光峰科技：2022年半年度报告(英文版)

Stock Code: 688007 Stock Short Name: Appotronics

Appotronics Corporation Limited

2022 Semiannual Report

August 2022

本报告为深圳光峰科技股份有限公司自愿披露的《2022年半年度报告（英文版）》，对本报告的中英文版本理解上发生歧义时，以中文版本为准。

This is the 2022 Semiannual Report (English Version) that is voluntarily disclosed byAppotronics Corporation Limited, and in case of any conflict between the Chinese version and theEnglish version, the Chinese version will control.

Important NoteI. The Board of Directors, the Board of Supervisors, directors, supervisors and senior officers ofthe Company hereby warrant that the information contained in this Annual Report is true,accurate and complete and this Annual Report is free from any misrepresentation, misleadingstatement or material omission, and agree to assume joint and several liability for this AnnualReport.II. Alert of significant risksThe Company has described in detail the risks that may exist in the production and operation ofthe Company in this Report. Refer to “Section III Discussion and Analysis of the Management - Riskfactors” for the relevant risks. We draw the attention of investors to such risks in making investments.III. All directors of the Company attended the meeting of the Board of Directors.IV. This Semiannual Report has not been audited.V. LI Yi, Person in charge of the Company, WANG Yingxia, Chief Accountant and Person inCharge of the Accounting Body (Accounting Officer) hereby represent that the financialstatements contained in the 2022 Semiannual Report are true, accurate and complete.VI. Profit distribution proposal or proposal for capitalization of capital reserve approved by the

Board of Directors during the reporting period

None

VII. Is there any material event concerning any special arrangement of corporate governance?

□ Applicable √ N/A

VIII. Risk statement regarding forward-looking statements

√ Applicable□ N/A

The forward-looking statements contained herein regarding the future plans, developmentstrategies or other matters of the Company do not constitute any substantive covenant made by theCompany to the investors. Investors and relevant personnel should sufficiently know about the risksin this aspect, and understand the differences among plans, predictions, and promises. The investorsshould be aware of the risk of investment.IX. Is there any non-operating occupation of funds by the controlling shareholder or its affiliates?NoX. Is there any external guarantee provided in contravention of the stipulated decision-makingprocedure?

No

XI. Are the majority of the directors unable to guarantee the truthfulness, accuracy and

completeness of the Semiannual Report disclosed by the Company?

No

XII. Other information

□ Applicable √ N/A

Table of ContentsSection I ................................................................................................................ Definitions

...... 5Section II ......................................................... Company Profile and Financial Highlights ...... 6

Section III ..................................................... Discussion and Analysis of the Management ...... 10

Section IV ......................................................................................... Corporate Governance ...... 29

Section V ............................................................. Environment and Social Responsibilities ...... 33

Section VI ................................................................................................ Significant Matters ...... 35

Section VII ................................................................ Changes in Shares and Shareholders ...... 65

Section VIII ................................................................................................. Preferred Shares ...... 70

Section IX ...................................................................................................................... Bonds ...... 71

Section X ..................................................................................................... Financial Report ...... 72

List of Documents Available for Inspection	Financial Statements with seals and signatures of the Person in charge of the Company, Chief Accountant and Person in charge of the Accounting Body (Accounting Officer)
	All original documents and announcements of the Company publicly disclosed during the reporting period

Section I DefinitionsFor purpose of this report, unless the context otherwise requires, the following terms shall have the

meanings indicated below:

Terms
Company or Appotronics	means	Appotronics Corporation Limited
Appotronics Ltd.	means	Appotronics Corporation Ltd., the former name of the Company
CINEAPPO	means	CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.
Formovie	means	Formovie (Chongqing) Innovation Technology Co., Ltd.
Appotronics HK	means	Appotronics Hong Kong Limited
Appotronics Daye	means	Shenzhen Appotronics Daye Investment Limited Partnership (LP)
Appotronics Deye	means	Shenzhen Appotronics Deye Consulting Partnership (LP)
Appotronics Hongye	means	Shenzhen Appotronics Hongye Investment Limited Partnership (LP)
Blackpine	means	Blackpine Investment Corp. Ltd.
Jinleijing	means	Shenzhen Jinleijing Investment Limited Partnership (LP)
Appotronics Chengye	means	Shenzhen Appotronics Chengye Consulting Partnership (LP)
XGIMI	means	Chengdu XGIMI Technology Co., Ltd.
Anker	means	Anker Innovations Technology Co., Ltd.
VAVA	means	Shenzhen VAVA Innovation Technology Co., Ltd.
Dangbei	means	Hangzhou Dangbei Network Technology Co., Ltd.
Midea Group	means	Midea Group Co., Ltd.
Delta Electronics or Delta	means	Delta Electronics, Inc.
CINIONIC	means	Cinionic Limited (previously known as Barco Cineappo Limited)
WeCast	means	WeCast Technology Corp.
GDC BVI	means	GDC Technology Limited (British Virgin Islands)
GDC Cayman	means	GDC Technology Limited (Cayman Islands)
DCI	means	Digital Cinema Initiatives of the United States
DLP	means	Digital Light Processing
PCT	means	Patent Cooperation Treaty
AR	means	Augmented Reality
GMV	means	Gross Merchandise Volume
IDC	means	International Data Corporation
ODM	means	Original Design Manufacturer
AVC	means	All VIEW CLOUD
B&W	means	Bowers & Wilkins, a top audio brand in the UK
WXGA	means	Wide Extended Graphics Array
WUXGA	means	Widescreen Ultra eXtended Graphics Array
OTA	means	Over-the-Air Technology

Section II Company Profile and Financial Highlights

I. Company profile

Chinese name	深圳光峰科技股份有限公司
Short name in Chinese	光峰科技
English name	Appotronics Corporation Limited
Short name in English	Appotronics
Legal representative	LI Yi
Registered address	20-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu Road, Yuehai Street, Nanshan District, Shenzhen
Historical changes of the Company’s registered address	1. October 24, 2006, Room 10, 14/F, Fangda Building, Keji South 12th Road, South Area, High-tech Industrial Zone, Nanshan District, Shenzhen 2. September 6, 2007, Room 03, 17/F, Overseas Chinese High-tech Venture Building, South Area, High-tech Industrial Zone, Nanshan District, Shenzhen 3. June 7, 2011, Area A, 1/F, Building 13, Xili Wenguang Industrial Zone, Nanshan District, Shenzhen 4. October 24, 2012, 401 Shenzhen IC Design and Application Industrial Park, South to Chaguang Road, Xili Township, Nanshan District, Shenzhen 5. December 14, 2017, 21-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu Road, Yuehai Street, Nanshan District, Shenzhen 6. August 1, 2018, 20-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu Road, Yuehai Street, Nanshan District, Shenzhen
Office address	20-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu Road, Yuehai Street, Nanshan District, Shenzhen
Postal code of office address	518052
Website	http://www.appotronics.com
Email	[e-mail]
Reference to changes during the reporting period	The Company disclosed the Announcement on Completion of Changes in Industrial and Commercial Registration Particulars on Legal Representative (No.: 2022-007) at the website of the Shanghai Stock Exchange (www.sse.com.cn) on February 24, 2022.

II. Contact person and contact information

	Board Secretary (Domestic representative for information disclosure)
Name	CHEN Yasha
Address	20-22/F, Hi-tech Zone Union Tower, No. 63 Xuefu Road, Yuehai Street, Nanshan District, Shenzhen
Telephone	0755-32950536
Facsimile	0755-86186299
Email	[e-mail]

III. Description of changes to the media for information disclosure and place for keeping thesemiannual reports

Designated newspaper for information disclosure	China Securities Journal (https://www.cs.com.cn) Shanghai Securities News (https://www.cnstock.com) Securities Times (http://www.stcn.com) Securities Daily (http://www.zqrb.cn)
Websites for publishing the semiannual reports	Shanghai Stock Exchange website (http://www.sse.com.cn)
Place for keeping the semiannual reports	Office of the Board of Directors
Reference to changes during the reporting period	N/A

IV. Stock and depository receipts of the Company(I) Stock of the Company

√ Applicable□ N/A

Stock of the Company
Stock Class	Stock exchange and board	Stock short name	Stock code	Former stock short name
A-shares	Shanghai Stock Exchange, STAR Market	Appotronics	688007	N/A

(II) Depository receipts of the Company

□ Applicable √ N/A

V. Other related information

□ Applicable√ N/A

VI. Main accounting data and financial indicators of the Company(I) Main accounting data

Unit: Yuan Currency: RMB

Main accounting data	During the reporting period (Jan. - Jun.)	Prior period	Change over the prior period (%)
Operating income	1,269,322,202.11	1,104,689,243.59	14.90
Net profit attributable to shareholders of the listed company	45,966,481.10	151,413,920.79	-69.64
Net profit attributable to shareholders of the listed company after deduction of non-recurring profit or loss	22,005,386.92	66,961,936.08	-67.14
Net cash flow from operating activities	-78,553,359.67	170,659,313.90	-146.03
	At the end of the reporting period	At the end of the prior year	Changes at the end of the reporting period from the end of the prior year (%)

