SHUHUA SPORTS(SH:605299)2021-04-07 16:00Dividend and Shareholder Returns - The company plans to distribute a cash dividend of 3.00 RMB per 10 shares to all shareholders, based on the total share capital on the dividend record date [5]. - The company has not adjusted its cash dividend policy during the reporting period, maintaining a consistent approach to shareholder returns [114]. - The company plans to distribute a cash dividend of CNY 3.00 per 10 shares, totaling CNY 123.45 million, which represents 90.14% of the net profit attributable to ordinary shareholders for 2020 [114]. Financial Performance - Operating revenue for 2020 was approximately ¥1.48 billion, an increase of 11.27% compared to ¥1.33 billion in 2019 [23]. - Net profit attributable to shareholders decreased by 6.81% to approximately ¥137 million from ¥147 million in 2019 [23]. - Basic earnings per share for 2020 was ¥0.38, down 7.32% from ¥0.41 in 2019 [24]. - Total assets increased by 26.27% to approximately ¥2.01 billion from ¥1.60 billion in 2019 [23]. - The company's net cash flow from operating activities decreased by 18.81% to approximately ¥148 million from ¥183 million in 2019 [25]. - The current ratio improved to 1.73 in 2020, up 44.17% from 1.20 in 2019 [24]. - The company's net assets attributable to shareholders increased by 47.34% to approximately ¥1.29 billion from ¥877 million in 2019, primarily due to the successful IPO [26]. - Cash and cash equivalents increased by approximately ¥275 million, contributing to the rise in current assets by 51.70% [26]. - The interest coverage ratio improved to 15.41 in 2020, compared to 14.22 in 2019 [25]. - The company's operating costs increased by 31.23% to CNY 1,032,974,150.82, primarily due to a rise in export volume and associated costs from e-commerce operations [56]. - The net profit attributable to shareholders decreased by 6.81% to CNY 136,950,065.89, while the net profit after deducting non-recurring gains and losses increased by 0.33% to CNY 130,567,004.03 [53]. Risk Management - The company has described potential risks in its report, urging investors to pay attention to these risks [7]. - The company emphasizes that forward-looking statements do not constitute substantial commitments to investors, highlighting investment risks [6]. - The company faces risks from fluctuations in raw material prices, particularly steel, which could impact gross margins and overall operating performance [109]. - Labor costs are rising due to increasing domestic prices and policies aimed at raising disposable income, which may affect the company's operating costs [110]. - The company is exposed to risks related to macroeconomic changes that could lead to decreased consumer spending on fitness equipment [106]. - The company has a concentrated customer base for its display rack products, primarily serving major brands like Anta and Xtep, which poses a risk if economic conditions worsen [107]. - The company’s financial performance may be adversely affected if economic downturns lead to reduced demand for fitness equipment [106]. Corporate Governance and Compliance - The company has received a standard unqualified audit report from Tianjian Accounting Firm [4]. - There are no non-operating fund occupations by controlling shareholders or related parties [7]. - The company has not violated decision-making procedures for external guarantees [7]. - The company has confirmed that all board members attended the board meeting, ensuring the accuracy and completeness of the annual report [8]. - The company has maintained a commitment to transparency and accuracy in its financial reporting, as stated by its management [8]. - The company has reported a commitment to avoid any direct or indirect competition with its own business, ensuring no similar or competitive activities will be undertaken domestically or internationally [117]. - The company emphasizes that it will not engage in any business activities that could compete with its operations, ensuring compliance with relevant laws and regulations [119]. - The controlling shareholder, Shuhua Investment, and actual controllers have committed to reducing and avoiding related party transactions to protect the interests of all shareholders [120]. Market and Industry Trends - The fitness equipment industry is expected to grow due to increased consumer health awareness and supportive government policies [41]. - The COVID-19 pandemic has accelerated consumer awareness of health, leading to a rise in outdoor and home fitness trends [43]. - The overall sports industry has reached a market size of over one trillion, indicating robust growth potential [90]. - The fitness equipment market is recognized as a sunrise industry with a promising future, driven by increasing consumer health awareness [90]. - The demand for fitness equipment is shifting towards more professional, intelligent, and personalized products, creating new growth opportunities [93]. - The domestic fitness market is becoming increasingly diversified, with a focus on optimizing business models and enhancing value-added services [94]. Research and Development - The company has established a research and development team of over 150 personnel, with some having over ten years of experience in the fitness equipment sector [47]. - Research and development expenses rose by 14.59% to RMB 32,902,050.75, indicating a focus on innovation [59]. - The company aims to enhance its R&D capabilities and establish a technology innovation system by collaborating with research institutions and technology companies [101]. - The production model will shift towards automation and customization to meet diverse consumer needs while improving operational efficiency [103]. Social Responsibility and Sustainability - The company has absorbed 51 impoverished workers into employment, providing labor contracts and social insurance [154]. - A donation of 2.25 million was made to the Jinjiang and Taiwan Business Charity Foundation for assisting needy households [154]. - The company has committed 2.62 million to social poverty alleviation initiatives [156]. - The company actively participated in social responsibility initiatives, including a donation of 1 million to support COVID-19 prevention efforts in Wuhan [159]. - The company emphasizes a sustainable development approach and plans to continue its "precision poverty alleviation" efforts as a long-term initiative [158]. - The company has implemented effective measures to manage waste and emissions during its production processes, ensuring compliance with environmental standards [162]. Employee and Management Structure - The total number of employees in the parent company is 1,044, while the total number of employees in major subsidiaries is 1,533, resulting in a combined total of 2,577 employees [197]. - The company has a total of 1,819 production personnel, 306 sales personnel, 153 technical personnel, 39 financial personnel, and 260 administrative personnel [197]. - The company has established a compensation system based on performance, with independent directors receiving an annual allowance of RMB 78,000, paid monthly [195]. - The total remuneration for all directors, supervisors, and senior management at the end of the reporting period amounted to RMB 6,302,900 [195]. - The management team has extensive experience in various sectors, contributing to the company's strategic direction [190].