ZYD(SH:600610)2018-08-29 16:00Financial Performance - The company's operating revenue for 2017 was ¥30,521,415.09, a decrease of 94.98% compared to ¥608,445,275.44 in 2016[25]. - The net profit attributable to shareholders of the listed company was -¥1,128,558,032.40 in 2017, a decline of 24,172.15% from ¥4,688,231.20 in 2016[25]. - The total assets at the end of 2017 were ¥431,550,290.81, down 77.08% from ¥1,882,890,207.87 in 2016[25]. - The basic earnings per share for 2017 was -¥1.0535, a decrease of 24,043.18% compared to ¥0.0044 in 2016[26]. - The weighted average return on equity for 2017 was -188.30%, a decrease of 188.306 percentage points from 0% in 2016[26]. - The net cash flow from operating activities was -¥105,571,433.04 in 2017, a decline of 527.49% from ¥24,695,412.23 in 2016[25]. - The company reported a significant loss due to the loss of control over Shanghe Construction and impairment of seedling assets[25]. - In the fourth quarter of 2017, the operating revenue was -¥410,176,937.87, indicating a substantial decline in performance[28]. - The company experienced a net profit attributable to shareholders of -¥1,129,138,810.79 in the fourth quarter, contributing to the overall annual loss[28]. - Non-recurring gains and losses included government subsidies amounting to ¥458,909.50 in 2017, down from ¥1,768,059.50 in 2016[30]. - The company reported a total revenue of CNY 30,521,415.09, a significant decrease of 95% compared to the previous year[44]. - The net profit attributable to shareholders was CNY -1,128,558,032.40, reflecting a decline of 3732% year-on-year[44]. - Total assets at the end of the reporting period amounted to CNY 431,550,290.81, down 77% from the beginning of the year[44]. - The company experienced a net cash flow from operating activities of CNY -105,571,433.04, a decrease of 527% compared to the previous year[46]. Legal and Regulatory Issues - The company received a disciplinary notice from the Shanghai Stock Exchange on December 27, 2017, due to violations of information disclosure regulations, leading to public reprimands for several executives and board members[9]. - The company is currently under investigation by the China Securities Regulatory Commission for suspected violations of information disclosure laws, which may lead to delisting risk if found guilty[10]. - The company has a significant legal risk involving a claim of 69,340,036.86 RMB from Shanghai Wensheng Asset Management Co., Ltd., which could negatively impact its financial performance[75]. - The company is under investigation by the China Securities Regulatory Commission for suspected information disclosure violations, and the outcome of this investigation is still pending[98]. - The company issued electronic commercial acceptance bills worth 3.5 billion RMB without real transaction backgrounds, violating relevant regulations[70]. - The company was included in the list of dishonest executors by the Shanghai Second Intermediate People's Court on November 1, 2017[118]. - The company has faced public reprimands from the Shanghai Stock Exchange and regulatory penalties totaling RMB 500,000[116][117]. Asset Management and Impairments - The company reported a provision for impairment of assets totaling CNY 623.35 million, including CNY 131.84 million for a subsidiary and CNY 62.33 million for inventory[93]. - The company lost control over its subsidiaries, resulting in a total impairment provision of 81,393,825.77 RMB for the investment in Shanghe Construction and 15,000,000.00 RMB for the investment in Zhongguan Construction[62]. - The company has recognized impairment provisions totaling 81.39 million yuan for a subsidiary, 15 million yuan for another subsidiary, and 122.90 million yuan for an associated company[187]. - The company has not provided sufficient evidence to assess the reasonableness of the impairment provisions for various assets, including a total of 62.33 million yuan for nursery assets[188]. Management and Governance - The company plans to improve its management structure and financial controls to address issues that led to the loss of control over subsidiaries and financial instability[69]. - The company is committed to improving its internal control systems and addressing existing issues systematically[71]. - The board of directors strictly adheres to legal requirements and maintains the interests of all shareholders[165]. - The supervisory board conducts regular meetings to oversee the legality and compliance of the management's actions[166]. - The company has undergone management changes, including the appointment of a new general manager and several board members[158]. - The company has experienced changes in its board members, with several resignations and appointments during the reporting period[150]. - The company has a governance structure that meets the requirements set by the China Securities Regulatory Commission[165]. Financial Position and Liabilities - The company's total assets as of December 31, 2017, amounted to CNY 431.55 million, with total liabilities of CNY 396.49 million, resulting in a net asset value of CNY 35.06 million and a debt-to-asset ratio of 91.88%[90]. - The company has an estimated liability of CNY 43.49 million related to the "Wensheng case," which is currently under review by the Supreme Court[94]. - The total amount of guarantees provided by the company, excluding those to subsidiaries, reached RMB 80,198,565.86, accounting for 228.77% of the company's net assets[123]. - The company has incurred management expenses of 169.29 million yuan related to nursery losses, with insufficient data to determine the impact on cost reporting[193]. Strategic Initiatives and Future Plans - The company plans to establish a regional operation team in Guizhou to enhance its market presence and capitalize on regional economic growth[39]. - The company aims to diversify its business into ecological and environmental sectors while maintaining its core operations in municipal and landscaping engineering[41]. - The company signed a joint agreement to participate in a PPP project, indicating a strategic move towards collaborative projects[42]. - The company plans to focus on small-scale bidding and projects to quickly recover funds and enhance brand credibility[71]. - The company intends to expand its market presence by actively developing new business channels and enhancing its professional team through recruitment[69]. Employee and Organizational Structure - The total number of employees in the parent company is 20, while the main subsidiaries employ 194, resulting in a total of 214 employees[161]. - The company has a competitive and incentive-based salary policy, implementing a performance-based wage system linked to individual performance assessments[162]. - The educational background of employees shows that 55 hold a bachelor's degree or higher, while 60 have a diploma, and 99 have a high school education or lower[161]. - The company has established different performance evaluation and salary systems for its subsidiaries based on their nature[162]. - The company has undergone management changes, including the appointment of a new general manager and several board members[158]. Audit and Compliance - The audit report issued by Sichuan Huaxin (Group) CPA indicated a disclaimer of opinion due to the inability to obtain sufficient audit evidence[86]. - The company lost control over its subsidiary Fujian Shanghe Construction Engineering Co., Ltd., which affected the ability to audit its financial statements[87]. - The internal control audit report issued by Sichuan Huaxin (Group) Accounting Firm provided an unqualified opinion with emphasis on certain issues, indicating areas needing attention[180]. - The company has not consolidated the financial statements of a subsidiary since January 1, 2017, leading to uncertainty regarding its impact on the consolidated financial statements[186]. - The company has not provided sufficient evidence to assess the reasonableness of the impairment provisions for various assets, including prepayments and inventory[93].