FSSS(SH:600399)2018-06-25 16:00Financial Performance - The company reported a total profit of -1,286,482,670.37 CNY and a net profit of -1,319,548,678.48 CNY for the year 2017, resulting in a cumulative undistributed profit of -2,612,237,312.69 CNY by the end of the year[6]. - The company's operating revenue for 2017 was CNY 4,984,304,965.53, representing a 6.56% increase compared to CNY 4,677,555,207.54 in 2016[33]. - The net profit attributable to shareholders of the listed company in 2017 was a loss of CNY 1,337,585,276.28, compared to a loss of CNY 44,102,024.07 in 2016[33]. - The net cash flow from operating activities for 2017 was CNY 671,135,719.31, a significant recovery from a negative cash flow of CNY 147,617,751.40 in 2016, marking an increase of 554.64%[33]. - The total assets at the end of 2017 were CNY 9,565,855,000.32, a decrease of 9.55% from CNY 10,575,927,359.24 at the end of 2016[34]. - The basic earnings per share for 2017 was -CNY 1.03, a decline from -CNY 0.03 in 2016, indicating a decrease of 3,300%[35]. - The weighted average return on net assets for 2017 was -292.10%, a decrease of 274.85 percentage points from -17.25% in 2016[35]. - The company reported a significant loss of 105.35 million yuan in the manufacturing sector, with total revenue of 90.69 million yuan[84]. - The company reported a net profit of CNY -1,319,548,678.48 for the year 2017, leading to a cumulative undistributed profit of CNY -2,612,237,312.69 by the end of 2017[100]. - The company proposed no profit distribution for the year 2017 due to the reported losses[101]. Bankruptcy and Restructuring - The company is facing bankruptcy restructuring as it has been unable to repay due debts and lacks the ability to pay, with a restructuring application filed by a creditor[15]. - The company has been issued a warning for delisting due to a negative net asset value and consecutive losses over the past two years, with its stock to be marked as *ST[9]. - The company is currently executing the restructuring plan of Northeast Special Steel Group, which was approved by the Dalian Intermediate People's Court in 2017[19]. - The company is at risk of bankruptcy reorganization due to an inability to repay debts, as indicated by a bankruptcy reorganization application filed against it[123]. - The controlling shareholder, Northeast Special Steel Group, is undergoing bankruptcy restructuring, with the restructuring plan approved by the Dalian Intermediate People's Court[127]. Internal Control and Audit Issues - The company's financial statements received an audit report with no opinion from the auditing firm due to the inability to obtain sufficient evidence[5]. - The company identified significant internal control deficiencies, leading to overstatements of inventory by 699,500,728.31 CNY, fixed assets by 841,589,283.99 CNY, and construction in progress by 296,958,490.00 CNY as of December 31, 2016[115]. - The company has initiated self-inspection and rectification efforts in response to the significant internal control deficiencies identified[120]. - The company is actively cooperating with regulatory investigations and is committed to addressing the identified financial reporting deficiencies[120]. - The company received an audit report from Zhongjun Accounting Firm, which issued an audit report with no opinion for the 2017 financial report[110]. Research and Development - The company’s R&D expenditure in 2017 amounted to CNY 182 million, focusing on high-end alloys and special steel products for aerospace and new energy applications[45]. - The company has 39 ongoing national research projects and has applied for 20 new projects under the "13th Five-Year Plan"[45]. - The company plans to invest more resources into the research and development of high-end special steel materials to meet the demands of high-end industries[87]. - The company plans to adjust product development directions and related equipment in line with a new strategic plan developed with its controlling shareholder[161]. - The company is committed to enhancing its competitive edge by investing in research and development[181]. Market and Product Strategy - The company is focusing on product structure optimization, enhancing service systems, and improving technical capabilities to maintain competitive advantages[49]. - The company plans to expand its market presence and invest in new technologies to enhance production efficiency[60]. - The company plans to achieve a steel production volume of 600,000 to 650,000 tons and a steel product output of 500,000 to 550,000 tons in 2018, with key products accounting for 350,000 to 400,000 tons[88]. - The projected revenue for 2018 is between 5.00 billion to 5.50 billion yuan, aiming to reverse the ongoing losses and achieve profitability[88]. - The company plans to expand its market presence in the automotive sector, focusing on high-performance steel products to meet increasing demand[79]. Social Responsibility and Community Engagement - The company plans to invest 132,000 in poverty alleviation projects in 2017[143]. - The company provided a total of 10.62 million RMB in funding for poverty alleviation efforts, helping 86 registered impoverished individuals to escape poverty[147]. - The company has established a comprehensive wastewater treatment facility with an investment of 42 million RMB, achieving near-zero wastewater discharge[152]. - The company is committed to enhancing its social responsibility by engaging in community service and environmental protection initiatives[150]. - The company received recognition for its poverty alleviation efforts, with a team member awarded as an advanced individual in poverty alleviation by the provincial government[148]. Related Party Transactions - The company reported significant related party transactions, including purchasing spare parts for approximately ¥15,047,753.4, which accounted for 0.30% of the total transaction amount[129]. - The company engaged in significant related party transactions, leveraging resources from its controlling shareholder to reduce operational costs and expand product range[132]. - The company has guaranteed 5 million RMB for its controlling shareholder, Northeast Special Steel Group, with the guarantee period from May 2014 to May 2016[137]. - The company’s related party debts do not have a significant impact on its overall financial position[135]. - The company has not reported any overdue guarantees or significant risks associated with its related party transactions[137]. Governance and Management - The company’s governance structure complies with relevant laws and regulations, ensuring equal rights for shareholders and diligent responsibilities for directors and supervisors[194]. - The company has established a performance evaluation mechanism for senior management, linking compensation to performance outcomes[199]. - The management team includes experienced professionals with extensive backgrounds in the steel industry, ensuring strong leadership[180]. - The company’s board of directors includes individuals with extensive experience in the steel industry, contributing to strategic decision-making[183]. - The total remuneration for the board members and senior management during the reporting period was not disclosed in the provided data[179].