YOFC(SH:601869)2020-04-23 16:00Financial Performance - In 2019, the company's operating revenue was CNY 7,769,175,495, a decrease of 31.61% compared to 2018[15]. - The net profit attributable to shareholders was CNY 801,225,042, down 46.20% from the previous year[15]. - The net profit after deducting non-recurring gains and losses was CNY 612,937,102, a decline of 58.06% year-on-year[15]. - The company's total revenue for 2019 was approximately RMB 7.77 billion, a decrease of about 31.6% compared to RMB 11.36 billion in 2018[46]. - Gross profit for 2019 was RMB 1.83 billion, down 43.2% from RMB 3.23 billion in 2018, resulting in a gross margin of 23.6% (2018: 28.4%)[46]. - The company's revenue from preform and fiber business was approximately RMB 2.508 billion, a year-on-year decrease of about 46.5%[39]. - The company's revenue from the cable business was approximately RMB 4.002 billion, a year-on-year decrease of about 30.1%[39]. - The company achieved overseas business revenue of approximately RMB 1.661 billion in 2019, a year-on-year decrease of about 11.9%[43]. - The company's total investment in trading financial assets amounted to 26,675,952 RMB, with a total investment return of 1,646,987 RMB for the period[65]. - The company reported a revenue of 5,120,000 RMB for the audit services provided by KPMG Huazhen LLP for the year 2019[124]. Cash Flow and Financial Position - The company's cash flow from operating activities increased by 49.05% to CNY 842,663,893 compared to 2018[15]. - Operating cash flow for 2019 was RMB 842.66 million, an increase of 49.05% from RMB 565.35 million in 2018[46]. - The company's cash and cash equivalents decreased by 20.87% to ¥2,123,861,315, down from ¥2,684,163,417 in the previous year[59]. - Inventory increased by 78.80% to ¥1,779,342,250 from ¥995,149,268 in the previous year, indicating a rise in stock levels despite reduced market demand[59]. - The company's long-term equity investments decreased by 8.04% to ¥1,495,444,610 from ¥1,626,151,304, primarily due to the disposal of stakes in joint ventures[64]. - The company's fixed assets increased by 81.04% to ¥3,650,781,975 from ¥2,016,583,574, largely due to the completion of construction projects[59]. Market and Industry Outlook - The demand for optical cables is expected to increase with the large-scale deployment of 5G networks starting in 2020[24]. - The global data traffic is expected to grow rapidly, driven by advancements in 5G, IoT, and cloud computing, leading to steady development in data center construction over the next 3-5 years[27]. - Despite a decline in optical fiber and cable prices in the Chinese market, the international market is projected to experience long-term healthy growth in demand, particularly in North America, Europe, and Latin America[28]. - The company anticipates continued growth in the optical fiber and cable industry driven by the ongoing deployment of 5G networks and increasing demand for high-speed internet services[68]. - The global IoT connected devices are expected to grow from approximately 10.8 billion in 2019 to 24.9 billion by 2025, with an annual growth rate of 15%[79]. Research and Development - The company has a robust R&D platform with 499 authorized patents, focusing on innovations in optical fibers and related technologies, including low-water-peak and ultra-low-loss fibers[34]. - The company is investing heavily in R&D, with a budget increase of 25% for new technology development[177]. - The company is investing CNY 500 million in R&D for innovative technologies in fiber optics over the next three years[182]. - The company plans to accelerate the development of new products such as ultra-low loss optical fibers and high-end multimode optical fibers, targeting growth opportunities in 5G and data centers[99]. Strategic Initiatives - The company launched the "5G All-Connect Strategy" and "Changfei Optical Cloud Industrial Internet Solution" during the Shanghai World Mobile Congress in June 2019, targeting various 5G application scenarios[40]. - The company signed agreements for broadband network connection projects in Peru, covering approximately 1,683 towns and over 1 million people, with a total contract value of about USD 400 million[41]. - The company formed a strategic cooperation with China Mobile to explore the application of 5G technology in various industries[41]. - The company is considering strategic acquisitions to enhance its market position, with a budget of 300 million allocated for potential mergers[177]. Corporate Governance and Compliance - The company has received a standard unqualified audit report from KPMG Huazhen[2]. - The company confirms no non-operating fund occupation by controlling shareholders and their related parties[2]. - The company has established a long-term commitment to avoid unfair transactions with related parties, ensuring fair pricing and compliance with legal regulations[121]. - The company will take necessary measures to ensure compliance with future regulations from the China Securities Regulatory Commission and the Shanghai Stock Exchange[119]. Environmental Responsibility - The company emphasizes environmental protection and has passed environmental management system certification, ensuring emissions are below national standards[147]. - The company has implemented strict management procedures for waste disposal, ensuring all hazardous waste is handled by qualified units and non-hazardous waste is recycled[148]. - The company conducted quarterly environmental monitoring in 2019, with results showing all pollutants were below national standards[150]. Shareholder Information - The total number of shares for cash dividends is 757,905,108, with an expected total cash dividend distribution of RMB 241,013,824, calculated based on a distribution of RMB X per 10 shares[2]. - The company reported a lock-up period of 36 months for major shareholders, during which they cannot transfer or manage their shares, with an automatic extension of 6 months if the stock price falls below the issue price[112]. - Major shareholders pledged to increase their holdings to support the company's stock price stability, with a commitment to buy shares at or below the latest audited net asset value[118].