CAHIC(SH:600195)2017-04-10 16:00Financial Performance - The company achieved a net profit attributable to shareholders of RMB 334,420,105.51 in 2016, representing a 21.31% increase compared to RMB 275,666,868.57 in 2015[3]. - Total operating revenue for 2016 was RMB 3,973,870,435.72, a decrease of 6.15% from RMB 4,234,189,943.05 in 2015[21]. - The net profit attributable to shareholders rose by 21.31% due to the divestment of equity in a joint venture[23]. - Basic earnings per share increased by 21.31% to CNY 0.7781 compared to the previous year[23]. - The company's total operating income for the year was 3.95 billion yuan, a decrease of 6.27% compared to the previous year[45]. - The company reported a positive profit for the period, with net profit available for common shareholders being positive, but no cash dividend proposal was made[125]. Assets and Liabilities - The company's total assets increased by 37.36% to RMB 6,030,681,072.02 at the end of 2016, compared to RMB 4,390,361,446.43 at the end of 2015[22]. - The net assets attributable to shareholders increased by 10.55% to RMB 3,357,573,340.82 at the end of 2016, compared to RMB 3,037,190,513.73 at the end of 2015[22]. - The company's short-term borrowings increased by 120.97% to 75,053,290 yuan, indicating a rise in financing activities[66]. - The debt-to-asset ratio increased to 38.74% in 2016, up from 23.57% in 2015, reflecting a higher level of leverage[194]. Cash Flow - The net cash flow from operating activities was RMB 633,402,460.30, up 19.48% from RMB 530,135,872.49 in 2015[22]. - The company's cash flow from operating activities increased by 19.48% year-on-year, reaching 633.40 million yuan[48]. - The cash interest coverage ratio improved to 128.95 in 2016, up from 67.20 in 2015, driven by an increase in net cash flow from operating activities[195]. Research and Development - The company has established a comprehensive R&D system to innovate new products and technologies in collaboration with research institutions[32]. - Research and development expenditure accounted for 5.83% of total operating income, exceeding the industry average[42]. - The total R&D investment amounted to 231,786,308.92 yuan, representing 5.83% of operating revenue, with capitalized R&D accounting for 53.55% of the total[60]. - The company’s R&D investment for the reporting period was 23,178.63 million RMB, significantly higher than the industry average R&D investment of 7,287.27 million RMB[80]. Market and Industry Position - The company operates in the animal health and nutrition sector, focusing on veterinary biological products and feed additives[32]. - The company holds a market share of approximately 20% in the animal vaccine sector, positioning it among the industry leaders[36]. - The market for animal vaccines in China is rapidly growing, driven by increased government investment in disease prevention[69]. - The veterinary vaccine industry in China has 77 companies, with the top 10 accounting for 57.42% of total sales, indicating a highly competitive market[108]. Product Development and Sales - The company achieved a revenue of 1.304 billion yuan in the biological products segment, representing a year-on-year growth of 4.46%[40]. - The pharmaceutical business generated a revenue of 744 million yuan, reflecting a year-on-year growth of 34.71%[41]. - The feed business achieved an annual revenue of 800.92 million yuan, representing a year-on-year growth of 22.07%[42]. - The company has introduced 12 new products and received 9 new veterinary drug certificates during the reporting period[36]. Dividends and Shareholder Returns - The company plans to distribute a cash dividend of RMB 2.35 per 10 shares, totaling RMB 10,100.30 million, based on a total share capital of 42,980 million shares[3]. - In 2016, the company distributed cash dividends of 0.193 RMB per share, totaling 82.95 million RMB, which accounted for 30.09% of the net profit attributable to shareholders[122]. - The company has not adjusted its cash dividend policy during the reporting period, maintaining a minimum cash distribution of 10% of the distributable profit when conditions are met[121]. Risks and Challenges - The company is facing risks from policy changes regarding animal disease prevention, which could impact market demand and the company's ability to meet it[114]. - Increased competition in the industry is leading to a potential loss of market share for the company if it fails to maintain its competitive advantages in new product development[117]. - Fluctuations in raw material prices could significantly impact the company's production costs and overall profitability[119]. Governance and Management - The company has undergone several management changes, including the resignation of key personnel in late 2016 and early 2017[165]. - The company continues to focus on strengthening its governance structure through the appointment of experienced individuals in key positions[165]. - The total remuneration for all directors, supervisors, and senior management during the reporting period amounted to 3.4591 million yuan[167]. Environmental and Safety Practices - The company is committed to becoming a "resource-saving and environmentally friendly" enterprise[146]. - The company successfully passed the clean production system certification during the year[146]. - The company has implemented a normalized monitoring management approach for energy consumption and pollutant emissions across its subsidiaries[146].