DAHAO TECHNOLOGY(SH:603025)2021-04-27 16:00Financial Performance - The company's operating revenue for 2020 was ¥832,533,320.34, a decrease of 14.42% compared to ¥972,860,763.09 in 2019[25]. - The net profit attributable to shareholders for 2020 was ¥214,340,674.65, down 15.79% from ¥254,546,096.17 in 2019[25]. - The net cash flow from operating activities decreased by 73.32% to ¥94,949,989.60 in 2020 from ¥355,942,186.40 in 2019[25]. - The basic earnings per share for 2020 was ¥0.23, a decrease of 17.86% compared to ¥0.28 in 2019[28]. - The weighted average return on net assets for 2020 was 12.23%, down 2.22 percentage points from 14.45% in 2019[28]. - The total assets at the end of 2020 were ¥2,072,461,930.55, a decrease of 1.22% from ¥2,097,977,322.47 at the end of 2019[25]. - The net assets attributable to shareholders at the end of 2020 were ¥1,813,125,786.80, an increase of 0.85% from ¥1,797,792,957.28 at the end of 2019[25]. - The company reported a net profit of ¥96,422,053.54 in Q4 2020, showing a significant increase compared to previous quarters[29]. - Non-recurring gains and losses totaled ¥64,085,230.18 in 2020, compared to ¥34,953,774.34 in 2019[32]. - The total profit for 2020 was 251 million yuan, down approximately 15.5% year-on-year[79]. - The net profit attributable to shareholders was 214 million yuan, a decline of 15.79% compared to the previous year[79]. Dividend Policy - The company proposed a cash dividend of 2.2 RMB per 10 shares, totaling 203,742,376.42 RMB to be distributed to shareholders, pending approval at the 2020 annual general meeting[5]. - The company has a cash dividend policy that stipulates a minimum of 30% of the distributable profit will be distributed in cash annually from 2018 to 2020[164]. - In 2018, the company distributed a cash dividend of 10 RMB per 10 shares, totaling 454.13 million RMB, and also increased its capital stock by 4 shares for every 10 shares held[164]. - In 2019, the cash dividend was set at 0.3 RMB per share, amounting to approximately 276.57 million RMB[165]. - In 2020, the cash dividend was reduced to 0.22 RMB per share, totaling around 203.75 million RMB[165]. Operational Risks and Challenges - The company reported no significant risks affecting its operations during the reporting period, with potential risks including macroeconomic changes due to the pandemic and high business concentration leading to performance fluctuations[6]. - The company recognizes the risks posed by the COVID-19 pandemic, which has created uncertainty in market demand and macroeconomic conditions[158]. - The international market's volatility poses a risk to the company's export sales, as geopolitical changes can significantly impact demand[160]. - The company has a high business concentration risk, with embroidery machine control products being a significant profit contributor, leading to performance volatility[161]. Market Position and Strategy - The company is a leading player in the domestic sewing equipment control field, focusing on the R&D, production, and sales of intelligent equipment computer control systems, which are essential components in sewing and knitting machinery[37]. - In 2020, the company maintained a leading market share in the embroidery machine control system despite a decline in market demand due to the pandemic and geopolitical factors, with continuous product innovation and technology advancements[47]. - The company achieved a significant increase in market share for its glove machine control systems in 2020, driven by close collaboration with end-users and improvements in product stability and user experience[53]. - The company has expanded its business into the smart factory systems for the sewing and knitting industry, completing deployments for over dozens of smart factories in collaboration with benchmark enterprises[56]. - The company’s control systems for special industrial sewing machines saw a rebound in market demand in the second half of 2020, with year-on-year growth in sales during the third and fourth quarters[48]. - The company’s intelligent factory solutions leverage industrial internet technologies to enhance user value and expand into new business areas beyond traditional control equipment[56]. - The company’s five-generation control system has successfully replaced the four-generation models, enhancing market competitiveness and customer experience[53]. - The company has strengthened its competitive position in the knitting machinery sector through strategic acquisitions, such as acquiring 51% of Suzhou TeKong Electronics Technology Co., enhancing R&D collaboration[53]. - The company follows a "four generations" R&D approach, focusing on continuous innovation and application-driven development to enhance product efficiency and