Net assets attributable to shareholders of the listed company	2,482,478,931.50	2,438,064,581.44	1.82
Total assets	4,124,469,910.64	4,097,230,955.90	0.66

(II) Financial highlights

Financial highlights	During the reporting period (Jan. - Jun.)	Prior period	Change over the prior period (%)
Basic earnings per share (RMB/share)	0.10	0.33	-69.70
Diluted earnings per share (RMB/share)	0.10	0.33	-69.70
Basic earnings per share after deduction of non-recurring profit or loss (RMB/share)	0.05	0.15	-66.67
Weighted average return on net assets (%)	1.86	6.89	-5.03 percentage points
Weighted average return on net assets after deduction of non-recurring profit or loss (%)	0.89	3.05	-2.16 percentage points
Proportion of R&D investments to operating income (%)	9.06	8.61	+0.45 percentage points

Explanation about the main accounting data and financial highlights

√ Applicable□ N/A

1. During the reporting period, the operating income increased by 14.90% on a year-on-year basis,primarily due to the growth of revenue from core devices, To C and large venue businesses.

2. During the reporting period, the net profit attributable to shareholders of the listed company, thenet profit attributable to shareholders of the listed company after deduction of non-recurring profit or loss,the basic earnings per share, diluted earnings per share, and basic earnings per share after deduction ofnon-recurring profit or loss decreased over the same period of the previous year, primarily due to thefollowing:

(1) the decrease in the revenue from the cinema projection service business with high gross marginas a result of the repeated outbreak of the COVID-19 epidemic, which resulted in a sharp decline in profit;

(2) the increase in the expense ratio for the current period, which was mainly caused by a proportionalrise in the Company’s marketing promotion expenses, R&D investments and share-based payments.During the reporting period, the Company’s selling expenses increased by RMB 30.6162 million,increased by 34.14% on a year-on-year basis, mainly due to increasing the market investment expenses ofRMB 20.9852 million to implement the Company’s policy of active market competition, increasinginvestment for the consumer market, and building own brands of the Company. The R&D expensesincreased by RMB 19.8313 million, increased by 20.85% on a year-on-year basis, mainly due to theCompany’s continuous investments in R&D. With respect to the administrative expenses, the share-basedpayments for the current period amounted to RMB 44.3015 million, increased by 98.55% on a year-on-year basis.

(3) Non-recurring profit or loss for the first half of 2022 decreased sharply compared with the sameperiod of the previous year, mainly due to a year-on-year decrease by RMB 55.7814 million in thegovernment grants recognized in profit or loss for the current period, among which, RMB 50 million as agovernment grant was paid to the subsidiary Formovie for settlement in Chongqing. In addition, RMB

38.1759 million as the performance compensation to GDC Cayman had been recognized in the non-recurring profit or loss for the first half of 2021.

3. The net cash flows from operating activities decreased by 146.03% on a year-on-year basis,primarily due to the year-on-year decrease in the revenue from the cinema projection service and thegovernment grants received and the increase in the human resources expenditures and marketing andpromotion expenses.VII. Differences in accounting data under Chinese accounting standards and overseas accountingstandards

□ Applicable √ N/A

VIII. Items and amounts of non-recurring profit or loss

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item of non-recurring profit or loss	Amount	Note (if applicable)
Gain or loss on disposal of non-current assets	-4,939,437.34
Government grants recognized in profit or loss for the current period (excluding government grants that are closely related to the business of the Company and are provided in fixed amount or quantity continuously according to the applicable polices and standards of the country)	16,026,819.55	VII. 84 of Section X
Profit or loss on entrusted investments or assets management	5,795,366.82	VII. 68 of Section X
Net profit or loss of subsidiaries from the beginning of the period up to the business combination date recognized as a result of business combination of enterprises involving enterprises under common control	13,594,336.06
Profit or loss on changes in the fair value of held-for-trading financial assets, derivative financial assets, held-for-trading financial liabilities and derivative financial liabilities and investment income on disposal of held-for-trading financial assets, derivative financial assets, held-for-trading financial liabilities, derivative financial liabilities and other debt investments, other than those used in the effective hedging activities relating to normal operating business	-1,434,000.00
Other non-operating income and expenses	-1,047,993.35
Other gains or losses meeting the definition of non-recurring profit or loss	364,144.36
Less: Effect of income taxes	2,770,765.40
Effects attributable to minority interests (net of tax)	1,627,376.52
Total	23,961,094.18

Description of defining non-recurring profit or loss items illustrated in Information Disclosure andPresentation Rules for Companies Making Public Offering of Securities No. 1--Non-recurring Profit orLoss as recurring profit or loss items

□ Applicable √ N/A

IX. Explanation about performance indicators not under the Accounting Standards for Business

Enterprises

□ Applicable √ N/A

Section III Discussion and Analysis of the ManagementI. Industry and main business during the reporting period

1. Main business

As a globally leading technology enterprise for laser display, the Company mainly engages in theresearch and development, production and sales of laser display core devices and complete equipment,and application of laser display technology to different scenarios based on proprietary laser displaytechnology and architecture. By now, our businesses have been implemented in the household display,cinema projection, business education, large venue, and other application scenarios, and are expanding tothe vehicle-mounted display, aviation display, AR, and other new fields.

2. Main products and services

Our products may be mainly classified into core laser display devices and complete laser displayequipment. Wherein the core devices can be further classified into laser light source (cinema light sourceand large venue light source), laser smart mini projection light generator, vehicle-mounted laser displaydevices and systems, and laser TV light generators; and complete laser display equipment can be classifiedinto laser smart mini projector, laser TV, laser cinema projector, large venue laser projector, lasereducation projector and others. The services the Company performs include laser cinema projectionservices, smart large-screen ecology system Feng OS and corresponding system solutions.

3. Industry in which the Company operates

3.1 Development stage, basic characteristics and main technical barriers of the industry

As an emerging industry, laser display is at the stage of rapid development. The growth drivers mainlycome from internal and external factors: As for the internal factor, laser is the brightest and purest artificiallight source in the world, naturally suitable for display, and is thus regarded as a new generation of displaytechnology due to its high brightness, wide color gamut, eye protection and environmental protection andenergy conservation.

With respect to the external factor, manufacturers in the industry have constantly upgraded theirtechnologies and products to drive the innovation at the supply end and to accelerate the penetration oflaser display products. Further, the progress in technologies generates new large-scale applicationscenarios such as vehicle-mounted display and aviation display, with huge potential for market explosion.In 2021, being listed in priorities for the 14

thFive-Year Plan, such as the “New Display and StrategicElectronic Materials” of the Ministry of Science and Technology, laser display has received policy supportfrom the state.

In terms of technologies, the laser display technology researched and developed by Appotronics iscompatible with various chip and technology routes, and is suitable for the DLP, LCOS, and LCDtechnologies, making a breakthrough in the core devices and imaging solutions of laser display in thedisplay field, hence becoming the mainstream technical route for the current international laser projectorindustry and widely used in household, cinema, large venue, commercial sector, and education fields.

Regarding core technologies, laser display products involve several fields, including optics,electronics, materials, physics, mechanical designing, precision manufacturing. The improvement inproduct performance relies on core devices (light source and light generator), while the research anddevelopment and iteration of core devices have the characteristics of high technical barriers and strongpatent barriers.

3.2 Analysis of the position of the Company in the industry and changes therein

As a new-general display technology, thanks to the advantages of high brightness, small size, longservice life, wide color gamut, energy conservation and environmental protection, the laser displaytechnology has a broad space for market application. Besides the conventional display field, it can beexpanded to the vehicle-mounted display, aviation display, AR, and other fields. The laser displaytechnology is becoming more and more important in the display field.

As a leading company in the laser display industry, Appotronics has created a strong patent moataround the underlying technical architecture of original laser phosphor display technologies, which is hard

to be bypassed by companies in the industry entering the route of laser phosphor technologies. In addition,since its establishment, the Company spared no effort in R&D investment, which lead to a strongtechnology barrier. We have been committed in the breakthroughs, innovations, expansion of applicationscenarios, and industrialization promotion of laser display technology, and thus created technologyreserves and patent portfolios covering the whole technology chain of laser display from key systemarchitecture, core devices to key algorithm. Relying on the core competitive advantages consisting of“patent moat + technical barriers”, the Company has its voice at the upstream core device stage in the laserdisplay industry, and has become the first choice for many customers.As for the household market, according to a report from IDC, Formovie ranked the third in theshipments of China’s customer projector market (i.e., household projector market) in the first half of 2022,with shipments of Formovie’s owned brands (excluding ODM) increasing by 289% year-on-year andoccupying 7% of market shares.

