LSR(SZ:002858)2018-08-20 16:00Financial Performance - The company's operating revenue for the first half of 2018 was ¥146,565,165.36, representing a 119.23% increase compared to ¥66,854,952.86 in the same period last year[18]. - The net profit attributable to shareholders was ¥2,155,602.45, a significant turnaround from a loss of ¥3,702,022.86, marking a 158.23% improvement[18]. - The basic earnings per share increased to ¥0.0171 from a loss of ¥0.0300, reflecting a 157.00% increase[18]. - The total assets at the end of the reporting period were ¥489,206,383.34, up 2.48% from ¥477,367,562.88 at the end of the previous year[18]. - The net assets attributable to shareholders decreased by 2.60%, from ¥402,464,610.95 to ¥391,988,213.40[18]. - The net cash flow from operating activities was negative at -¥35,568,593.01, a decline of 1,209.65% compared to a positive cash flow of ¥3,205,394.33 in the previous year[18]. - The weighted average return on net assets improved to 0.53% from -1.68%[18]. - The company reported a total income of 2,871,678.10, with a significant increase in investment income from financial products amounting to 2,482,237.92[23]. - The company achieved a revenue of ¥146,565,165.36, representing a 119.23% increase compared to the same period last year[36]. - Operating costs rose to ¥116,915,924.07, an increase of 132.69% year-on-year, reflecting the rapid growth in revenue[40]. - The company reported a net profit attributable to the parent company of ¥2,155,602.45, marking a turnaround from loss to profit[36]. - Research and development expenses increased by 16.26% to ¥7,440,078.93, indicating a commitment to innovation[41]. - The company reported a gross profit margin of 22.39% for the racetrack operations, which decreased by 6.06% year-on-year[45]. Operational Activities - The company has hosted 3 events in the China Touring Car Championship (CTCC) during the first half of 2018, which is recognized as China's premier racing event[26]. - The company has organized 2 events in the China Karting Championship, which is considered the highest level karting event in China, during the first half of 2018[26]. - The TCR China series, which started in 2017, has held 1 event in the first half of 2018, showcasing its potential for growth in the domestic racing scene[26]. - The company has launched the TMC Touring Car Master Challenge, a new single-brand racing event, with 2 events held in the first half of 2018[26]. - The Super Endurance Championship (SEC) will have its final race duration extended to 24 hours in 2018, marking a significant change in the event's format[26]. - The company is actively promoting various racing events, including the FIA WTCR and the China Touring Car Championship, to enhance its brand presence in the motorsport industry[26]. - The company is focused on expanding its automotive sports services, including training and event promotion, to cover the entire industry chain[26]. - The company has established partnerships with international organizations to ensure the quality and competitiveness of its racing events[26]. - In the first half of 2018, the company hosted a total of 3 events for the Guangdong Championship Car Race and 8 events for the Lisheng Super Track Festival[27]. - The company’s racing team, SAIC Volkswagen 333 Team, participated in 3 races in the first half of 2018, achieving a championship and a third place in the Super Cup 2.0T group[27]. - The company operates multiple racing venues, including the Shanghai Tianma Circuit, which is a FIA Grade 4 track, and the Guangdong International Circuit, a FIA Grade 3 track, with lengths of 2.063 km and 2.82 km respectively[27]. - The Zhuzhou International Karting Circuit, which opened in November 2017, is the first karting track in South China designed according to FIA-CIK standards, with a length of 1.048 km[28]. - The company injected 2 million RMB into the registered capital of Zhuzhou International Circuit Development Co., Ltd. as part of the cooperation agreement during the reporting period[30]. - Fixed assets increased by 11.3 million RMB due to the completion of the Tianma Circuit expansion project and 1.91 million RMB from the completion of the racing modification project[30]. Market Strategy and Risks - The company aims to leverage the growing market for motorsport in China, supported by government policies promoting sports consumption and fitness[29]. - The company is focused on enhancing its core competitiveness while optimizing its existing business segments and improving its industry chain ecosystem[29]. - The company faces various operational risks, which are detailed in the report, and emphasizes the importance of risk awareness for investors[5]. - The company faces risks related to the inability to extend commercial promotion rights for major events, which could significantly impact operational performance[72]. - The company acknowledges the potential impact of macroeconomic fluctuations on its business and is taking measures to address these risks[74]. - The company is actively working to mitigate risks associated with talent shortages by enhancing internal management and performance evaluation systems[74]. - The company plans to mitigate risks associated with high accounts receivable concentration by enhancing credit governance, implementing stricter collection efforts, and conducting thorough customer credit assessments[78]. Shareholder and Capital Structure - The company did not distribute cash dividends or issue bonus shares for the half-year period[83]. - The first phase of the employee stock ownership plan resulted in the purchase of 938,800 shares, accounting for approximately 1.49% of the total share capital, at an average price of 41.494 RMB per share[91]. - The company completed a capital reserve increase plan, doubling its total share capital from 63,160,000 shares to 126,320,000 shares[113]. - The proportion of restricted shares decreased from 74.98% to 51.19% after the release of 15,027,500 shares[112]. - The company’s shareholders approved the profit distribution and capital reserve increase plan during the annual general meeting held on April 25, 2018[115]. - The actual controllers of the company hold 38.44% of the shares, which may influence management decisions and potentially affect minority shareholders[79]. - The total number of ordinary shareholders at the end of the reporting period was 33[120]. - The largest shareholder, Xia Qing, holds 23.99% of the shares, totaling 30,300,000 shares[121]. - Shanghai Saisai Investment Co., Ltd. is the second-largest shareholder with a 14.45% stake, amounting to 18,251,600 shares[121]. - The total number of shares held by the top ten shareholders is 64,665,000, with a significant portion being subject to restrictions[121]. Financial Management and Investments - The company has invested ¥9,950.00 million of the raised funds in financial products, with a remaining balance of ¥267.79 million in the fundraising account[58]. - The company utilized ¥1,521.83 million of the raised funds during the reporting period, with a cumulative total of ¥4,009.92 million utilized[56]. - The company anticipates increased depreciation and amortization expenses from new fundraising projects, which may negatively impact future earnings if market conditions worsen[79]. - The company is actively seeking to expand its market presence and reduce the time to reach full production capacity for its fundraising projects[79]. - The company has established a unique closed-loop business model within the automotive sports industry, enhancing customer engagement and operational efficiency[34]. - The company’s marketing efforts have expanded to include various short video and live streaming platforms to increase event visibility and attract a broader audience[37]. Accounting and Financial Reporting - The financial report for the first half of 2018 was not audited[134]. - The company has implemented changes in accounting policies as of April 2, 2018[106]. - The company conducts impairment testing for financial assets, recognizing impairment losses when the carrying amount exceeds the present value of expected future cash flows[190]. - The company applies a weighted average method for inventory valuation and assesses net realizable value to determine inventory write-downs[196]. - The company uses aging analysis to determine bad debt provisions, with rates of 5% for receivables within 1 year and 100% for those over 3 years[195]. - The company emphasizes the importance of fair value measurement in assessing the financial position of non-current assets[200]. - The accounting treatment for impairment losses is crucial for accurate financial reporting and decision-making[200].