LECRON(SZ:300343)2020-04-29 16:00Financial Performance - The internet advertising business has significantly declined, leading to a substantial drop in revenue and profit, which may impact overall company performance [6]. - The company reported a decrease in operating income compared to previous years, indicating potential risks in receivables recovery and increased bad debt risk [6]. - The company's operating revenue for 2019 was ¥3,513,747,937.12, a decrease of 2.38% compared to ¥3,599,465,997.37 in 2018 [25]. - The net profit attributable to shareholders for 2019 was -¥1,473,977,838.09, an improvement from -¥1,953,787,104.88 in 2018 [25]. - The total assets at the end of 2019 were ¥3,286,654,453.34, down 18.88% from ¥4,051,649,624.16 at the end of 2018 [25]. - The net assets attributable to shareholders decreased by 62.84% to ¥852,852,057.49 from ¥2,295,193,949.10 in 2018 [25]. - The company reported a net loss of 147.57 million CNY for 2019, which was a 22.23% improvement from the net loss of 189.76 million CNY in 2018 [48]. - The total profit for 2019 was -145.80 million CNY, an improvement of 21.51% from -185.77 million CNY in 2018 [48]. - The company reported a net loss attributable to shareholders of approximately -1.47 billion yuan for 2019, with no cash dividends proposed for the year [151]. Audit and Compliance - The company has engaged Xinyong Zhonghe Accounting Firm for the audit of the 2019 financial statements, which issued a qualified opinion report [5]. - The financial report emphasizes the importance of accurate and complete financial disclosures to stakeholders [5]. - The company has maintained its commitment to transparency and accountability in its financial reporting practices [5]. - The company has pledged to minimize related party transactions and ensure that any unavoidable transactions are conducted at fair market prices, adhering to legal and regulatory requirements [170]. - The company has committed to fulfilling its promises regarding share transfer restrictions and has not violated any of these commitments [181]. Business Strategy and Operations - The company plans not to distribute cash dividends, issue bonus shares, or increase capital from reserves [6]. - The company is focusing on restructuring its internet business to mitigate risks associated with declining advertising revenue [6]. - The company has not outlined any market expansion or acquisition strategies in the available documents [6]. - The company plans to continue focusing on market expansion and integration of acquired entities to enhance operational efficiency and revenue growth [47]. - The company aims to enhance its core competitiveness through product structure adjustment and new technology development [105]. - The company plans to focus on new materials and fine chemicals, particularly polyurethane new materials and fluorine-containing polymers, while exiting capital-intensive internet marketing businesses [127]. Research and Development - The company has invested significantly in R&D, focusing on technological innovation and product structure adjustment to enhance competitive advantages [55]. - Research and development investment amounted to ¥51,649,592.55, representing 1.47% of operating revenue in 2019 [108]. - The company is developing a new pentane/isopentane mixed foaming system, which is expected to enhance product competitiveness and generate additional revenue of approximately ¥20 million [81]. - The company has developed proprietary technologies, holding 63 effective patents, including 47 invention patents [55]. - The company has completed various stages of product development, including market research, formulation, and process development, with ongoing efforts in product application promotion [87]. Market and Product Development - The internet segment generated revenue of 2.255 billion yuan, accounting for 64.18% of total revenue, while the chemical segment contributed 1.259 billion yuan, or 35.82% [59]. - The revenue from the chemical new materials sector was ¥1,258,628,221.33, which accounted for 35.82% of total revenue, showing a significant increase of 190.18% year-on-year [67]. - The company has expanded its market presence internationally, particularly in South Korea, Southeast Asia, and the Middle East, leading to noticeable growth in sales volume and revenue [55]. - The company aims to enhance its product range and competitiveness through the introduction of innovative polyurethane solutions [87]. - The company is targeting emerging application areas, such as cold chain construction and modern agriculture, for polyurethane products [142]. Client and Supplier Relations - The customer retention rate for direct clients was 46%, while for agency clients it was 48% [62]. - The total number of clients reached 245, with 129 direct clients and 116 agency clients [62]. - The company’s major customer, Customer One, contributed ¥397,512,649.38, accounting for 11.31% of total annual sales [75]. - The top five suppliers accounted for a total procurement amount of ¥830,928,420.57, representing 26.53% of the annual procurement [79]. Future Outlook - The company expects a revenue growth guidance of 15% for the next fiscal year [187]. - New product launches are projected to contribute an additional $200 million in revenue [188]. - Market expansion plans include entering three new international markets by Q3 2024 [190]. - The company is considering strategic acquisitions to enhance its market position [191]. - The management has emphasized a focus on sustainability initiatives in future strategies [194].