COSL(SH:601808)2017-03-21 16:00Financial Performance - The company reported a net profit of RMB -11,459,456,594 for the year 2016, with a net profit attributable to shareholders of RMB -11,456,186,318[2]. - In 2016, the company's operating revenue was RMB 15,152.2 million, a decrease of 35.9% compared to RMB 23,654.0 million in 2015[19]. - The net profit attributable to shareholders was a loss of RMB 11,456.2 million, compared to a profit of RMB 1,073.9 million in 2015, marking a decline of 1,166.8%[19]. - The company's net cash flow from operating activities was RMB 2,740.6 million, down 58.2% from RMB 6,556.2 million in 2015[19]. - By the end of 2016, the total assets were RMB 80,544.1 million, a decrease of 13.9% from RMB 93,525.1 million at the end of 2015[19]. - The company reported a basic earnings per share of -RMB 2.40 in 2016, compared to RMB 0.23 in 2015, reflecting a decline of 1,166.8%[20]. - The weighted average return on equity was -27.98% in 2016, down 30.27 percentage points from 2.29% in 2015[20]. - The gross profit margin for the company dropped by 32.4 percentage points year-on-year, primarily due to the continued low oil prices and reduced demand in the oilfield services sector[74]. - The company reported a significant decrease in operating costs across all segments, with total operating costs amounting to RMB 17,295.8 million, down 32.4% from the previous year[74]. Dividend and Retained Earnings - The total distributable retained earnings as of December 31, 2016, amounted to RMB 15,450,440,854 after deducting the dividend payout of RMB 324,468,256 for the year 2015[2]. - The company plans to distribute a cash dividend of RMB 0.05 per share, totaling RMB 238,579,600, based on a total share capital of 4,771,592,000 shares[2]. - The company’s dividend policy stipulates that the annual payout should not be less than 20% of the net profit for the year, provided there are retained earnings[106]. - In 2016, the company declared a cash dividend of 0.50 CNY per share, totaling 238,579,600 CNY, with a net profit attributable to shareholders of -11,456,186,318 CNY[108]. - In 2015, the cash dividend was 0.68 CNY per share, amounting to 324,468,256 CNY, with a net profit of 1,073,907,130 CNY, representing a profit margin of 30%[108]. - In 2014, the company paid a cash dividend of 4.80 CNY per share, totaling 2,290,364,160 CNY, with a net profit of 7,492,057,527 CNY, achieving a profit margin of 31%[108]. - The company has not proposed a cash profit distribution plan for the reporting period despite having positive distributable profits[109]. Operational Efficiency and Market Conditions - The company’s operational efficiency metrics include calendar day utilization and operational day utilization rates, which are critical for assessing performance[9]. - The oilfield services market size decreased by 33% in 2016, reaching USD 22.13 billion, marking the first consecutive annual decline since 1996[26]. - The company aims to enhance its risk management capabilities in response to the low oil price environment, focusing on proactive risk assessment and control[40]. - The company maintained a stable safety and environmental performance, with an OSHA recordable incident rate of 0.1 in 2016[44]. - The company has established a mature global service network and long-term stable relationships with major international and national oil companies[32]. - The company has a complete R&D system and a team of experienced technical service experts, providing high-end technical services and solutions to key technical challenges[32]. Impairments and Asset Management - The company recognized goodwill impairment of RMB 3,455.4 million and fixed asset impairment of RMB 3,688.4 million due to the ongoing downturn in the oilfield services industry[30]. - The company recorded an asset impairment loss of RMB 8,272.7 million, including fixed asset impairment of RMB 3,688.4 million and goodwill impairment of RMB 3,455.4 million[88]. - The company’s goodwill was fully impaired, resulting in a 100% decrease from RMB 3,394.5 million in the previous year[90]. Debt and Financing - The company issued RMB 10 billion in corporate bonds and secured USD 350 million in low-cost revolving loans to optimize its debt structure[48]. - The company issued corporate bonds totaling RMB 30 billion in June 2016, with an interest rate of 4.10%[145]. - The financial expenses increased by 27.8% to RMB 648.4 million due to higher interest expenses[82]. Risk Management and Compliance - The company emphasizes the uncertainty of forward-looking statements regarding future plans and development strategies, highlighting the need for investors to recognize associated risks[3]. - The company has not reported any non-operational fund occupation by controlling shareholders or related parties[4]. - The company has not faced any risks of suspension or termination of its listing during the reporting period[114]. - The company has fulfilled its commitments regarding avoiding competition and addressing land rights issues as per its agreements[110]. - The company has no undisclosed litigation or arbitration situations during the reporting period[116]. - The company has not experienced any changes in its ordinary share capital structure during the reporting period[141]. Corporate Governance and Management - The company has a diverse board with a mix of executive and non-executive directors, enhancing governance[157]. - The average age of the board members is 55 years, contributing to a balance of experience and innovation[157]. - The company has seen a consistent structure in its executive team, with no significant turnover reported during the period[156]. - The report highlights the tenure of key executives, with some serving since 2016, ensuring continuity in leadership[157]. - The company emphasizes safety and operational efficiency, with executives having held positions related to safety management in drilling operations[159]. - The company has undergone significant leadership changes, with multiple executives holding key positions since 2016, reflecting a stable management structure[159]. Research and Development - Research and development expenditure in 2016 was RMB 567.1 million, down 35.7% from RMB 882.0 million in 2015[71]. - The company has developed 30 core products and improved its operational capabilities in high-temperature, high-pressure, and ultra-deepwater environments[47]. - The company successfully developed four types of deep-water drilling completion fluid technologies and five types of cementing process technologies, resulting in a total of 30 core products[84]. - Research and development investments have increased by 30%, totaling $150 million, aimed at advancing new technologies[162]. Market Expansion and Future Outlook - The company plans to enhance cooperation with oil companies and accelerate the development of overseas markets and integrated contracting services[26]. - The company aims to achieve a balanced revenue contribution of 50% from domestic and international markets in the medium to long term[45]. - The company is exploring partnerships to enhance its service offerings, which could lead to an additional H million in revenue[160]. - The company is expanding its market presence in Southeast Asia, targeting a 25% market share by the end of the next fiscal year[162]. - The company provided a positive outlook for the next fiscal year, projecting a revenue growth of 10% to $1.32 billion[162].