A-share securities code: Shanghai Fudan Microelectronics Group Co.Ltd(688385) securities abbreviation: Shanghai Fudan Microelectronics Group Co.Ltd(688385) Announcement No.: 2022011 Hong Kong stock securities code: 01385 securities abbreviation: Shanghai Fudan
Shanghai Fudan Microelectronics Group Co.Ltd(688385)
Announcement on 2021 profit distribution plan
The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear legal responsibility for the authenticity, accuracy and integrity of its contents according to law.
Important content tips:
Distribution ratio per share: cash dividend of 0.65 yuan (including tax) will be distributed for every 10 shares. No bonus shares will be given for this profit distribution, and no accumulation fund will be converted into share capital.
The profit distribution is based on the total share capital on the date of equity distribution registration, and the specific date will be specified in the announcement of equity distribution implementation.
If the total share capital of the company changes before the equity registration date of equity distribution, it is proposed to maintain the total distribution unchanged, adjust the distribution proportion per share accordingly, and make a separate announcement on the specific adjustment.
The proportion of cash dividends in this year is less than 30%, mainly based on the characteristics of the company’s industry, its own operation and its current development stage.
1、 Basic information of profit distribution plan
According to the audit confirmation of Ernst & Young Huaming Certified Public Accountants (special general partnership), as of December 31, 2021, Shanghai Fudan Microelectronics Group Co.Ltd(688385) (hereinafter referred to as “the company” or ” Shanghai Fudan Microelectronics Group Co.Ltd(688385) “) realized the net profit attributable to the owner of the parent company in 2021 was 51446678071 yuan, and the distributable profit of the parent company at the end of 2021 was 46373903602 yuan. In 2021, the company plans to distribute profits based on the total share capital registered on the date of equity distribution. The profit distribution plan is as follows:
The company plans to distribute cash dividends of RMB 0.65 (including tax) to all shareholders for every 10 shares. As of December 31, 2021, the total share capital of the company is 814502000 shares. Based on this calculation, the total cash dividends to be distributed are RMB 5294263000 (including tax), and the proportion of cash dividends to the net profit attributable to shareholders of Listed Companies in 2021 is 10.29%. No bonus shares will be given for this profit distribution, and no accumulation fund will be converted into share capital.
The final dividend will be denominated and declared in RMB, the dividend on A-Shares will be paid in RMB and the dividend on H shares will be paid in Hong Kong dollars. The exchange rate used for the conversion of cash dividends from RMB to Hong Kong dollars will be based on the average central parity rate of RMB to Hong Kong dollars published by the people’s Bank of China five working days before the date of dividend declaration.
If the total share capital of the company changes from the date of disclosure of this announcement to the date of equity distribution and equity registration, the company intends to maintain the total distribution and adjust the distribution proportion per share accordingly. In case of subsequent changes in the total share capital, the specific adjustment will be announced separately.
The profit distribution plan needs to be submitted to the 2021 annual general meeting for deliberation.
2、 Description of cash dividend ratio less than 30% in this year
(I) industry situation and characteristics of listed companies
The company is a professional company engaged in the design, development and testing of VLSI, and providing customers with system solutions. The company’s IC design industry is technology intensive, knowledge intensive and capital intensive. The technology upgrading and product iteration speed in the industry is fast. At the same time, chip products have high technical barriers and the advantages of first mover enterprises are obvious. This requires the company to have an accurate and rapid grasp of market requirements, with forward-looking R & D and layout, continuous technology accumulation, rapid product evolution and flexible customer service, Continuously launch competitive chip products and system solutions. In 2021, the company’s R & D investment reached about 749 million yuan, accounting for 29.06% of the company’s operating revenue in that year, providing strong support for the company’s long-term development.
At present, the international leading chip design company has strong capital and technical strength, and there is still a certain gap compared with it in terms of overall strength and brand awareness; The number of emerging chip design companies in China is increasing, their technical level is also maturing, and the homogenization competition of some chip products is intensifying; In addition, the supply chain may fluctuate in a certain period of time, which poses a challenge to the development of the company. The company still needs to maintain large-scale R & D investment to support the construction of talent team and enrich product types, so as to respond to the diversified needs of downstream customers and market risks, so as to maintain market competitiveness.