Regarding professional display, according to the Market Survey Report on the Laser Project Marketof Chinese Mainland in 2022H1 of AVC Revo, Appotronics ranked the first in terms of both sales volumeshare (i.e., 17.9%) and sales value share (i.e., 16.6%) on the large venue projector market in the first halfof 2022, while the Company ranked the first in the education market, with its sales volume representing

26.2%.

With respect to the innovative business, the Company has fully exercised the advantages of itstechnologies and products and taken the advantageous position in the vehicle-mounted and otherinnovative display applications. During the reporting period, the Company acquired the certificate forIATF 16949:2016 Quality Management System, the admission certificate for entering the domestic andoverseas vehicle supply chain. On this basis, the Company will keep exploring the pre-shipment marketand post-shipment market for its vehicle-mounted display, and strengthen the multi-level and all-roundcooperation with vehicle manufacturers and tier-1 suppliers.

II. Core technologies and progress in R&D of technologies

1. Core technologies and their advancement, and changes during the reporting period

We have been committed in the breakthroughs, innovations, expansion of application scenarios, andindustrialization promotion of laser display technology, and thus created technology reserves and patentportfolios covering the whole technology chain of proprietary laser display from key system architecture,core devices to key algorithm.

The Company has devoted many R&D resources in the preparation and processing for theminiaturization of laser display systems, light source architecture, complete equipment structure, machineperception, and thin film material. The big data, algorithm and design solutions accumulated by us overthe years will enable us to rapidly develop products and solutions meeting the requirements of differentapplication scenarios, such as cinema projection, home entertainment, outdoor exhibition, ultra large-sizeddisplay, and immersive display. We have achieved breakthrough in, and started the marketing of, ultra-small portable laser light generators, vehicle-specification laser light generators, and light generators ofwide color gamut and high dynamic range.

National scientific and technology awards

□ Applicable √ N/A

Qualification of national “little giant” enterprises in specialized, refine, differential, and innovativeaspects, and “leading enterprise” in the manufacturing industry

□ Applicable √ N/A

2. R&D achievements during the reporting period

During the reporting period, the Company made the following achievements in technology andproduct innovation:

1. Core devices

During the reporting period, the Company has constantly developed its proprietary laser displaytechnology and applied it in the series of laser cinema light sources and laser TV light generators, and keptreducing costs on the basis of maintaining performance. Meanwhile, we focused on the racetrack of lasermini projectors to improve brightness, color and other performances, and maintained our leadingadvantages in terms of brightness. During the reporting period, the Company provided Dangbei, Ankerand other customers with laser mini projector light generators, laser TV light generators and other coredevices.In the field of innovative smart vehicle-mounted applications, the Company completed theassessment of the prototype in multiple application scenarios in a vehicle, started the R&D efforts for massproduction of vehicle-specification projection light generator module, and achieved IATF 16949certification during the reporting period. At the same time, the Company made use of leading technologyadvantages in optical films to form a good combination with vehicle-mounted display.

In the field of innovative AR applications, the Company displayed R&D results related to high-definition, high-transmittance, miniaturized and multi-application AR modules externally, and sharedthem with both the academia and the industry at the 2022 International Conference on Display Technology(ICDT 2022). The Company will continue to promote the commercialization of AR modules and plans todemonstrate related R&D results stage by stage.

In terms of other innovative applications, the Company entered into the strategic cooperation withMidea Group, and on this basis, will provide laser projection core devices for the first generation ofhousehold service robot, so as to realize mobile projection. This indicates the organic combination of laserdisplay and AIOT.

2. Complete equipment

In the household field, in May 2022, Formovie officially released a new flagship product, namelyV10 4K ultra-high-definition project with the following features: over 2,500 lumens of brightness, takingthe lead in the same level; 3,840*2,160 resolutions, 8.3 million pixels, and enhanced AI picture quality,showing an ultra-high-definition vision; the first 2.1-channel speaker design in the industry, improvingsubwoofer effects and achieving stereo sound effects; wood grain mixing with Kender, being free of coldfeeling generated by technology, facilitating integration into home environment; automatic correction,sensorless focusing, intelligent screen obstacle avoidance, and automatic curtain alignment, etc., makingit more convenient for users to use. During the reporting period, Formovie launched Formovie Theater, afull-color laser TV product with 4K resolution and BT.2020 color gamut abroad. It is also the first laserTV configured with Android TV 11.0 and Google farfield voice. The sound quality of this product wasdeveloped and commissioned by us and a well-known brand B&W, taking the lead in the industry in termsof synchronous sound and picture.

In the commercial field, the Company newly developed the white series of wireless and portableprojection laser projectors for commercial use with a slim body and a light weight, which can produce3,600 lumens of brightness, WXGA and WUXGA resolution and meet many commercial meetings andother application scenarios.

During the reporting period, as the first Chinese enterprise independently researching and developing3DLP high-lumen large venue projectors, the Company launched the new G series of high-brightness largevenue projectors adopting a high-efficiency liquid cooling system and 3DLP imaging technology toachieve 25,000 lumens of high brightness. This series effectively supplements the brightness and priceranges for the previous T series of high-brightness large venue projectors, realizing broader applicationsof high-brightness large venue projectors.

3. Algorithm

During the reporting period, the Company kept iterating the omnidirectional correction function ofprojectors based on the structured light technology and ToF sensors, which has been successfully used interminal products. The omnidirectional correction function based on the structured light technology canhelp optimize the correction accuracy of projectors, and enlarge the the maximum supportable angle ofprojection display, improving more design freedom and offering important support for subsequent new

functions and new applications. Capitalizing on this function, the projectors of the Company can realizethe real-time automatic correction to further improve user experience.

4. Smart large-screen ecology system Feng OS

In the first half of 2022, Feng OS system completed a total of five iterations and realized theapplication self-upgrade, not only greatly reducing users’ OTA costs but also fully upgrading voiceassistance and supporting voice-triggered projection as an exclusive function. During the reporting period,the Feng OS system took the lead in releasing the function of screen matching for taking pictures by amobile phone, so that keystone correction may be performed by the camera in the mobile phone insteadof human eyes, hence providing more intelligent and more convenient functions for uses. The Feng OSsystem adds customized recommendation algorithms to more pages, making it easier for users to discovertheir personalized preferences faster and more accurately and improving the overall payment rate by 20%.

List of intellectual property rights acquired during the reporting period

	Increase		Total
	Applications (pcs)	Granted (pcs)	Applications (pcs)	Granted (pcs)
Patent for invention	128	88	1,541	906
Patent for utility model	77	84	629	519
Patent for design	23	16	206	181
Software copyright	3	5	116	116
Others	110	99	1,107	923
Total	341	292	3,599	2,645

Note: 1. The “others” showed in the above table refers to the Company’s trademarks; 2. during thereporting period, the Company filed a total of 142 valid PCT international patent applications.

3. R&D investments

Unit: Yuan

	Current period	Previous Period	Change (%)
R&D investments expensed	114,959,786.37	95,128,483.66	20.85
R&D investments capitalized	0.00	0.00	N/A
Total R&D investments	114,959,786.37	95,128,483.66	20.85
Proportion of R&D investments to operating income (%)	9.06	8.61	+0.45 percentage points
Proportion of R&D investments capitalized (%)	0.00	0.00	N/A

Reasons for the material change in the total R&D investments compared with last year

□ Applicable √ N/A

Reasons for the great change in the proportion of R&D investments capitalized and explanationabout the rationality thereof

□ Applicable √ N/A

4. R&D projects

√ Applicable□ N/A

Unit: RMB 0’000

S.N.	Projects	Estimated total investment	Investment in the current period	Aggregate investment	Progress or interim results	Goals	Technological level	Application scenario
1	Trichromatic Laser Display Complete Equipment Production Demonstration Line	10,284.00	2,608.25	9,570.32	Mass production	This project will research the industrialization of the technology of RGB trichromatic laser with phosphor to satisfy the market demands for RGB trichromatic laser display, build a mass production line for trichromatic laser display complete equipment, acquire proprietary IP, and realize large-scale application of trichromatic laser display products.	This project will greatly promote the industrial upgrading of trichromatic laser display technology, and gain international competitive edge for proprietary trichromatic laser display technology.	This project has established a trichromatic laser display complete equipment production demonstration line.
2	Innovative projection	8,000.00	1,220.85	1,220.85	Laboratory test	The R&D, design and production of vehicle-mounted projection products will be customized for different models, AR optical modules will be researched and developed, and projection solutions in the AIoT field will	Take the lead in the industry.	Intended for vehicle-mounted, AR, AIoT and other innovative projection display application scenarios.

