Juewei Food (SH:603517)2019-04-15 16:00Financial Performance - The company's operating revenue for 2018 was approximately CNY 4.37 billion, representing a year-on-year increase of 13.45% compared to CNY 3.85 billion in 2017[24]. - The net profit attributable to shareholders for 2018 was approximately CNY 640.63 million, reflecting a growth of 27.69% from CNY 501.72 million in 2017[24]. - The basic earnings per share for 2018 was CNY 1.56, up 23.81% from CNY 1.26 in 2017[27]. - The weighted average return on equity for 2018 was 23.07%, slightly increasing by 0.22 percentage points from 22.85% in 2017[27]. - The net assets attributable to shareholders at the end of 2018 were approximately CNY 3.02 billion, a 17.61% increase from CNY 2.57 billion at the end of 2017[24]. - The company reported a quarterly revenue of approximately CNY 1.18 billion in Q3 2018, showing a strong performance compared to previous quarters[28]. - In 2018, the company's revenue reached CNY 4,367,982,964.03, a year-on-year increase of 13.45% from CNY 3,850,167,592.14[57]. - The net profit attributable to the parent company was CNY 64,062,940, a 27.69% increase compared to CNY 50,172,450 in the previous year[57]. - The company's main business revenue from the sale of marinated food was CNY 4,213,274,696.03, with a year-on-year growth of 13.47%[60]. Cash Flow and Dividends - The company plans to distribute a cash dividend of RMB 6.1 per 10 shares, totaling RMB 250.1 million, and to increase capital by 4 shares for every 10 shares held, resulting in a total capital increase of 164 million shares[6]. - The proposed cash dividend distribution exceeds 30% of the annual net profit attributable to shareholders[6]. - The operating cash flow net amount was CNY 484,614,128.61, a decrease of 25.07% compared to the previous year[58]. - The net cash flow from operating activities decreased by 25.07% to approximately CNY 484.61 million in 2018, down from CNY 646.79 million in 2017[24]. - The net cash flow from investing activities was -871,413,659.30 CNY, an increase of 63.92% compared to the previous year, due to increased equity investments in joint ventures[80]. - The net cash flow from financing activities was 20,752,092.90 CNY, a decrease of 96.25%, primarily due to an increase in short-term borrowings[80]. Market Expansion and Strategy - The company plans to continue expanding its market presence and invest in new product development to drive future growth[24]. - The company aims to strengthen its leading position in the duck neck chain industry while expanding its overseas market presence[97]. - The company plans to expand its store count and improve single-store revenue by focusing on high-potential locations such as transportation hubs and urban complexes[54]. - The company has established a nationwide sales network and is gradually entering overseas markets, with expectations of increased revenue and net asset growth following the fundraising efforts[105]. - The company aims to transform its service model from inward to outward-facing, leveraging its supply chain capabilities and technology[88]. Supply Chain and Production - The company has established a complete raw material procurement system that reduces intermediate links and lowers procurement costs while ensuring the quality of purchased raw materials[36]. - The company utilizes a daily production model based on sales orders, ensuring that production aligns closely with market demand[38]. - The company has a robust supply chain system that maximizes freshness and ensures timely product delivery to its sales network[47]. - The company employs a logistics model that includes cold chain transportation, ensuring product quality and safety during delivery[39]. - The company implemented a full "cold chain" distribution system to ensure product quality and safety during transportation[51]. Research and Development - The company invested CNY 10,053,629.62 in R&D, representing a 47.80% increase from CNY 6,802,172.71 in the previous year[58]. - The number of R&D personnel was 234, accounting for 5.76% of the total workforce[79]. - Research and development expenses amounted to ¥10.05 million, representing 0.23% of total revenue[79]. - The company established long-term partnerships with institutions like Hunan Agricultural University to enhance product development through research[51]. Risks and Challenges - The company faces risks from potential animal epidemics or natural disasters that could disrupt the supply of poultry products, impacting overall market demand and operational performance[104]. - The competitive landscape in the leisure marinated food industry is intensifying, with potential new entrants posing risks to the company's market position[105]. - Over 90% of the company's main business revenue comes from franchise channels, indicating a rapid growth in the number of franchise stores, which poses management risks if franchisees do not adhere to operational guidelines[105]. - The company reported a significant increase in raw material costs due to rising breeding costs and inflation, which may adversely affect production costs if not managed properly[104]. Governance and Management - The company has a diverse background in management, with experience in various industries including pharmaceuticals and technology[162]. - The board of directors includes members with extensive experience in various industries, enhancing governance and strategic oversight[171]. - The company maintains independence from its controlling shareholder in financial, personnel, asset, and operational aspects, with no interference in decision-making[184]. - The company has established a robust investor relations management system, enhancing communication with investors through various channels[184]. - The total number of employees in the parent company and major subsidiaries is 4,066, with 254 in the parent company and 3,812 in subsidiaries[179]. Shareholding and Ownership - The top shareholder, Hunan Jucheng Investment Co., Ltd., holds 157,248,000 shares, representing 38.35% of the total shares[147]. - The controlling shareholder, Ju Cheng Investment, and board members have committed to not reducing their shareholdings below the issue price for two years after the lock-up period[119]. - The actual controller, Dai Wenjun, has confirmed that there is currently no direct or indirect competition with the company and will not engage in similar business activities in the future[120]. - The total number of ordinary shareholders at the end of the reporting period is 10,669, an increase from 7,829 at the end of the previous month[145]. Audit and Compliance - The internal control audit report issued by Tianzhi International Accounting Firm indicates that the company maintained effective financial reporting internal controls as of December 31, 2018[197]. - The audit opinion provided by Tianzhi International Accounting Firm is a standard unqualified opinion, confirming the fair presentation of the company's financial statements[198]. - The audit was conducted in accordance with Chinese Certified Public Accountant auditing standards, ensuring the independence and ethical compliance of the auditors[199].