SHEN TONG TECHNOLOGY(SH:605228)2022-04-28 16:00Financial Performance - In 2021, the net profit attributable to shareholders was CNY 95,831,629.01, with cumulative distributable profits reaching CNY 181,797,513.56 as of December 31, 2021[6]. - The company's operating revenue for 2021 was approximately RMB 1.38 billion, a decrease of 7.24% compared to 2020[25]. - The net profit attributable to shareholders for 2021 was approximately RMB 95.83 million, down 18.69% from the previous year[25]. - The net cash flow from operating activities decreased by 38.24% to approximately RMB 145.20 million in 2021[25]. - The basic earnings per share for 2021 was RMB 0.23, a decline of 34.29% compared to 2020[26]. - The weighted average return on equity decreased by 5.89 percentage points to 6.91% in 2021[26]. - The net profit after deducting non-recurring gains and losses was 83,471,700 RMB, a decline of 19.44% from 103,611,400 RMB year-on-year[48]. - The company achieved operating revenue of 1,378,690,663.67 RMB, a decrease of 7.24% compared to the previous year's 1,486,336,159.28 RMB[48]. Dividends and Profit Distribution - The proposed cash dividend for 2022 is CNY 0.70 per 10 shares, totaling CNY 29,718,500.00 to be distributed to all shareholders[6]. - The company distributed cash dividends of 0.85 RMB per 10 shares, totaling 35,700,000 RMB to shareholders based on a total share capital of 420,000,000 shares[37]. - The company has established a cash dividend policy that prioritizes a minimum of 10% of the distributable profits for cash dividends, with higher percentages based on the company's development stage and capital expenditure plans[122][123]. - The company aims for a cash dividend ratio of at least 80% during the mature stage without significant capital expenditures, and at least 40% with significant expenditures[123]. - The board of directors must provide a detailed explanation if no cash dividend is proposed despite positive profits, including the intended use of retained earnings[128]. Corporate Governance - The company is committed to ensuring the authenticity, accuracy, and completeness of the annual report[4]. - The audit report issued by Lixin Certified Public Accountants is a standard unqualified opinion[5]. - The company maintains a complete independence in operations, assets, and finances, with no interference from the controlling shareholder[87]. - The company’s governance structure is in full compliance with the Company Law and relevant regulations, with no significant discrepancies[88]. - The company has established a transparent information disclosure system, adhering to legal requirements for timely and accurate reporting[88]. - The company has implemented strict insider information management to prevent stock price fluctuations due to leaks[88]. - The company has established management systems for insider information and shareholding changes[105]. Research and Development - The company established new subsidiaries to focus on research and development in automotive electrification and intelligence[34]. - The company is developing new products including a 3D facial recognition algorithm and a multifunctional smart lock technology[34]. - The company focuses on R&D for lightweight materials and has successfully developed polycarbonate (PC) windows for vehicles, promoting market adoption[41]. - The total R&D expenditure amounted to ¥65.01 million, representing 4.72% of the company's total revenue[59]. - The company has a total of 350 R&D personnel, making up 16.94% of the total workforce[60]. Market and Industry Trends - The automotive parts manufacturing industry is experiencing rapid growth due to the increasing vehicle ownership and expansion of the automotive parts market in China[38]. - The company anticipates continued growth in the automotive parts industry driven by specialization and efficiency improvements amid increasing competition[74]. - The market share of new energy vehicles in China reached 13.4% in 2021, with production and sales increasing by 1.6 times year-on-year[40]. - The automotive parts industry is expected to shift towards lightweight, electronic, integrated, and modular components to enhance performance and reduce emissions[76]. Risks and Challenges - The company has described potential risks in the "Management Discussion and Analysis" section of the report[11]. - The company faces risks from macroeconomic fluctuations that could impact the automotive industry and, consequently, its sales and financial performance[81]. - The company recognizes the risk of raw material price volatility, particularly for plastic resins, which could affect production costs and profit margins[82]. Shareholder Information - The largest shareholder, Ningbo Shentong Investment Co., Ltd., holds 194,397,178 shares, representing 46.29% of the total shares[178]. - The total number of shares held by the top five shareholders is 334,230,392, which is approximately 79.82% of the total shares[178]. - The company has a total of 3,022,223 shares held by Ningbo Shouke Yanyuan Kangtai Venture Capital Partnership, which will become tradable on January 20, 2022[182]. Internal Controls and Compliance - The internal control system has been continuously improved to enhance decision-making efficiency and ensure compliance and asset safety[134]. - The internal control audit report issued by the accounting firm confirmed the effectiveness of the internal control system with a standard unqualified opinion[136]. - The company has not encountered any non-standard audit opinions from its accounting firm, reflecting sound financial practices[153]. - The company has committed to avoiding related party transactions and ensuring strict compliance with financial management systems[12]. Employee Management and Incentives - The company has implemented a restricted stock incentive plan to enhance employee motivation and retain talent, with 36 individuals granted shares[36]. - The company has a structured compensation policy that includes basic salaries and performance-based bonuses, designed according to different departments and positions[118]. - The company emphasizes employee training to enhance skills and job adaptability, viewing employees as valuable assets[140]. Investment and Financial Management - The company raised approximately RMB 471.20 million from its initial public offering, with a net amount of RMB 412.15 million after deducting issuance costs[33]. - The company has engaged in cash asset management, with a total investment of RMB 265,600,000 in bank financial products, with no overdue amounts[163]. - The company has a fixed income investment of RMB 50,000,000 with a 4.37% annualized return, which has been fully recovered[163]. Future Outlook - The company plans to expand its market presence, particularly in the Japanese and European markets, while also focusing on the new energy vehicle sector[77]. - Future outlook remains cautiously optimistic, pending further details on market conditions and product launches[97].