Kersen(SH:603626)2017-06-01 16:00Financial Performance - In 2016, the company achieved a net profit of CNY 176,092,145.50, with a distributable profit of CNY 158,482,930.95 after allocating 10% to statutory surplus reserves[4] - The company plans to distribute a cash dividend of CNY 1.60 per 10 shares, totaling CNY 33,706,672.00 to shareholders[4] - The remaining undistributed profits will be carried forward to future years, with no plans for capital reserve conversion into shares or bonus shares[4] - The company's operating revenue for 2016 was CNY 1,302,779,283.53, representing a year-on-year increase of 19.49% compared to CNY 1,090,312,939.40 in 2015[21] - The net profit attributable to shareholders for 2016 was CNY 188,895,872.50, showing a decrease of 4.71% from CNY 198,237,301.11 in 2015[21] - The basic earnings per share for 2016 was CNY 1.20, down 4.00% from CNY 1.25 in 2015[23] - The total assets at the end of 2016 amounted to CNY 1,490,429,151.53, an increase of 11.68% from CNY 1,334,576,382.79 in 2015[22] - The cash flow from operating activities for 2016 was CNY 400,113,246.47, a significant increase of 293.33% compared to CNY 101,724,233.95 in 2015[22] - The company reported a net asset attributable to shareholders of CNY 606,292,337.80 at the end of 2016, which is a 45.26% increase from CNY 417,396,465.30 in 2015[22] - The weighted average return on equity for 2016 was 36.90%, a decrease of 25.38 percentage points from 62.28% in 2015[23] Risk Management - The company has outlined potential risks in its annual report, advising investors to pay attention to these risks[7] - The company faces risks from rising costs, including raw materials and labor, which could impact profitability if not managed effectively[112] - The company anticipates challenges from increasing competition and rising manufacturing costs in the domestic market[102] Market and Industry Position - The company focuses on providing precision metal structural components for clients in various industries, including consumer electronics and medical devices, serving well-known clients such as Apple, Sony, and Medtronic[30] - The precision metal manufacturing industry is experiencing increasing demand for high-quality, high-precision components due to rapid advancements in technology and consumer expectations[34] - The company has been recognized as one of the top 200 global suppliers by Apple, which accounted for 97% of its procurement in 2016[37] - The company actively seeks to expand its market presence through potential client engagement and participation in various exhibitions[33] - The company plans to continue expanding its market presence and product offerings in the 3C industry, adapting to rapid technological changes[75] Research and Development - The company has established a strong R&D team of over 400 professionals, focusing on various engineering disciplines to improve product innovation and responsiveness to market changes[42] - The total R&D investment was 63.45 million yuan, representing 4.87% of the operating revenue, with 437 R&D personnel making up 15.27% of the total workforce[73] - The company focused R&D efforts on over 20 projects, including components for ultra-thin smartphones and high-precision surgical instruments, expected to contribute 40%-70% of revenue in the next year[75] - The company has authorized a total of 69 patents, including 15 invention patents, as of the report date[52] Customer and Sales Structure - The company’s top five customers accounted for 69.50% of its revenue, indicating a diversification in customer and product structure[49] - The company has formed a stable sales system with long-term clients, primarily through direct sales and supplier certifications[32] - The company’s sales to its top five customers accounted for 69.50% of its main business revenue, indicating a significant reliance on a concentrated customer base[108] Financial Management and Dividend Policy - The company’s profit distribution policy emphasizes cash dividends, prioritizing stable and continuous returns to investors[114] - The company plans to distribute cash dividends at least once a year, with a minimum of 30% of the average distributable profit over the last three years[118] - The company has not proposed a cash profit distribution plan for the reporting period despite having positive distributable profits[122] - The company’s cumulative cash dividends over the last three years must not be less than 30% of the average annual distributable profit[118] Corporate Governance - The company has established a comprehensive internal governance structure, including a board of directors, supervisory board, and various committees to ensure compliance and risk management[189] - The board of directors held five meetings during the year, all attended in person, ensuring effective governance[191] - The company has implemented a performance evaluation and incentive mechanism for senior management to align with strategic goals[193] Social Responsibility and Employee Relations - The company actively participates in social welfare activities, donating 100,000 yuan to the Red Cross Society in Guizhou Province in 2016[152] - The company provides comprehensive labor protection for employees, ensuring their income is above the industry average during its rapid development phase[149] - The company has a union and a mediation committee to improve employee relations and resolve disputes[149] - The company emphasizes fair competition and has signed anti-commercial bribery agreements with partners[151] Audit and Compliance - The company has provided a standard unqualified audit report from its accounting firm, ensuring the accuracy and completeness of the financial report[6] - The auditors have conducted their work in compliance with Chinese CPA auditing standards, ensuring no material misstatements in the financial statements[198] - The audit opinion states that the financial statements fairly reflect the company's financial position in all material respects[200]