WG Tech(SH:603773)2019-04-25 16:00Financial Performance - The company's operating revenue for 2018 was approximately CNY 699.80 million, representing a year-on-year increase of 7.03% compared to CNY 653.84 million in 2017[23]. - The net profit attributable to shareholders for 2018 was CNY 158.05 million, a decrease of 23.92% from CNY 207.75 million in 2017[23]. - Basic earnings per share for 2018 were CNY 1.82, down 37.76% from CNY 2.93 in 2017[24]. - The weighted average return on equity for 2018 was 12.11%, a decrease of 20.88 percentage points from 32.99% in 2017[24]. - The company's total assets increased by 76.44% to CNY 1,797.33 million at the end of 2018, compared to CNY 1,018.64 million at the end of 2017[23]. - The net cash flow from operating activities for 2018 was CNY 199.77 million, a decrease of 10.00% from CNY 221.97 million in 2017[23]. - The company reported a net profit of CNY -11.23 million in Q4 2018, contrasting with profits in the first three quarters[26]. - The company's main business revenue for flat panel displays reached ¥681.84 million, with a gross margin of 50.76%, a year-on-year decrease of 6.51%[74]. - The total revenue from domestic operations was ¥575.82 million, with a gross margin of 49.14%, reflecting a year-on-year decrease of 8.51%[74]. - The operating cost increased by 26.49% to ¥357,040,708.61, driven by rising raw material prices and increased expenses related to depreciation and waste treatment[66]. Dividend Distribution - The profit distribution plan for 2018 proposes a cash dividend of 6.80 RMB per 10 shares, totaling 64,324,978.08 RMB (including tax) to be distributed to shareholders[5]. - The total number of shares for the dividend distribution is based on the total share capital of 94,595,556 shares as of the end of 2018[113]. - The dividend distribution plan has been approved by the board and will be submitted for shareholder approval[113]. - The company's net profit attributable to ordinary shareholders for 2018 is 158,046,909.86 RMB, resulting in a dividend payout ratio of 40.70%[115]. - No bonus shares or capital reserve transfers to increase share capital will be implemented for the year 2018[113]. - The remaining undistributed profits will be carried forward to the next fiscal year[113]. Audit and Compliance - The company reported a standard unqualified audit opinion from Zhongqin Wanxin Accounting Firm[4]. - The company is committed to ensuring the accuracy and completeness of the financial report as stated by the management[4]. - The company has adhered to the revised financial reporting format as mandated by the Ministry of Finance[186]. - The company has not reported any significant accounting errors or changes in accounting policies during the reporting period[189]. - The company will ensure compliance with relevant laws and regulations during any share transfers by its executives[120]. Risks and Challenges - The report includes a risk factor section that outlines potential risks the company may face[7]. - The company faces risks from intense market competition in the FPD optical glass processing industry, which may lead to decreased market share and profit margins[100]. - The company is exposed to product price volatility due to rapid updates in the mobile smart terminal industry, which could negatively impact profitability if not managed effectively[102]. - The company has a significant amount of accounts receivable, which poses financial risks if market conditions change or if there are delays in collection[104]. - The company faces risks related to high customer concentration, which could impact its business if major clients reduce or cease orders[108]. Research and Development - The company has developed advanced technologies in TFT-LCD thinning, coating, and photolithography, enhancing its competitive edge in the industry[45][46][47]. - The company aims to strengthen its technology research and development, optimize product structure, and expand its customer base to overcome industry challenges[38]. - R&D investment for the year amounted to RMB 20,521,537.37, with 20 new patents granted, including 4 invention patents[59]. - The company has established a new R&D center to support the development of new technologies and products, including 3D glass covers and back panels, which are currently in small-scale production[149]. Legal Matters - The company is currently involved in a lawsuit against China Display Technology Co., Ltd. for a payment dispute amounting to approximately 8.47 million USD[193]. - The company has successfully won a court ruling in its favor regarding the aforementioned lawsuit, with the formal judgment expected to be received shortly[193]. - The company has been ordered by the court to pay RMB 1,597,150.27 to the plaintiff in a construction contract dispute, while other claims from the plaintiff were dismissed[194]. Shareholder Commitments - The company's actual controller and major shareholders have made commitments regarding shareholding stability and transfer restrictions[120]. - The controlling shareholder commits to vote in favor of share repurchase proposals aimed at stabilizing the stock price[142]. - The company has received a commitment letter from its controlling shareholders to avoid conflicts of interest and ensure no misuse of company assets[183]. - The controlling shareholder has committed to not transferring more than 25% of their shares within 12 months post-lockup and no more than 50% within 24 months, ensuring stability in shareholding[157].