First(SH:603806)2019-02-27 16:00Financial Performance - The company's operating revenue for 2018 was CNY 4,809,736,097.86, representing a 4.90% increase compared to CNY 4,584,919,761.58 in 2017[16]. - The net profit attributable to shareholders of the listed company was CNY 751,257,491.27, an increase of 28.38% from CNY 585,192,012.41 in the previous year[16]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was CNY 430,656,193.07, a decrease of 20.80% compared to CNY 543,756,897.94 in 2017[16]. - The net cash flow from operating activities was CNY 169,574,040.38, down 30.21% from CNY 242,962,049.10 in the previous year[16]. - The total assets at the end of 2018 were CNY 6,455,917,796.66, reflecting a 13.19% increase from CNY 5,703,364,920.90 at the end of 2017[16]. - The net assets attributable to shareholders of the listed company were CNY 5,553,888,887.48, up 10.48% from CNY 5,026,890,215.05 at the end of 2017[16]. - The company's basic earnings per share increased by 28.57% to CNY 1.44 in 2018 compared to CNY 1.12 in 2017[17]. - Net profit attributable to shareholders rose by 28.38% year-on-year, primarily due to compensation income from the P3 plant relocation[17]. - Operating cash flow decreased by CNY 73.39 million, a decline of 30.21%, mainly due to reduced cash received from sales[17]. - Total assets increased by CNY 752.55 million, a growth of 13.19%, driven by increases in inventory and fixed assets[17]. Dividend Policy - The company plans to distribute a cash dividend of CNY 4.50 per 10 shares, totaling CNY 235,170,000.00 for the year 2018[3]. - The cash dividend policy stipulates that the company will distribute at least 10% of the annual distributable profit, with a minimum cash dividend ratio of 20% for the years 2018-2020[125]. - In 2018, the company proposed a cash dividend of RMB 4.50 per 10 shares, totaling RMB 235.17 million[128]. - In 2017, the company distributed a cash dividend of RMB 6.00 per 10 shares, totaling RMB 241.20 million, with a profit distribution ratio of 41.22%[128]. - The company aims to maintain a stable and continuous profit distribution policy while ensuring sustainable development[125]. Market and Industry Trends - The global photovoltaic market has experienced a compound annual growth rate of over 40% over the past decade, with new installed capacity increasing from 53GW in 2015 to 102GW in 2017, totaling over 405GW[25]. - The average cost of photovoltaic power generation has decreased by 73% since 2010, with expectations to drop by another 50% by 2020, paving the way for grid parity[33]. - China's photovoltaic application market has ranked first globally for five consecutive years, with cumulative installed capacity also leading the world for three years[34]. - The global photovoltaic market is projected to grow significantly, with annual new installed capacity expected to reach 660 GW by 2030, and cumulative installed capacity reaching 9,170 GW by 2050[108]. - The industry is experiencing increased concentration, with leading companies gaining advantages in technology, scale, and cost[110]. Operational Highlights - The company sold 581 million square meters of photovoltaic encapsulation film, a 0.69% increase year-on-year, and 42.98 million square meters of backsheet, a 15.09% increase[23]. - The company sold 774.55 million square meters of photosensitive dry film, representing a year-on-year growth of 386.37%[46]. - The company operates under a "make-to-order" production model, aligning production with sales orders[24]. - The company has established itself as a leading supplier of photovoltaic encapsulation materials, leveraging over a decade of R&D and innovation to maintain a competitive edge in the market[39]. - The company is actively upgrading its product structure and production equipment to meet high-value application demands from core customers, aiming to enhance market share and solidify its industry leadership[35]. Research and Development - Research and development expenses increased by 17.43% to CNY 179,478.18 million, indicating a commitment to innovation[52]. - The company has a robust technical research and development platform, recognized as a national high-tech enterprise, which supports its innovative capabilities in the photovoltaic materials sector[37]. - The company continues to increase R&D investment for technological upgrades and product line expansions in the photovoltaic business[89]. - The company is committed to continuous product R&D, with plans to integrate advanced material preparation technologies to develop new products and improve existing ones[115]. Risk Management - The company has detailed potential risks in its report, which investors should consider[5]. - The company is focusing on enhancing its risk management, particularly in areas such as external investment and accounts receivable, to mitigate potential risks[114]. - The company faces risks from industry fluctuations and intensified market competition, particularly as the solar industry approaches a critical phase of achieving "grid parity"[117]. - The company is at risk of declining gross margins and operating income due to potential price fluctuations in products and raw materials, despite having strong bargaining power[118]. - The company reported a significant increase in accounts receivable, which poses risks to its operational performance[120]. Shareholder Information - The largest shareholder, Hangzhou Foster Technology Group Co., Ltd., holds 280,271,414 shares, accounting for 53.63% of total shares[175]. - The second-largest shareholder, Lin Jianhua, holds 111,329,400 shares, representing 21.30% of total shares[175]. - The total number of ordinary shares increased from 402,000,000 to 522,600,000, representing a 30% increase due to a capital reserve conversion of 120,600,000 shares[168]. - The total number of ordinary shareholders increased from 9,916 to 10,096 during the reporting period[173]. - The company has no significant related party transactions during the reporting period[182]. Employee and Management Structure - The company has a total of 1,698 employees, with 1,169 in production, 49 in sales, 250 in technical roles, 24 in finance, and 206 in administration[195]. - The educational background of employees includes 69 with postgraduate degrees, 220 with bachelor's degrees, 244 with associate degrees, and 1,165 with secondary education or below[196]. - The company emphasizes a salary policy that links employee remuneration to performance and contribution, aiming for sustainable development and mutual benefits[197]. - The company has established a training management system to enhance employee capabilities and ensure alignment with corporate development goals[198]. - The company has maintained a stable management team since 2010, with key personnel holding long-term positions[188]. Corporate Governance - The company has appointed Tianjian Accounting Firm as its auditing institution for the 2018 fiscal year, with a fee of 930,000 RMB[141]. - The company has no major litigation or arbitration matters during the reporting period[143]. - The company and its controlling shareholders have no integrity issues, such as failing to fulfill court judgments or large debts due[144]. - The company has not faced any penalties from securities regulatory agencies in the past three years[194]. - The company has established a long-term commitment to ensure the accuracy and completeness of its prospectus[134].