HFCC(SZ:002806)2019-04-08 16:00Financial Performance - The company achieved total revenue of CNY 649,938,134.02 in 2018, representing a year-on-year increase of 47.89%[18]. - Net profit attributable to shareholders reached CNY 78,149,375.22, a significant increase of 174.20% compared to the previous year[18]. - The net cash flow from operating activities was CNY 77,569,749.79, up 68.20% from the previous year[18]. - The company’s total assets increased by 185.07% year-on-year, reaching CNY 1,781,514,909.03 by the end of 2018[19]. - The company’s net assets attributable to shareholders grew by 238.29% to CNY 1,260,233,672.00[19]. - Basic earnings per share rose to CNY 0.54, an increase of 157.14% compared to the previous year[18]. - The total operating revenue for 2018 reached ¥649,938,134.02, representing a year-on-year increase of 47.89% compared to ¥439,484,144.11 in 2017[72]. - The revenue from the electrode foil segment was ¥422,337,231.09, accounting for 64.99% of total revenue, with a growth of 5.52% from ¥400,240,534.18 in 2017[72]. - The revenue from the new energy vehicle power system was ¥148,085,890.42, marking a significant increase as it was not reported in 2017[72]. - The net water agent segment saw revenue of ¥78,842,666.32, which is a 100.91% increase from ¥39,243,609.93 in 2017[72]. Dividend Distribution - The company plans to distribute a cash dividend of 0.80 RMB per 10 shares to all shareholders, based on a total of 176,239,202 shares[4]. - The company reported a cash dividend of 14,099,136.16 RMB for the year 2018, representing 18.04% of the net profit attributable to ordinary shareholders[156]. - The available distributable profit for the year-end is RMB 129,833,037.73, after accounting for a net profit of RMB 8,078,828.54 and a legal reserve of RMB 807,882.85[159]. - The cash dividend distribution represents 100% of the total distributable profit for the year[159]. Business Operations and Acquisitions - The company completed the acquisition of 100% equity in Lihua Huachuang in September 2018, which has been integrated into the company's operations[28]. - The company completed the acquisition of 100% equity in LiGong Huachuang, which became a wholly-owned subsidiary as of September 30, 2018[69]. - The company has expanded its operational scope by including new subsidiaries such as Beijing Huafeng New Energy Technology Research Institute and Zhaoqing Huafeng Electromechanical Equipment Co., Ltd. in its consolidated financial statements[79]. - The company has acquired several subsidiaries, including Beijing LITIAN Huachuang Electric Vehicle Technology Co., Ltd., which was included in the consolidated financial statements since September 2018, significantly impacting overall operations[110]. Research and Development - The company has developed key technologies for electric vehicles, including integrated control systems and power conversion controllers, maintaining a competitive edge in the industry[30]. - The company has developed a systematic independent R&D system, holding multiple patents including methods for low-voltage anode foil and high-power pulse power supplies, enhancing its competitive edge in the electrode foil industry[34]. - The company has participated in multiple key national R&D projects, focusing on lightweight materials and all-climate battery systems, which are crucial for enhancing the competitiveness of electric vehicles[53]. - The company has a strong R&D platform, with 17 invention patents and 54 software copyrights in the electric vehicle sector, showcasing its robust research capabilities[52]. - The company is focusing on developing integrated control systems to reduce the overall size and improve reliability of electric commercial vehicles[125]. - The company will enhance its R&D capabilities in the new energy vehicle power system platform to maintain its leadership in key technologies[130]. Market Position and Strategy - The company is positioned as a leader in the production of low-voltage formation foil, with product quality reaching levels comparable to top Japanese manufacturers[28]. - The company is among the top three largest manufacturers in the domestic low-voltage electrode foil sector, ensuring stable product performance and effective cost control[40]. - The company has established a strong customer base with long-term partnerships with major electrolytic capacitor manufacturers in Japan, Korea, and Taiwan, enhancing its market expansion capabilities[46]. - The company aims to lead the integration of the new energy commercial vehicle industry, promoting technological advancements and optimizing standards across the supply chain[118]. - The company plans to strengthen its position in the electric foil business while expanding into other electrode materials[129]. Environmental Compliance - The company is classified as a key pollutant discharge unit by environmental protection authorities[199]. - The pH level of wastewater discharge is maintained at 7.3, within the acceptable range of 6-9[199]. - Suspended solids concentration in wastewater is 17 mg/L, below the limit of 60 mg/L, achieving a compliance rate of 7.14%[199]. - Chemical Oxygen Demand (CODcr) is recorded at 26 mg/L, significantly lower than the 90 mg/L threshold, with a compliance rate of 10.92%[199]. - The company has established wastewater treatment facilities that operate in accordance with environmental assessment requirements[200]. Risks and Challenges - The company faces risks from fluctuations in raw material prices, particularly for electronic light foil, which significantly impacts production costs[138]. - The company is exposed to cyclical demand fluctuations in downstream industries, particularly in consumer electronics, which can adversely affect its operating performance[139]. - The company faces risks related to accounts receivable and bad debts, which may impact normal operations if major debtors' financial conditions deteriorate[146]. - The company has experienced significant fluctuations in the RMB to USD exchange rate, which could affect export sales prices and operational performance[146]. - The company maintains a certain level of inventory to ensure normal operations, but risks of inventory impairment exist due to market demand fluctuations[147]. Corporate Governance - The company emphasizes the independence of its operations, ensuring it has the necessary assets, personnel, and capabilities to conduct business autonomously[164]. - The company guarantees the independence and integrity of its assets, ensuring no unauthorized use of its resources by related parties[164]. - The financial department of the company is established to maintain independent financial accounting and management systems[164]. - The company has committed to providing accurate and complete information regarding the transaction, ensuring no misleading statements or omissions[163]. Future Outlook - The company aims for a revenue growth of 7% and a net profit growth of 3% in 2019[131]. - The domestic market for new energy vehicle power systems is expected to grow rapidly, with a projected production and sales of over 2 million units in 2020[128]. - Future outlook indicates a projected revenue growth of 30% for 2019, driven by new product launches and market expansion strategies[167].