						be provided upon the request of vehicle manufacturers.
3	Laser TV	7,420.00	1,620.21	7,067.45	Mass production	A new generation of trichromatic laser light source and light generator, B&W customized audio, Feng OS system, and high-gain screen will be adopted to achieve ultra-wide color gamut and low blue light for eye protection and greatly improve the brightness and ease of use.	Take the lead in the industry.	4K household laser TVs.
4	Laser cinema projector	6,556.00	1,121.94	5,368.16	Mass production	This project will research and develop the low-cost and DCI-compliant laser cinema projector meeting high-end home use and DCI-compliant LED cinema screen.	Take the lead in the industry; the home cinema projector and LED cinema screen will comply with DCI standards.	Intended for the high-end household market and projection halls at cinemas.
5	Core device light source and light generator project	5,768.00	1,117.60	3,922.60	Mass production	A new generation of light generator technology will be adopted to create a light source light generator with lower costs, higher color gamut, and higher energy efficiency ratio.	Take the lead in the industry; the cost effectiveness, color gamut, light effect, and other performance are greatly improved, to better satisfy the demands of customers.	Intended for upgrading of light source for small-sized cinema projector, trichromatic laser TV, laser mini projector and other fields.
6	Smart mini projector	5,091.00	2,511.05	4,422.63	Mass production	The smart mini projector products with high performance and high cost effectiveness will be	Take the lead in the industry.	Intended for home mini projector market.

						researched and developed, and different series of products will be laid out to make breakthroughs in technology innovation and quality upgrade and meet different user needs.
7	Professional display products (large venue + business education)	4,825.00	1,296.09	2,853.56	Mass production	Multiple laser large venue projectors with high brightness and smart business projectors with cost effectiveness will be researched and developed for meeting different user needs.	Take the lead in the industry.	Intended for high-end large venue projector, business education projector and other fields.
Total	/	47,944.00	11,495.98	34,425.57	/	/	/	/

5. R&D staff

Unit: 0’000 Currency: RMB

Basic information
	Current period	Previous Period
Number of R&D staff (persons)	471	391
Proportion of R&D staff to total employees of the Company (%)	30.45	30.52
Total compensation of R&D staff	7,641.61	6,049.49
Average compensation of R&D staff	16.22	15.47

Education
Academic background	Number	Percentage (%)
Master and above	124	26.33
Bachelor and below	347	73.67
Total	471	100.00
Age structure
Age	Number	Percentage (%)
Below 30 (exclusive)	165	35.03
30-40 (including 30, excluding 40)	218	46.29
40 and above	88	18.68
Total	471	100.00

Note: The average compensation of R&D staff shown in the table above was the average compensationfor 2022 and the first half of 2021, respectively.

6. Other description

□ Applicable √ N/A

III. Analysis of core competitiveness during the reporting period(I) Analysis of core competitiveness

√ Applicable□ N/A

1. A patent moat around the underlying technical architecture

With the underlying technical architecture of proprietary laser display technology at the center, theCompany has built a united whole patent system, which is hard to be simulated by or to be directlybypassed by the competitors entering the route of laser phosphor technologies. As of the first half of 2022,Appotronics had a total of 2,518 patents filed and granted throughout the world, including 1,606 patentsgranted, thus owning extremely obvious patent advantage. As the underlying key architecture technology,the laser phosphor display technology invented by the Company has been cited more than 650 times byindustry giants such as Philips of the Netherlands, Osram of Germany, Epson of Japan, and NEC, etc.

2. Voice in the industry supported by core devices

Since its establishment, the Company spared no effort in R&D investment, which lead to a strongtechnology barrier. We have been committed in the breakthroughs, innovations, expansion of applicationscenarios, and industrialization of laser display technology, and created technology reserves and patentportfolios covering the whole technology chain of laser display from key system architecture, core devicesto key algorithm. These efforts lead to the strong voice of the Company in the laser display industry,making the Company the first choice for customers. Meanwhile, the stable base of major customers fromvarious industries also contribute to the continuously increasing market shares of Appotronics around theworld.

3. Forward-looking strategic layout and head start advantages

By virtue of our advantages in core devices, the Company made forward-looking arrangement fornew application scenarios, such as vehicle-mounted display, aviation display, AR, etc., to promoteinnovative application of core devices in new and broad fields and tracks. Such forward-lookingarrangement leads to the head start advantages of the Company in the racetrack, hence injecting new powerfor the medium- and long-term development of Appotronics and expanding more space for growth.

(II) Events occurred during the reporting period that have a material effect on the Company’s core

competitiveness, analysis of the effect and countermeasures

□ Applicable √ N/A

IV. Discussion and analysis of business situations

(I) Analysis of business operation during the reporting period

Amid domestic epidemic, shortage of industry supply chains and complicated and volatile macroenvironment at home and abroad in the first half of 2022, the Company adhered to the strategic layout of“core technologies + core devices + application scenarios”, comprehensively sought the growth in profits,increased investments in the R&D, actively explored innovative applications and strengthened themanagement of supply chains and inventories, with a view to ensuring the order of production andoperation for the Company. During the reporting period, the Company achieved the operating income ofRMB 1.2693222 billion, increasing by 14.90% on a year-on-year. We achieved outstanding results in threebig businesses such as core device, own-brand consumer product, large venue protection. Overall, marketshares of cinema projection service, large venue and education as the fundamental business of theCompany maintained the first place. Meanwhile, as the growth business of the Company, core devices andowned-brand customer products repeatedly made breakthrough, with a strong development momentum.

Unit: 0’000 Currency: RMB

Main business by sector
Sector	Operating income	Operating costs	Gross margin (%)	% Change in operating income	% Change in operating cost	% Change in gross margin
Laser display	126,932.22	88,456.06	30.31	14.90	22.24	-4.19 percentage points
Main business by product
Product	Operating income	Operating cost	Gross margin (%)	Year-on-year increase or decrease of operating income (%)	Year-on-year increase or decrease of operating cost (%)	Year-on-year increase or decrease of gross margin (%)
1. Sales	113,156.62	81,850.58	27.67	24.12	24.87	-0.43 percentage points
(1) Light source and light generator	22,736.62	13,445.20	40.87	120.97	210.91	-17.11 percentage points
(2) Complete laser projector	79,768.57	59,761.32	25.08	4.90	4.89	+0.01 percentage points
Laser cinema projector	2,358.15	1,405.43	40.40	-17.42	-1.12	-9.83 percentage points

Professional display projector (large venue and business education)	17,763.33	9,867.05	44.45	-6.84	-12.52	+3.61 percentage points
Laser TV	21,745.97	14,453.12	33.54	-16.56	-21.58	+4.26 percentage points
Smart mini projector	37,901.11	34,035.72	10.20	35.09	31.69	+2.31 percentage points
(3) Other products	10,651.43	8,644.06	18.85	120.35	103.41	+6.76 percentage points
2. Cinema projection service	13,521.49	6,474.67	52.12	-27.17	0.70	-13.25 percentage points
3. Other business	254.11	130.82	48.52	-65.63	-65.76	+0.20 percentage points
Total	126,932.22	88,456.06	30.31	14.90	22.24	-4.19 percentage points

1. Core device business

1.1 Business of household core devices

In the first half of 2022, the Company’s smart projectors maintained a rapid growth trend in China.We took the opportunity on the rapid development of the smart mini projector market and intensified ourefforts to business portfolios of To C core devices.

The business of laser projection core devices achieved rapid expansion in the household field. TheCompany supplied customized laser mini projectors, laser TV light generators, or other products toDangbei, Anker Innovations, VAVA, Xgimi, ViewSonic, Haier, and other manufacturers. In the first halfof 2022, we achieved the operating income of RMB 230 million from this business, basically being theperformance throughout 2021. Among them, the laser projectors X3 and X3 Pro released jointly by theCompany and Dangbei won warm response from consumers. At the same time, the Company keptdevoting more energy to exploring customers abroad, and enlarging the strategic cooperation size with oldcustomers, so as to gradually realize mass production of new products for new customers. The joining ofmore and more partners in the laser projection ecology chain further proves the competitive advantages ofour core technologies.

1.2 Business of innovative core devices

1.2.1 Achieve IATF 16949 certification and take the advantageous position in the new vehicle-mounted track

A trend for the future vehicle industry is the intelligentization of vehicles. The new requirements onvehicle-mounted displays for intelligent cabins motivated innovative application of laser projectiondisplay as vehicle-mounted displays, such as drive assistance, and human-machine interaction experienceand entertainment for passengers, including the vehicle roof screen, vehicle window transparent display,large screen for entertainment, AR-HUD, smart surfaces, smart laser headlights, etc., which lead to a broadmarket space for vehicle-mounted display.

