YOFC(SH:601869)2021-03-26 16:00Financial Performance - The company's operating revenue for 2020 was CNY 8,221,542,967, representing a 5.82% increase compared to CNY 7,769,175,495 in 2019[16]. - The net profit attributable to shareholders decreased by 32.14% to CNY 543,677,809 from CNY 801,225,042 in 2019[16]. - The net cash flow from operating activities dropped significantly by 83.28% to CNY 140,866,409 compared to CNY 842,663,893 in 2019[16]. - The basic earnings per share for 2020 was CNY 0.72, down 32.08% from CNY 1.06 in 2019[17]. - The weighted average return on equity decreased by 3.33 percentage points to 6.13% in 2020 from 9.46% in 2019[17]. - The gross profit for 2020 was RMB 1.79 billion, a decrease of 2.50% from RMB 1.83 billion in 2019, resulting in a gross margin of 21.74% compared to 23.60% in 2019[44]. - The company reported a total of CNY 194,978,593 in non-recurring gains and losses for 2020, compared to CNY 188,287,940 in 2019[21]. - The company reported a net profit of approximately RMB -7.17 million in Q1 2020, indicating a quarterly loss due to the impact of the COVID-19 pandemic[38]. - The company achieved near full production capacity in early April 2020, following strict pandemic control measures and a rapid resumption of operations[38]. - The company reported an EBITDA of approximately RMB 1,010 million for 2020, a decrease of 17.99% compared to RMB 1,232 million in 2019[182]. Dividend and Profit Distribution - The company plans to distribute a cash dividend of RMB 2.16 per 10 shares, totaling approximately RMB 163.71 million based on a total share capital of 757,905,108 shares as of December 31, 2020[3]. - The company has no plans for stock dividends or capital reserve transfers for the current year, with retained earnings carried forward to the next year[3]. - The company’s cash dividend for 2019 was RMB 3.18 per 10 shares, totaling RMB 241,013,824, which was slightly higher than the 2020 distribution[81]. - The company is committed to a stable and scientific profit distribution policy, ensuring reasonable returns for shareholders[80]. - The company has not proposed a cash profit distribution plan for the reporting period despite having positive distributable profits, which requires disclosure of reasons and future plans for undistributed profits[82]. Governance and Compliance - The company has received a standard unqualified audit report from KPMG Huazhen, ensuring the accuracy and completeness of the financial report[3]. - There are no non-operating fund occupations by controlling shareholders or their related parties, and no violations in decision-making procedures for external guarantees[4]. - The company has maintained a consistent governance structure, with all board members present at the board meeting[3]. - The company operates under the supervision of the China Securities Regulatory Commission and is listed on the Shanghai Stock Exchange[9]. - The company is committed to ensuring the authenticity and accuracy of its annual report, with key management personnel affirming the report's integrity[3]. - The company has established a long-term commitment to avoid conflicts of interest and ensure that no direct or indirect competition with its main business occurs[88]. - The company has not disclosed any undisclosed operational assets that compete with its main business[88]. - The company has not engaged in any significant related party transactions that could harm shareholder interests[92]. - The company has a long-term commitment to maintaining fair and transparent dealings with its stakeholders[92]. Market and Industry Outlook - The demand for optical cables is expected to improve due to the acceleration of 5G construction, despite previous price pressures[24]. - The global demand for optical cables is expected to maintain an annual growth rate of over 5% from 2021 to 2025, according to a report by CRU[27]. - The company anticipates long-term sustainable development as industry demand recovers and supply structure optimizes[37]. - The company is focused on the communication industry, specializing in the R&D and manufacturing of optical fiber preforms, optical fibers, and cables[23]. - The market environment for preform and fiber businesses is anticipated to improve as demand stabilizes and supply structure optimizes[25]. - The company faces market risks due to potential price declines in optical fibers and cables amid increasing competition and supply growth[73]. Research and Development - The company has successfully established a comprehensive R&D platform, holding a total of 475 valid patents in China, including 298 invention patents, and 90 overseas patents[35]. - The company is investing $50 million in research and development for new technologies aimed at enhancing product efficiency[148]. - The company plans to invest in research and development, allocating 5% of its annual revenue towards innovation initiatives[152]. - The company has developed new fiber products, including ultra-low loss G.654.E fiber, which are positioned to meet the increasing quality demands of 5G network deployments[71]. Financial Position and Assets - The total assets increased by 15.10% to CNY 15,855,597,394 at the end of 2020 from CNY 13,775,899,595 at the end of 2019[16]. - The company’s total investment cash flow was negative at ¥1,550,713,839, reflecting increased investments in debt and equity instruments[54]. - The company’s accounts receivable amounted to approximately RMB 3,962 million as of December 31, 2020, with a provision for bad debts of RMB 185 million[188]. - The company’s current ratio improved slightly to 2.16 in 2020 from 2.08 in 2019, an increase of 3.66%[182]. - The company’s interest coverage ratio decreased to 12.60 in 2020 from 15.45 in 2019, a decline of 18.44%[182]. - The total liabilities as of December 31, 2020, were CNY 4,500,000,000, compared to CNY 4,000,000,000 in 2019, indicating an increase of 12.5%[195]. Employee and Management - The total number of employees in the parent company is 2,351, and the total number of employees in major subsidiaries is 528, resulting in a combined total of 2,879 employees[165]. - The company has a diverse employee composition with 1,226 production personnel, 349 sales personnel, and 863 technical personnel[165]. - The company emphasizes internal fairness, incentive, and external competitiveness in its compensation strategy[166]. - The company actively promotes an equity incentive plan to attract and retain key talents[166]. - The company’s board of directors and senior management remuneration is based on performance evaluation and annual operational goals[162]. Strategic Initiatives - The company is considering strategic acquisitions to bolster its technology portfolio, with a budget of $100 million allocated for potential deals[150]. - The company aims to enhance its competitive position in the market through strategic initiatives and potential mergers or acquisitions in the future[1]. - The company plans to continue expanding its market presence and product offerings, focusing on new technologies and innovations in the fiber optics sector[1]. - The company is targeting emerging markets in Southeast Asia, Africa, and South America for international expansion under the "Belt and Road" initiative[72]. Environmental and Social Responsibility - The company has implemented environmental management systems and achieved compliance with national environmental standards for wastewater and waste gas emissions[119]. - The company is committed to sustainable development and has been recognized for its efforts in environmental protection and pollution prevention[118]. - The company has established a robust waste management system, ensuring all hazardous waste is disposed of by qualified entities[119].