143 million profit from the diaphragm business of lithium diaphragm Golden Crown shares are expected to turn from losses to profits last year.

Recently, Golden Crown shares (300510) announced that the company expects to achieve an operating income of 800 million yuan to 1 billion yuan in 2020 and a net profit of 50 million yuan to 70 million yuan in 2020, successfully turning a loss into a profit.

According to the announcement, in 2020, Jinguan shares disposed of Liaoyuan Hongtu Lithium Diaphragm Technology Co., Ltd. (referred to as "Liaoyuan Hongtu") and Huzhou Jinguanhongtu diaphragm Technology Co., Ltd. (referred to as "Huzhou Jinguan"). The total investment income is 143 million yuan. This income belongs to non-recurrent profit and loss, but the company deducts a non-net profit loss of 90 million yuan to 120 million yuan in 2020, which is significantly lower than the loss of 1.625 billion yuan in 2019.

Specifically, Jinguan shares dispose of 85% of the shares of the subsidiary Liaoyuan Hongtu, and the remaining 15% of the shares are measured at fair value, resulting in a total investment income of 106 million yuan; dispose of 85% of the shares of the subsidiary Huzhou Jinguan, the remaining 15% of the equity is measured at fair value, and the equity changes related to the original equity investment are transferred to the profits and losses of the current period when they lose control, resulting in a total investment income of 37.1015 million yuan. This income belongs to non-recurring profit or loss.

While the investment income mentioned in the preceding paragraph is included in non-recurrent profits and losses, in accordance with the requirements of the Accounting Standards for Enterprises No. 33-Consolidated Financial statements, the profits and losses of disposed subsidiaries in 2020 are included in the consolidated income statement, of which Liaoyuan Hongtu lost 103 million yuan in 2020. Huzhou Golden Crown lost 178600 yuan in 2020.

According to public data, in January 2018, Golden Crown shares paid 1.476 billion yuan in cash to buy a 100% stake in Liaoyuan Hongtu, further lay out the new energy industry chain and deepen the "Smart Electroweb + New Energy" strategy.

On December 24, 2020, Golden Crown announced that through the Luoyang Public Resources Trading Center, the company publicly transferred 85% of the shares of Liaoyuan Hongtu, a wholly-owned subsidiary, and 85% of Huzhou Jinguan. Luoyang Jincheng Smart Yunlian Technology Co., Ltd. delisted Liaoyuan Hongtu 85% equity and Huzhou Jinguan 85% equity with a total of 700 million yuan.

At the same time, according to the "performance commitment and compensation Agreement" signed between the company and Zhang Hanhong, Gongqingcheng Baifuyuan Hongtu Investment Management Partnership (Limited Partnership) and Li Xiaoming (collectively referred to as "compensation obligor"), the compensation obligor agrees and promises that the after-tax net profit of Liaoyuan Hongtu belonging to the shareholders of the parent company after deducting non-recurrent profits and losses is not less than 220 million yuan. In view of the ongoing audit of Liaoyuan Hongtu's financial statements in 2020 and the fact that the net profit promised by the compensation obligor is not expected to be achieved according to the current situation, the company is currently actively negotiating with the compensation obligor on matters related to performance compensation. the impact of this matter on the 2020 financial statements is not taken into account in this performance forecast. After forming concluding comments on the above matters, the company will disclose the relevant contents in a timely manner.

In the follow-up, Golden Crown shares may focus on the company's resources to develop profitable businesses such as new energy charging facilities.

It is reported that Golden Crown shares are proposed to increase by 1 billion yuan for demonstration projects in the construction and operation of high-power orderly charging stations, and supplementary liquidity was also approved by Henan State-owned assets Supervision and Administration Commission at the end of last year. This additional project is expected to help the company seize the historical opportunity of the development of the new energy vehicle charging pile market, give full play to the advantages of the industrial chain formed by the company in the field of transmission and distribution, and quickly layout the construction of new energy vehicle charging facilities in Henan Province. Seize the market opportunity, promote the implementation of charging pile industry strategy, and lay a good foundation for the national layout of charging pile operation business.

Guotai Junan analysts believe that with the increase in policies such as new infrastructure and station subsidies, the cumulative market space for charging infrastructure construction from 2020 to 2025 exceeds 100 billion.

In addition, in 2020, Golden Crown shares, Nanjing Nengrui and Nengrui Electric Power have won the bid for a total of about 210 million yuan, and the winning products include single-phase smart meters, collectors, concentrators, special transformer collection terminals, intelligent distribution transformer terminals, and so on. This will significantly enhance the company's brand influence and competitiveness, expand market share and consolidate industry position, and the gradual delivery of the above orders will also have a positive impact on the company's performance in the future.