Financial Performance - The group's revenue decreased approximately 94.4% from RMB 159.0 million in the year ended December 31, 2019, to RMB 8.9 million in the year ended December 31, 2020, primarily due to the impact of COVID-19 on sports events[27]. - Revenue from the event operation and marketing segment fell 99.1% from RMB 74.2 million in 2019 to RMB 0.7 million in 2020, while the sports services segment revenue decreased about 90.3% from RMB 84.8 million to RMB 8.2 million[29]. - The group's service costs decreased approximately 95.0% from RMB 186.7 million in 2019 to RMB 9.3 million in 2020, with event operation and marketing segment costs dropping 100% to RMB 0[30]. - The gross loss decreased about 98.6% from RMB 27.7 million in 2019 to RMB 0.4 million in 2020, with the gross loss margin reducing from 17.4% to approximately 4.5%[31]. - Other income increased approximately 0.6% from RMB 17.7 million in 2019 to RMB 17.8 million in 2020[35]. - The group's other losses decreased by approximately 97.5% from a net loss of RMB 397.9 million for the year ended December 31, 2019, to a net loss of RMB 10.0 million for the year ended December 31, 2020[36]. - The group's loss before income tax decreased by 91.8% from RMB 499.9 million for the year ended December 31, 2019, to RMB 40.9 million for the year ended December 31, 2020[37]. - The loss attributable to owners of the company decreased by 90.3% from RMB 455.1 million for the year ended December 31, 2019, to RMB 44.0 million for the year ended December 31, 2020[39]. - As of December 31, 2020, the group's cash and cash equivalents were approximately RMB 137.7 million, down from RMB 167.3 million as of December 31, 2019[40]. - The net current assets increased by approximately 2.5% from RMB 312.1 million as of December 31, 2019, to RMB 319.8 million as of December 31, 2020[41]. Business Strategy and Operations - The company focused on cost reduction and increasing investment returns to stabilize cash flow during the pandemic[11]. - The company organized two online marathon events to meet the demand of runners during the pandemic[11]. - The company anticipates a recovery in the sports event industry starting in April 2021, with a large number of events planned[12]. - The company aims to host contractually obligated events and expand into small and customized corporate events in 2021[15]. - The company is exploring business expansion opportunities in the sports industry and related sectors to mitigate risks associated with a single event operation[12]. - The company has developed strategies for event operations under the new normal of pandemic prevention, ensuring safety and health[15]. - The company has prepared to resume normal operations and is actively communicating with local governments to explore new events[12]. - The company emphasizes providing a safe and comfortable event platform for the sports community[15]. - The group is actively exploring new market opportunities in paddle sports, winter sports, and youth training for project planning in 2021[24]. - The management anticipates a gradual recovery in the sports event market post-March 2021, following successful pandemic control measures and vaccine rollout[24]. Investments and Financial Management - The company invested RMB 34 million in the Minsheng Trust Plan, expecting an annualized return of 4.7%[60]. - The company confirmed a gain of approximately RMB 271,441 from the Minsheng investment by December 31, 2020[60]. - The company made an investment of RMB 40 million in the Chang'an Trust Plan, which has since matured and been reinvested[61]. - The total gain from the Chang'an investments was approximately RMB 1,531,682, with a fair value of RMB 28.3 million as of December 31, 2020[63]. - The investment in the China-US Green Investment Fund amounted to RMB 50 million, with a fair value of RMB 60 million as of December 31, 2020, reflecting a fair value loss of RMB 6.2 million[64]. - The Chang'an investments represented about 4.66% of the company's total assets as of December 31, 2020[63]. Corporate Governance - The company adhered to the corporate governance code and maintained a high level of governance standards throughout the year[77]. - All independent non-executive directors confirmed their independence and compliance with the relevant regulations as of December 31, 2020[85]. - The company provided training for all directors to ensure they are updated on their responsibilities and the company's operations[95]. - The board includes a diverse range of expertise, enhancing its operational efficiency[90]. - The company has established appropriate insurance for directors and senior management against legal claims arising from corporate activities[92]. - The company has a structured process for the re-election of directors every three years[87]. - The board is collectively responsible for the company's strategic decisions and performance[89]. - The company has implemented a clear guideline for securities trading by employees to prevent conflicts of interest[78]. - The Audit Committee held two meetings during the year ending December 31, 2020, to review the annual financial performance and reports for the year ending December 31, 2019, and the interim financial performance for the six months ending June 30, 2020[102]. - The Remuneration Committee conducted two meetings in the year ending December 31, 2020, to review the company's remuneration policies and structures, as well as the compensation of executive directors and senior management[104]. - The Nomination Committee held two meetings during the year ending December 31, 2020, to review the board's structure, size, and composition, and to assess the independence of independent non-executive directors[108]. - The company has adopted a board diversity policy to ensure a diverse perspective at the board level, which includes considerations of gender, age, cultural background, professional qualifications, and industry experience[111]. - The Audit Committee is responsible for independent review of the group's financial reporting processes, internal controls, and risk management systems[99]. - The company aims to maintain a balanced perspective on diversity to support business growth and will review the board's composition annually[114]. - The Nomination Committee will review the board diversity policy