Qinghai Spring(SH:600381)2020-04-29 16:00Financial Performance - The net profit attributable to the parent company for the year ended December 31, 2019, was CNY 5,807,775.09, while the net profit for the parent company was CNY 75,005,274.93[5]. - The cumulative distributable profit for shareholders at the end of the year was CNY 1,457,616,538.81, but the parent company had a cumulative distributable profit of CNY -1,573,843,576.55[5]. - The company’s board proposed not to distribute profits for the year 2019 due to the significant negative retained earnings of the parent company[5]. - The company's revenue for 2019 was approximately ¥233.75 million, a decrease of 29.81% compared to ¥333.02 million in 2018[21]. - Net profit attributable to shareholders was ¥5.81 million, down 91.51% from ¥68.45 million in the previous year[21]. - Basic earnings per share decreased by 91.67% to ¥0.01 from ¥0.12 in 2018[23]. - The weighted average return on equity dropped to 0.24%, a decrease of 2.67 percentage points from 2.91% in 2018[23]. - The total assets at the end of 2019 were approximately ¥2.41 billion, a slight decrease of 1.10% from ¥2.44 billion in 2018[22]. - The cash flow from operating activities was negative at approximately -¥236.30 million, compared to -¥183.97 million in 2018[21]. - The company reported a net loss of ¥6.20 million after deducting non-recurring gains and losses, a decline of 124.29% from a profit of ¥25.51 million in 2018[21]. - The total non-recurring gains and losses amounted to approximately ¥12.01 million in 2019, compared to ¥42.93 million in 2018[27]. - The company’s total equity attributable to shareholders increased slightly to approximately ¥2.39 billion, a 0.37% increase from ¥2.38 billion at the end of 2018[21]. - The company reported a total revenue of CNY 233.75 million for the year 2019, representing a year-on-year decline of 29.81%[41]. - The net profit attributable to shareholders was CNY 5.81 million, down 91.51% compared to the previous year[41]. - Revenue from the Cordyceps-related business was CNY 102.25 million, a decrease of 23.42% year-on-year[41]. - The fast-moving consumer goods (FMCG) segment achieved revenue of CNY 51.74 million, an increase of 104.85% year-on-year[42]. - The company reduced traditional advertising revenue, resulting in a 56.65% decline in that segment, with revenue of CNY 74.37 million[41]. - Investment income decreased by 42.58%, totaling CNY 39.74 million, due to a sluggish domestic capital market[41]. - Research and development expenses increased by 48.13% to CNY 4.50 million, primarily due to increased investment in beverage project development[46]. - The company reported a total of 60 million RMB in entrusted financial management with a return rate of 7%[118]. - The company has a total of 70 million RMB in entrusted financial management with a return rate of 1%[119]. - The company has a total of 76 million RMB in entrusted financial management with a return rate of 0%[119]. - The company has a total of 74.2 million RMB in entrusted financial management with a return rate of 9%[119]. - The company has a total of 210.581 million RMB in entrusted financial management with a return rate of 0%[119]. Risk Management - The company has disclosed various risks including policy risk, market risk, and internal management risk, urging investors to pay attention to these risks[7]. - The report includes a forward-looking statement risk declaration, indicating that future development plans do not constitute a substantive commitment to investors[6]. - The company acknowledges potential risks from the COVID-19 pandemic, particularly affecting its key sales channels in the restaurant and specialty markets[89]. - The internal control system has been improved to enhance risk prevention and operational efficiency[42]. - The company confirmed that there were no significant deficiencies in internal controls during the reporting period[166]. Corporate Governance - The audit report issued by Zhongxing Caiguanghua Certified Public Accountants was a standard unqualified opinion[4]. - The company has not engaged in non-operating fund occupation by controlling shareholders or related parties[7]. - The company has not violated decision-making procedures for providing guarantees[7]. - The company has established comprehensive internal governance regulations but recognizes the need for further improvements to adapt to external changes[90]. - The company has committed to avoiding or minimizing related party transactions with its subsidiaries, ensuring fair market pricing for any necessary transactions[98]. - The company will adhere to the corporate charter regarding related party transactions and will disclose any such transactions in a timely manner[99]. - The company has not reported any major litigation or arbitration matters during the reporting period[112]. - The company changed its auditing firm from Ruihua Certified Public Accountants to Zhongxing Caiguanghua Certified Public Accountants for the 2019 financial audit[111]. - The company has made commitments to avoid preferential treatment in business dealings with third parties due to its controlling shareholder status[98]. - The company will bear responsibility for any losses incurred by shareholders due to non-compliance with its commitments regarding related party transactions[99]. - The company has not reported any non-standard audit opinions from its accounting firm for the year[100]. Business Strategy and Operations - The company focuses on the research, production, and sales of Cordyceps products, as well as fast-moving consumer goods (FMCG) like alcoholic beverages[31]. - The company has established a leading position in the efficient utilization and deep processing of Cordyceps, with plans to expand its applications