SCAM(SZ:300554)2022-04-24 16:00Financial Performance - The company's profit significantly declined in 2021 due to a drop in diamond wire product prices, rising raw material costs, and substantial asset impairment provisions[5]. - The company's operating revenue for 2021 was ¥248,452,404.38, a decrease of 3.84% compared to ¥258,379,491.43 in 2020[20]. - The net profit attributable to shareholders was -¥75,010,965.42, representing a decline of 474.48% from ¥20,030,740.07 in the previous year[20]. - The net cash flow from operating activities improved significantly to ¥103,263,132.95, a 975.04% increase from -¥11,800,942.86 in 2020[20]. - The total assets at the end of 2021 were ¥765,839,564.96, down 17.34% from ¥926,506,270.11 at the end of 2020[20]. - The company reported a basic earnings per share of -¥0.8013, a decrease of 474.44% compared to ¥0.2140 in 2020[20]. - The net profit after deducting non-recurring gains and losses was -¥80,956,660.14, a decline of 588.42% from ¥16,575,322.80 in 2020[20]. - The weighted average return on net assets was -14.03%, a decrease of 17.79% from 3.76% in the previous year[20]. - The company achieved operating revenue of 248.45 million yuan, a year-on-year decrease of 3.84%, and a net profit attributable to shareholders of -75.01 million yuan, down 474.48% year-on-year[42]. Market and Industry Outlook - The demand for diamond wire, used in silicon wafer cutting, is expected to reach 100 million kilometers in 2022 due to the growth in the photovoltaic industry[30]. - The photovoltaic industry saw a record addition of 55 GW of new capacity in 2021, with expectations to reach 75-90 GW in 2022[30]. - The company faced significant pressure on product prices due to intense competition and plans for capacity expansion among peers in the diamond wire production sector[30]. - The semiconductor industry has shown remarkable growth, and the company anticipates strong sales for its diamond tools used in this sector[83]. - The company aims to increase the production capacity of silicon slicing wire to 10 million kilometers per year, with a focus on domestic equipment procurement to replace Japanese machinery[82]. Research and Development - The company focuses on the research, production, and sales of diamond and cubic boron nitride tools, aiming to become a leading supplier of precision superhard material products in China[32]. - The company has accumulated 72 authorized patents, including 18 invention patents, and has established a comprehensive patent system in diamond wire and diamond grinding wheels[35]. - R&D expenses amounted to 24.21 million yuan, representing 9.75% of operating revenue, an increase of 39.89% year-on-year, supporting ongoing technological innovation[47]. - The company is developing several new products, including a metal bond soft blade and high-precision diamond hard blades, aimed at enhancing market competitiveness[60]. - The company plans to upgrade its production lines, targeting a 30% increase in production speed and stable product quality[60]. Corporate Governance - The financial report is guaranteed to be true, accurate, and complete by the company's management[4]. - The company has established a governance structure that complies with relevant laws and regulations, ensuring independent operation from the controlling shareholder[92]. - The board of directors consists of 9 members, including 3 independent directors, ensuring compliance with governance standards[93]. - The company has implemented a performance evaluation and incentive mechanism that aligns with its development status[95]. - The company actively engages with investors through various channels, enhancing communication and transparency[96]. Risk Management - The company emphasizes the importance of understanding the differences between plans, forecasts, and commitments to mitigate investment risks[5]. - The company faces risks from intensified market competition, which could lead to price and margin pressures on its products[85]. - The company faces risks related to rising raw material prices, which have increased significantly since the second half of 2020, impacting profit margins[87]. Subsidiaries and Expansion - The company has a wholly-owned subsidiary, Jiangsu Sanchao Diamond Tool Co., Ltd.[13]. - A new subsidiary, Jiangsu Sanjing Semiconductor Materials Co., Ltd., was established to develop and sell diamond tools for semiconductor wafer processing, with some products already in small-scale sales[37]. - The company established a new subsidiary, Jiangsu Sanjing Semiconductor Materials Co., Ltd., with a registered capital of 50 million RMB[158]. Profit Distribution and Financial Policies - No cash dividends, stock bonuses, or capital increases from reserves will be distributed for the year[6]. - The company reported a total distributable profit of 108,055,296.72 CNY, with a cash dividend amount of 0 CNY, resulting in a cash dividend ratio of 0.00%[135]. - The company plans to prioritize cash distribution of profits, with a minimum of 10% of distributable profits to be distributed in cash if no major investments or cash expenditures occur[131]. - The company has established a long-term stable profit distribution policy to provide reasonable returns to investors[147]. Employee and Talent Management - The total number of employees at the end of the reporting period was 691, with 162 in the parent company and 529 in major subsidiaries[126]. - The company implemented a salary adjustment plan for 2021, focusing on performance and competency, which successfully attracted talent[127]. - The company emphasizes talent development and employee rights, providing competitive compensation and a safe working environment[148]. Environmental and Social Responsibility - The company has established a comprehensive wastewater treatment system and air pollution control measures, meeting national environmental standards[145]. - The company actively engages in social responsibility, ensuring fair treatment of shareholders and employees, and maintaining transparency in operations[147]. - The company has not been listed as a key pollutant discharge unit by environmental authorities in 2021[146]. Financial Management and Reporting - The company has no major internal control deficiencies as of December 31, 2021, indicating effective management and compliance[139]. - The company reported zero significant defects in financial reporting for the year 2021[142]. - The current domestic accounting firm, Tianheng Accounting Firm, has been engaged for 8 consecutive years, with an audit fee of 600,000 RMB[159].