WLGF(SH:603779)2020-04-28 16:00Financial Performance - The company's consolidated net profit attributable to shareholders for 2019 was -25,865,056.50 CNY, a significant decline compared to a net profit of 51,640,341.38 CNY in 2018, representing a decrease of 149.94%[5]. - The total operating revenue for 2019 was 667,257,781.35 CNY, down 15.32% from 787,996,055.83 CNY in 2018[22]. - The basic earnings per share for 2019 was -0.08 CNY, compared to 0.22 CNY in 2018, indicating a significant decline[23]. - The weighted average return on equity for 2019 was -1.88%, a decrease of 5.56 percentage points from 3.68% in 2018[24]. - The net profit attributable to shareholders was -¥25,865,056.50, marking the first loss since the company went public[46]. - Total revenue for the year was approximately $637.16 million, a decrease of 16.93% compared to the previous year, while gross margin improved by 1.95 percentage points to 58.11%[50]. - The company reported a total revenue of 51,172.95 million with a net profit of 1,522.79 million[94]. - The company reported a total revenue of 8,757,822,000 RMB for the year 2019, with a net profit of 2,717,945,000 RMB, representing a profit margin of approximately 31%[156]. Cash Flow and Assets - The cash flow from operating activities for 2019 increased by 201.37% to 151,037,958.00 CNY, compared to 50,116,414.66 CNY in 2018[22]. - The company's total assets as of the end of 2019 were 2,056,701,093.95 CNY, a decrease of 2.39% from 2,106,988,582.96 CNY at the end of 2018[22]. - The net assets attributable to shareholders at the end of 2019 were 1,359,746,617.96 CNY, down 3.40% from 1,407,611,283.50 CNY in 2018[22]. - The company’s total assets include ¥579,982,905.46 in overseas assets, accounting for 28.20% of total assets[33]. - Cash and cash equivalents decreased by 61.01% to ¥64,108,293.05, primarily due to reduced income and increased investment in the Australian subsidiary's 60,000-ton premium grape wine processing project[64]. - Accounts receivable decreased by 75.47% to ¥19,254,748.47, mainly due to reduced income and increased supplier payment obligations[64]. - Fixed assets increased by 103.80% to ¥771,178,723.72, primarily due to the transfer of the Australian subsidiary's 60,000-ton premium grape wine processing project to fixed assets[64]. Marketing and Sales - The company has developed a comprehensive marketing network covering the entire country, combining distributor models with direct sales channels[37]. - Marketing efforts included 10 large-scale promotional concerts, with the November 9 concert in Hangzhou attracting 35,000 attendees, boosting brand visibility[43]. - The company plans to focus on expanding its organic wine segment and improving production efficiency in the coming year[50]. - The company aims to expand its organic wine product line and enhance brand recognition and value[97]. - The company plans to focus on marketing its international wine series and organic product lines in 2020[99]. - The company added 53 new distributors but lost 59, resulting in a total of 423 distributors, a decrease of 6 from the end of 2018[83]. - Online sales revenue reached 14.11 million RMB, a significant increase of 77.06% from the previous period's 7.96 million RMB[86]. Research and Development - The company is recognized as one of the earliest enterprises in China to conduct research and development on organic wine production technologies, maintaining a leading position in the domestic market[38]. - Research and development expenses rose by 47.59% to ¥4,386,887.23, reflecting a commitment to innovation[47]. - The company has a complete industry chain from grape seedling breeding to wine production, which enhances its market response and risk resistance capabilities[39]. - The company improved grape quality through better management practices at its vineyards, leading to enhanced product quality[44]. Risks and Challenges - The company faced various risks as detailed in the report, which may impact future development strategies[9]. - The company is at risk of raw material supply disruptions due to natural disasters affecting grape production[102]. - The company has experienced a significant increase in competition from imported wines, impacting market share[96]. - The company faces significant uncertainties regarding its ability to continue as a going concern due to lawsuits and asset seizures related to illegal guarantees by its actual controller[190]. - Legal proceedings initiated by banks against Wulong Wine for loan guarantees could impact its financial position and reputation[193]. Corporate Governance and Compliance - The company has received a non-standard audit opinion from Zhongxi Accounting Firm, which has been acknowledged and addressed by the board[117]. - The company has maintained its internal control audit without any changes in the auditing firm over the past six years[121]. - The company has not reported any significant differences in governance compared to regulatory requirements[179]. - The company has confirmed that all financial reports are in compliance with relevant laws and regulations[118]. - The company has not disclosed any major related party transactions or changes in its employee incentive plans during the reporting period[124]. Social Responsibility and Environmental Initiatives - The company has engaged in various social responsibility initiatives, including technical guidance in agricultural planting to improve the living standards of farmers in impoverished areas[138]. - The company has implemented strict environmental protection measures, with wastewater discharge COD concentrations of 26 mg/L and 31 mg/L at different production sites, both below the required standards[143]. - The company has installed online monitoring systems for wastewater discharge, ensuring real-time compliance with environmental regulations[142]. - The company has committed to reducing energy consumption and pollutant emissions during production processes[140]. Shareholder Information - The company has a cash dividend policy that mandates a minimum of 20% of distributable profits to be paid out as cash dividends[107]. - The cash dividend amount for 2019 was 7,839,858.39 RMB, representing a 0% payout ratio[112]. - The company distributed a capital reserve increase of 4.5 shares for every 10 shares held, totaling 103,102,434 shares, resulting in a new total share capital of 332,749,154 shares[110]. - The total share capital increased from 229,646,720 shares to 332,749,154 shares after a capital reserve conversion of 103,102,434 shares[149]. - The largest shareholder, Wang Zhenhai, held 157,278,629 shares, representing 47.27% of the total shares[155].