Neoway(SH:688159)2021-05-28 16:00Financial Performance - The company's revenue decreased significantly due to the impact of the COVID-19 pandemic, particularly in overseas vehicle networking terminals and domestic smart grid data collection [4]. - The company's operating revenue decreased by 26.66% year-on-year, amounting to ¥573.62 million in 2020 compared to ¥782.17 million in 2019 [22]. - The net profit attributable to shareholders decreased by 237.58% year-on-year, resulting in a loss of ¥75.06 million in 2020, down from a profit of ¥54.56 million in 2019 [22]. - The cash flow from operating activities showed a significant decline, with a net outflow of ¥91.94 million in 2020, compared to a slight outflow of ¥2.04 million in 2019, marking a decrease of 4,413.44% [25]. - Basic earnings per share fell to -¥0.8362 in 2020 from ¥0.7993 in 2019, representing a decrease of 204.61% [24]. - The company's net profit for the year was a loss of CNY 75.06 million, a decline of 237.58% compared to the previous year [62]. - The net cash flow from operating activities was CNY -91.94 million, a year-on-year change of -4,413.44% [82]. Research and Development - The company increased its investment in research and development as well as sales expenses during the reporting period, leading to a net loss [4]. - The company's R&D expenditure as a percentage of operating revenue increased to 15.24% in 2020, up from 7.93% in 2019, indicating a rise of 7.31 percentage points [24]. - The company's total R&D investment for 2020 reached CNY 87.4 million, a significant increase of 40.85% compared to the previous year, with R&D expenses accounting for 15.24% of total revenue [49]. - The average number of R&D personnel increased by 112, contributing to higher R&D and sales expenses compared to the previous year [25]. - The company applied for 83 new patents during the reporting period, doubling the number from the previous year, bringing the total number of patents to 41 and software copyrights to 80 [48]. - The company’s R&D expenses increased by 40.85% to ¥87.40 million compared to the previous year [84]. Market Expansion and Product Development - The company is focused on expanding its market presence and enhancing its product offerings through increased R&D efforts [4]. - The company is actively exploring overseas markets, particularly in the automotive and smart energy sectors, with plans for further global market expansion [37]. - The company launched multiple new products in the automotive terminal product line, including 4G smart OBDs and AI intelligent terminals [41]. - The company is focusing on developing new products and technologies in the fields of IoT and wireless communication, with ongoing projects in 4G, NB-IoT, and 5G solutions [57]. - The company has developed solutions for various sectors including smart cities, gas, and water management, laying a solid technical and product foundation for market expansion [47]. - The company is committed to meeting personalized application needs by providing integrated "cloud-pipe-end" solutions for clients [41]. Operational Challenges - Despite a recovery in order volume in the fourth quarter, the shortage of electronic components affected the delivery of existing orders [4]. - The company faced significant challenges in revenue due to the impact of the pandemic on overseas vehicle networking terminals and domestic smart grid collection, alongside shortages of electronic components affecting order deliveries [25]. - The company is actively addressing chip shortages by placing orders six months in advance and exploring domestic chip alternatives to mitigate supply risks [73]. - The company is at risk of not being able to provide products to major clients in North America if U.S. chip bans are enforced [76]. - Future market competition and potential changes in rebate policies from chip manufacturers could significantly impact the company's operating performance [79]. Financial Health and Investments - The total assets increased by 31.32% year-on-year, reaching ¥1.30 billion at the end of 2020, compared to ¥988.25 million at the end of 2019 [22]. - The net assets attributable to shareholders grew by 64.40% year-on-year, amounting to ¥842.85 million at the end of 2020, up from ¥512.68 million at the end of 2019 [22]. - The company's accounts receivable financing increased from 33.81 million to 64.14 million, a change of 30.33 million [32]. - The trading financial assets surged from 10,000 to 183.99 million, resulting in a change of 183.98 million, contributing 7.65 million to current profits [32]. - The company has ongoing projects with a total expected investment of CNY 22.2 million for 5G wireless communication modules and solutions, with current investments of CNY 1.28 million [53]. Shareholder and Compliance Commitments - The company plans not to distribute cash dividends or conduct capital reserve transfers to increase share capital for the 2020 fiscal year [7]. - The company is committed to transparency and has established a clear communication channel for investors and stakeholders [17]. - The company will not repurchase shares during the lock-up period [135]. - The company has established a clear plan for compliance with shareholding regulations and commitments [136]. - The company will notify the stock exchange four trading days prior to any share reduction and announce it three trading days before [135]. - The company will ensure that any illegal proceeds from share reductions are deducted from future cash dividends [136].