XINGYE TECH.(002674)2020-04-20 16:00Financial Performance - The company's operating revenue for 2019 was ¥1,587,100,991.37, a decrease of 12.16% compared to 2018[16]. - Net profit attributable to shareholders was ¥118,024,529.84, reflecting a 1.97% increase from the previous year[16]. - The net profit after deducting non-recurring gains and losses was ¥114,525,937.03, up by 9.16% year-on-year[16]. - The net cash flow from operating activities was ¥43,065,583.91, down 88.82% compared to 2018[16]. - The company reported a basic earnings per share of ¥0.3907, an increase of 1.98% from the previous year[16]. - Total assets at the end of 2019 were ¥2,975,434,180.40, a slight increase of 0.38% from the end of 2018[16]. - The total operating revenue for 2019 was ¥1,587,100,991.37, a decrease of 12.16% compared to ¥1,806,797,339.03 in 2018[50]. - The revenue from the cowhide leather industry accounted for 97.47% of total revenue, amounting to ¥1,546,908,954.39, down 13.39% from ¥1,786,002,396.72 in 2018[50]. - Other business revenue increased by 93.28% to ¥40,192,036.98, compared to ¥20,794,942.31 in 2018[50]. - The gross profit margin for the cowhide leather industry was 15.80%, a decrease of 15.11% year-on-year[53]. Cash Dividend and Profit Distribution - The company plans to distribute a cash dividend of 6.00 CNY per 10 shares, totaling 177,614,740.20 CNY, based on a total of 296,024,567 shares eligible for distribution[3]. - The net profit for the year 2019 was reported at 113,116,518.22 CNY, with 10% allocated to statutory surplus reserves amounting to 11,311,651.82 CNY[137]. - As of December 31, 2019, the actual distributable profit was 450,213,750.86 CNY after deducting the previously distributed profit of 181,249,297.20 CNY[132]. - The company has maintained a cash dividend payout ratio of 100% of the distributable profit for the year 2019[136]. - The total cash dividends distributed over the past three years were 177,614,740.20 CNY in 2019, 181,249,297.20 CNY in 2018, and 151,041,081.00 CNY in 2017, reflecting a consistent return to shareholders[134]. - The remaining undistributed profit after the 2019 dividend distribution will be retained for future allocations, amounting to 272,598,010.66 CNY[137]. - The company is currently implementing a share buyback program, which may affect the share capital structure prior to the dividend distribution[138]. - The profit distribution plan is subject to approval at the company's 2019 annual general meeting[138]. - The cash dividend for 2019 represents 150.49% of the net profit attributable to ordinary shareholders, indicating a strong commitment to shareholder returns[134]. - The company committed to a stable and continuous dividend distribution policy, emphasizing reasonable returns for investors and sustainable development[141]. Business Operations and Strategy - The company has not reported any changes in its main business operations since its listing[14]. - The company has confirmed the accuracy and completeness of the financial report by its management team[2]. - The company operates under the stock code 002674 on the Shenzhen Stock Exchange[10]. - The company has a registered address in Jinjiang City, Fujian Province, with a postal code of 362211[10]. - The company has appointed Deloitte Touche Tohmatsu CPA Ltd. as its accounting firm[15]. - The company has a dedicated investor relations email for inquiries: ir@xingyeleather.com[10]. - The company has maintained a strong client base, including well-known brands such as Belle and Lilang, focusing on mid-to-high-end leather products[27]. - The company has implemented a management structure based on business units, allowing for rapid product sampling and quick delivery to meet customer demands[31]. - The company is strategically positioned near major economic development areas and leather manufacturing bases, enhancing its ability to respond to market trends[36]. - The company has shifted its marketing strategy to focus on personalized and fashionable products, moving away from low-value products[47]. Research and Development - The company has applied for 109 patents, including 88 invention patents, and has been recognized as a "National Enterprise Technology Center" by multiple government departments[34]. - The company has established a dual R&D system, with a technical center and product development teams in each division, focusing on market trends and customer needs[35]. - The company has developed new products such as "light-resistant, cold-resistant, and waterproof high-performance leather" and "low formaldehyde children's shoe leather" during the reporting period[46]. - The R&D strategy includes collaboration with research institutions to drive innovation and develop new products that meet consumer demand and market trends[109]. - The company aims to develop high cost-performance new products and shorten R&D and delivery cycles to meet customer demands quickly when the market recovers[114]. Environmental Initiatives - The company’s environmental initiatives include a comprehensive wastewater treatment and recycling system, aligning with national environmental regulations[32]. - The company has implemented a comprehensive wastewater treatment system, utilizing a "five-water separation" method to manage different types of wastewater effectively[191]. - The company has established a recycling process for chromium-containing wastewater, allowing for the reuse of treated water in production, thus minimizing waste[192]. - The company has a solid waste management strategy in place, handling both general and hazardous solid waste generated during production[197]. - The company has installed a high-efficiency air purification system to treat exhaust gases from various production processes, ensuring compliance with emission standards[197]. - The company has reported no instances of exceeding pollutant discharge limits across its facilities, demonstrating compliance with environmental regulations[190]. Risks and Challenges - The company faces risks from environmental policies that may increase operational costs due to stricter pollution control regulations, requiring more investment in environmental facilities[115]. - The fluctuation in raw material prices, particularly cowhide, poses a significant risk to the company's profitability, as substantial price changes can adversely affect financial performance[117]. - The company imports a large amount of raw hides, primarily settled in foreign currencies, making it susceptible to exchange rate fluctuations that could impact earnings[119]. - The company is at risk of losing core technical personnel, which could hinder new product development and future growth if not adequately addressed[120]. - Changes in fashion trends may reduce the demand for natural leather in shoe uppers, but the company is exploring new markets for bag and furniture leather to mitigate this impact[121]. - The escalation of the US-China trade war could lead to increased tariffs on leather products, affecting sales and procurement costs, thereby impacting overall operations[122]. - The ongoing COVID-19 pandemic has severely affected global trade, leading to order cancellations and a sluggish domestic market, which has significantly impacted the company's downstream shoe manufacturing clients[123]. Related Party Transactions - The company reported a significant related party transaction amounting to 3,207 million yuan for waste disposal services, with a pricing principle of 26.03 yuan per ton[171]. - Another related party transaction was recorded at 2,126.2 million yuan for waste disposal services, priced at 26 yuan per ton, representing a 16.37% increase compared to the previous period[171]. - The company disclosed a related party transaction of 1,618.8 million yuan for waste disposal services, with a pricing principle of 85 yuan per ton, reflecting a 27.78% increase[171]. - The company has established a pricing principle for related party transactions at 5 yuan per ton for waste disposal services, with a total transaction amount of 890 million yuan[171]. - The company’s related party transactions are subject to market pricing principles, ensuring compliance with regulatory requirements[171]. - The company has received approval for all disclosed related party transactions, confirming their adherence to governance standards[171]. Financial Management - The company raised a total of CNY 715,978,294.62 from a non-public offering of 61,510,162 shares at CNY 11.64 per share, with a net amount of CNY 709,971,083.30 after expenses[89]. - The company has committed to invest CNY 70,997.11 million in various projects, with CNY 26,976.22 million already utilized, indicating a utilization rate of approximately 38.1%[90]. - The company has no outstanding funds from the raised capital, indicating effective fund management[90]. - The company reported a total undistributed profit of 549.13 million yuan as of the end of the reporting period[156]. - The company did not face any suspension or termination of listing issues following the annual report disclosure[163].