Brother Enterprises (SZ:002562)2020-04-19 16:00Financial Performance - The company's operating revenue for 2019 was approximately ¥1.26 billion, a decrease of 11.12% compared to ¥1.42 billion in 2018[17]. - Net profit attributable to shareholders increased by 100.88% to approximately ¥43.83 million from ¥21.82 million in 2018[17]. - The net profit after deducting non-recurring gains and losses was approximately ¥13.60 million, a significant increase of 223.92% compared to a loss of ¥10.97 million in 2018[17]. - The company's total assets at the end of 2019 were approximately ¥4.31 billion, reflecting a growth of 20.32% from ¥3.58 billion at the end of 2018[17]. - The net assets attributable to shareholders increased by 2.57% to approximately ¥2.32 billion from ¥2.26 billion in 2018[17]. - The basic earnings per share rose by 66.67% to ¥0.05 from ¥0.03 in 2018[17]. - The weighted average return on net assets was 1.91%, up from 0.97% in 2018[17]. - The net cash flow from operating activities was negative at approximately -¥94.41 million, a decline of 132.21% compared to ¥293.09 million in 2018[17]. - The company reported a government subsidy of approximately ¥13.59 million in 2019, which is a significant increase from ¥8.56 million in 2018[22]. - The fair value changes of financial assets resulted in a profit of approximately ¥16.17 million in 2019, compared to ¥30.08 million in 2018, indicating a decrease in trading performance[22]. Market and Product Development - The company established a wholly-owned subsidiary in Hong Kong and a wholly-owned subsidiary in South Africa, aiming to acquire 100% equity of LANXESS CISA PROPRIETARY LIMITED, enhancing its market position in the chromium tanning agent sector[26]. - The vitamin product sales were impacted by the African swine fever, leading to fluctuations in market demand, although the overall demand for vitamins remains steady[30]. - The leather chemicals industry is shifting towards cleaner and functional products, which aligns with the company's focus on developing green leather chemicals[30]. - The pharmaceutical raw materials market is experiencing stable growth, driven by increasing health and nutrition awareness, despite challenges from regulatory changes and environmental scrutiny[30]. - The company completed the acquisition of 100% equity of LANXESS CISA Proprietary Limited for EUR 8.305 million to enhance its market competitiveness in leather chemicals and vitamin K3[40]. - The company’s construction projects for new products, including phenol and iodine contrast agents, began trial production by the end of 2019[40]. Operational Efficiency and Management - The company has implemented a comprehensive supplier evaluation system to enhance procurement management, ensuring cost advantages and quality assurance[28]. - The company’s internal management emphasizes systematic and standardized operations, supported by the integration of various information systems[36]. - The company aims to enhance its organizational structure and management processes to improve operational efficiency and data-driven decision-making[81]. - The company will focus on technology innovation to strengthen its core competitive advantages, guided by market demand and technological development[81]. - The company intends to improve its global marketing network to enhance customer satisfaction and create competitive advantages through service[81]. - The company has established a three-level technology innovation mechanism to enhance collaboration in research and development[81]. Financial Management and Investments - The net cash flow from investment activities dropped by 366.02% to -289.75 million CNY, mainly due to reduced financial management activities[58]. - The net cash flow from financing activities increased by 537.71% to 630.30 million CNY, driven by long-term borrowings for the acquisition of Brother CISA[58]. - The company has committed to projects including the annual production of 13,000 tons of Vitamin B3 and 10,000 tons of 3-cyanopyridine, with a total investment commitment of RMB 420 million[72]. - The project for the annual production of 20,000 tons of phenol and 31,100 tons of phenolic derivatives is expected to reach operational status by June 2020[72]. - The company plans to continue expanding its market presence and product offerings in the coming years[72]. Corporate Governance and Compliance - The company has established a governance structure that includes a shareholders' meeting, board of directors, and supervisory board to ensure transparency and fairness[140]. - The company has implemented various communication channels to enhance interaction with investors, improving transparency and trust[140]. - The company is committed to continuous and stable returns to shareholders, adhering to profit distribution policies and corporate governance[140]. - The company has adhered to commitments made regarding avoiding competition and regulating related transactions[94]. - The company’s financial statements have been adjusted retrospectively due to changes in accounting policies as per the Ministry of Finance's notifications[97]. Environmental and Social Responsibility - The company emphasizes the importance of safety and environmental protection, aiming to enhance safety management levels and promote clean production[81]. - The company has invested in environmental protection, enhancing employee awareness through various training programs, and has improved energy conservation and emission reduction levels[142]. - The wastewater treatment facility of the company has a processing capacity of 350 tons per day and has been operating stably since November 15, 2013[145]. - The company has created job opportunities for disabled individuals, contributing to social harmony[142]. - The company has actively participated in social welfare initiatives, supporting local education, culture, and health[142]. Employee Management and Development - The company has implemented a new "salary management plan" and "performance management plan" to enhance employee welfare and competitiveness[141]. - The company has a performance evaluation mechanism to enhance employee accountability and execution[196]. - The company has a comprehensive training plan that includes programs for new graduates and management development[197]. - The total number of employees in the company is 2,381, with 586 in the parent company and 1,795 in major subsidiaries[194]. - The company follows a compensation policy based on legality, fairness, motivation, and competitiveness to attract and retain talent[196]. Shareholder and Equity Management - The company completed the repurchase of 6,791,240 shares, accounting for 0.7529% of the total share capital of 902,031,312 shares, with a total payment of 30,000,260.48 RMB[150]. - The company’s convertible bonds converted into 24,400,560 shares during the year, with a total conversion amount of 130,540,400 RMB[156]. - The company has not conducted any repurchase transactions among the top 10 shareholders during the reporting period[166]. - The total number of shareholders at the end of the reporting period was 37,474, with 35,907 being ordinary shareholders[164]. - Major shareholder Qian Zhida holds 28.54% of shares, totaling 257,395,438 shares, with 64,348,860 shares pledged[164].