ETERN(SH:600105)2019-04-29 16:00Financial Performance - The company achieved a net profit of ¥172,118,753.92 for the year 2018, with a consolidated net profit attributable to the parent company of ¥193,519,665.84[6]. - The proposed cash dividend distribution is ¥1.5 per 10 shares, totaling ¥187,942,578, leaving a retained earnings balance of ¥310,590,504.03 for the next year[6]. - The company has reported a total of ¥729,149,440.70 in undistributed profits at the beginning of the year[6]. - The company plans to allocate 10% of the net profit to statutory surplus reserves, amounting to ¥17,211,875.39[6]. - The company's total distributable profit at the end of 2018 is ¥498,533,082.03[6]. - The net profit attributable to shareholders for 2018 decreased by 32.87% to CNY 193,519,665.84 from CNY 288,273,456.19 in 2017[26]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was CNY 135,062,888.16, down 49.89% from CNY 269,537,712.62 in 2017[26]. - Basic earnings per share for 2018 were CNY 0.16, down 30.43% from CNY 0.23 in 2017[27]. - The weighted average return on equity decreased to 7.07% in 2018 from 10.75% in 2017, a decline of 3.68 percentage points[27]. - The company's gross profit margin decreased due to rising copper prices and a 5-7% price reduction on old models, leading to a net profit decrease of 32.87%[97]. Revenue and Growth - The company's operating revenue for 2018 was CNY 3,221,253,190.80, representing a year-on-year increase of 12.19% compared to CNY 2,871,270,366.46 in 2017[26]. - In 2018, the company's main business revenue reached 3,221.25 million RMB, an increase of 12.19% compared to 2,871.27 million RMB in the previous year[98]. - The communication technology segment generated revenue of 1,080.98 million RMB, while the automotive wiring harness segment contributed 1,227.19 million RMB, and the overseas engineering segment brought in 780.84 million RMB[98]. - The overseas engineering segment saw a revenue increase of 29% and a profit growth of 10%, primarily due to the commencement of the Shahjibazar power station project in Bangladesh[87]. - The automotive wiring harness sales revenue grew by 20% in 2018, driven by successful project completions for major clients like Volkswagen and General Motors[92]. Cash Flow and Investments - The company's cash flow from operating activities was negative CNY 136,165,183.03, a significant decline from negative CNY 17,526,712.75 in 2017, marking a decrease of 676.90%[26]. - The company reported a net cash flow decrease of 676.90% from operating activities, indicating significant cash outflows during the reporting period[99]. - The total inventory increased by 38.27% to ¥789,368,108.62, attributed to higher order volumes and new project initiations[125]. - The company’s cash and cash equivalents decreased by 36.44% to ¥436,536,205.24 due to increased project investments[125]. Research and Development - The company invested significantly in R&D, with expenses rising by 27.09% to 148.55 million RMB, impacting overall profitability[99]. - The total R&D investment reached ¥168,176,960.62, accounting for 5.22% of operating revenue[114]. - The company developed several new products in 2018, including 5G communication cables and high-temperature superconducting materials, achieving significant technological advancements[117][119]. - The superconducting materials team undertook 14 projects at various levels, improving process stability and enhancing product yield[158]. - The company is committed to increasing R&D investment, particularly in new products related to 5G construction and automotive wiring for new energy vehicles[166]. Market and Industry Trends - The communication technology industry is projected to reach a revenue of 3.5 trillion yuan by 2020, with an average annual growth rate of 15.5%[142]. - The demand for optical fiber and cables is expected to grow significantly due to the full-scale commercialization of 5G and the expansion of cloud computing data centers starting in 2020[143]. - The automotive industry is shifting towards higher technology content, with the company making strides in the electric vehicle wiring harness market[91]. - The global demand for optical fiber in 2018 grew by 4%, marking the lowest growth rate since 2003, primarily due to a downturn in the Chinese market[51]. Corporate Governance and Compliance - The company has made commitments regarding the legality and compliance of its asset restructuring, ensuring transparency and accountability[180]. - The company confirmed that all documents related to the asset injection are authentic and free from any false records or misleading statements[183]. - The company has committed to reducing and regulating related party transactions, ensuring fair operations at market prices[186]. - The company has maintained a good integrity record over the past three years, with no significant legal or regulatory issues reported[186]. - The company has committed to prioritizing investment opportunities under equal conditions[185]. Future Outlook - The company anticipates a 30% year-on-year growth in new energy vehicle sales in 2019, presenting significant opportunities for its wiring harness production[67]. - The company plans to continue expanding its market presence and invest in new product development to drive future growth[102]. - The company aims to enhance its strategic collaboration with foreign chip manufacturers for the development of core components in 5G communication systems[153]. - The company plans to actively expand new customers and increase market share among existing clients, focusing on high-voltage wiring for new energy vehicles[155].