stability[58]. - The company adopts a direct purchasing and outsourcing model for component procurement, ensuring a production-driven procurement strategy based on production plans and inventory levels[58]. - The core products are manufactured based on an "order-oriented, sales-driven" model, accommodating a variety of small-batch orders and some large orders through OEM processing[59]. - The company has established a leading position in the domestic market for embroidery machine control systems, sock machine control systems, and special industrial sewing machine control systems[68]. - The company emphasizes technological innovation, with a focus on automation, networking, digitization, and intelligence to enhance product performance and reduce labor costs for end customers[67]. - The company has a strong brand recognition among customers, with long-term partnerships established with major domestic and international sewing and knitting machinery manufacturers[69]. - The company has invested in advanced technologies such as machine vision, artificial intelligence, and industrial internet to drive automation and smart solutions in the sewing industry[67]. - The company has a robust R&D platform with multiple proprietary technologies, including integrated control systems and advanced data processing capabilities[63]. - The company operates a multi-layered service network with technical support personnel stationed in key overseas markets, ensuring rapid response to customer needs[72]. Future Outlook - The company plans to continue focusing on technological innovation and market expansion in response to the challenges posed by the pandemic[118]. - The company aims to achieve a total revenue target of 1.1 billion yuan in 2021[157]. - The company will continue to enhance its product innovation and fine management capabilities to maintain a competitive edge in the market[156]. - The market for control systems in the sewing and knitting equipment sector is expected to grow, with increasing opportunities for manufacturers who can meet market demands[149]. - The company is committed to diversifying its business strategy and expanding its product line to support future growth[156]. - The company is actively developing special industrial sewing machines, sock machines, and other control products, gradually optimizing its product structure, with increasing revenue and profit contributions from these areas[161]. - The company aims to reduce the revenue dependency on embroidery machine control products through product development and acquisitions, achieving some success during the reporting period[161]. Investment and Financial Management - The company has entrusted a total of 650 million RMB in bank wealth management products, with an outstanding balance of 100 million RMB[194]. - The company has invested 50 million RMB in a structured deposit with Minsheng Bank, yielding an annualized return of 3.80%[196]. - The company has allocated 100 million RMB to Agricultural Bank's wealth management plan, achieving a return of 4.20%[196]. - The company has invested another 100 million RMB in a structured deposit with Minsheng Bank, with a return of 3.80%[196]. - The company has also placed 100 million RMB in a structured deposit with Traffic Bank, yielding a return of 3.75%[199]. - The company has committed 100 million RMB to another structured deposit with Minsheng Bank, achieving a return of 3.90%[199]. - The company has invested 100 million RMB in a structured deposit linked to SHIBOR, with a return of 4.00%[199]. Corporate Governance and Compliance - The company received a standard unqualified audit report from Beijing Xinghua Accounting Firm[4]. - The company emphasizes the importance of accurate and complete financial reporting, with key personnel affirming the integrity of the annual report[4]. - The company has confirmed that all board members attended the board meeting, ensuring collective responsibility for the report's accuracy[4]. - The company has not engaged in any non-operational fund occupation by controlling shareholders or their affiliates[6]. - The company has not violated any decision-making procedures regarding external guarantees[6]. - The company has not reported any major litigation or arbitration matters during the year[182]. - The company has not disclosed any significant related party transactions that have not been previously announced[188]. - The company is awaiting approval from relevant authorities regarding the adjustments to the stock incentive plan[188]. - The company appointed Beijing Xinghua Certified Public Accountants as the auditor with a remuneration of 500,000 RMB for a 10-year term[179]. - The internal control audit was also conducted by Beijing Xinghua Certified Public Accountants with a fee of 100,000 RMB[179].