Leon(SZ:300603)2018-08-28 16:00Financial Performance - Total revenue for the reporting period was ¥242,931,717.03, a decrease of 44.87% compared to ¥440,623,262.31 in the same period last year[16]. - Net profit attributable to shareholders was ¥3,389,434.19, down 90.71% from ¥36,501,489.24 year-on-year[16]. - Net profit after deducting non-recurring gains and losses was ¥1,647,943.06, a decline of 95.34% compared to ¥35,325,963.97 in the previous year[16]. - Basic earnings per share decreased to ¥0.0331, down 91.09% from ¥0.3716 in the same period last year[16]. - The overall gross profit margin for the reporting period was 20.21%, an increase of 1.30% compared to the same period last year[73]. - Operating profit for the first half of 2018 was CNY 4,525,986.01, significantly lower than CNY 41,014,009.89 in the same period of 2017, a decrease of approximately 88.9%[153]. - The company reported a total profit of CNY 4,437,741.87, down from CNY 40,748,057.25, reflecting a decline of about 89.1%[154]. Assets and Liabilities - Total assets at the end of the reporting period were ¥1,255,298,700.88, a decrease of 9.32% from ¥1,384,255,975.37 at the end of the previous year[16]. - Current liabilities decreased from CNY 924,668,895.20 to CNY 801,906,272.73, a reduction of about 13.3%[144]. - Total liabilities decreased from CNY 957,168,895.20 to CNY 835,112,272.73, a decline of about 12.8%[144]. - Owner's equity decreased from CNY 427,087,080.17 to CNY 420,186,428.15, a slight decrease of approximately 1.6%[146]. - The actual guarantee balance at the end of the reporting period was CNY 5,076.59 million, which represents 12.08% of the company's net assets[105]. Cash Flow - The net cash flow from operating activities was -¥193,464,917.97, worsening by 35.29% compared to -¥143,004,932.77 in the same period last year[16]. - Cash flow from investment activities showed a net outflow of -24,468,607.81 yuan, worsening from -13,632,436.99 yuan in the previous period[162]. - Cash inflow from financing activities was 151,330,773.53 yuan, with a net cash flow of 97,746,452.13 yuan after outflows[162]. - The ending balance of cash and cash equivalents decreased to 57,187,628.19 yuan from 134,157,906.37 yuan, reflecting a decline of approximately 57.4%[163]. Business Strategy and Operations - The company is focusing on three main business directions: security business integration and maintenance, communication business design and maintenance, and smart city and IoT project development[23]. - The company is actively expanding its IDC business and enhancing its service capabilities in the telecommunications industry[31]. - The company is expanding its service network beyond Xinjiang to other regions in China and Central Asia, aiming to mitigate sales concentration risks[68]. - The company is actively pursuing mergers and acquisitions to enhance its capital strength and expand its business in economically developed regions[68]. - The company recognizes the potential for significant growth in the security market, with the number of cameras in China being less than half of that in Europe and the US, indicating room for expansion[71]. Research and Development - The company holds over 60 independent intellectual property rights, showcasing its strong R&D capabilities[26]. - Research and development expenses fell by 65.35% to ¥4,098,593.50, indicating a reduction in investment in R&D activities[32]. - The company plans to enhance the efficiency of existing assets and improve profitability through refined project management and standardized processes[85]. - The company is focusing on technological advancements and innovation to enhance its competitive edge in the market[172]. Shareholder and Governance - The company plans not to distribute cash dividends or issue bonus shares[5]. - The actual controller, Wang Gang, holds a total of 41.55% of the company's shares, which may impact operational and financial decisions[74]. - The company has established measures to avoid competition with its controlling shareholders and related parties, ensuring no direct or indirect competition arises[82]. - The company will take necessary actions to protect the interests of minority investors during stock price stabilization efforts[83]. - The company has committed to improving its governance structure to ensure shareholders can fully exercise their rights[85]. Risks and Challenges - The company faces risks from industry investment slowdown, which may lead to a significant decrease in business revenue due to macroeconomic changes and technological advancements[66]. - The company is addressing risks related to project execution without formal contracts, ensuring that costs can be recovered even if contracts are not signed[70]. - The company is exposed to risks from accounts receivable, which could lead to liquidity shortages and bad debt losses if not managed effectively[73]. - The company faces potential operational disruptions due to natural disasters, pandemics, or geopolitical events, particularly as its business is concentrated in the Xinjiang region[74]. Future Outlook - The company provided a future outlook projecting a revenue growth of 25% for the next fiscal year, driven by new product launches and market expansion[81]. - The company aims to introduce three new products in the next six months, with expected sales contributing an additional 300 million RMB in revenue[81]. - The company plans to expand its market presence in Southeast Asia, targeting a 10% market share within the next two years[81]. - The company anticipates that the security system and communication network engineering revenues will be significantly higher in the second half of the year due to seasonal fluctuations[69].