SFC(SH:601595)2018-08-28 16:00Financial Performance - The company's operating revenue for the first half of 2018 was CNY 533.75 million, a slight increase of 1.21% compared to CNY 527.35 million in the same period last year[21]. - The net profit attributable to shareholders decreased by 45.04% to CNY 58.66 million from CNY 106.73 million year-on-year[21]. - The net cash flow from operating activities dropped significantly by 95.43%, amounting to CNY 5.40 million compared to CNY 118.29 million in the previous year[21]. - The basic earnings per share fell by 44.83% to CNY 0.16 from CNY 0.29 in the same period last year[22]. - The company experienced an 11% increase in operating costs compared to the previous year, primarily due to the fixed costs associated with newly opened cinemas still in the cultivation phase[23]. - The company attributed the decline in net profit to the renovation closure of a subsidiary and a decrease in revenue from film distribution[23]. - The company anticipates that as new cinemas mature, their increasing revenue will gradually cover early fixed costs, leading to a steady recovery in operating profit[23]. Market Overview - In the first half of 2018, the total box office in the national film market reached RMB 32.03 billion, an increase of 17.82% year-on-year, with 901 million viewers, up 15.34%[29]. - The box office for domestic films was RMB 18.97 billion, a year-on-year increase of 80.1%, accounting for 59.21% of the total box office, significantly up from 39% in the same period last year[29]. - As of June 2018, the number of screens nationwide reached 55,623, maintaining the global lead, with 3D screens totaling 49,190, representing 88% of the total[30]. - The number of new screens added in the first half of 2018 was 4,847, reflecting a growth rate of approximately 9% compared to the end of 2017[30]. - The top ten cinema chains accounted for a combined market share of 68.61%, up from 67.63% in the same period last year, indicating a stable competitive landscape[31]. Operational Developments - The company opened 3 new cinemas during the reporting period, with a total of approximately 7 planned for the year[40]. - The company continues to enhance its industry chain advantages, integrating film distribution, screening, marketing, online ticketing, and technical services[33]. - The average single-screen revenue remained stable, but the industry faces challenges in digesting new capacity, leading to pressure on traditional cinema operating models and profit margins[37]. - The company actively invests in high-end cinema equipment, including laser giant screens and IMAX, to improve service levels and enhance customer experience[33]. Financial Position - The company's total assets decreased by 2.64% to CNY 2.91 billion from CNY 2.99 billion at the end of the previous year[21]. - The net assets attributable to shareholders decreased by 1.45% to CNY 2.07 billion from CNY 2.10 billion at the end of the previous year[21]. - Cash and cash equivalents decreased by 8.03% to ¥1,292,587,855.10, accounting for 44.43% of total assets[47]. - Accounts receivable decreased by 6.41% to ¥270,496,491.65, representing 9.30% of total assets[47]. - Inventory increased by 59.37% to ¥15,686,681.32, primarily due to an increase in film equipment purchases[47]. - Long-term equity investments rose by 19.28% to ¥95,260,629.04, reflecting growth in strategic investments[47]. Shareholder Information - The total number of common shareholders at the end of the reporting period was 27,833[70]. - The largest shareholder, Shanghai Film (Group) Co., Ltd., held 258,523,597 shares, representing 69.22% of total shares[72]. - The second-largest shareholder, Shanghai Jingwen Investment Co., Ltd., held 12,126,403 shares, accounting for 3.25%[72]. Compliance and Governance - The company has a commitment to avoid any direct or indirect competition with its controlling shareholder, Shanghai Film Group, ensuring investor rights are protected[60]. - The company emphasizes the importance of minimizing and standardizing related party transactions with its subsidiaries[62]. - The company commits to not infringing on its own or other shareholders' rights through related party transactions, with a promise to compensate for any losses incurred[62]. - There are no significant lawsuits or arbitration matters reported during the reporting period[64]. Accounting Policies - The company has not made any changes to its accounting policies or estimates compared to the previous accounting period[67]. - The financial statements are prepared based on the going concern assumption, ensuring the company’s ability to continue operations in the foreseeable future[116]. - The company adheres to the Chinese Accounting Standards, ensuring compliance and transparency in financial reporting[119].