HAGG(SH:601177)2021-04-13 16:00Financial Performance - The company's operating revenue for 2020 was ¥1,918,436,700.15, representing a 16.07% increase compared to ¥1,652,875,834.57 in 2019[22]. - Net profit attributable to shareholders reached ¥83,914,652.63, a significant increase of 325.25% from ¥19,732,791.53 in the previous year[22]. - The net cash flow from operating activities increased by 210.39% to ¥410,407,610.36, up from ¥132,221,707.13 in 2019[22]. - The basic earnings per share rose to ¥0.2098, a 325.56% increase compared to ¥0.0493 in 2019[22]. - The weighted average return on equity improved to 4.98%, an increase of 3.78 percentage points from 1.20% in 2019[22]. - The company's total assets at the end of 2020 were ¥4,015,179,367.29, reflecting a 3.61% increase from ¥3,875,171,998.77 in 2019[22]. - The net profit after deducting non-recurring gains was ¥33,622,579.22, compared to a loss of ¥11,945,279.56 in 2019[22]. - The company reported a significant increase in net profits from subsidiaries, with Qianjin Forging, Qianjin Coupling, and Qianjin General respectively increasing by 1,433 million yuan, 805 million yuan, and 2,769.62 million yuan[94]. Dividend and Profit Distribution - The company plans to distribute a cash dividend of 0.20 RMB per 10 shares, totaling 8,001,200 RMB, based on a total share capital of 400,060,000 shares as of the end of 2020[5]. - The company will not conduct capital reserve transfers to increase share capital, with remaining distributable profits carried forward to future years[5]. - The company has established a mechanism for profit distribution that prioritizes cash dividends when conditions permit[115]. - The company did not propose a cash profit distribution plan for ordinary shares despite having positive net profit[118]. Audit and Compliance - The company has received a standard unqualified audit report from Tianjian Accounting Firm, ensuring the accuracy and completeness of the financial report[4]. - The company has appointed Tianjian Accounting Firm as its auditor, with signed accountants Wei Jun and Gu Yanping[19]. - There are no non-operational fund occupations by controlling shareholders or related parties, and no violations in decision-making procedures for external guarantees[6]. - The company has not faced any risks regarding the inability of more than half of the board members to guarantee the authenticity of the annual report[7]. - The company has not reported any instances of funds being occupied or overdue receivables during the reporting period[120]. - The audit report issued by Tianjian Accounting Firm confirmed that the financial statements fairly reflect the company's financial position as of December 31, 2020[189]. Market and Industry Overview - The company primarily produces and sells marine gearboxes, construction machinery gearboxes, wind power gearboxes, automotive transmissions, agricultural machinery gearboxes, and friction materials[33]. - In 2020, the mechanical industry achieved a total operating income of 22.85 trillion yuan, a year-on-year increase of 4.49%, exceeding the national industrial growth rate by 3.73 percentage points[39]. - The company's downstream industries include shipbuilding, construction machinery, wind power generation, and agriculture, with the shipbuilding industry completing 38.53 million deadweight tons in 2020, a year-on-year increase of 4.9%[41]. - The construction machinery industry saw a total operating income of 639.2 billion yuan in 2020, with a profit of 61.789 billion yuan, representing year-on-year growth of 23.16% and 39.68% respectively[42]. - In 2020, the national installed capacity of wind power reached 281.53 million kilowatts, an increase of 34.6%, accounting for 12.79% of the total installed power generation capacity[44]. Research and Development - The company completed the design of 87 new products and developed 3 key components, with 52 patent applications filed and 36 patents granted during the year[57]. - The company has a market share of over 55% in the domestic marine gearbox market and is the largest independent supplier of transmission systems in the engineering machinery sector[48]. - The company is focusing on research and development to innovate and update products continuously, collaborating with domestic and international teams[113]. - Research and development expenses were ¥95,836,133.57, showing a slight decrease of 0.26% year-on-year[61]. Operational Efficiency - The company improved operational efficiency by transitioning to an order-driven production model, resulting in reduced inventory and capital turnover days[58]. - The company employs a mixed procurement model, utilizing centralized procurement for bulk goods to enhance bargaining power, while subsidiaries handle less shared materials independently[34]. - The production model is primarily order-based, focusing on small batches and multiple varieties, with detailed production plans tailored to different product categories[35]. - The company has established long-term cooperative relationships with manufacturers in the construction machinery, agricultural machinery, and wind power sectors, typically signing framework agreements for monthly production based on specific demand[36]. Financial Management - The company is committed to enhancing cash flow management and risk control measures to ensure financial stability[108]. - The company emphasizes cost control through comprehensive budget management and operational efficiency improvements[112]. - The company reported a net cash flow from investment activities of -¥4,701,500.23, an improvement of 48.17% compared to the previous year[62]. - The net cash flow from financing activities was -¥263,706,496.52, a significant decline of 949.66% year-on-year due to repayment of short-term loans[63]. Corporate Governance - The company has maintained a consistent leadership structure, with key positions held by experienced professionals since 2011[162]. - The management team consists of 22 individuals, with a total of 2,356,000 shares held by non-director team members at the end of the reporting period[150]. - The company has a performance-based compensation system for non-independent directors and senior management, with payments based on annual operational performance assessments[171]. - The company is committed to maintaining a high level of corporate governance and transparency in its operations[162]. Future Outlook - The company aims for a revenue target of 2.08 billion yuan in 2021, with a control on period expenses not exceeding 396 million yuan[105]. - The company plans to enhance its market share by actively exploring new markets and maintaining its position in traditional strong markets, particularly in the shipbuilding and engineering machinery sectors[105]. - The wind power industry is anticipated to experience significant growth, with non-fossil energy consumption expected to reach around 25% by 2030, driving demand for wind power products[100]. - The company is focusing on enhancing its production efficiency and capacity through lean production management and technological upgrades[106].