Huijin(SZ:300368)2020-04-24 16:00Financial Performance - The company's operating revenue for 2019 was ¥846,521,153.95, representing a 2.33% increase compared to ¥827,266,152.45 in 2018[22]. - The net profit attributable to shareholders decreased by 6.66% to ¥44,607,320.75 from ¥47,789,842.27 in the previous year[22]. - The net profit after deducting non-recurring gains and losses surged by 1,766.48% to ¥32,492,104.27 from ¥1,740,820.43 in 2018[22]. - The total assets increased by 24.66% to ¥1,962,911,167.04 at the end of 2019, up from ¥1,574,614,768.44 in 2018[23]. - The company reported a negative net cash flow from operating activities of ¥134,384,799.82, worsening by 214.19% compared to ¥-42,771,779.43 in 2018[22]. - The basic earnings per share decreased by 5.41% to ¥0.0839 from ¥0.0887 in 2018[23]. - The company achieved a total operating revenue of CNY 846.52 million in 2019, representing a year-on-year growth of 2.33%[64]. - Operating profit increased significantly to CNY 82.70 million, up 156.80% compared to the previous year, while total profit rose to CNY 82.66 million, marking a 296.35% increase[64]. - The smart manufacturing business revenue declined by 37.93% to CNY 334.59 million, primarily due to the divestiture of subsidiaries and reduced income from industrial automation products[68]. - The information technology and system integration segment saw a revenue increase of 27.56% to CNY 367.64 million, driven by enhanced service delivery capabilities[68]. - The supply chain business generated CNY 144.29 million in revenue, marking its first contribution to the company's income[68]. Cash Flow and Investments - The company’s cash and cash equivalents decreased by 31.59% to CNY 159.27 million due to increased procurement payments and acquisition costs[40]. - Accounts receivable increased by 120.94% to CNY 520.66 million, primarily due to the inclusion of new supply chain company receivables[41]. - The company’s prepayments rose by 415.21% to CNY 155.16 million, reflecting the integration of new supply chain company prepayments[41]. - Operating cash inflow increased by 45.99% to ¥1,366,486,102.15, driven by increased sales collections and the expansion of the consolidation scope[96]. - Operating cash outflow rose by 53.34% to ¥1,500,870,901.97, primarily due to increased procurement payments related to the expanded consolidation scope[96]. - Investment cash inflow decreased by 42.62% to ¥77,502,859.11, attributed to reduced cash recovery from the disposal of subsidiaries[96]. - Financing cash inflow increased by 68.63% to ¥735,174,000.00, mainly due to increased temporary borrowings from the controlling shareholder and new bank loans[96]. - The net increase in cash and cash equivalents was a decrease of ¥72,188,726.12, reflecting a decline of 266.83% year-on-year[95]. Business Expansion and Strategy - The company is expanding into intelligent manufacturing, information technology, and supply chain businesses, but faces risks related to market acceptance and understanding of industry development patterns[8]. - The company is pursuing a strategic upgrade from financial equipment to financial technology and services, which requires enhanced risk management mechanisms to mitigate expansion risks[10]. - The company is actively exploring new business areas, but there is uncertainty regarding the success of these initiatives in the market[8]. - The company expanded its business into non-bank sectors, achieving significant breakthroughs in manufacturing equipment for new retail, government, and hospital self-service terminals[32]. - The company aims to leverage its existing technology and service network to accelerate growth in non-bank business areas[32]. - The company has formed a supply chain service business segment focused on coal, coke, iron ore, and building materials industries, leveraging the resources and advantages of its state-owned controlling shareholder[36]. - The supply chain business has achieved both organic growth and external acquisitions, enhancing customer stickiness and industry value through innovative business models and big data technology[36]. - The company aims to achieve full product line coverage in the currency circulation medium sector, including cash, cards, and digital currency, while expanding into new retail, government, telecommunications, and lottery sectors[56]. - The company plans to accelerate the development of its financial services business through both organic growth and mergers and acquisitions, targeting supply chain services for specific industries and small to medium-sized enterprises[56]. Research and Development - The company has made significant R&D achievements, with many results protected by patents and software copyrights, but risks exist regarding technology leakage and loss of core technical personnel[9]. - The company aims