2019-04-29 16:00Important Notes Board of Directors' Statement The Board confirms the report's integrity and notes that it is unaudited - All company directors attended the board meeting to review this quarterly report3 - The company's first quarter 2019 report is unaudited3 Basic Company Information Key Financial Data The company reported significant growth in revenue and net profit, though profit excluding non-recurring items declined Key Financial Indicators for Q1 2019 | Indicator | Current Period | Prior Year Period | YoY Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue (Yuan) | 74,419,029.40 | 51,632,742.35 | 44.13% | | Net Profit Attributable to Shareholders (Yuan) | 12,039,643.64 | 8,770,910.55 | 37.27% | | Net Profit Attributable to Shareholders excl. Non-recurring Items (Yuan) | 4,567,832.10 | 5,579,552.35 | -18.13% | | Net Cash Flow from Operating Activities (Yuan) | 16,246,365.85 | 7,002,165.63 | 132.02% | | Basic Earnings Per Share (Yuan/Share) | 0.10 | 0.08 | 25.00% | | Weighted Average Return on Equity | 1.83% | 1.56% | Increase of 0.27 percentage points | Non-recurring Gains and Losses for Q1 2019 | Item | Current Period Amount (Yuan) | | :--- | :--- | | Gains/Losses from Entrusted Investments or Asset Management | 6,155,611.39 | | Government Subsidies | 2,589,676.25 | | Gains/Losses from Fair Value Changes of Financial Instruments | -349,005.47 | | Income Tax Impact | -923,142.48 | | Total | 7,471,811.54 | Shareholder Information The company's shareholder base is concentrated, with the top two related shareholders holding a significant stake - As of the end of the reporting period, the total number of shareholders was 7,4407 - Key shareholder relationships: Feng Yuxia and Zhou Zhiwen are a married couple; Gu Meifang and Gu Xiaolei are aunt and nephew8 Top 10 Shareholders | Shareholder Name | Number of Shares | Shareholding Ratio (%) | | :--- | :--- | :--- | | Feng Yuxia | 32,703,300 | 28.44 | | Zhou Zhiwen | 17,994,340 | 15.65 | | Gu Xiaolei | 10,080,840 | 8.77 | | Gu Meifang | 6,909,840 | 6.01 | | Zuo Conglin | 5,136,600 | 4.47 | Significant Matters Analysis of Significant Changes in Key Financial Statement Items and Indicators The company experienced significant changes across financial items, driven by business growth and investment activities Analysis of Balance Sheet Item Changes Balance sheet changes were driven by increased cash from operations and redemption of wealth management products Key Balance Sheet Item Changes | Item | Period-End Balance (Yuan) | Beginning Balance (Yuan) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Cash Funds | 253,907,397.62 | 148,692,597.57 | 70.76% | Increased cash collection from labor services and redemption of wealth management products | | Interest Receivable | 3,925,446.56 | 1,688,630.14 | 132.46% | Increased income from wealth management products | | Other Current Assets | 178,239,859.74 | 267,311,021.10 | -33.32% | Redemption of idle funds used for purchasing wealth management products | | Dividends Payable | 34,498,380.00 | - | N/A | Accrued but unpaid cash dividends for the current period | Analysis of Income Statement Item Changes The income statement reflects strong growth in both operating revenue from labor services and investment income Key Income Statement Item Changes | Item | Current Period Amount (Yuan) | Prior Year Period Amount (Yuan) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 74,419,029.40 | 51,632,742.35 | 44.13% | Increased revenue from providing external labor services | | Operating Costs | 35,226,496.69 | 23,354,436.39 | 50.83% | Corresponding cost increase due to revenue growth | | Selling Expenses | 2,161,549.85 | 1,152,986.19 | 87.47% | Increased personnel costs and office expenses | | Investment Income | 6,155,611.39 | 1,164,710.96 | 428.51% | Increased income from wealth management products | | Operating Profit | 15,504,117.59 | 10,382,528.60 | 49.33% | Increased revenue from labor services and wealth management income | Analysis of Cash Flow Statement Item Changes Cash flow improved significantly due to increased collections from business growth and redemption of investments Key Cash Flow Statement Item Changes | Item | Jan-Mar 2019 (Yuan) | Jan-Mar 2018 (Yuan) | Change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 16,246,365.85 | 7,002,165.63 | 132.02% | Increased cash collection due to business growth | | Net Cash Flow from Investing Activities | 29,371,122.24 | -10,077,903.85 | N/A | Redemption of idle funds used for purchasing wealth management products | | Net Cash Flow from Financing Activities | 700,000.00 | 9,597,090.00 | -92.71% | Decrease in cash received from investments | Appendix Financial Statements This appendix contains the unaudited Q1 2019 consolidated and parent company financial statements Consolidated Balance Sheet The consolidated balance sheet shows total assets of ¥1.18 billion and total liabilities of ¥0.55 billion as of March 31, 2019 Consolidated Balance Sheet Summary (As of March 31, 2019) | Item | Period-End Balance (Yuan) | Prior Year-End Balance (Yuan) | | :--- | :--- | :--- | | Total Assets | 1,183,561,255.07 | 1,141,409,701.02 | | Total Liabilities | 553,426,160.01 | 489,888,909.10 | | Total Equity Attributable to Parent Company | 629,377,945.66 | 651,319,438.78 | | Total Equity | 630,135,095.06 | 651,520,791.92 | Consolidated Income Statement The company achieved Q1 2019 consolidated revenue of ¥74.42 million and net profit of ¥12.04 million Consolidated Income Statement Summary (Q1 2019) | Item | Current Period Amount (Yuan) | Prior Year Period Amount (Yuan) | | :--- | :--- | :--- | | I. Total Operating Revenue | 74,419,029.40 | 51,632,742.35 | | III. Operating Profit | 15,504,117.59 | 10,382,528.60 | | IV. Total Profit | 15,502,789.44 | 10,881,453.60 | | V. Net Profit | 11,895,439.90 | 8,770,089.85 | | Net Profit Attributable to Parent Company Shareholders | 12,039,643.64 | 8,770,910.55 | | Basic Earnings Per Share (Yuan/Share) | 0.10 | 0.08 | Consolidated Cash Flow Statement Q1 2019 operating cash flow was ¥16.25 million, a significant increase from the prior year period Consolidated Cash Flow Statement Summary (Q1 2019) | Item | Current Period Amount (Yuan) | Prior Year Period Amount (Yuan) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 16,246,365.85 | 7,002,165.63 | | Net Cash Flow from Investing Activities | 29,371,122.24 | -10,077,903.85 | | Net Cash Flow from Financing Activities | 700,000.00 | 9,597,090.00 | | Net Increase in Cash and Cash Equivalents | 45,214,800.05 | 5,536,446.68 | | Period-End Balance of Cash and Cash Equivalents | 193,907,397.62 | 260,153,729.94 | Parent Company Financial Statements The report provides parent company financial statements for an independent analysis of its financial position - The report provides the Parent Company Balance Sheet (starting page 11), Income Statement (starting page 16), and Cash Flow Statement (starting page 19) for an independent analysis of the parent company's financial condition and operating results172227