TRONLY(SZ:300429)2019-04-07 16:00Financial Performance - The company's operating revenue for 2018 was CNY 739,083,610.12, representing a 15.49% increase compared to CNY 639,954,962.08 in 2017[23]. - The net profit attributable to shareholders for 2018 was CNY 146,556,470.86, up 15.77% from CNY 126,590,925.89 in 2017[23]. - The net cash flow from operating activities increased by 29.07% to CNY 111,605,525.93 in 2018 from CNY 86,467,606.26 in 2017[23]. - The total assets at the end of 2018 reached CNY 1,882,459,731.74, a 46.75% increase from CNY 1,282,754,278.15 at the end of 2017[23]. - The company reported a basic earnings per share of CNY 0.5523 for 2018, reflecting a 12.21% increase from CNY 0.4922 in 2017[23]. - The weighted average return on equity for 2018 was 10.95%, down from 12.52% in 2017[23]. - Operating costs for 2018 were ¥443,181,706.98, reflecting a year-on-year increase of 17.80%[48]. - The company reported a gross margin of 40.12% for electronic chemical sales, a decrease of 1.15% from the previous year[54]. Research and Development - The company reported a research and development investment accounting for 6% of its operating revenue, indicating a strong commitment to innovation despite potential risks to profitability[10]. - The company has accumulated substantial independent intellectual property rights, which helps mitigate risks in new product development[6]. - The company is focused on continuous product innovation to adapt to the evolving demands of the electronic materials industry[6]. - The company has applied for a total of 126 patents in China, including 28 PCT patents, and has received multiple patents from various international patent offices[39]. - The company has established a strong R&D team, focusing on continuous innovation and development of leading products in the photoresist chemical field[45]. - The company's R&D expenditure in 2018 was ¥48,552,080.34, representing a 24.90% increase compared to 2017, and accounting for 6.57% of total revenue[65]. Market and Sales - The market share of the company's PCB photoresist specialty chemicals is steadily increasing as the PCB industry continues to shift towards mainland China[33]. - The sales of electronic chemicals accounted for 99.31% of total revenue, with a year-on-year growth of 15.02%[52]. - Domestic sales contributed ¥407,575,582.36, representing 55.15% of total revenue, with an 18.18% increase year-on-year[52]. - The company has become a major supplier of LCD photoresist materials, breaking the monopoly of multinational companies like BASF[40]. - The company maintains stable relationships with major clients such as Hitachi Chemical and Samsung SDI, ensuring long-term partnerships[41]. Risk Management - The company is facing risks related to long project construction cycles, which now take approximately 2-3 years due to increased environmental and safety regulations[9]. - The company aims to minimize the risk of declining profitability by actively developing new markets and controlling operational cost increases[10]. - The company emphasizes the importance of communication with government departments to shorten project approval times and enhance planning efforts[9]. - The company has established an EHS department to effectively manage safety and environmental risks associated with the use of various chemicals in production[7]. - The company is facing risks related to high technical barriers in the electronic materials industry, particularly in PCB processing and semiconductor manufacturing[95]. Environmental Compliance - The company has received multiple certifications for its environmental management and safety standards, demonstrating its commitment to safety and compliance[7]. - The company has implemented environmental protection measures, including a wastewater treatment system that meets the GB8978-1996 standard with a discharge of 4.6 tons/year of COD[143]. - The company’s waste gas emissions of nitrogen oxides are at 2.47 tons/year, compliant with the GB16297-1996 standard[143]. - The company’s solid waste disposal is managed by qualified units, ensuring compliance with environmental regulations[143]. - The company has established an emergency response plan for environmental incidents, which has been reviewed and filed with the environmental protection department[143]. Profit Distribution - The profit distribution plan approved by the board proposes a cash dividend of 1.50 RMB per 10 shares, with a capital reserve conversion of 9 shares for every 10 shares held[10]. - The company declared a cash dividend of CNY 1.50 per 10 shares, totaling CNY 40,677,899.10 for the year 2018[103]. - The total distributable profit for the year was CNY 135,606,402.66, with cash dividends accounting for 100% of the profit distribution[103]. - The cash dividend for 2018 represented 27.76% of the net profit attributable to ordinary shareholders, which was CNY 146,556,470.86[105]. - The company maintained a consistent dividend policy, with cash dividends of CNY 2.20 per 10 shares in 2015 and CNY 1.00 per 10 shares in both 2016 and 2017[104]. Governance and Compliance - The company has fulfilled its commitments during the reporting period and as of the end of the reporting period, no commitments remain unfulfilled[106]. - The company and its directors have not faced any administrative penalties from the China Securities Regulatory Commission in the last 16 months[106]. - No public reprimands from the stock exchange have been received by the company or its executives in the last 12 months[106]. - The company has committed to not transferring or entrusting the management of its shares for 36 months from the date of its stock listing[106]. - The company has established a clear framework for penalties related to share transfer violations, including daily fines for late payments[107]. Shareholder Structure - Major shareholder Qian Xiaochun holds 28.26% of the shares, totaling 76,636,092 shares, with 13,559,300 shares pledged[158]. - Major shareholder Guan Jun holds 18.50% of the shares, totaling 50,181,625 shares, with 12,545,406 shares pledged[158]. - The company has a stable ownership structure with no changes in actual control[162]. - The total shares held by directors, supervisors, and senior management at the end of the period amounted to 5,569,858 shares, down from 7,187,182 shares at the beginning of the period, indicating a reduction of approximately 22.5%[167]. Management and Employees - The total number of employees in the company is 1,110, with 254 in the parent company and 856 in major subsidiaries[180]. - The company has a total of 751 production personnel, 39 sales personnel, 176 technical personnel, 17 financial personnel, and 127 administrative personnel[180]. - The company aims to maintain a competitive salary level above the industry average to attract and retain top talent[181]. - The company has implemented a comprehensive reform of its salary performance system based on market demand and different job levels[181]. - The company has established a comprehensive performance evaluation system for senior management, linking their performance directly to compensation[188]. Audit and Financial Reporting - The company has not experienced any non-standard audit reports during the reporting period[117]. - The company has ensured that all commitments made to minority shareholders have been fulfilled on time[115]. - The company reported a significant change in its financial reporting policies due to the issuance of new financial statement formats by the Ministry of Finance on June 15, 2018, which affected the preparation of the 2018 annual financial statements[118]. - The company has adjusted its financial statements in accordance with the new accounting policies adopted during the reporting period[118]. - The company has appointed Jiangsu Suya Jincheng Accounting Firm as its auditor, with an audit fee of 700,000 RMB and a continuous service period of 10 years[120].