to enhance its competitive edge by increasing R&D investment in cutting-edge information technology and improving customer service models[37]. - The company’s R&D investment in 2019 amounted to ¥27,305,448.55, representing 3.23% of its operating revenue[91]. - The number of R&D personnel decreased to 124 in 2019, accounting for 12.68% of the total workforce, down from 14.00% in 2018[91]. - The company completed the development of a smart printing control system, producing 30 units for user testing, aimed at enhancing efficiency and reducing risks associated with stamp usage[88]. - A total of 3 prototypes of the intelligent tail box management terminal have been completed, addressing the issues of high costs and inefficiencies in cash transport for banks[89]. - The company has developed a document digitization management system using RFID technology, which is expected to significantly improve the efficiency of document management processes[90]. - The intelligent shared picture book disinfection cabinet has been successfully launched, expanding the company's market share in the disinfection equipment sector[90]. - The company aims to enhance its product offerings in the intelligent office service terminal sector, with ongoing small-batch trials of new devices[90]. Governance and Risk Management - The company emphasizes the importance of talent management to prevent key personnel loss, as the complexity of its organizational structure increases with business expansion[6]. - The company has a complex organizational structure due to the expansion of subsidiaries, which increases the difficulty of operational decision-making and risk control[6]. - The company is committed to improving its governance structure and internal controls to enhance management capabilities and business operations[6]. - The company acknowledges the risk of declining demand for cash-related equipment due to the rise of mobile and online payment technologies, leading to increased market competition and potential margin pressure[8]. - The company is focused on optimizing its operational management system to enhance asset efficiency and profitability by addressing low-yield non-core businesses[56]. Shareholder Returns and Dividends - The company has a cash dividend distribution plan of 0.17 yuan per 10 shares (including tax) based on a total of 528,943,475 shares, with no bonus shares issued[11]. - The cash dividend represents 5.99% of the total distributable profit of 150,098,115.05 yuan for the year[144]. - The cash dividend for 2019 accounts for 20.16% of the net profit attributable to ordinary shareholders[149]. - The company will not distribute cash dividends or increase capital reserves due to consecutive years of negative cash flow from operating activities[141]. - The company has no plans for capital reserve conversion into share capital or issuing bonus shares for the 2019 fiscal year[147]. - The company aims to ensure stable returns to shareholders while considering industry characteristics and funding needs[145]. Related Party Transactions and Commitments - The company became the controlling shareholder of Huijin Co., Ltd. and committed to avoiding related party transactions with it[153]. - The company will not engage in any business that competes with Huijin Co., Ltd. and its subsidiaries[154]. - The company has committed to not utilizing its controlling shareholder status to improperly occupy company funds or engage in activities detrimental to the interests of public shareholders[159]. - The company has established a commitment to conduct any related party transactions under normal commercial conditions, ensuring fairness and compliance with legal regulations[158]. - The performance commitment for Zhongke Tuoda includes a net profit of no less than RMB 43 million, RMB 53 million, and RMB 63 million for 2018, 2019, and 2020 respectively[173]. - The company has a compensation mechanism in place for any shortfall in the promised net profit, ensuring full compensation to the company[173]. - The performance commitments are subject to annual audits by qualified accounting firms[179]. Legal and Compliance Matters - The company has engaged in various legal proceedings, including a case against Wuxi Xiding Technology Co., Ltd. filed in March 2020[199]. - The company has successfully resolved a technical entrustment contract dispute with Hebei Shenyang Technology Co., Ltd. through mediation[198]. - The company has reached mediation agreements in multiple disputes, including a 112.34 thousand yuan case with Beijing Dianchuang Zhizhi Technology Co., Ltd.[198]. - There are no non-operating fund occupations by controlling shareholders or related parties during the reporting period[186]. - The domestic accounting firm, Zhongqin Wanxin, has been retained for 9 consecutive years, with an audit fee of 1 million yuan[191].