During the reporting period, the Company acquired the certificate for IATF 16949:2016 QualityManagement System, the admission certificate for entering the domestic and overseas vehicle supply chain.

On this basis, the Company will keep exploring the pre-shipment market and post-shipment marketfor its vehicle-mounted display, and strengthen the multi-level and all-round cooperation with vehiclemanufacturers and tier-1 suppliers.

1.2.2 Release the first optical module with PPI exceeding 10,000 developed by Appotronicsaround the world, a significant breakthrough in AR technology field

The Company released the first optical module with PPI exceeding 10,000 developed by Appotronicsaround the world in May 2022, indicating a significant breakthrough made by the Company in the R&Dof AR technology field. This mini AR optical module has become the world’s first commercialized AR

optical module with PPI exceeding 10,000 by achieving a breakthrough in underlying technical structureand great progress in high pixel density.

1.2.3 Conclude a strategic cooperation with Midea Group, entering the home service robotmarketDuring the reporting period, capitalizing on the self-developed laser light generator with highbrightness, small size, outstanding heat dissipation and high energy efficiency, the Company establisheda strategic cooperation with Midea Group, a domestic home appliance giant, in the field of home servicerobot, under which Appotronics provided projection solutions for the first generation of home servicerobot released by Midea Group. This cooperation expanded innovative application scenarios of theCompany’s core devices, and the Company has the capacity for laser implantation to enter the field ofmobile devices.

2. Non-core device business

2.1 Continue to make great efforts on the consumer market, achieving a new businessbreakthrough

During the reporting period, the Company continued to make great efforts on the consumer marketand intensified the promotion of owned-brand consumer market. The subsidiary Formovie achieved thegrowth of its own-brand business by 50% on a year-on-year basis, which accounted for 50% of the totaloperating income of Formovie. Meanwhile, the gross margin from Formovie’s owned-brand businessincreased by over 5% compared with the same period of the previous year, showing a great improvement.

In May 2022, Formovie officially released a new flagship product, namely V10 4K ultra-high-definition projector, and during the 618 Shopping Festival, won the champion in the sales volume of thisnew product. During the 618 Shopping Festival this year, Formovie achieved the gross merchandise value(GMV) of over RMB 200 million throughout China as the champion for five consecutive years in boththe online sales value and the sales volume of laser TVs.

According to a report from IDC, Formovie ranked the third in the shipments of China’s customerprojector market (i.e., household projector market) in the first half of 2022, with shipments of Formovie’sowned brands (excluding ODM) increasing by 289% on a year-on-year basis and occupying 7% of marketshares.

Figure 1: Formovie’s V10 4K ultra-high-definition projector

2.2 Improve the ability to innovation and differentiation for solutions, and rank the first in theprofessional display business market share

During the reporting period, the Company’s professional display business suspended and wascancelled and the whole market performance of large venue business and business education decreasedcompared with the same period of the previous year due to the impact of domestic COVID-19. However,

the Company actively responded to this impact and further improved the product and channel layout tomaintain the leading market share.Regarding large venue business, the Company launched the new G series of laser 3DLP high-brightness large venue projectors for lighting engineering projects, night tours and major venue shows,realizing broader applications of high-brightness large venue projectors.

In addition, the Company proactively explored new application scenarios and kept innovatingsolutions. In the fields of lighting engineering projects and night tours, we focused on the sales of high-end models, and comprehensively improved our brand influence by creating the cases with industryinfluence such as the projection show in Chongqing Fuling Jinxiu Square and the Huiyi Cultural TourismCharacteristic Town of Wunvzhou, Wuyuan, Jiangxi.According to the Market Survey Report on the Laser Project Market of Chinese Mainland in 2022H1of AVC Revo, Appotronics ranked the first in terms of both sales volume share (i.e., 17.9%) and salesvalue share (i.e., 16.6%) on the large venue projector market in the first half of 2022, while the Companyranked the first in the education market, with its sales volume representing 26.2%.

2.3 Actively respond to the impact of COVID-19, so that the cinema business is expected torebound rapidly

In the first half of 2022, amid the repeated outbreak of the epidemic, the cinema projection servicebusiness of the Company may also be affected due to the closedown of some cinemas and postponedshowing of films. As the films will be played in the peak seasons such as summer vacation and NationalDay holiday in the second half of year, along with the strong policy support from China FilmAdministration, the Company’s cinemas business is expected to rebound rapidly.

During the reporting period, in order to continuously expand the market share of light sources, thesubsidiary CINEAPPO officially released ALPD

?Lite version of light sources for diverse and flexiblebusiness demand of customers, thus reducing the overall investment pressure for customers, improvingthe film projection quality and delivering superior viewing experience. As of the disclosure date of thisreport, over 27,000 ALPD

?

laser projectors of CINEAPPO were installed in China, offering services formore than 6,000 cinemas. During the reporting period, the Company intensified efforts to promote theapplication of laser light sources on the overseas market, and improved the influence of the brand abroadincluding the U.S., Thailand, South Korea, Italy, Ireland and other countries and regions, with a rapidgrowth in the overseas market demand.

What’s more, during the reporting period, CINEAPPO was named in the list of the second batch ofBeijing “little giant” enterprises in specialized, refine, differential, and innovative aspects in 2021.(II) Analysis of factors affecting profits during the reporting periodDuring the reporting period, the Company’s selling expenses increased by RMB 30.6162 million,increased by 34.14% on a year-on-year basis, mainly due to increasing the market investment expenses ofRMB 20.9852 million to implement the Company’s policy of active market competition, increasing theinvestment for the consumer market and building own brands of the Company. With respect to theadministrative expenses, the Company successively launched restricted share incentive plan to motivatecore personnel playing a significant role in the new growth curve of the Company in the future, and theshare-based payments for the current period amounted to RMB 44.3015 million, increased by 98.55% ona year-on-year basis.Regarding non-recurring profit or loss, the government grants recognized by the Company in profitor loss for the current period decreased by RMB 55.7814 million compared with the same period of theprevious year, and the performance compensation to GDC Cayman amounting to RMB 38.1759 millionwas recognized in the non-recurring profit or loss for the first half of 2021. Non-recurring profit or lossfor the first half of 2022 declined sharply on a year-on-year basis.As a result of the above, the Company experienced significant changes in the profits for the currentperiod compared with the same period of the last year. With the effects of share-based payment expensesbeing eliminated, the net profits attributable to owners of the parent company were RMB 86.2056 million,and the net profits attributable to owners of the parent company after deduction of non-recurring profit or

loss were RMB 62.2445 million.

To sum up, the first half of 2022 saw an uptick in the Company’s sales revenue because of advantagesof its core devices, resilience of business and stableness of fundamental business despite repeated impactof the epidemic and other macro factors. Meanwhile, the Company actively made arrangement forinnovative application areas such as vehicle-mounted display, kept expanding application areas of coredevices and deeply explored potential growth points of its future profits. Overall, the Company maintainedits stable operating basis and enjoyed continuous favorable future growth although it bore the pressure ofstrategic investment and temporary decline in profits.Significant changes in the operations of the Company during the reporting period, and the eventsthat have or are expected to have a significant impact on the operations of the Company during thereporting period

□ Applicable √ N/A

V. Risk factors

√ Applicable □ N/A

1. Risk of macro-environment

The prolonged COVID-19 epidemic, constant trade friction between China and the US, andincreasing geopolitical risks lead to variability, uncertainty, complexity, and vagueness for the world. Theaccelerated restructuring of the global economic pattern will cause constant adjustment in the industrialchain. Although China basically maintained the stable fundamental aspects of the macro economy, thiscannot eliminate the potential risks that may be caused by the uncertainties in the macro economy to thedevelopment of the Company.

2. Risks of the COVID-19 epidemic

The repeated outbreak of the epidemic in China may cause planned product releases, customer visits,on-site technology commissioning, etc. to be postponed or cancelled, delaying or preventing the Companyfrom participating in exhibitions as expected, and additional difficulties in order acquisition. With respectto the supply chain, epidemic control measures lead to blocked logistics, increasing logistics costs,prolonged period for purchase of raw materials, which intensified the difficulties in supply chainmanagement and smooth sales. The cinema projection service business of the Company may also beaffected due to the closedown of some cinemas and postponed showing of films. Epidemic prevention andcontrol, if no improvement is achieved, may result in uncertainties for the production and operation of theCompany.

3. Risk related to the supply of important raw materials

Under the impact of tension in the supply chain, there are risks that core suppliers cannot supply partspromptly at the expected quality and quantity. This may slow down the growth of the Company’s To Cbusiness, and postponed shipment of some core devices or complete equipment products may result inrisks of failing to achieve the expected growth rate in operating performance of the Company.

