ECC(SH:600850)2019-04-23 16:00Financial Performance - In 2018, the company achieved a net profit attributable to shareholders of CNY 302,590,690.79, representing a 4.84% increase compared to CNY 288,610,057.58 in 2017[6]. - The company's operating revenue for 2018 was CNY 7,303,418,993.65, reflecting a growth of 10.70% from CNY 6,597,305,411.09 in the previous year[25]. - The net cash flow from operating activities decreased significantly by 89.68% to CNY 80,426,129.75, down from CNY 779,403,697.34 in 2017[25]. - The total assets of the company at the end of 2018 were CNY 6,259,772,041.20, an increase of 10.40% from CNY 5,670,073,444.40 at the end of 2017[27]. - The net assets attributable to shareholders increased by 12.29% to CNY 2,346,549,490.16, compared to CNY 2,089,766,237.32 at the end of 2017[27]. - The basic earnings per share for 2018 were CNY 0.7157, up from CNY 0.6859 in 2017[28]. - The diluted earnings per share increased by 4.67% to CNY 0.7147 in 2018, compared to CNY 0.6828 in the previous year[28]. - The company's gross margin decreased by 0.8 percentage points, with the growth rate of operating costs slightly exceeding that of operating revenue[56]. - The company reported a significant decrease in net cash flow from operating activities, down 89.68% to 80.43 million RMB[55]. - The company expects to achieve a revenue of 7.6 billion RMB in 2019, reflecting a strategic focus on digital transformation and industry value chain layout[90]. Dividend and Shareholder Returns - The company plans to distribute a cash dividend of CNY 3.6 per 10 shares to shareholders[6]. - In 2018, the company distributed a cash dividend of 3.60 RMB per 10 shares, amounting to approximately 152.64 million RMB, which represents 50.45% of the net profit attributable to ordinary shareholders[98]. Operational Highlights - The company reported no foreseeable major risks in its operations, indicating a stable outlook[8]. - The company provides industry information technology solutions, data center intelligent solutions, and specialized services, maintaining a strong industry reputation and influence[36]. - The company has launched a multi-cloud platform management solution to help clients manage multiple cloud platforms efficiently, addressing operational complexity and enhancing system availability[37]. - The company offers a comprehensive network security solution tailored to client needs, covering various security domains to protect network information systems[37]. - The software-defined networking (SDN) solution enhances network resource management efficiency, supporting IT automation in data centers[38]. - The company aims to empower clients' digital transformation through innovative technology integration, focusing on cloud computing and big data[36]. - The company provides low-latency network solutions for financial trading, reducing transaction delays to nanosecond levels, which directly impacts transaction rates and profitability[41]. - The company has developed an end-to-end IPv6 deployment solution, responding to the national plan for IPv6 implementation by 2025, enhancing customer business continuity and security[41]. - The company has implemented a next-generation smart metropolitan area network project for China Unicom, enabling agile, elastic, and automated network services across multiple data centers[41]. - The company offers data center solutions that utilize a Spine-Leaf architecture to handle massive data access and improve system security and resource efficiency[41]. - The company has established a comprehensive service system for data center operations, including design consulting, project management, and ongoing maintenance, achieving high renewal rates for its services[46]. - The company has been recognized as one of the top 30 engineering firms in China for data centers and one of the top 10 for data center operations, reflecting its industry influence and brand reputation[45]. - The company integrates multi-dimensional data for retail clients, providing smart store solutions that enhance customer experience and support digital transformation[44]. - The company focuses on smart manufacturing solutions, leveraging advanced technologies to support industries such as automotive and electronics, enhancing operational efficiency[41]. - The company has developed a comprehensive cloud service offering, including private, public, and hybrid cloud solutions, to support clients' technology upgrades and business transformations[46]. Research and Development - The company maintained a strong focus on innovation, applying for 4 new patents and obtaining 5 authorized invention patents in 2018[51]. - R&D expenses totaled ¥251,589,523.30, accounting for 3.83% of total revenue, with a slight decrease of 5.09% compared to the previous year[69]. - The company invested a total of ¥279,510,728.55 in R&D, with 9.99% of this amount capitalized[69]. - The company emphasized the development of new products in areas such as cloud management platforms and data center solutions, maintaining a focus on enhancing competitive capabilities[72]. Market Position and Strategy - The company ranked 21st in the 2018 list of the top 100 software business revenue companies in China[53]. - The company is committed to deepening industry information solutions and expanding its international business presence[51]. - The company is actively pursuing asset securitization and leveraging its platform advantages in the capital market[90]. - The company is facing risks related to macroeconomic conditions, operational challenges, and potential legal disputes due to overdue receivables[93]. - The company emphasizes the importance of talent retention in the competitive software and information technology services industry[93]. - The company is adapting to new market trends and optimizing its business structure to ensure stable growth in core operations[93]. Governance and Compliance - The company has a governance structure that complies with relevant laws and regulations, ensuring clear responsibilities among shareholders, the board of directors, and management[174]. - The board of directors consists of 9 members, including 3 independent directors, meeting legal requirements for composition[174]. - The company emphasizes transparency in information disclosure, adhering to principles of fairness and accuracy[174]. - The company has a performance evaluation system for senior management, ensuring accountability and alignment with corporate governance standards[174]. - The company has successfully adhered to all commitments made regarding information disclosure and major asset restructuring, reflecting strong governance practices[102]. - The audit report confirmed that the financial statements fairly reflect the company's financial position and operating results for the year ended December 31, 2018[187]. - There were no significant deficiencies in internal control reported during the audit period[182]. Shareholder Information - The total number of ordinary shares increased from 421,215,168 to 424,011,005 due to the exercise of stock options, representing an increase of 2,795,837 shares[129]. - The total number of ordinary shareholders decreased from 22,603 to 20,212 during the reporting period[133]. - The company reported a total shareholding of 179,915,166 shares held by East China Computer Technology Research Institute, representing a significant portion of the total shares[137]. - The top individual shareholder, Song Shimin, holds 21,162,010 shares, accounting for approximately 4.99% of the total shares[137]. - The company has no reported strategic investors or major shareholders with over 10% holdings, indicating a diversified ownership structure[140]. - The actual controller of the company is China Electronics Technology Group Corporation, which has indirect control over several listed companies[143]. - The company has not undergone any changes in its controlling shareholder during the reporting period, maintaining stability in its ownership structure[141]. - There are no reported restrictions on shareholding reduction for major shareholders, suggesting flexibility in share management[146]. Employee and Management Compensation - The total pre-tax remuneration for the reporting period for Zhang Weimin was 108.04 million yuan[149]. - The total pre-tax remuneration for the reporting period for Guo Wenqi was 158.16 million yuan[149]. - The total pre-tax remuneration for the reporting period for Yang Zhihua was 103.51 million yuan[151]. - The total pre-tax remuneration for the reporting period for Sun Weili was 91.67 million yuan[151]. - The total pre-tax remuneration for the reporting period for Miao Yunjie was 100.40 million yuan[151]. - The total remuneration for all directors, supervisors, and senior management was 9.9508 million yuan[165]. - The company has established a competitive compensation policy based on job position, performance evaluation, and industry salary surveys[170]. - The training program includes internal training led by employees and external training conducted by industry experts, aimed at enhancing employee skills and organizational capabilities[171].