SIFANG(SH:601126)2017-03-30 16:00Financial Performance - In 2016, the company achieved a net profit of RMB 324,817,791.98, with a total distributable profit of RMB 1,171,291,092.72[2]. - The company's operating revenue for 2016 was RMB 3,139,209,646.55, representing a decrease of 5.04% compared to RMB 3,305,876,061.72 in 2015[18]. - The net profit attributable to shareholders decreased by 14.00% to RMB 295,935,970.43 from RMB 344,116,049.77 in the previous year[18]. - The net profit after deducting non-recurring gains and losses was RMB 261,319,967.15, down 19.76% from RMB 325,683,074.36 in 2015[18]. - Basic earnings per share decreased by 14.29% to CNY 0.36 in 2016 compared to CNY 0.42 in 2015[19]. - Diluted earnings per share also decreased by 14.29% to CNY 0.36 in 2016 compared to CNY 0.42 in 2015[19]. - The weighted average return on equity fell by 1.83 percentage points to 7.86% in 2016 from 9.69% in 2015[19]. - The company reported a net cash flow from operating activities of CNY 411,276,730.87 in Q4 2016, indicating positive cash generation[22]. - The company achieved a total order contract amount of 4.155 billion yuan in 2016, an increase of 6.98% compared to 3.884 billion yuan in the previous year[36]. - The company achieved a total contract value of 136.898 million yuan in the thermal power sector for 2016, doubling from 62.778 million yuan in 2015, indicating a year-on-year growth of 118%[39]. Cash Flow and Investments - The net cash flow from operating activities increased significantly to RMB 151,271,458.69, compared to RMB 71,915,186.43 in 2015[18]. - The company’s investment activities generated a net cash outflow of CNY 93,887,910.73, an improvement from a net outflow of CNY 180,341,932.51 in the previous year[62]. - The company reported a decrease in cash flow from investing activities, with a net outflow of CNY 93,887,910.73, compared to a larger outflow of CNY 180,341,932.51 last year[181]. - The financing activities resulted in a net cash outflow of CNY 162,925,223.92, contrasting with a net inflow of CNY 163,952,678.82 in the previous period[181]. - The total cash and cash equivalents at the end of the period were CNY 347,622,657.87, down from CNY 452,796,689.65 at the beginning of the period[181]. Research and Development - The company maintained an average R&D expense ratio of over 10% of operating revenue over the past three years, emphasizing its commitment to innovation[29]. - Research and development expenses increased by 4.82% to CNY 400.89 million, reflecting the company's commitment to maintaining technological leadership[49]. - Total R&D expenditure for the year amounted to CNY 400,892,322.44, representing 12.77% of operating revenue, with 670 R&D personnel accounting for 19.54% of the total workforce[60]. - The company has invested in research and development for new technologies in various fields, including banking security and renewable energy[32]. Market Position and Growth - The company has been recognized as one of the top 100 software businesses in China for nine consecutive years, reflecting its strong market position[30]. - The company maintained a market share in relay protection and substation automation equipment, remaining a leader in the industry[36]. - The company is actively expanding into new markets, including smart grids and energy internet, while continuing to innovate in power system secondary equipment and DC transmission technology[36]. - The company’s market share in the secondary protection monitoring equipment bidding increased from 12.86% in 2015 to 14.95% in 2016, with a bid amount of 5.855 billion RMB[77]. Dividend and Shareholder Engagement - The company plans to distribute a cash dividend of RMB 1.78 per 10 shares, totaling RMB 144,744,616.00[2]. - The cash dividends for 2016 represented 48.91% of the net profit attributable to ordinary shareholders in the consolidated financial statements[94]. - The company engaged with minority shareholders to gather feedback on the dividend distribution process[90]. - The remaining undistributed profits will be carried forward to future years for distribution[91]. Governance and Compliance - The company received a standard unqualified audit report from Beijing Zhongzheng Tiantong Accounting Firm[4]. - The company has adhered to its articles of association in implementing the dividend policy[90]. - The company maintains independence from its controlling shareholder in business, personnel, assets, institutions, and finance[157]. - The company has implemented a performance evaluation system that integrates goals, responsibilities, and performance assessments, continuously optimizing it for effectiveness and motivation[147]. Risks and Future Outlook - The company has outlined potential risks in its future development strategies, which investors should be aware of[3]. - The company anticipates a slowdown in electricity consumption growth in 2017, with overall power supply capacity being surplus, leading to challenges in profitability for coal power enterprises[85]. - The company will closely monitor national industrial development dynamics and adapt to changes in the electricity market due to ongoing reforms[86]. - The company plans to focus on the adjustment of power generation structure, emphasizing energy conservation, emission reduction, and new energy generation as key investment areas[68].