Hexing(SH:603556)2020-04-27 16:00Financial Performance - The net profit attributable to shareholders for 2019 was RMB 500,474,255.87, with a legal surplus reserve of RMB 18,161,339.53, resulting in a total distributable profit of RMB 2,117,915,201.10[2] - The proposed cash dividend for 2019 is RMB 6.00 per share, amounting to an estimated total cash dividend of RMB 294,240,882.00 based on a total share capital of 490,401,470 shares[2] - The total amount of share repurchase in 2019 was RMB 97,495,301.56, contributing to a total cash dividend distribution of RMB 391,736,183.56, which represents 78.27% of the net profit attributable to shareholders for the year[2] - The company's operating revenue for 2019 was CNY 2,954,172,901.03, representing a 15.72% increase compared to CNY 2,552,901,256.19 in 2018[14] - The net profit attributable to shareholders for 2019 was CNY 500,474,255.87, a significant increase of 51.70% from CNY 329,919,823.05 in 2018[14] - The net profit after deducting non-recurring gains and losses was CNY 380,239,422.09, up 47.25% from CNY 258,221,024.78 in 2018[15] - The net cash flow from operating activities for 2019 was CNY 494,285,211.01, a dramatic increase of 6,279.38% compared to -CNY 7,998,951.12 in 2018[15] - The total assets at the end of 2019 were CNY 6,785,839,638.17, reflecting a 5.88% increase from CNY 6,408,966,314.01 at the end of 2018[15] - The net assets attributable to shareholders at the end of 2019 were CNY 5,224,992,898.83, which is a 6.82% increase from CNY 4,891,422,058.24 in 2018[15] - The basic earnings per share for 2019 was CNY 1.03, up 51.47% from CNY 0.68 in 2018[16] - The weighted average return on net assets for 2019 was 9.99%, an increase of 3.09 percentage points from 6.90% in 2018[16] Audit and Compliance - The audit report issued by Ernst & Young Huaming is a standard unqualified opinion, affirming the accuracy of the financial statements[2] - The report indicates that all board members attended the board meeting, ensuring comprehensive oversight of the financial reporting process[2] - The company emphasizes that the forward-looking statements in the report do not constitute a substantive commitment to investors, highlighting the importance of investment risk awareness[3] - The company has detailed the risks it faces in the annual report, particularly in the section discussing future development and potential risks[3] - The company has not experienced any non-operational fund occupation by controlling shareholders or related parties during the reporting period[3] - The company has not violated any decision-making procedures regarding external guarantees during the reporting period[3] - The company has maintained effective internal control with no significant deficiencies reported during the period[157] - The audit report issued by Ernst & Young Huaming confirmed that the financial statements fairly reflect the company's financial position as of December 31, 2019[158] Market and Industry Position - The company operates in the power equipment and renewable energy industry, which has a promising development outlook and vast market potential[26] - The company is the largest exporter of smart electric meters in China, covering over 90 countries and regions globally, establishing a strong brand image and competitive advantage[28] - The company is actively responding to the growing demand for power infrastructure in regions like Eastern Europe, Latin America, and Southeast Asia[26] - The overseas market generated main business revenue of CNY 2,006.11 million, an increase of 15.84% year-on-year[36] - Domestic market revenue amounted to CNY 933.43 million, growing by 16.33% year-on-year due to increased bidding for electric meters[36] - The global electric meter market's annual expenditure is projected to grow from $19.1 billion in 2019 to $24 billion by 2029, with an annual growth rate of over 6%[58] Research and Development - The company has 140 patents, including 32 invention patents, and continues to invest in R&D to maintain its technological advantage[33] - Research and development expenses amounted to CNY 242.47 million, an increase of 18.66% year-on-year, enhancing product competitiveness[41] - The company is focusing on developing the next generation of smart meters based on the IR46 international standard, which is a key future direction in the domestic market[27] - The company has established a unified hardware and firmware platform to enhance product competitiveness and reduce development cycles[24] Shareholder and Governance - The controlling shareholder, Haixing Holdings, committed not to transfer or manage its shares for 36 months post-listing[72] - The actual controllers, Zhou Liangzhang and Li Xiaoqing, also made a similar commitment regarding their shares for the same period[72] - The company reported that there were no direct or indirect share reductions by the actual controllers after the listing, with a commitment to maintain the share price above the issue price for two years post-lockup[73] - The board members and senior management committed to not reduce their indirect holdings in the company for two years post-lockup, ensuring compliance regardless of job changes[74] - The company has maintained a clean integrity status with no issues reported for the controlling shareholders or actual controllers[85] Social Responsibility and Community Engagement - The company donated RMB 150,000 to Yaoshan Township for local industrial development in 2019[106] - A total of RMB 15,000 was invested in one poverty alleviation project focused on industrial development, with no documented poverty alleviation for registered impoverished individuals[107] - The company plans to continue its investment in the "Linking Towns and Villages" poverty alleviation initiative in 2020[109] - The company has received multiple awards for its commitment to social responsibility, including recognition as a model worker home and best enterprise for social responsibility in Hangzhou[111] - The company adheres to ISO 14001 environmental management standards and has passed environmental assessments, ensuring compliance with national and local regulations[112] Financial Management and Investments - The company has entrusted financial management with a total amount of 1,853,000,000.00 RMB from raised funds and 4,789,000,000.00 RMB from self-owned funds[90] - The annualized return rate for entrusted financial management products ranges from 4.5% to 5.35%[90] - The company has a remaining balance of 522,000,000.00 RMB in bank financial products from raised funds[90] - The company has not provided guarantees to shareholders, actual controllers, or their related parties[89] - The company has not disclosed any significant related party transactions during the reporting period[88] Employee Engagement and Management - The company employed a total of 3,374 staff, including 995 in the parent company and 2,379 in major subsidiaries[142] - The company’s remuneration policy is based on competitiveness, incentive, and fairness, with a focus on performance evaluation[145] - The company signed a consulting agreement with Korn Ferry for comprehensive employee training during the reporting period[146] - The company has implemented an employee stock ownership plan to align the interests of shareholders, the company, and management[150] Corporate Governance and Board Activities - The company held three shareholder meetings during the reporting period, ensuring compliance with regulations and proper exercise of voting rights[147] - The company’s board of directors has established a remuneration and assessment committee to evaluate senior management based on performance standards[138] - The board of directors consists of 9 members, including 3 independent directors, complying with legal and regulatory requirements[149] - The company held 10 board meetings during the reporting period, with 3 in-person meetings and 7 conducted via communication methods[154] Cash Flow and Financial Position - The cash flow from investment activities was negative at -628.1 million, primarily due to the purchase of financial products[50] - The company’s total assets at the end of the year were 6.8 billion, with cash and cash equivalents accounting for 35.71% of total assets, down from 41.52% the previous year[51] - The company’s long-term borrowings increased by 180.77%, reaching 381.3 million, reflecting a significant rise in bank loans[51] - The company’s cash and cash equivalents at the end of 2019 were approximately 493.30 million RMB, down from 917.88 million RMB at the end of 2018, reflecting a decrease of about 46%[189]