SA(SH:601021)2017-03-30 16:00Financial Performance - The audited net profit for the parent company in 2016 was RMB 848,390,138, with cumulative undistributed profits amounting to RMB 4,485,191,938 as of December 31, 2016[2]. - The company's operating revenue for 2016 was CNY 8,429,404,272, representing a 4.15% increase from CNY 8,093,672,545 in 2015[22]. - The net profit attributable to shareholders for 2016 was CNY 950,518,951, a decrease of 28.42% compared to CNY 1,327,858,772 in 2015[22]. - The net cash flow from operating activities increased by 26.67% to CNY 2,039,738,341 in 2016 from CNY 1,610,295,679 in 2015[22]. - The total assets at the end of 2016 were CNY 19,646,560,632, reflecting a 22.57% increase from CNY 16,028,988,804 at the end of 2015[22]. - The basic earnings per share for 2016 was CNY 1.19, down 29.17% from CNY 1.68 in 2015[23]. - The weighted average return on equity decreased to 13.74% in 2016 from 23.01% in 2015, a decline of 9.27 percentage points[23]. - The net profit after deducting non-recurring gains and losses was ¥238,771,357 in Q1 2016, dropping to a loss of ¥395,908,891 in Q4 2016[26]. - The company reported a decrease of 68.63% in net profit after deducting non-recurring gains and losses, amounting to CNY 204,726,533 in 2016[22]. Dividend Policy - The proposed cash dividend distribution amounts to RMB 128,092,800, representing 15.1% of the parent company's net profit, equating to RMB 1.60 per 10 shares[2]. - The cash dividend payout ratio is below 30% due to significant capital expenditure needs in the capital-intensive airline industry, with a focus on retaining profits for operational liquidity and aircraft acquisitions[3]. - The board of directors has approved the profit distribution plan, which will be submitted for shareholder approval at the annual meeting[3]. - The company plans to distribute at least 10%, 13%, and 15% of distributable profits as cash dividends in the first three years post-IPO, with a minimum cash dividend ratio of 20% in any distribution[147]. - The proposed cash dividend is subject to approval at the company's shareholder meeting[149]. Operational Strategy - The company is in a growth phase with substantial funding requirements for future development, including the purchase of aircraft and related equipment[3]. - The company has established regional hubs in Shenyang, Shijiazhuang, Shenzhen, and is exploring additional hubs in Chongqing, Kunming, and Chengdu, enhancing its market expansion strategy[52]. - The company will focus on maintaining a first-class safety performance, ensuring the highest level of safety standards in aviation operations[121]. - The company aims to expand its fleet size while ensuring flight safety, aiming to become a competitive international low-cost airline[119]. - The company plans to increase domestic route capacity in 2017, adding new routes to Ningbo, Yangzhou, and Harbin, while also optimizing existing major business routes[124]. Market Position and Industry Trends - The global air transport industry saw a passenger volume of 3.77 billion in 2016, with a year-on-year growth of 5.9%[34]. - The market share of low-cost airlines globally increased from 8.0% in 2001 to 25.7% in 2016, indicating significant growth potential in the sector[37]. - The domestic low-cost airline market share in China was 10.3% in 2016, with expectations for further growth due to increasing demand and supportive policies[37]. - The civil aviation industry in China is expected to grow at an annual rate of 10.8% for passenger turnover and 10.4% for passenger transport volume by 2020[114]. - The government aims to increase the number of airports to around 260 and improve air traffic management capabilities by 2020[114]. Risk Management - The company has provided a detailed risk description in the report, highlighting potential risks to future development[6]. - The company emphasizes that forward-looking statements do not constitute substantive commitments to investors, urging caution regarding investment risks[5]. - The company will strengthen foreign currency asset-liability management to mitigate exchange rate losses, with a focus on matching foreign currency assets and liabilities[129]. - The company is at risk of losing subsidy income from route and government subsidies due to the expiration of cooperation agreements[142]. Corporate Governance - The company has not engaged in non-operational fund occupation by controlling shareholders or related parties[6]. - There are no violations of decision-making procedures regarding external guarantees[6]. - The company has committed to optimizing its capital structure while balancing short-term cash returns to shareholders with long-term growth investments[149]. - The company will ensure compliance with relevant regulations regarding related party transactions and will not exploit its position for improper benefits[162]. Environmental and Social Responsibility - The company has planted over 250,000 drought-resistant trees with a survival rate of 86% as part of its ecological restoration project in Hebei province[179]. - The company has established a "Spring Airlines Love Flying" special fund, raising over 580,000 RMB in 2016 for educational and charitable activities[179]. - The company has been recognized as a "Shanghai Advanced Enterprise in Energy Conservation and Emission Reduction" for successfully completing energy consumption targets set by the municipal transportation committee in 2016[178]. Future Outlook - The company aims to achieve a flight hour target of approximately 270,600 hours and a passenger turnover of about 290 million person-kilometers in 2017[120]. - The passenger transport volume is projected to reach approximately 17.3 million passengers in 2017[120]. - The company will continue to explore auxiliary business opportunities, focusing on O2O sales, hotel services, and destination services, while increasing the revenue share from mobile applications[131].