in food and health products[32]. - The overall Cordyceps industry is currently in a downturn due to unclear policies and market misconceptions about safety and efficacy[33]. - The company aims to strengthen its capabilities in the health industry by integrating Cordyceps-related traditional Chinese medicine products through licensing and technology acquisition[34]. - The advertising market in China saw an overall decline of 8% in the first three quarters of 2019, with traditional advertising down by 11.4%[35]. - The company’s investment strategy includes low-risk financial products and private equity investments, with the private fund industry in China growing by 7.52% year-on-year[36]. - The FMCG segment includes the "Lianglu" series of alcoholic beverages and "Huo Lu" fruit juice tea, with a focus on health-conscious production methods[36]. - The company aims to strengthen its product quality and explore new marketing models to enhance its market presence[42]. - The company plans to continue its focus on the core value of products and the development of new business segments[40]. - The company aims to enhance the research and product layout of Cordyceps products, aiming to strengthen its capabilities in the health industry[87]. - In 2020, the company will focus on accelerating the market promotion of its alcoholic beverage products, emphasizing innovation, team development, and new marketing models[87]. - The company plans to explore new marketing models to support the development of its fast-moving consumer goods business[85]. - The company is committed to improving internal control systems to reduce operational costs and enhance product quality[86]. - The company has completed the merger of its wholly-owned subsidiary, Qinghai Spring Pharmaceutical Resources Technology Co., Ltd., to optimize management and reduce costs[81]. - The company is focused on the sustainable development of the winter worm summer grass industry, anticipating favorable policy changes to seize growth opportunities[84]. Shareholder Information - The largest shareholder, Tibet Rongen Technology Co., Ltd., holds 273,168,394 shares, representing 46.53% of the total shares[136]. - The second largest shareholder, Xiao Rong, owns 56,762,789 shares, accounting for 9.67% of the total shares[136]. - Guangxi Taida New Original Equity Investment Co., Ltd. reduced its holdings by 23,481,214 shares, now holding 15,145,980 shares, which is 2.58%[136]. - Qinghai Provincial State-owned Assets Investment Management Co., Ltd. holds 14,886,200 shares, representing 2.54% of the total shares[136]. - China International Financial Co., Ltd. owns 11,740,000 shares, which is 2.00% of the total shares[136]. - CITIC Securities Co., Ltd. holds 9,274,157 shares, accounting for 1.58% of the total shares[136]. - Lu Yiping has 7,646,857 shares, representing 1.30% of the total shares[136]. - Xu Kaidong owns 5,750,358 shares, which is 0.98% of the total shares[136]. - Shanghai Shengji Chuangye Investment Co., Ltd. holds 2,978,989 shares, accounting for 0.51% of the total shares[136]. - The report indicates no changes in the controlling shareholder or actual controller during the reporting period[139]. - The total number of shares held by the current and departing directors, supervisors, and senior management at the beginning of the year was 64,409,646 shares, with no changes during the reporting period[146]. - Zhang Xuefeng, the Chairman and General Manager, received a pre-tax remuneration of 542,500 CNY during the reporting period[146]. - The independent director Qian Ying received a pre-tax remuneration of 60,000 CNY, while independent director Li He received no remuneration[146]. - The total pre-tax remuneration for all directors and senior management amounted to 2,832,500 CNY[146]. - No stock options or equity incentives were granted to directors and senior management during the reporting period[148]. - The company has maintained a consistent shareholding structure with no changes in the number of shares held by directors and senior management[146]. Employee and Community Engagement - The company emphasizes employee rights protection and skill enhancement through various internal training programs[122]. - The company actively engages in community welfare activities, contributing to the construction of a harmonious society[123]. - The company has implemented energy-saving measures that benefit both production costs and environmental sustainability[123]. - The company has established emergency response plans for environmental incidents at its two production facilities, which adhere to secondary discharge standards[124]. - The company maintains a focus on product quality and integrity in operations, contributing to cost savings and environmental protection[123]. Internal Controls and Compliance - The company’s financial report has been confirmed by the responsible persons to be true, accurate, and complete[4]. - The company has established emergency response plans for environmental incidents at its two production facilities, which adhere to secondary discharge standards[124]. - The company has disclosed its internal control self-evaluation report for the fiscal year 2019 on the Shanghai Stock Exchange website[166]. - The company has not reported any risks identified by the supervisory board during the reporting period[165]. - The company has not reported any impact from the new accounting policies on its financial statements for the year[101]. - The company has not reached its original profit forecast for certain assets or projects, but this is marked as not applicable for the reporting period[100]. - The company has completed the repayment of debts formed before the bankruptcy reorganization of Xiancheng Mining, ensuring the protection of creditor rights[159].