periodically to ensure its effectiveness[116]. - The company has established three committees: Audit Committee, Remuneration Committee, and Nomination Committee, each with clear written terms of reference[98]. - The Remuneration Committee's main responsibilities include reviewing and recommending the remuneration of individual executive directors and senior management to the board[104]. - The board of directors reviewed the company's corporate governance policies and compliance with legal and regulatory requirements[119]. Risk Management - The company faced significant operational risks due to the COVID-19 pandemic, impacting its event operations and marketing business[129]. - The company is conducting market research for new business development to mitigate risks associated with its single business model[129]. - The board is responsible for assessing and determining the nature and extent of risks the company is willing to accept to achieve strategic objectives[120]. - The company has established a risk management and internal control system to manage significant risks rather than eliminate them[120]. - The audit committee assists the board in evaluating and monitoring the risk levels and the effectiveness of the risk management system[121]. - The company aims to identify, assess, and manage all existing and future significant risks within acceptable levels[125]. - The risk management process includes risk identification, assessment, management measures, and monitoring and reporting[126]. - The company is implementing cost-saving measures and low-risk financial investments to increase other revenue sources[129]. - The board concluded on the effectiveness of the risk management and internal control systems after reviewing the audit committee's work[121]. - The company is facing a risk of employee turnover due to the COVID-19 pandemic, with many employees considering other industries for income sources[132]. - The company is actively maintaining relationships with government and sponsors to mitigate customer attrition risks caused by the inability to hold events[132]. - As of December 31, 2020, the company has implemented a risk-oriented internal control evaluation covering financial reporting, fund management, and revenue processes[135]. - The company has established a quality control center responsible for internal monitoring, ensuring compliance with financial reporting and risk management[135]. - The company paid RMB 1,150,000 for audit-related services and RMB 74,000 for non-audit services for the year ending December 31, 2020[144]. - The board believes that the internal control procedures for handling and disclosing inside information are effective[137]. - The company has a closed-loop management mechanism for internal control planning, review, reporting, and follow-up[135]. - The company has not identified any significant uncertainties that may affect its ability to continue as a going concern[141]. Shareholder Relations and Communication - The company ensures that all resolutions presented at the shareholders' meeting are voted on according to listing rules[147]. - The company has established procedures for shareholders to request special meetings and submit proposals[148]. - The company emphasizes effective communication with shareholders to strengthen investor relations and enhance understanding of business performance and strategies[155]. - The company has adopted a dividend policy to maintain sufficient cash reserves for funding needs, future growth, and shareholder value[156]. - As of December 31, 2020, there were no changes to the company's articles of association[159]. Environmental, Social, and Governance (ESG) Performance - The company continues to diversify its business into areas such as sports insurance and sports beverages, aiming to integrate "real economy + finance" for long-term development[168]. - During the reporting period, the company reported significant reductions in air emissions: SOx decreased from 0.82 kg in 2019 to 0.18 kg in 2020, NOx decreased from 2.34 kg to 0.53 kg, and PM decreased from 0.41 kg to 0.06 kg[172]. - The company plans to monitor vehicle usage closely and optimize data collection systems for future emissions tracking[172]. - The company is committed to maintaining close communication with stakeholders to improve ESG performance and risk management[163]. - The company has established a shareholder communication policy to ensure shareholder concerns are addressed appropriately[155]. - The company has not set any predetermined dividend payout ratio[158]. - The company will continue to develop various products and conduct market research despite the impact of the COVID-19 pandemic on its operations[168]. - GHG emissions decreased significantly to 27.43 tons CO2 equivalent in 2020, down approximately 86.7% from 190.954 tons in 2019[176]. - Scope 1 direct emissions from fuel combustion dropped by about 82% from 29.35 tons to 5.18 tons CO2 equivalent due to reduced vehicle usage[176]. - Electricity consumption decreased by approximately 78%, with total energy consumption falling to 32,314 kWh from 143,493 kWh in 2019[193]. - The intensity of electricity usage in the office increased by 42%, reaching 24.1 kWh per square meter due to changes in office space and rental costs[193]. - Water consumption in the office was 889 cubic meters in 2020, a significant increase compared to 11,410 cubic meters in 2019, as the Beijing office was included in the data for the first time[197]. - The company reported a total of 0.15 tons of paper waste in 2020, down from 0.736 tons in 2019, reflecting reduced business activities during the pandemic[184]. - Business travel remained the primary source of emissions, prompting the company to review and strengthen travel management policies[185]. - The company implemented measures to promote public transport usage for commuting, aiming to reduce private car use[186]. - The company adopted an OA system to promote paperless operations and encouraged double-sided printing and recycling[187]. - The company plans to utilize new technologies and eco-friendly materials in future marathon events to minimize environmental impact[191]. - The group does not engage in the use of any packaging materials, thus no related data or information is presented in this report[200].
中国前沿科技集团(01661) - 2020 - 年度财报