ZHEJIANG SHIBAO(SZ:002703)2020-04-23 16:00Financial Performance - The company reported a profit distribution plan of no cash dividends, no bonus shares, and no capital reserve conversion into shares[7]. - The company's operating revenue for 2019 was ¥982,370,362.06, a decrease of 13.30% compared to ¥1,133,097,729.85 in 2018[35]. - The net profit attributable to shareholders in 2019 was -¥176,711,694.44, representing a significant decline of 2,527.90% from ¥7,278,368.34 in 2018[35]. - The net cash flow from operating activities improved to ¥39,800,748.05 in 2019, a 409.74% increase from -¥12,849,643.30 in 2018[35]. - The total assets at the end of 2019 were ¥1,975,196,092.31, down 3.42% from ¥2,045,077,333.85 at the end of 2018[35]. - The company reported a basic earnings per share of -¥0.2238 in 2019, a decrease of 2,532.61% from ¥0.0092 in 2018[35]. - The net assets attributable to shareholders decreased by 11.95% to ¥1,301,834,988.37 at the end of 2019 from ¥1,478,546,682.81 at the end of 2018[35]. - The gross profit from the main business was RMB 127,405,462.04, with a gross margin of 13.21%, down from 16.62% in 2018[50]. - The company reported a net profit attributable to shareholders of RMB -176,711,694.44, compared to a profit of RMB 7,278,368.34 in 2018[54]. - The total sales volume for automotive parts was 1,899,168 units, a decline of 8.75% from 2,081,171 units in 2018[59]. - The production volume of automotive parts was 1,874,522 units, down 9.15% from 2,063,234 units in the previous year[59]. - The company's financial expenses increased by 775.15% to RMB 3,017,313.82, mainly due to increased bank borrowings[51]. - The automotive parts manufacturing segment generated RMB 964,554,512.66 in revenue, representing 98.19% of total operating revenue, with a gross margin of 13.21%[55]. Operational Risks and Challenges - The automotive parts manufacturing industry is significantly influenced by the macroeconomic cycle and national policies, which poses operational risks for the company[9]. - The company faces a high proportion of accounts receivable, which may increase with business scale expansion, posing a risk of bad debts[15]. - The company has highlighted the risk of product quality issues, which could lead to recalls and negatively impact brand reputation and financial performance[10]. - The company has not disclosed specific revenue figures or growth percentages in the report, indicating a need for further financial details[11]. - The company has not provided specific guidance on future performance or revenue targets, reflecting uncertainty in market conditions[8]. - The automotive industry faced substantial pressure in 2019 due to trade tensions and the COVID-19 pandemic, impacting overall market demand[102]. Research and Development - The company emphasizes the importance of continuous technological innovation to meet the evolving demands of automotive manufacturers[12]. - The company aims to enhance its research and production capabilities in automotive steering systems to achieve international competitiveness[44]. - Zhejiang Shibao is one of the first companies in China to develop hydraulic and electric power steering systems, focusing on intelligent driving solutions[44]. - R&D expenditure was RMB 61,712,823.86, a decrease of 7.14%, but the proportion of R&D spending relative to operating revenue increased[51]. - In 2019, the company's R&D investment accounted for 6.28% of sales revenue, emphasizing its commitment to technological innovation[137]. - The company launched an electric power steering system that operates independently of the engine, significantly reducing fuel consumption and environmental pollution[137]. - The company focuses on the research and development of automotive steering products, including steering gears and key components of steering systems[183]. Strategic Plans and Future Outlook - The company plans to expand its product offerings towards integrated modular automotive components related to steering systems[44]. - The company plans to accelerate the development of steering technologies related to intelligent and autonomous driving[102]. - Future strategies include a cautious investment approach, slowing down new production line construction, and focusing on core business areas[102]. - The company will continue to focus on mergers and acquisitions to strengthen its position in the automotive parts industry[101]. Financial Management and Capital Structure - The company raised a total of RMB 705,172,000.00 from the non-public issuance of A-shares, with a net amount of RMB 660,046,164.00 after deducting underwriting fees[79]. - As of December 31, 2019, the company had utilized RMB 515,440,660.47 of the raised funds, with a net interest income of RMB 38,406,118.97 from bank deposits[81]. - The company temporarily supplemented working capital with RMB 170,000,000.00, leaving a balance of RMB 11,128,335.54 in the special account for raised funds as of December 31, 2019[82]. - The company's total loans and borrowings increased to ¥151,800,000.00, up from ¥29,080,000.00 at the end of 2018, indicating a significant increase in financing activities[74]. - The capital structure at the end of the reporting period showed a capital debt ratio of 2.62%, compared to -6.45% in 2018, reflecting a shift in financial leverage[76]. - The total amount of entrusted financial management reached RMB 20,601 million, with an outstanding balance of RMB 7,100 million[130]. Corporate Governance and Management - The actual controller of the company is Zhang Shiquan, who is also the chairman[150]. - The chairman, Zhang Shiquan, holds 26,391,580 shares, unchanged from the beginning of the period[153]. - There were no changes in the board of directors, supervisors, or senior management during the reporting period[154]. - The company has maintained a stable management structure with no personnel changes reported[154]. - The management team has extensive experience, with key members holding positions since 2004[155]. - The total pre-tax remuneration for the board of directors and senior management amounted to CNY 426.90 million[174]. - The company employed a total of 1,537 staff, with 1,001 in production, 380 in technical roles, and 48 in sales[175]. Compliance and Quality Assurance - The company has maintained a comprehensive quality assurance system, implementing IATF:16949 quality system certification[131]. - The company complies with all applicable laws and regulations regarding business registration, taxation, and product quality[186]. - The company has obtained ISO14001 environmental management system certification for its subsidiaries, indicating a commitment to environmental management[138]. - The company has achieved compliance with local environmental regulations, with wastewater and exhaust emissions meeting government standards in 2019[137]. Shareholder Information - The total number of shares outstanding is 789,644,637, with 97.49% being unrestricted shares[143]. - The largest shareholder, Zhejiang Sibao Holding Group Co., Ltd., holds 43.28% of the shares, while the second-largest shareholder, Hong Kong Central Clearing (Nominee) Limited, holds 27.49%[146]. - The company has a total of 37,556 common shareholders, with 10 shareholders holding more than 5% of the shares[146]. Miscellaneous - The company has not experienced any significant foreign currency risk during the reporting period, as sales and purchases were primarily in RMB[94]. - There were no major asset or equity sales during the reporting period[93]. - The company has not engaged in any major related party transactions during the reporting period[127]. - The company has not implemented any stock incentive plans or employee stock ownership plans during the reporting period[126]. - The company has not experienced any major accounting errors requiring retrospective restatement during the reporting period[121]. - The company has not made any changes to the scope of consolidated financial statements compared to the previous year[122]. - The company has not conducted any precise poverty alleviation work during the reporting year and has no subsequent plans[136]. - The company reported no convertible securities, options, warrants, or similar rights during the reporting period[193].