4. Financial risk

(1) Risk of impairment of accounts receivable

As of the end of the reporting period, the carrying amount of our accounts receivable was RMB

360.4607 million, accounting for 8.74% of our total assets. Our products are generally delivered afterreceiving the payment therefor. We give certain credit period to some major customers. In case of anymaterial adverse change in the business condition of our customers, we may be unable to recover certainaccounts receivable, which may have an adverse effect on our operating performance in the future.

(2) Risk of impairment of inventories

As of the end of the reporting period, the carrying amount of our inventories was RMB 793.8370million, accounting for 19.25% of our assets. Our inventories mainly comprise raw materials and goodsin stock. If any significant change in the competition pattern of the industry, material innovation in laserdisplay technology and products or the impact of COVID-19 results in a large quantity of unsalable

products, the recoverable amount of the inventories will be lower than their carrying amount. Theimpairment of inventories will have a negative effect on our earnings.

(3) Risks of impairment of fixed assets

As of the end of the reporting period, the carrying amount of our fixed asset was RMB 454.0105million, accounting for 11.01% of our assets. Our fixed assets mainly consist of production equipment andcinema projector light sources for lease, where the cinema projector light sources account for 78.06%. Ifthe COVID-19 epidemic results in prolonged closedown of cinemas, the cinema projector light sourcesmay be idle, causing risks of impairment of fixed assets and adverse effects to the operation of theCompany.

(4) Risks related to government grants

During the reporting period, the Company received government grants in accordance with relevantstate policies, which are special funds or awards for R&D projects. The decrease in government grants tobe received by the Company in the future may result in adverse effects to the profitability and cash flowof the Company.

5. Risks in the arbitration with relevant parties of the participating company GDC BVI

At present, the Company is in the process of arbitration and counter arbitration with relevant partiesof GDC concerning the rights and interests of the parties. Because GDC Cayman, GDC BVI, Mr. ZHANGWanneng and his management team violated the provisions of the Shareholders’ Agreement andSettlement Agreement, including but not limited to the appointment of directors in violation of corporategovernance regulations, violation of protective provisions for the Company, and failing to purchase theminimum quantity of C5 projectors and core device parts by the end of 2021. As a result, the cooperationon the purchase business for cinema hardware products between the Company and GDC BVI is subject touncertainty. The the trial of this case has not been started, the impact of such case on the profit or loss ofthe Company cannot be determined at present; the eventual actual impact depends on the award of thearbitration tribunal or the negotiation between the parties.

VI. Main business situations during the reporting periodPlease refer to “IV. Discussion and analysis of business situations” in this section for details.(I) Analysis of main business

1. Analysis of changes in relevant items of financial statements

Unit: Yuan Currency: RMB

Item	Current period	Previous Period	% Change
Operating income	1,269,322,202.11	1,104,689,243.59	14.90
Operating costs	884,560,607.88	723,612,305.19	22.24
Selling expenses	120,302,361.36	89,686,195.83	34.14
Administrative expenses	106,015,842.36	83,960,516.92	26.27
Financial expenses	-3,353,880.91	1,532,019.30	-318.92
R&D expenses	114,959,786.37	95,128,483.66	20.85
Net cash flow from operating activities	-78,553,359.67	170,659,313.90	-146.03
Net cash flows from investing activities	5,167,457.19	-365,535,026.25	N/A
Net cash flows from financing activities	124,508,865.09	75,588,344.51	64.72

Description of reasons for changes in the operating income: The operating income increased by 14.90%on a year-on-year basis, primarily due to the growth of revenue from core devices, To C and the largevenue projector businesses.Description of reasons for changes in the operating costs: The operating costs increased by 22.24% on ayear-on-year basis, primarily due to the pro-rate increase in the operating costs from the growth ofoperating income; the Company’s revenue structure changed, including the increase in the revenue from

To C business and the decrease in cinema projection service with high gross margin, which resulted in thechanges in operating costs exceeding the changes in operating income.Description of reasons for changes in the selling expenses: The selling expenses increased by 34.14% ona year-on-year basis, primarily due to the increase in marketing expenses caused by the Company’sfurthered promotion and the increase in employee salaries caused by the rise in sales personnel in thecurrent period.Description of reasons for changes in the administrative expenses: The administrative expenses increasedby 26.27% on a year-on-year basis, primarily due to the incentives to core personnel playing a significantrole in the new growth curve of the Company in the future; and the Company successively launchedrestricted share incentive plans, under which the share-based payment expenses were RMB 44.3015million in the current period, with a year-on-year increase.Description of reasons for changes in the financial expenses: The financial expenses decreased by 318.92%on a year-on-year basis, primarily due to the increase in foreign exchange gains caused by the exchangerate fluctuations in the current period.Description of reasons for changes in the R&D expenses: The R&D expenses increased by 20.85% on ayear-on-year basis, primarily due to the rise in the number of R&D employees and their average salariesas a result of our continuous investments in the R&D.Description of reasons for changes in the net cash flows from operating activities: The net cash flows fromoperating activities decreased by 146.03% on a year-on-year basis, primarily due to the decrease in therevenue from the cinema projection service and the government grants received compared with the sameperiod of the previous year and the increase in the human resources expenditures and marketing andpromotion expenses.Description of reasons for changes in the net cash flows from investing activities: The net cash flowsincreased by RMB 370.7025 million on a year-on-year basis, primarily due to recovery of investmentsfrom transfer by the Company of the equity in the participating companies, and due to the year-on-yeardecrease of the new increase in bank wealth management amount.Description of reasons for changes in the net cash flows from financing activities: The net cash flows fromfinancing activities increased by 64.72% on a year-on-year basis, primarily due to the increase in bankloans in the current period.

2. Detailed description of major changes in the business type, profit composition or profit sourcesof the Company in the current period

□ Applicable √ N/A

(II) Explanation about material change in profit due to non-main business

□ Applicable √ N/A

(III) Analysis of assets and liabilities

√ Applicable □ N/A

1. Status of assets and liabilities

Unit: Yuan

Item	Balance at the end of the period	% of total assets at the end of the period	Balance at the end of the prior period	% of total assets at the end of the prior period	% Change	Explanation
Receivables	3,289,265.10	0.08	244,860.00	0.01	1,243.32	Primarily due

financing						to the increase in bank’s acceptance bills received during this period
Prepayments	62,817,169.05	1.52	98,116,970.83	2.39	-35.98

Primarily dueto cancellationofprepaymentsat the end ofthe prior yearbecause ofreceipt ofpurchased rawmaterials inthe currentperiod

Contract assets	2,655,553.13	0.06	3,903,859.23	0.10	-31.98	Primarily due to recovery of payments because of project acceptance in the current period
Other current assets	70,973,361.94	1.72	52,761,820.83	1.29	34.52	Primarily due to the increase in the input VAT to be deducted
Long-term equity investment	159,724,538.60	3.87	293,601,085.27	7.17	-45.60	Primarily due to disposal of the equity in participating companies
Use right assets	47,546,507.50	1.15	26,803,910.76	0.65	77.39	Primarily due to the signing of new lease contracts and the confirmation of use right assets
Other non-current assets	17,929,878.09	0.43	10,998,641.77	0.27	63.02	Primarily due to the increase in prepayments for long-term

						assets
Short-term borrowings	130,045,205.48	3.15	5,570,878.11	0.14	2,234.38	Primarily due to the increase in bank loans and the discount of bank’s acceptance bills in the current period
Accounts payable	292,737,366.30	7.10	419,966,567.27	10.25	-30.30	Primarily due to the payment of amounts of goods payable in the current period
Employee benefits payable	27,603,680.75	0.67	64,119,087.51	1.56	-56.95	Primarily due to the payment of accrued salaries and wages as well as bonuses for the preceding year in the current period
Other current liabilities	6,652,129.13	0.16	19,561,104.12	0.48	-65.99	Primarily due to the payment of amounts payable for goods returned in the current period
Lease liabilities	29,884,884.77	0.72	10,789,352.69	0.26	176.98	Primarily due to the signing of new lease contracts and the confirmation of Lease liabilities

Other descriptionNone

2. Overseas assets

√ Applicable □ N/A

(1) Size of assets

Including: overseas assets of RMB 579,548,700.00 (Unit: Yuan Currency: RMB), accounting for

14.05% of total assets.

(2) Explanation about the high proportion of overseas assets

□ Applicable √ N/A

3. Encumbrances on major assets as of the end of the reporting period

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount	Reason
Bank deposits	40,000,000.00	Term deposits
Bank deposits	3,293,156.61	Pledged term deposits
Bank deposits	302,062.50	Interests accrued
Other monetary funds	50,315,805.66	Security deposit for notes and letters of credit
Intangible assets	286,545,999.84	Land use rights used to be as the loan mortgage

4. Other description

□ Applicable √ N/A

(IV) Analysis of investments

1. Overall analysis of external equity investments

√ Applicable□ N/A

At the end of the reporting period, the Company held the long-term equity investment of RMB

159.7245 million, RMB 133.8765 million lower than the opening amount.

