Founder Securities(SH:601901)2015-04-29 16:00Financial Performance - Total operating revenue for 2014 reached ¥4.90 billion, an increase of 41.89% compared to ¥3.44 billion in 2013[34]. - Net profit attributable to shareholders was ¥1.80 billion, reflecting a growth of 61.49% from ¥1.11 billion in 2013[34]. - The company's total assets increased by 134.90% to ¥86.92 billion from ¥36.60 billion in 2013[34]. - The total liabilities rose by 166.16% to ¥56.12 billion compared to ¥20.68 billion in 2013[34]. - Basic earnings per share increased by 44.65% to ¥0.2637 from ¥0.1813 in 2013[36]. - The weighted average return on equity improved to 8.65%, up by 1.22 percentage points from 7.38% in 2013[36]. - The company's total revenue for 2014 was CNY 4,899,699,230.06, a 41.89% increase from CNY 3,453,058,407.18 in 2013[44]. - The net profit for the year was 1.796 billion RMB, an increase of 62.79% compared to the previous year, primarily due to the rise in operating income[53]. - The company's cash and cash equivalents increased by 87.51% to approximately 22.548 billion RMB, up from 12.025 billion RMB in the previous year[81]. Capital Structure and Compliance - The company reported a net capital/net asset ratio of approximately 43.83% as of December 31, 2014, which is below the warning standard of 48% set by the Securities Company Risk Control Indicators Management Measures[6]. - The company plans not to distribute cash dividends, issue bonus shares, or convert capital reserves into share capital for the year 2014 due to the need to maintain compliance with risk control indicators[6]. - The company has no non-operating fund occupation by controlling shareholders or related parties[8]. - The company has no external guarantees provided[9]. - The company has established a cash dividend policy based on sustainable development and shareholder returns, adhering to relevant laws and regulations[138]. - The company has committed to enhancing its internal control management mechanisms to mitigate operational risks[137]. - The company has emphasized the importance of ethical conduct and professional integrity among its employees to reduce moral hazards[137]. Acquisitions and Mergers - The acquisition of 100% equity in China Minzu Securities was completed in August 2014, but the integration has not met expectations due to disagreements among shareholders regarding board re-election[9]. - As of December 31, 2014, the company has not included China Minzu Securities in its consolidated financial statements due to the lack of effective control over its financial and operational policies[9]. - The company issued a total of 2,132,101,395 shares to acquire 100% equity of China Minzu Securities, which was approved by the board and completed registration[183]. - The company plans to acquire 70.01% of the equity of Founder Dongya Trust for 2.85 billion yuan, but the transaction is currently on hold due to regulatory approval issues[187]. Operational Expansion - The total number of regional branches and securities business departments reached 161, including 8 regional branches and 153 securities business departments[30]. - The company established 6 new branches in various provinces, increasing the total number of branches to 152, with 48% being non-physical branches[67]. - The company opened 4 new securities business departments during the reporting period[155]. - The company completed the relocation of 5 securities business departments within the same city during the reporting period[156]. Risk Management - The company has implemented risk management strategies including the use of VaR and stress testing to assess potential losses from market fluctuations[128]. - The company’s liquidity risk management involves regular monitoring of short-term and long-term funding needs to ensure sufficient cash reserves[133]. - The company has recognized the importance of managing credit risk through client education, credit assessments, and daily monitoring of market positions[132]. - The company established a dynamic risk control indicator monitoring mechanism and a net capital replenishment mechanism[160]. Legal Matters - The company is involved in a significant arbitration case with Zhengquan Holdings regarding a share purchase agreement, with a claim for RMB 3 billion in compensation for loss of rights[165]. - Zhengquan Holdings has filed a lawsuit for shareholder information rights, seeking access to shareholder registers and financial reports since August 11, 2014, along with a claim for RMB 1,255,500 in economic damages[166]. - The total amount involved in the new lawsuits and arbitration cases is RMB 3,001,255.55[167]. - The company had 17 bank accounts frozen, totaling RMB 1.773 billion, due to the arbitration case initiated by Zhengquan Holdings[168]. Future Outlook - The company aims to enhance its business strategies and performance in response to increasing competition from both domestic and foreign financial institutions[117]. - The company aims to become a leading comprehensive securities firm, focusing on balanced development across various business lines and enhancing capital intermediary services[118]. - The company will enhance its research and sales capabilities by integrating top industry talent and expanding institutional client services[121]. - The company is considering further acquisitions to strengthen its market position and diversify its service portfolio[151].