FOUNTAIN(SZ:000005)2021-04-29 16:00Financial Performance - The company's operating revenue for 2020 was ¥398,921,057.66, a decrease of 27.81% compared to ¥552,609,080.63 in 2019[14] - The net profit attributable to shareholders was -¥387,466,536.61, representing a decline of 321.80% from ¥174,688,341.61 in the previous year[14] - The total assets at the end of 2020 were ¥2,468,377,463.56, down 18.58% from ¥3,031,840,976.34 at the end of 2019[14] - The net assets attributable to shareholders decreased by 24.87% to ¥1,239,944,019.90 from ¥1,650,310,972.99 in 2019[14] - The basic earnings per share for 2020 was -¥0.366, a decline of 321.82% compared to ¥0.165 in 2019[14] - Total revenue for 2020 was ¥398,921,057.66, a decrease of 27.81% compared to ¥552,609,080.63 in 2019[46] - Environmental business revenue accounted for 88.70% of total revenue, totaling ¥353,857,155.72, down 26.95% from ¥484,375,051.20 in 2019[46] - Hotel operation and property management revenue was ¥40,760,291.49, representing 10.22% of total revenue, a decline of 26.57% from ¥55,508,674.47 in 2019[46] Cash Flow and Investments - The net cash flow from operating activities increased significantly to ¥116,373,610.28, up 847.30% from ¥12,284,797.44 in 2019[14] - The company reported a significant decrease in investment activity cash inflow, down 72.10% to ¥66,547,689.22[55] - The net cash flow from financing activities was negative at -¥105,386,053.54, a 49.17% improvement compared to the previous year[55] - The long-term equity investments increased by 113.44% compared to the beginning of the period due to investment income recognized from the joint venture Zhonghuan Xingyuan[25] - The company has secured loans totaling CNY 90,000,000 and CNY 30,000,000, backed by real estate assets, indicating a reliance on property for financing[64] Operational Highlights - The company achieved an operating income of 353 million RMB from environmental engineering services during the reporting period[34] - The company completed the demolition of the "Shenzhen Car Port" and transferred the building to the government, marking a significant milestone in urban renewal projects[30] - The company has developed a prototype of the "Industrial-grade HTC Reactor System" for biomass hydrothermal carbonization, with five authorized patents obtained during the reporting period[32] - The company has successfully managed to achieve approximately 98% occupancy for pre-sold properties despite challenges faced during the reporting period[35] - The company has suspended promotional activities for solar CSP-driven desalination modules due to the pandemic, impacting international project developments[33] Internal Controls and Governance - The company has acknowledged significant deficiencies in internal controls as per the audit report[5] - The company has indicated uncertainty regarding its ability to continue as a going concern due to negative net profits in recent years[14] - The company has established a dedicated institution to enhance internal control and information disclosure processes following the violations[97] - The company has fully separated from the controlling shareholder in terms of personnel, assets, institutions, and finance, ensuring a standardized "three separations" approach[189] - The independent financial department and accounting system operate independently, with the company maintaining its own bank accounts and tax obligations[190] Shareholder Information - The total number of shares after the recent changes is 1,058,536,842, maintaining a 100% shareholding structure[155] - The largest shareholder, China Investment Corporation, holds 13.91% of shares, totaling 147,240,445 shares, which are pledged[159] - The company has urged its major shareholders to reduce the stock pledge ratio due to high pledge risks[156] - The company has no major shareholders holding more than 10% of shares[163] - The company has a total of 111,212 common shareholders at the end of the reporting period[158] Legal and Compliance Issues - The company is involved in ongoing litigation to enforce a cooperation agreement for the Pinghu urban renewal project[39] - The company has initiated legal proceedings to counteract the claims made by Shenzhen Pinghu Co., which has delayed the progress of the urban renewal project[100] - The company is actively working to resolve the administrative review regarding the cancellation of land use rights in Zhaoqing[102] - The administrative lawsuit regarding the Zhaoqing project has not progressed, and the likelihood of a favorable outcome is considered low[104] - The company is expected to bear a liability of approximately 31.73 million yuan due to the guarantees, based on the court's ruling regarding the debtor's inability to repay[96] Future Prospects and Strategies - The company plans to generate 80 million RMB in preferred stock cash income annually from the urban renewal project in Nanyou Factory Area[36] - The company is focusing on feasibility studies for the KURAKURA Innovation Park in Bali, Indonesia, as part of its investment in large industrial park infrastructure[82] - Future business prospects include the development of a solar-powered desalination system, which aims to reduce freshwater costs to below $0.50 per ton[73] - The company plans to integrate advanced waste treatment technologies to address the challenges of waste management and resource recovery in densely populated regions[75] - The company is focusing on the development of specialized equipment for organic waste resource utilization, indicating a shift towards sustainable waste management solutions[76]