(1) Material equity investments

√ Applicable□ N/A

Name of the Investees	Opening carrying amount (RMB)	Closing carrying amount (RMB)	Shareholding ratio in the investee (%)	Accounting account
Cinionic Limited	126,924,427.39	0.00	0.00
GDC Technology Limited (British Virgin Islands)	166,676,657.88	159,724,538.60	44.00	Long-term equity investment

(2) Material non-equity investments

□ Applicable √ N/A

(3) Financial assets at fair value

√ Applicable□ N/A

As of June 30, 2022, the balance of held-for-trading financial assets was RMB 493,566,000.00,including RMB 449,000,000.00 of structured deposits, RMB 44,566,000.00 of investment in equityinstruments, and RMB -1,634,000.00 of changes in fair values for the current period; the balance of otherinvestments in equity instruments was RMB 7,075,419.38, namely investment in two investees of theCompany; the balance of receivables financing was RMB 3,289,265.10, namely bank acceptance bills.(V) Sale of material assets and equities

√ Applicable□ N/A

During the reporting period, based on its operating development demand, the Company transferredits 20% of equity in Cinionic Limited to Barco Visual Electronics Company Limited as the transferee atthe price of USD 20 million, so as to further optimize the asset structure and effectively integrate resources

of the Company. This transaction has been completed. After the completion of this transaction, thecompany ceased to hold the equity in Cinionic Limited. This equity transfer generated a translationdifference due to exchange rate fluctuations, so the Company recognized the USD -704,670.16 of the losson disposal (translated into RMB -4,611,079.66).(VI) Analysis of major holding and participating stock companies

√ Applicable□ N/A

Unit: 0’000 Currency: RMB

Name	Main business	Registered capital	Shareholding ratio	Total assets	Net assets	Operating income	Net profit
CINEAPPO	Provision of cinema laser light source projection service and sales of projectors	10,000.00	63.20%	88,178.21	44,110.46	16,109.94	636.46
Formovie	R&D and sale of household display products	7,017.54	39.19%	96,325.45	1,241.16	60,958.84	-4,658.22
Appotronics HK	R&D and sale of laser light source	30,116.15	100.00%	49,028.75	36,479.58	9,518.38	-415.81

(VII) Structured entities controlled by the Company

□ Applicable √ N/A

VII. Other disclosures

□ Applicable √ N/A

Section IV Corporate GovernanceI. Brief introduction of general meetings of shareholders

Session	Date of meeting	Reference to resolutions published on the designated website	Date of disclosure of resolutions	Resolutions
1st extraordinary general meeting of shareholders in 2022	March 29, 2022	www.sse.com.cn	March 30, 2022	Please refer to the Announcement on the Resolutions of the 1st Extraordinary General Meeting of Shareholders in 2022 (No. 2022-027) disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on March 30, 2022 for details.
2nd extraordinary general meeting of shareholders in 2022	April 22, 2022	www.sse.com.cn	April 23, 2022	Please refer to the Announcement on the Resolutions of the 2nd Extraordinary General Meeting of Shareholders in 2022 (No. 2022-034) disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on April 23, 2022 for details.
Annual general meeting of shareholders in 2021	May 25, 2022	www.sse.com.cn	May 26, 2022	Please refer to the Announcement on the Resolutions of the 2nd Extraordinary General Meeting of Shareholders in 2022 (No. 2022-054) disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on May 26, 2022 for details.

Extraordinary general meeting of shareholders requested by the preferred shareholder withrestitution of voting right

□ Applicable √ N/A

Explanation about the general meetings of shareholders

√ Applicable□ N/A

During the reporting period, the Company held 1 annual general meeting and 2 extraordinary generalmeetings in total. After being certified by Beijing JunHe (Shenzhen) Law Firm engaged by the Company,

the convening and holding procedures of general meetings of shareholders, the qualifications of thepersons attending the meting and conveners, the voting procedures and results comply with the relevantprovisions of the Companies Law, the Rules for General Meetings of Shareholders and other laws,regulations and normative documents as well as the provisions of the Articles of Association, and are legaland valid. All proposals submitted by the Board of Directors of the Company to the General Meeting havebeen reviewed and passed.II. Changes in directors, supervisors, senior officers and key technical staff

√ Applicable□ N/A

Name	Position	Change
BO Lianming	Director	Left the Company
YU Zhuoping	Director	Elect
YAN Li	Board Secretary	Left the Company
CHEN Yasha	Board Secretary	Recruited

Changes in directors, supervisors, senior officers and key technical staff

√ Applicable□ N/A

1. Mr. BO Lianming, the former director, resigned from his position as the member of the secondBoard of Directors and as the member of the Strategy Committee under the second Board of Directors dueto his physical health on March 11, 2022, and after that, he ceased to hold any position in the Company.The Company convened the 8th meeting of the second Board of Directors and the 1

st

extraordinary generalmeeting of shareholders in 2022 respectively on March 11, 2022 and March 29, 2022, approving theProposal on Election of Mr. YU Zhuoping as the Company’s Non-independent Director throughdeliberation, and agreeing to elect Mr. YU Zhuoping as a non-independent director of the Company andthe member of Strategy Committee under the second Board of Directors, with the term of officecommencing from the date of approval by that meeting until the expiry of the term of the second Board ofDirectors.

2. Ms. YAN Li, the former secretary of the Board of Directors, resigned from her position as thesecretary of the Board of Directors due to her personal family and physical health, and after that, sheceased to hold any position in the Company. The Company convened the 12th meeting of the secondBoard of Directors on April 29, 2022, approving the Proposal on Appointment of the Company’s Secretaryof the Board of Directors through deliberation, and agreeing to appoint Ms. CHEN Yasha as the secretaryof the Board of Directors, with the term of office commencing from the date of approval by that meetinguntil the expiry of the term of the second Board of Directors.

Description of determination of key technical staff of the Company

√ Applicable□ N/A

The key technical staff of the Company were determined by taking into account the following factors:

(1) play an important role in the Company’s R&D system or hold an important position in the Company’sR&D department;

(2) lead the R&D of multiple core technologies of the Company during the period of service;

(3) obtain several patents in the capacity as inventor or designer, and make outstanding contributions tothe core technologies of the Company;

(4) have a deep professional knowledge background in the laser display industry, broad workqualifications or project experience.

Any candidate shall meet at least two of the above criteria at the same time, and then with the approval bythe Chairman, may be determined as a key technician of the Company.III. Proposals for profit distribution and capitalization of the capital reserveProfit distribution proposal or proposal for capitalization of capital reserve during the reportingperiod

Whether to implement profit distribution or capitalization of capital reserve	No
Number of bonus shares distributed per 10 shares	/
Cash dividends distributed per 10 shares (inclusive of tax)	/
Number of shares distributed out of the capital reserve per 10 shares	/
Description of the proposal for profit distribution on ordinary shares and capitalization of the capital reserve
/

IV. Share incentive plan, employee stock ownership plan and other employee incentive measuresof the Company and their effect(I) Equity incentives already disclosed in the interim announcements about which no newinformation is available

√ Applicable□ N/A

Summary	Reference
The Company held the 8th meeting of the second Board of Directors, the 7th meeting of the second Board of Supervisors and the 1st extraordinary general meeting of shareholders in 2022 respectively on March 11, 2022 and March 29, 2022, approving the Proposal on Adjusting the Grant Price of Restricted Shares under the 2021 Restricted Share Incentive Plan, the Proposal on Granting Reserved Restricted Shares to Grantees under the 2021 Restricted Share Incentive Plan, the Proposal on Granting Reserved Restricted Shares to Grantees under the 2021 Second Restricted Share Incentive Plan, and other related proposals through deliberation.	Please refer to the relevant announcements disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on March 14, 2022 and March 30, 2022 for details.
On April 29, 2022, the Company held the 12th meeting of the second Board of Directors and the 11th meeting of the second Board of Supervisors, approving the Proposal on the 2022 Restricted Share Incentive Plan (Draft) of the Company and Summary of the Plan and other related proposals through deliberation.	Please refer to the relevant announcements disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on April 30, 2022 for details.
On May 25, 2022, the Company held the annual general meeting of shareholders in 2021, approving the Proposal on the 2022 Restricted Share Incentive Plan (Draft) of the Company and Summary of the Plan and other related proposals through deliberation.	Please refer to the relevant announcements disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on May 26, 2022 for details.
On May 25, 2022, the Company held the 13th meeting of the second Board of Directors and the 12th meeting of the second Board of Supervisors, approving the Proposal on Initial Granting of Restricted Shares to Grantees through deliberation.

