SuKen Agriculture(601952)2020-04-29 16:00Financial Performance - The company's operating revenue for 2019 was ¥8,027,819,758.01, representing a 64.38% increase compared to ¥4,883,604,777.17 in 2018[33]. - The net profit attributable to shareholders for 2019 was ¥591,370,021.44, a decrease of 2.32% from ¥605,440,569.79 in 2018[33]. - The net cash flow from operating activities increased by 87.39% to ¥658,924,855.11 in 2019 from ¥351,632,573.65 in 2018[33]. - The total assets as of the end of 2019 were ¥8,056,846,535.09, a 15.34% increase from ¥6,985,417,319.83 at the end of 2018[33]. - The net assets attributable to shareholders increased by 5.64% to ¥5,909,809,393.41 in 2019 from ¥5,594,099,929.06 in 2018[33]. - The basic earnings per share for 2019 was ¥0.43, a decrease of 2.27% compared to ¥0.44 in 2018[34]. - The weighted average return on net assets for 2019 was 10.36%, down from 11.25% in 2018, a decrease of 0.89 percentage points[34]. - The company reported a net profit of ¥483,006,894.05 after deducting non-recurring gains and losses, which is a slight increase of 1.07% from ¥477,890,228.73 in 2018[33]. - The average return on net assets after deducting non-recurring gains and losses was 8.46% in 2019, down from 8.88% in 2018, a decrease of 0.42 percentage points[34]. - The company achieved a consolidated operating revenue of 8.03 billion RMB, an increase of 64.38% compared to the previous year[72]. - The net profit attributable to shareholders was 591 million RMB, a decrease of 2.33% year-on-year[72]. - The company's total assets increased by 15.34% to 8.057 billion RMB, while total liabilities rose by 38.36% to 1.8 billion RMB[72]. Dividends and Shareholder Returns - The company plans to distribute a cash dividend of 2 RMB per 10 shares, totaling 275.6 million RMB (including tax) based on a total share capital of 1,378,000,000 shares as of the end of 2019[6]. - The company distributed cash dividends of RMB 2.00 per 10 shares, totaling RMB 275.6 million, which accounted for 45.52% of the distributable profits for the year 2018[163]. - The cash dividend policy was executed in accordance with the regulations set by the China Securities Regulatory Commission and the Shanghai Stock Exchange, ensuring protection of minority shareholders' rights[163]. - The company has maintained a consistent cash dividend policy over the past three years, with a stable payout ratio[164]. - In 2019, the company reported a net profit attributable to ordinary shareholders of RMB 59.14 million, with a dividend payout ratio of 46.60%[164]. Audit and Compliance - The company has received a standard unqualified audit report from Tianjian Accounting Firm[5]. - The board of directors and senior management have guaranteed the accuracy and completeness of the annual report[4]. - The company has not reported any significant accounting errors or non-standard audit opinions during the reporting period[174]. - The company has reappointed Tianjian Accounting Firm as the auditor for the 2019 fiscal year[178]. - There are no major litigation or arbitration matters reported for the year[178]. Operational Strategy and Development - The company has outlined potential risks in its future development, which are detailed in the report[8]. - The company emphasizes that forward-looking statements regarding budgets and operational plans do not constitute substantive commitments to investors[7]. - The company aims to expand its high-value-added industries while maintaining a focus on core agricultural operations, fostering new competitive advantages[47]. - The company is actively developing its edible oil business through its subsidiary, further diversifying its product offerings and improving economic efficiency[47]. - The company has established a comprehensive agricultural service platform integrating "internet + finance + modern agricultural services + large-scale growers" to enhance its service capabilities[47]. - The company has established a comprehensive agricultural industrialization model, achieving vertical integration and collaborative development across the entire industry chain, with a focus on unified management of crop varieties, seed supply, and agricultural production measures[58]. - The company is focused on expanding its market presence through innovative marketing strategies and e-commerce initiatives[156]. - The company plans to enhance R&D capabilities and develop high-value-added products in the rice processing sector[156]. - The company plans to invest in infrastructure and advanced agricultural machinery to improve production standards[156]. Product and Market Development - The company operates 19 subsidiaries focused on the cultivation of rice, wheat, and barley, primarily in Jiangsu Province, ensuring a stable supply chain[48]. - The company emphasizes product quality control and food safety through a standardized production system, enhancing its competitive edge in the market[48]. - The rice processing segment has a designed production capacity of 375,000 tons per year, with actual production reaching nearly 260,000 tons in 2019[50]. - The edible oil processing business has a refining capacity of over 270,000 tons and a bottling capacity of 300,000 tons per year[50]. - The company has developed over 160 high-end rice products and 60 varieties of edible oil, continuously enhancing its product offerings through technological innovation[62]. - The company has established stable partnerships with major supermarket chains, enhancing its market presence in Jiangsu and surrounding provinces[50]. - The company has a strong presence in the agricultural sector, with multiple licenses supporting its operational capabilities[115]. Risks and Challenges - The company faced risks related to natural disasters that could significantly impact crop yields and quality, potentially leading to substantial operational losses[160]. - There is a risk of product quality issues that could damage the company's reputation and lead to economic claims, affecting sales and overall performance[160]. - The company is exposed to land transfer risks due to the complexities of rural land rights and potential disputes over land use, which could adversely affect operations[160]. - Changes in tax incentives could negatively impact the company's financial performance, as it currently benefits from various tax exemptions[160]. - The company relies on government subsidies, and any significant changes to these policies could greatly affect profitability[160]. Investments and Acquisitions - The company acquired 51.25% of Jintaiyang Grain and Oil, with a commitment for net profits of at least 50 million CNY, 55 million CNY, and 60 million CNY for the years 2018, 2019, and 2020 respectively, totaling a minimum of 165 million CNY over three years[173]. - The company has made significant investments in agricultural infrastructure and technology innovation, with new subsidies of ¥10,190,000.00 for agricultural efficiency and technology promotion[139]. - The company has actively pursued mergers and acquisitions to expand its operational capabilities and market reach[120]. - The company completed a total external equity investment of ¥372,040,000 during the reporting period, including an investment of ¥366,540,000 to acquire a 51.25% stake in Jin Tai Yang Grain and Oil[144]. Compliance and Governance - The company has made long-term commitments to avoid competition with its subsidiaries and to minimize related party transactions[168]. - The company will adhere to the land lease agreement with the Agricultural Reclamation Group, ensuring no arbitrary adjustments to lease fees[170]. - The company has engaged Tianjian Accounting Firm for nine years, with an audit fee of 155,000 CNY[175]. - The company has outlined measures to reduce future related party transactions as part of its long-term strategy[168]. - The company has not proposed any share buyback plans during the reporting period, indicating a focus on dividend distribution instead[165].