ADD(SH:603089)2019-04-15 16:00Financial Performance - The company's operating revenue for 2018 was CNY 1,082,674,291.25, representing a 28.41% increase compared to CNY 843,129,425.65 in 2017[20]. - The net profit attributable to shareholders for 2018 was CNY 100,759,028.48, a 39.94% increase from CNY 72,004,152.69 in 2017[20]. - The net profit excluding non-recurring gains and losses was CNY 91,804,966.37, which is a 50.68% increase from CNY 60,926,506.34 in 2017[20]. - The cash flow from operating activities for 2018 was CNY 93,170,185.71, showing an 8.56% decrease from CNY 101,895,914.83 in 2017[20]. - The total assets at the end of 2018 were CNY 1,596,421,019.11, a 51.76% increase from CNY 1,051,948,965.81 at the end of 2017[20]. - The net assets attributable to shareholders increased to CNY 779,458,383.90, a 9.67% increase from CNY 710,700,355.42 at the end of 2017[20]. - Basic earnings per share increased by 36.23% to CNY 0.94 in 2018 compared to CNY 0.69 in 2017[22]. - Operating profit for the reporting period was 12,301.41 CNY, reflecting a year-on-year increase of 54.27%[74]. Dividends and Shareholder Returns - The company proposed a cash dividend of CNY 3 per 10 shares, totaling CNY 32,001,000.00, and a capital reserve conversion of 4.5 shares for every 10 shares held, increasing total shares to 154,671,500[5]. - The company reported a net profit of 100,759,028.48 RMB for 2018, with a cash dividend payout ratio of 31.76%[140]. - The company has committed to maintaining a transparent dividend policy, as per the guidelines from the China Securities Regulatory Commission[136]. - The company has a cash dividend policy that aims for a minimum of 45% of the average distributable profit over the last three years to be distributed as cash dividends[134]. Acquisitions and Market Expansion - The company completed acquisitions of 51% stakes in Wuhu Rongji and Anbote, contributing to increased net profit and total assets[23]. - The company has expanded its product offerings through acquisitions, including a 51% stake in Wuhu Rongji for RMB 267 million and a 51% stake in Anbodi for RMB 73 million, enhancing its product structure and market reach[58]. - The company has strengthened its market expansion efforts, resulting in significant sales growth from new overseas clients and domestic electric vehicle manufacturers[69]. - The company is actively expanding its global market presence, focusing on high cost-performance products to win overseas orders[117]. Research and Development - The company has developed a robust R&D management system, focusing on product innovation and rapid development in response to market demands[59]. - The total R&D expenditure amounted to ¥45,644,674.65, representing 4.22% of the total revenue, with 280 R&D personnel accounting for 10.61% of the total workforce[88]. - Research and development investments have been increased, leading to the launch of new products such as electric control shock absorbers and adjustable damping shock absorbers[70]. - The company aims to enhance its R&D capabilities to meet the stringent quality and performance requirements of major automotive manufacturers[100]. Production and Operational Efficiency - The company employs an "order-based" production model, organizing production based on customer framework sales agreements and actual orders, which requires high optimization capabilities[46]. - The company has developed a lean production management system to enhance production efficiency and standardization across various product models[47]. - The company reported a production capacity utilization rate of 107.54% for the Yuhuan Zhengyu factory, with an actual output of 6,452,486 units against a design capacity of 6,000,000 units[104]. - The company has established a comprehensive quality control system and obtained multiple certifications, including ISO/TS16949, ensuring stable product quality[63]. Market Trends and Industry Outlook - The automotive parts industry is projected to maintain stable growth, closely linked to the overall automotive market development[100]. - The aftermarket for automotive parts, particularly in overseas markets, remains a key target for the company’s products[101]. - The global passenger car ownership is projected to reach 1.7 billion by 2035, providing a solid foundation for the aftermarket's continuous growth[103]. - The automotive shock absorber and engine sealing component industries are cyclical, influenced by macroeconomic factors and automotive production adjustments[55]. Risks and Challenges - The company faces risks from global economic downturns that could impact automotive demand and sales, particularly in the aftermarket for shock absorbers[130]. - Currency fluctuations pose a risk to the company's profitability, as sales are primarily in USD and EUR, affecting revenue from exports[131]. - The company is exposed to raw material price volatility, which could adversely affect profitability if product prices are not adjusted accordingly[131]. - Trade barriers in importing countries could reduce the competitiveness of the company's products in international markets, impacting export sales[131]. Corporate Governance and Compliance - The independent directors are responsible for ensuring that the dividend distribution process is conducted fairly and in accordance with regulations[138]. - The company has committed to not using its shareholder status to harm the interests of the issuer and other shareholders[150]. - The company will ensure that any related transactions are conducted under fair and reasonable conditions to protect the interests of the issuer and other shareholders[150]. - The company has no major litigation or arbitration matters during the reporting period[157].