AURORA(SH:600666)2021-04-16 16:00Financial Performance - The company reported a net loss of CNY 684,343,494.57 for the year 2020, with a negative cash flow from operating activities of CNY 36,630,657.85[4]. - Due to the net loss of CNY 685 million, the company will not implement any profit distribution or capital reserve transfer to share capital for the year[5]. - The company's operating revenue for 2020 was approximately RMB 519.56 million, a decrease of 28.81% compared to RMB 729.80 million in 2019[25]. - The net profit attributable to shareholders of the listed company was approximately RMB -684.92 million, a significant decline from RMB 67.14 million in the previous year[25]. - The basic earnings per share for 2020 was -0.56 yuan, down 1,220% from 0.05 yuan in 2019[26]. - The total assets at the end of 2020 were approximately RMB 2.95 billion, a decrease of 19.93% from RMB 3.69 billion at the end of 2019[25]. - The weighted average return on net assets was -171.52% for 2020, a decrease of 180.73 percentage points from 9.21% in 2019[26]. - The company's net assets attributable to shareholders decreased by 92.33% to approximately RMB 56.86 million at the end of 2020 from RMB 741.77 million at the end of 2019[25]. - The net profit attributable to shareholders decreased by RMB 752.06 million year-on-year, primarily due to a decline in sales revenue of high-margin equipment products and increased financial expenses[28]. - The net cash flow from operating activities decreased by RMB 258.16 million year-on-year, mainly due to a decline in operating revenue[28]. Legal and Financial Risks - The company is facing significant uncertainties regarding its ability to continue as a going concern due to cash shortages and ongoing legal disputes, which have led to the freezing of multiple assets and bank accounts[4]. - There are ongoing litigation risks, with some accounts and assets already frozen, and the company is actively seeking to negotiate settlements with creditors[10]. - The controlling shareholders' pledged shares have reached the liquidation line, and their shares are subject to judicial freezing, posing a risk of change in actual control of the company[11]. - The company may face bankruptcy liquidation risks if creditors apply for auction, reorganization, or bankruptcy proceedings, although current operations are not affected[12]. - The company is actively negotiating with creditors to resolve asset freezes affecting bank accounts, properties, and subsidiary equity, which have not significantly impacted operations[107]. - The company has outstanding debts totaling RMB 42.90 million from Hangzhou Zunyan, with interest accrued of RMB 12.93 million in 2019 and RMB 7.85 million in 2020[106]. - The company is facing litigation risks, including potential investor lawsuits due to administrative penalties from the China Securities Regulatory Commission[108]. - The company has provided guarantees for loans totaling RMB 100 million and is involved in multiple lawsuits related to these debts[106]. - The company has a risk of bankruptcy liquidation if creditors file for auction or restructuring, although current frozen assets do not affect daily operations[110]. Operational Challenges - The company has experienced a significant decline in cash flow from operations, indicating potential liquidity challenges moving forward[32]. - The overall operating income decreased due to a slowdown in demand for processing equipment from downstream customers, despite an increase in sales of large-sized automotive bending equipment[59]. - The company has a high inventory value of 559 million yuan, which could lead to potential write-downs if market conditions worsen[105]. - The company reported accounts receivable of 424 million yuan, which is relatively high compared to total assets, posing a risk of bad debts if not collected[104]. Market and Product Development - The company plans to focus on the development of new technologies and products to enhance market competitiveness[26]. - The company is exploring market expansion opportunities and potential mergers and acquisitions to strengthen its market position[26]. - The demand for sapphire materials in consumer electronics, particularly for smartwatches, saw substantial growth, with sales volume and revenue for sapphire windows in consumer electronics significantly increasing year-on-year[41]. - The sapphire industry is expected to benefit from a recovery in demand as the pandemic is controlled, with significant growth potential in emerging applications like MicroLED and MiniLED[41]. - The company is committed to developing integrated production line solutions to meet the upcoming demands for equipment automation and intelligence[43]. Research and Development - Research and development expenses increased year-on-year, contributing to the overall financial strain[28]. - The company has focused on technological innovation, resulting in a robust patent portfolio that supports product quality improvement and cost reduction[46]. - The company has invested in the automation and intelligence of its 3D bending equipment, achieving significant improvements in production efficiency and material yield[51]. - The company has established partnerships with two major universities to foster innovation and technology transfer[175]. Shareholder and Governance Issues - The company has not proposed any cash dividend distribution plans for the past three years, reflecting ongoing financial challenges[112]. - The shareholders collectively hold 145,434,697 shares, including newly issued and transferred shares from Taiji Group[115]. - The company guarantees the independence of its assets, operations, and financials, ensuring no harm to the legal rights of shareholders[118]. - The company will actively communicate with shareholders, especially minority shareholders, regarding dividend distribution plans and address their concerns promptly[119]. - The company has committed to reducing and regulating related party transactions with its controlling shareholders and affiliates[118]. Compliance and Regulatory Matters - The company has received administrative penalties from the China Securities Regulatory Commission for false disclosures in multiple financial reports, resulting in fines and a 10-year market ban for a key individual[138][139]. - The company is currently involved in significant litigation, including a lawsuit related to a trust investment agreement that has reached the execution stage[128]. - The company has implemented strict pandemic prevention measures during the COVID-19 outbreak, ensuring production continuity while adhering to government regulations[149]. - The company emphasizes transparency and investor communication through various platforms, enhancing trust and governance structure[150]. Employee and Management Structure - The company employed a total of 1,432 staff, with 1,022 in production, 26 in sales, 189 in technology, 53 in finance, and 142 in administration[184]. - The company has implemented a salary system for its directors and senior management based on industry standards and individual performance assessments[178]. - The total amount paid for labor outsourcing during the reporting period was 5,299,379 yuan[187]. - The company has a total of 4 employees in the parent company, indicating a lean management structure[184].