(II) development stage and business model of listed companies
The company adopts the typical fabless business model of the integrated circuit design industry, focuses on the integrated circuit design business, and entrusts the wafer manufacturing, packaging and testing to the wafer manufacturing enterprises, packaging and testing enterprises respectively.
The company has product lines such as security and identification chip, nonvolatile memory, smart meter chip, FPGA chip and integrated circuit test service. The products are widely used in many fields such as finance, social security, anti-counterfeiting and traceability, network communication, home appliances, automotive electronics, industrial control, signal processing, data center, artificial intelligence and so on. There are corresponding international and Chinese enterprises in each product line, and the market competition is fierce. At present, the company is in the stage of rapid development and needs to continue to invest a lot of money in technology research and development and market expansion.
(III) profitability and capital demand of listed companies
In order to cope with the competition in the chip design industry, the company needs to invest a lot of money in R & D investment, expand the team and explore the market.
In 2022, the company’s capital needs include but are not limited to the following aspects:
(1) Continue to maintain a certain intensity of R & D investment, which is respectively used for the R & D of 1 billion gate level FPGA based on 14 / 16nm process; At the same time, further enrich the types of FPGA and PSoC chips in the 28nm process to expand the new market;
(2) Strengthen the introduction and training of talents, and build new R & D teams in areas with concentrated scientific and technological personnel; (3) In order to stabilize the supply chain, it is necessary to strengthen capacity guarantee measures, and the cost of the company’s main business may increase accordingly;
(4) With the expansion of enterprise scale, the capital required for daily sales, management and other operations may increase.
(IV) the exact purpose of retained undistributed profits and the estimated income of the company
The company’s profit distribution plan is a reasonable arrangement made in combination with the company’s strategic development plan, current operating conditions, future capital needs and other factors. At the end of 2021, the retained undistributed profits of the company will be transferred to the next year, mainly used for R & D investment, production and operation development, so as to maintain the company’s leading technology advantage, help the company seize the development opportunities of the industry, improve the overall value of the company and meet the fundamental interests of the majority of shareholders.
3、 Decision making procedures performed by the company
(I) convening, deliberation and voting of the board meeting
At the 32nd meeting of the 8th board of directors held on March 18, 2022, the proposal on profit distribution plan in 2021 was reviewed and approved, the profit distribution plan was agreed, and the plan was submitted to the 2021 annual general meeting of shareholders of the company for deliberation.
(II) opinions of independent directors
The independent non-executive director of the company believes that the profit distribution plan conforms to the actual situation and development needs of the company, does not damage the interests of minority shareholders, and complies with relevant laws and regulations, normative documents and the articles of association. In conclusion, the independent non-executive director of the company agreed to the proposal on the profit distribution plan for 2021 and submitted the proposal to the 2021 annual general meeting of shareholders of the company for deliberation.
(III) opinions of the board of supervisors
On March 18, 2022, the 13th meeting of the eighth board of supervisors of the company deliberated and approved the proposal on the profit distribution plan for 2021. The board of supervisors considered that the profit distribution plan for 2021 fully considered the company’s operating performance, cash flow, development characteristics, capital demand and other factors, and the decision-making procedure, profit distribution form and proportion of the plan were in line with relevant laws and regulations and the articles of association, There are no circumstances that harm the interests of shareholders.
4、 Relevant risk tips
(I) analysis of the impact of cash dividends on earnings per share, cash flow and production and operation of listed companies
This profit distribution plan comprehensively considers the company’s current development stage, future capital demand and other factors, and will not have a significant impact on the company’s operating cash flow, normal operation and long-term development. Retained undistributed profits will be transferred to the next year, mainly for R & D investment, production and operation development, which is conducive to the company’s competitiveness and better deal with market competition risks.
(II) description of other risks
The profit distribution plan can only be implemented after being submitted to the 2021 annual general meeting of the company for deliberation and approval. It is hereby announced.
Shanghai Fudan Microelectronics Group Co.Ltd(688385) board of directors March 21, 2022
