - Net profit for the year was ¥33,157,523.00, down 59.37% year-on-year[35]. - The weighted average return on net assets decreased to 4.43% from 11.38% in the previous year[22]. - The company reported a distributable profit of 221,530,236.53 yuan for the year 2013, with a capital reserve of 328,907,870 yuan[147]. - The company's net profit attributable to shareholders for 2013 was CNY 33,157,523, resulting in a cash dividend payout ratio of 15.53%[149]. Cash Flow and Financing - The net cash flow from operating activities improved to -¥51,448,151.77, a 70.46% increase compared to -¥174,139,722.23 in 2012[22]. - The cash inflow from financing activities increased by 366.67% to ¥140,000,000.00, primarily due to new bank loans to supplement working capital[51]. - The net cash flow from financing activities increased by 204.58% year-on-year, primarily due to increased bank borrowings[52]. - The net increase in cash and cash equivalents rose by 96.41% year-on-year, driven by a 9.65% increase in cash inflow from operating activities and a 366.67% increase in cash inflow from financing activities[52]. Assets and Liabilities - Total assets at the end of 2013 were ¥1,111,639,220.81, reflecting a 10% increase from ¥1,010,563,557.43 at the end of 2012[22]. - The net assets attributable to shareholders increased by 1.59% to ¥756,357,371.55 from ¥744,501,324.94 in 2012[22]. - Accounts receivable increased to ¥609,832,924.95, accounting for 54.86% of total assets, up 3.14% year-on-year, primarily due to seasonal business growth[62]. - Short-term borrowings rose significantly to ¥120,000,000.00, representing 10.79% of total assets, an increase of 7.82% from ¥30,000,000.00 in 2012[64]. - The company’s accounts payable increased to ¥146,079,953.10, which is 13.14% of total assets, reflecting a strategic shift towards using bank bills for supplier payments[65]. Research and Development - The company conducted 8 external and 20 internal research projects, resulting in 20 new products and technologies being applied, with 1 recognized as internationally advanced[33]. - Research and development expenses increased by 23.03% to ¥32,450,098.14, representing 5.36% of operating revenue, up from 4.06% in the previous year[48]. - The company has developed 20 new products and technologies in 2013, with one recognized as internationally advanced and two as domestically leading[70]. - The company has accumulated a total of 18 patents, including 9 invention patents and 9 utility model patents, with an additional 18 patents pending approval[70]. Market and Business Strategy - The company is actively pursuing a "going out" strategy to expand its international and domestic markets, enhancing external strategic cooperation[32]. - The company aims to achieve a stable growth in oil production, with a cumulative proven geological reserve of 2.2 billion tons and an annual production of over 200 million tons by 2030[104]. - The company is positioned to benefit from the rapid growth in natural gas demand, with expectations that shale gas production in China will reach 6 billion cubic feet per day by 2030, constituting 20% of the country's natural gas output[107]. - The company aims to expand its market presence beyond the southwest region, addressing the risks associated with reliance on a single major client[118]. - The company plans to enhance management efficiency and support its "second entrepreneurship" initiative by optimizing operations and improving management effectiveness[120]. Risks and Challenges - The company faces risks related to industry investment control, market access mechanisms, and potential loss of core technical personnel[12]. - The company recognizes the challenges posed by a slowdown in exploration investment due to declining economic growth rates, which may impact oil and gas demand[113]. - The company faces increased competition as the oil and gas industry becomes more market-oriented and open to new entrants, including foreign companies[114]. - The company acknowledges the need for deeper exploration in major basins, with significant undiscovered resources still available[111]. Corporate Governance and Social Responsibility - The company has established a robust internal control system to protect the rights of shareholders and creditors[152]. - The company has maintained a commitment to social responsibility, focusing on sustainable development and environmental protection[151]. - The company emphasizes employee rights and safety, conducting regular training and promoting a harmonious labor relationship[154]. - The company has not faced any environmental violations or penalties during the reporting period[157]. Dividend Policy - The company has established a profit distribution policy that ensures at least 10% of the annual distributable profit is distributed in cash dividends, with a cumulative distribution of at least 30% over any three consecutive years[142]. - For the fiscal year 2013, the company plans to distribute a cash dividend of 0.30 yuan per 10 shares, totaling 5,149,350 yuan, while also increasing its share capital by 102,987,000 shares through capital reserves[147]. - The company plans to issue 6 bonus shares for every 10 shares held, increasing the total share capital to 274,632,000 shares[150].