CGS(SH:601881)2018-03-28 16:00Dividend Distribution - The company plans to distribute a cash dividend of RMB 1,216,471,050.84 (including tax), which translates to RMB 1.20 per 10 shares based on a total share capital of 10,137,258,757 shares as of the end of 2017[5]. - The proposed cash dividend for 2017 is RMB 1,216,471,050.84, accounting for 30.56% of the net profit attributable to shareholders[178]. - The cash dividend distribution plan includes a payout of RMB 1.20 per 10 shares, subject to adjustments based on changes in total share capital[178]. - After the cash dividend distribution, the retained earnings for the company will be RMB 13,408,376,185.86, which will be carried forward to the next year[178]. - The company has established a profit distribution policy that prioritizes cash dividends, ensuring a stable return to investors[173]. - The cash dividend proposal has been approved by the board and will be submitted for shareholder approval[179]. - The company emphasizes compliance and transparency in its profit distribution process, protecting the interests of minority investors[178]. - The total undistributed profits at the end of the year amount to RMB 14,624,847,236.70 after accounting for the previous year's cash dividends[177]. - The company will conduct the cash dividend distribution within two months after the shareholder meeting approval[179]. Financial Performance - The company's operating revenue for 2017 was ¥11,344,192,279.74, a decrease of 14.32% compared to ¥13,240,439,880.86 in 2016[40]. - The net profit attributable to shareholders of the parent company was ¥3,980,730,433.74, down 22.76% from ¥5,153,546,221.82 in the previous year[40]. - The total assets at the end of 2017 amounted to ¥254,814,966,451.09, reflecting a 3.63% increase from ¥245,880,521,017.15 in 2016[40]. - The total liabilities increased by 1.28% to ¥189,928,532,783.68 in 2017 from ¥187,526,621,348.41 in 2016[40]. - The basic earnings per share decreased by 27.78% to ¥0.39 in 2017 from ¥0.54 in 2016[41]. - The weighted average return on equity was 6.33% in 2017, down 2.64 percentage points from 8.97% in 2016[41]. - The net capital at the end of the reporting period was ¥50,746,807,591.89, down from ¥53,108,748,426.14 at the end of the previous year[42]. - The risk coverage ratio decreased to 242.39% in 2017 from 361.60% in 2016[42]. - The liquidity coverage ratio was 171.61% at the end of 2017, down from 218.70% in the previous year[42]. Business Operations and Strategy - The company is positioned as a leading comprehensive financial service provider in China's securities industry, focusing on brokerage, investment banking, and asset management[50]. - The company aims to enhance its market position and public image by adjusting its business model to a "dual-wheel drive" strategy, focusing on wealth management and investment banking[56]. - The company has expanded its business scope to include internet securities and private fund comprehensive custody services, indicating a strategic shift towards digital finance[20]. - The company has been involved in multiple capital increases and restructuring since its establishment in 2007, reflecting its growth strategy[25]. - The company operates 470 securities business departments across 31 provinces, with Guangdong having the highest number at 76[36]. - The company has established a structured governance framework in compliance with relevant laws and regulations[29]. - The company is focused on continuous improvement of its operational mechanisms and institutional development[29]. - The company has a dedicated team managing its subsidiaries and branches to ensure effective operations[30]. Risk Management - The company faces various risks including legal and compliance risks, strategic planning risks due to market changes, operational and management risks from business model transformations, market risks from price fluctuations of held securities, credit risks from counterparty defaults, liquidity risks from cash shortages, and operational risks from internal process management failures[8]. - The company emphasizes risk management through organizational structure, management mechanisms, and information technology to mitigate operational and market risks[8]. - The company has established a three-tier risk license management system to ensure effective risk control and authorization for innovative business types[150]. - The company actively manages credit risk through pre-evaluation and post-monitoring mechanisms, ensuring that credit exposure is closely monitored[158]. - The company recognizes potential exchange rate risks as it expands overseas, planning to implement effective measures for risk management[158]. - The company established a dynamic monitoring system for risk control indicators, ensuring real-time monitoring of net capital and liquidity risk control indicators[162]. - The risk management committee assists the board in formulating risk management strategies and policies, evaluating major risk matters[165]. Compliance and Governance - The company has established a structured governance framework in compliance with relevant laws and regulations[29]. - The company maintains a strong focus on compliance with the "Company Law" and "Securities Law" in its operations[29]. - The company emphasizes compliance and transparency in its profit distribution process, protecting the interests of minority investors[178]. - The company has not encountered any significant accounting errors that would require correction[189]. - The company has maintained a good integrity status, with no defaults on court judgments or significant overdue debts reported during the period[196]. - The company confirmed that there were no false records or misleading statements in the prospectus[182]. - The company did not reach the original profit forecast for any assets or projects during the reporting period[183]. Market Conditions - The stock market in China experienced a mixed performance in 2017, with the Shanghai Composite Index increasing by 6.56% and the ChiNext Index decreasing by 10.67%[58]. - The total amount of A-share transactions in 2017 was RMB 111.76 trillion, a year-on-year decrease of 11.66%[58]. - The average daily trading volume in the market was RMB 457.4 billion, down 12.43% year-on-year, with the average commission rate at 0.036%, a decline of 11.4%[69]. - The balance of margin financing and securities lending at the end of 2017 was RMB 1.03 trillion, an increase of 9.26% year-on-year[58]. Subsidiaries and Investments - The company has a total of 5 subsidiaries, with registered capital ranging from RMB 10 billion to RMB 12 billion[30]. - The company operates 36 branches across various regions, each with a registered capital of RMB 500,000[32]. - The subsidiary "银河期货" holds an 83.32% ownership and has a registered capital of RMB 12 billion[30]. - The company has expanded its overseas business platform to eight countries, enhancing its revenue diversification strategy[107]. - The company plans to enhance product line innovation and improve customer service systems to strengthen its core competitiveness in bond underwriting[90]. Audit and Financial Reporting - The company has undergone an audit by Deloitte Touche Tohmatsu and received a standard unqualified audit opinion for its 2017 financial report[4]. - The company’s financial report is prepared in accordance with Chinese accounting standards and international financial reporting standards[4]. - The company retained Deloitte as its domestic auditor for 2017, with an audit fee of RMB 4.16 million, and for the international audit, the fee is RMB 550,000[190]. - The company adopted the revised "Accounting Standard for Government Grants" starting in 2017, impacting the recognition of government grants related to future expenses and losses[184]. - The implementation of the new financial instrument standards in 2018 is expected to affect the company's financial reporting, with an impact on equity not exceeding 2% as of January 1, 2018[187].