ZDDC(SH:600633)2021-03-25 16:00Financial Performance - The company's operating revenue for 2020 was approximately RMB 3.54 billion, representing a year-on-year increase of 24.52% compared to RMB 2.84 billion in 2019[21]. - The net profit attributable to shareholders of the listed company for 2020 was approximately RMB 511.59 million, a slight increase of 2.28% from RMB 500.18 million in 2019[21]. - The net profit attributable to shareholders after deducting non-recurring gains and losses surged by 111.46% to approximately RMB 571.67 million in 2020, compared to RMB 270.35 million in 2019[21]. - The net cash flow from operating activities increased by 31.58% to approximately RMB 1.03 billion in 2020, up from RMB 786.34 million in 2019[21]. - The total assets at the end of 2020 were approximately RMB 11.19 billion, a slight decrease of 0.16% from RMB 11.20 billion at the end of 2019[21]. - The basic earnings per share for 2020 remained stable at RMB 0.40, unchanged from 2019[22]. - The diluted earnings per share also remained at RMB 0.40 for 2020, consistent with the previous year[22]. - The weighted average return on net assets for 2020 was 6.23%, a decrease of 0.08 percentage points from 6.31% in 2019[25]. - The company reported a significant increase in the basic earnings per share after deducting non-recurring gains and losses, which rose by 104.55% to RMB 0.45 in 2020 from RMB 0.22 in 2019[25]. - The company recorded non-recurring gains and losses totaling approximately RMB -60.08 million in 2020, compared to RMB 229.83 million in 2019[29]. - The company achieved a net profit of RMB 90.62 million for 2020, surpassing the profit commitment of RMB 88.21 million[151]. Dividend Distribution - The company plans to distribute a cash dividend of 0.08 CNY per share, totaling 101,258,441.84 CNY (including tax) based on a total share base of 1,265,730,523 shares after deducting repurchased shares[7]. - The company has established a cash dividend policy that mandates a minimum of 20% of the distributable profits to be paid out as cash dividends in any given year, with a cumulative distribution of at least 30% over any three consecutive years[121]. - Cumulative cash dividends distributed since the company's listing amount to approximately 1.76 billion RMB[125]. - The company has proposed a profit distribution plan for 2020, which is subject to approval at the upcoming shareholders' meeting[125]. Corporate Governance - The company has received a standard unqualified audit report from Tianjian Accounting Firm, ensuring the accuracy and completeness of the financial report[6]. - The company has confirmed that all board members attended the board meeting, ensuring governance compliance[5]. - The company has stated that there are no instances where more than half of the directors cannot guarantee the authenticity of the annual report[9]. - The company has established a long-term commitment to maintain an independent corporate governance structure and ensure compliance with relevant laws and regulations[133]. - The company guarantees to compensate for any actual losses incurred due to violations of commitments made during the major asset restructuring[136]. - The company has emphasized the importance of adhering to legal and regulatory frameworks in all related transactions and governance practices[133]. - The company has committed to not engaging in any business that competes with its main operations after the completion of the major asset restructuring[139]. - The company has pledged to respect the independent legal status of its subsidiaries and avoid any illegal occupation of their funds or assets[146]. Business Development and Strategy - The company aims to become a leading digital sports industry platform by investing in Luodun Development to seize opportunities in the Hainan Free Trade Port[43]. - The company is actively exploring the digital sports sector through investments, including participation in the restructuring of 罗顿发展 to establish a leading digital sports platform[62]. - The company aims to enhance its self-developed gaming capabilities while exploring diversified development paths, targeting breakthroughs in overseas markets[105]. - The company is focused on improving the big data sector by leveraging quality internet infrastructure and expanding the comprehensive service capabilities of its subsidiary, Fuchun Cloud[106]. - The company plans to accelerate the national layout of data centers, seizing opportunities from the "14th Five-Year Plan" which emphasizes new infrastructure development, including big data centers[99]. - The company has committed to developing its own media cloud platform and applying new technologies in the media industry[145]. Market and Industry Insights - In 2020, the Chinese gaming market achieved actual sales revenue of 278.69 billion yuan, a year-on-year increase of 20.71%[35]. - The number of gaming users in China reached 665 million, growing by 3.7% year-on-year[35]. - The revenue from China's self-developed games in the domestic market was 240.19 billion yuan, an increase of 26.74% year-on-year, accounting for over 80% of the total domestic market revenue[35]. - The overall esports market maintained a stable upward trend, supported by product market stability and revenue growth from live streaming platforms, with the company exploring new boundaries in the esports industry through "esports+" and "IP+" strategies[99]. Risks and Challenges - The company has outlined potential risks in its future development plans, which investors should be aware of[8]. - The company faces risks related to market competition, requiring continuous innovation in new products and technologies to maintain its leading position in the internet industry[114]. - Management risks have increased due to the company's expansion into multiple business areas, necessitating timely optimization of organizational and management structures[115]. - The company is at risk of losing core talent, which is critical for its long-term development, due to intense competition for skilled personnel in the internet sector[116]. - The company has acknowledged potential impacts from macroeconomic conditions, industry policy changes, and unforeseen events, which could adversely affect operations and investor interests[119]. Investment Activities - The company completed 13 new investment projects during the reporting period, with a total investment amount of 813.71 million yuan, representing an increase of 80.20% year-on-year[39]. - Long-term equity investments increased by 61.13% compared to the end of the previous year, primarily due to increased external investments[40]. - Major investments included 325 million yuan in Roton Development Co., Ltd., accounting for 12.16% ownership, and 124 million yuan in Beijing Cool Network Technology Co., Ltd., with a 29.24% ownership[87]. - The company has invested a cumulative total of 200 million yuan in the Star Road Dingtai (Tongxiang) Big Data Industry Equity Investment Fund, holding a 32.82% stake[88]. Related Party Transactions - The total amount of related party transactions for the period was RMB 8,797 million, with major daily related party transactions amounting to RMB 8,659 million, accounting for 98.43% of the total[165]. - The company engaged in related party transactions with Zhejiang Daily Press Group, totaling RMB 6,405 million for service provision, representing 8.66% of similar transactions[165]. - The company has established a regular settlement method for related party transactions, ensuring transparency and compliance[165]. Social Responsibility - The company has disclosed its 2020 Social Responsibility Report, indicating its commitment to social responsibility[195]. - The company does not fall under the category of major polluters as per environmental protection department classifications[198].