Huijin(SZ:300368)2018-04-12 16:00Financial Performance - The company's operating revenue for 2017 was ¥621,373,955.11, a decrease of 8.08% compared to ¥676,019,042.14 in 2016[22]. - The net profit attributable to shareholders was -¥165,502,173.01, representing a decline of 461.86% from ¥45,736,746.94 in the previous year[22]. - The net cash flow from operating activities was -¥89,959,901.70, a decrease of 308.05% compared to ¥43,239,421.86 in 2016[22]. - The total assets at the end of 2017 were ¥1,636,420,377.55, down 6.60% from ¥1,752,093,681.99 at the end of 2016[22]. - The company reported a basic earnings per share of -¥0.3043, a decline of 461.83% from ¥0.0841 in 2016[22]. - The weighted average return on equity was -16.57%, a decrease of 20.92% from 4.35% in 2016[22]. - The total profit for the year was -194.39 million yuan, with a net profit attributable to shareholders of -165.50 million yuan, a year-on-year decline of 461.86%[45]. - The company’s cash and cash equivalents at year-end were 251.57 million yuan, a decrease of 35.17% compared to the beginning of the year[36]. Revenue Breakdown - Bank-related business achieved revenue of CNY 338.51 million, a decrease of 26.74% year-on-year, accounting for 54.48% of total revenue[46]. - Non-bank business revenue reached CNY 282.86 million, an increase of 32.19% year-on-year, representing 45.52% of total revenue[47]. - The overall revenue decreased by 8.08% from CNY 676.02 million in 2016 to CNY 621.37 million in 2017[51]. - The company reported a significant decline in smart self-service terminal revenue, down 34.74% due to intensified market competition and delayed contract signings[53]. - Software product development and sales revenue fell by 41.04%, impacted by increased regulatory scrutiny in the third-party payment industry[53]. - Industrial automation equipment and processing manufacturing revenue surged by 334.38%, driven by enhanced product development and market promotion efforts[53]. Research and Development - The company has made substantial R&D achievements, with many results protected by patents and software copyrights, but risks remain regarding potential technology leaks and loss of key personnel[10]. - R&D investment in 2017 amounted to ¥72,728,436.10, representing 11.70% of total revenue, an increase from 9.99% in 2016[73]. - The number of R&D personnel decreased to 625 in 2017, down from 719 in 2016, but the proportion of R&D personnel to total staff increased to 33.87%[73]. - The company completed the development of a software system for RFID tag reading and writing, enhancing its product competitiveness in the digital currency space[34]. - The company is focusing on the development of new products and technologies, including a blockchain-based currency transfer system, to capitalize on the growing demand for digitalization in the banking sector[46]. Acquisitions and Expansion - The company successfully acquired Beijing Zhongke Tuoda Technology Co., Ltd. in February 2018, expanding its information technology solutions for financial and government sectors[34]. - The company is actively pursuing cooperation and acquisition opportunities to enhance its information technology business[34]. - The company has shifted its focus to expand into non-banking sectors, successfully developing products such as lottery robots and security self-service devices[31]. - The company aims to provide customized intelligent equipment for non-banking industries while maintaining its core business in financial solutions[31]. Management and Governance - The company reported a significant increase in the complexity of management due to the expansion of subsidiaries, which raises the risk of management inefficiencies and talent shortages[7]. - The company is committed to optimizing its management structure and enhancing internal governance to protect investor interests[117]. - The company plans to enhance internal control processes and optimize organizational structure to improve subsidiary profitability amid risks from management complexity and talent shortages[122]. Financial Health and Risks - The company's goodwill on the consolidated balance sheet was valued at CNY 147.60 million as of the end of 2017, indicating potential impairment risks if acquisitions do not achieve expected synergies[6]. - The company incurred an impairment provision of CNY 24.28 million for goodwill related to certain subsidiaries, adversely affecting annual performance[48]. - The company’s goodwill decreased by 62.01% to 147.60 million yuan due to intensified market competition and underperformance of subsidiaries[37]. - The company is shifting its focus from revenue growth to enhancing net profit and cash flow management, aiming to improve profitability and exit low-margin product markets[115]. Future Outlook - The company provided a future outlook, projecting a revenue increase of 12% for the next fiscal year, driven by new product launches and market expansion strategies[182]. - The company aims to achieve a customer satisfaction rate of 90% by the end of the next fiscal year, up from 85%[182]. - The company plans to expand its market presence in Southeast Asia, targeting a market share increase of 8% within the next two years[182]. - A strategic acquisition of a smaller competitor is anticipated to enhance the company's technological capabilities and increase market competitiveness[181].