HLC(SH:600731)2021-03-22 16:00Financial Performance - The net profit attributable to shareholders for 2020 was CNY 289,112,689.16, with an undistributed profit at year-end of CNY 357,244,883.04[4] - The company's operating revenue for 2020 was approximately ¥2.03 billion, a decrease of 5.70% compared to ¥2.15 billion in 2019[21] - Net profit attributable to shareholders increased by 186.02% to approximately ¥289.11 million from ¥101.08 million in 2019[21] - The net cash flow from operating activities rose by 129.04% to approximately ¥459.06 million, compared to ¥200.43 million in 2019[21] - Basic earnings per share for 2020 were ¥0.8139, reflecting an increase of 185.98% from ¥0.2846 in 2019[22] - The weighted average return on equity increased to 21.94%, up by 12.91 percentage points from 9.03% in 2019[22] - Total assets at the end of 2020 were approximately ¥2.97 billion, a 23.20% increase from ¥2.41 billion at the end of 2019[21] - The net assets attributable to shareholders increased by 25.02% to approximately ¥1.46 billion from ¥1.17 billion in 2019[21] - The company achieved a total operating revenue of 2,026.28 million yuan and a net profit of 289.11 million yuan for the reporting period[53] Dividend Distribution - The company plans to distribute a cash dividend of CNY 0.4 per 10 shares and issue 2 bonus shares for every 10 shares held, along with a capital reserve conversion of 1 share for every 10 shares held, resulting in a total share capital increase to 461,789,508 shares[4] - The total cash dividend to be distributed amounts to CNY 14,208,907.92 (including tax), with 71,044,540 bonus shares and 35,522,270 shares from capital reserve conversion[4] - The cash dividend payout ratio for 2020 is approximately 4.91% of the net profit attributable to shareholders[136] Risk Management - The company has identified risks including policy risk, market risk, operational risk, and financial risk, which are discussed in detail in the report[6] - The company has established a risk management framework to address credit, liquidity, and market risks associated with its financial instruments[122] - The company is actively monitoring and managing its financial risks through regular assessments and audits[123] - The company is facing safety production risks due to the nature of its operations involving hazardous materials and high-pressure processes[119] - The company is exposed to raw material supply and price fluctuation risks, which can significantly impact production costs and gross margins[118] Research and Development - The company is engaged in the development, production, and sales of chemical fertilizers and pesticides, with a focus on research and development of fine chemical products[33] - The company holds a total of 262 valid patents as of December 31, 2020, including 198 invention patents, reflecting its commitment to R&D and innovation[40] - The company has increased its investment in R&D for new products and technologies, particularly in developing alternatives to high-toxicity pesticides[40] - Research and development efforts included 242 projects, with 24 new patents applied for and 24 patents granted during the year[50] - The company is focusing on high-efficiency, low-toxicity, and low-residue pesticide development, aligning with industry trends towards sustainable practices[102] Market Position and Strategy - The company is a leading domestic producer of carbamate pesticides, with a high market share and a complete industrial chain, ensuring raw material supply[42] - The company's main products, including Dimethomorph and Sulfentrazone, maintained a leading global market share, with exports showing growth despite challenging conditions[48] - The company expanded its domestic market presence, successfully entering nearly 800 central and local grain storage facilities, doubling sales year-on-year[48] - The company ranks 30th in the top 100 pesticide sales in China and 15th in pesticide export value[81] - The company is exploring opportunities for market expansion and technological innovation to strengthen its position in the agricultural chemicals market[102] Environmental and Social Responsibility - The company has committed to continuous improvement in its environmental management practices, as evidenced by its monitoring and reporting of pollutant emissions[170] - The company has actively engaged in social responsibility initiatives, focusing on employee health and safety, and has paid all required taxes to promote harmonious development among stakeholders[168] - The company managed to treat 6,829.21 tons of pesticide waste through its self-built incineration facility, ensuring compliance with environmental regulations[172] - Hunan Haili Changde Pesticide Chemical Co., Ltd. is listed as a key pollutant discharge unit for 2020, with a total COD discharge of 135.75 tons/year and ammonia nitrogen discharge of 34.4 tons/year, both within the regulatory limits[170] Corporate Governance - The board of directors and management have confirmed the authenticity and completeness of the annual report, assuming legal responsibility for any misrepresentation[5] - The company has established a robust internal control system to enhance corporate governance and ensure compliance with environmental and safety regulations[168] - The company has committed to avoid any direct or indirect competition with its controlled enterprises, as stated in a commitment letter issued in August 2013[140] - The company has not reported any significant accounting errors or non-standard audit opinions during the reporting period[140] Financial Audit - The audit report issued by Da Hua Certified Public Accountants was a standard unqualified opinion, ensuring the accuracy and completeness of the financial report[5] - The company appointed Dahua Certified Public Accountants (Special General Partnership) for the 2020 financial statement audit, with a remuneration of RMB 580,000[150]