On June 29, 2022, the Company held the 14th meeting of the second Board of Directors and the 13th meeting of the second Board of Supervisors, approving the Proposal on Invalidating Partially Granted but Not Vested 2021 Restricted Shares, the Proposal on Adjustments to Grant Prices under the Company’s Restricted Share Incentive Plan, the Proposal on Vesting Criteria for the First Vesting Period in the Initial Grant under 2021 Restricted Share Incentive Plan and other related proposals through deliberation.

Please refer to the relevant announcements disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on June 30, 2022 for details.

(II) Incentives that have not been disclosed in any interim announcement or about which there’snew information availableShare incentives

□ Applicable √ N/A

Other description

□ Applicable √ N/A

Employee stock ownership plan

□ Applicable √ N/A

Other incentives

□ Applicable √ N/A

Section V Environment and Social Responsibilities

I. Environment(I) Environmental protection information of the Company and its major subsidiaries that are

identified as major polluters by the environmental protection authority

□ Applicable √ N/A

(II) Environmental protection information of any company that is not identified as a major polluter

√ Applicable□ N/A

1. Administrative penalties imposed due to environmental issues

□ Applicable √ N/A

2. Disclosure of other environmental protection information with reference to that of majorpolluters

√ Applicable□ N/A

As a leading laser display technology enterprise in the world, the Company mainly engages in theresearch and development, production and sales of laser display core devices and complete equipment andapplication of laser display technology to different scenarios based on the proprietary laser displaytechnology and architecture. The Company does not belong to the major polluter as determined by therelevant laws and regulations of the state. During the reporting period, the Company had no production oroperating entity included in the list of major polluters identified by the environmental protection authority,and its production and operating activities have little impact on environment. During its production andoperation, the Company mainly emits waste gas, waste water and solid waste, which have been properlyhandled in accordance with the relevant requirements.The industrial waste gas emitted from the Company’s daily production and operation mainly includetin-containing waste gas and non-methane hydrocarbons, which is treated by UV photolysis, active carbonadsorption plant, air purification equipment and other equipment. The emission concentration of treatedwaste gas meets the Atmospheric Pollutant Emission Limit (DB44/27 - 2001 Level 2), the environmentalstandard in the place where the production or operation entity is domiciled, and the Company engages athird-party testing organization to conduct test and valuation every year.The sanitary wastewater discharged by the Company’s offices is uniformly treated by the officebuildings and the industrial park properties, and after the qualified pretreatment, then discharged into themunicipal sewage pipe network. The industrial wastewater is uniformly recycled and treated by a qualifiedenvironmental protection company. Meanwhile, the Company actively optimizes the production processand reduces sewage discharge.

Hazardous waste and general industrial solid waste are professionally treated by a qualifiedenvironmental protection company, while recyclable waste is collected and sorted by the Company’scleaning staff and then recovered by the relevant resource recovery unit.

3. Reason for failure to disclose other environmental protection information

□ Applicable √ N/A

(III) New information about the environmental protection information disclosed during the

reporting period

□ Applicable √ N/A

(IV) Relevant information conducive to protecting ecology, preventing pollution and fulfilling

environmental responsibilities

√ Applicable□ N/A

The Company achieved ISO14001 environmental management system certification in 2008, andmaintained such certification to date, and also achieved the QC080000 Hazardous Substance ProcessManagement (HSPM) in 2019. All of our products are green products and have passed Chinaenvironmental labeling product certification, RoHS, REACH.

To achieve “dual carbon” goals, the Company is committed to giving full play to the supporting andleading role of scientific and technological innovation and conducting green and low-carbon technologicalinnovation activities. The Company devotes itself to providing customers with environmental-friendlyinnovative solutions. Compared with the traditional cinema light source, the energy-saving design ofALPD

?laser light source enables it to be high-efficient and energy-saving and make outstandingachievements in energy conservation and emission reduction.

As of the end of the reporting period, ALPD

?laser projection solution in China has realized 212.8million hours of running length, help partners save about 383 millions kWh of electricity and reduce about

167.7 million m

of CO

emissions. The Company has constantly generated economic benefits forcustomers in terms of green, low-carbon and technologically innovative actions and contributed to thenational “dual carbon” goals.(V) Measures taken to reduce carbon emissions during the reporting period and their effect

√ Applicable□ N/A

Internally, the Company continued to act with the goal of reducing costs and improving efficiency.We innovated technologies and optimized optical structure to reduce the use of devices on the basis ofrealizing equal effect and kept improving the use rate of raw materials and equipment, thus reducing theconsumption of resources.The Company actively advocated green office. To be specific, in the process of daily office, weguided employees to use online approval system to replace paper and to shut off computers when they getoff the work and turn off lights during lunch breaks for one hour. Our administrative departmentestablished an energy-saving team to check the shutdown of equipment and power every day and give areminder timely in case of keeping it running. In addition, we provided the shuttle bus for employees andadvocated the use of public transit means, so as to reduce daily carbon emissions. We also postedconspicuous signs of power and paper saving at the relevant locations of the office space and the watersaving reminders in the rest room.The Company attached great importance to the popularization of daily energy conservation andenvironmental protection conception and encouraged employees to adopt a low-carbon lifestyle,implement rules of energy conservation and emission reduction and daily management measures, andeffectively save water and power.II. Information on consolidation and expansion of the results of poverty alleviation, ruralrevitalization and other specific work

√ Applicable□ N/A

Given the great importance attached to contributions to social development, the Company, as acorporate citizen, donated laser projectors worth RMB 1.2597 million to Shenzhen Health Commissionthrough Shenzhen Red Cross Society in April 2022, which are used in the online class and home educationfor the children of healthcare workers against coronavirus disease from 29 medical units includingShenzhen Center for Disease Control and Prevention and Emergency Care Center, as the support for anti-epidemic efforts. In June 2022, the Company gave the support to the First Youth Smart City Forum inShenzhen sponsored by Shenzhen Society of Science and Technology by offering large screen to protectthe vision of teenagers.

Section VI Significant MattersI. Fulfillment of covenants(I) Covenants made by the actual controller, shareholders, affiliates and acquirer of the Company, the Company itself and other related parties during the

reporting period or the outstanding covenants made by them in the prior periods

√ Applicable□ N/A

Background of covenant	Covenant type	Covenantor	Covenant content	Validity period of covenant	Whether there’s a time limit for the fulfillment of the covenant	Whether the covenant has been strictly fulfilled on time	Reason for failure to fulfill the covenant on time (if applicable)	Action plan if failing to fulfill the covenant on time
Covenant relating to IPO	Restriction on the sale of shares	Covenant by the controlling shareholder regarding restriction on the sale of shares held by him, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues	Refer to IPO Prospectus	36 months after completion of the IPO and the extended period stated below	Yes	Yes	N/A	N/A
	Restriction on the sale of shares	Covenant by the actual controller regarding restriction on the sale of shares held by him, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		36 months after completion of the IPO and the extended period stated below, and 6 months after termination of employment with the Company	Yes	Yes	N/A	N/A

Restriction on the sale of shares	Covenant by the concert parties of the actual controller regarding restriction on the sale of shares held by them, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		36 months after completion of the IPO and the extended period stated below	Yes	Yes	N/A	N/A
Restriction on the sale of shares	Covenant by the directors regarding restriction on the sale of shares held by them, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		12 months after completion of this issuing and the extended period stated below	Yes	Yes	N/A	N/A
Restriction on the sale of shares	Covenant by the supervisors regarding restriction on the sale of shares held by them, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		12 months after completion of this issuing	Yes	Yes	N/A	N/A
Restriction on the sale of shares	Covenant by HU Fei, as a member of key technical staff, regarding restriction on the sale of shares held by him, voluntary lock-up of		12 months after completion of the IPO and the extended period stated below,	Yes	Yes	N/A	N/A

	such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		and 6 months after termination of employment with the Company
Restriction on the sale of shares	Covenant by the senior officers regarding restriction on the sale of shares held by them, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		12 months after completion of this issuing and the extended period stated below	Yes	Yes	N/A	N/A
Restriction on the sale of shares	Covenant by the key technical staff YU Xin and others regarding restriction on the sale of shares held by them, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		12 months after completion of the IPO and listing of stock and the extended period stated below	Yes	Yes	N/A	N/A
Restriction on the sale of shares	Covenant by the holders of more than 5% shares regarding restriction on the sale of shares held by them, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		12 months after completion of the IPO and listing of stock	Yes	Yes	N/A	N/A

Restriction on the sale of shares	Covenant by the other shareholders regarding restriction on the sale of shares held by them, voluntary lock-up of such shares, extension of lock-up period, intention to hold and dispose of shares and other issues		12 months after completion of the IPO and listing of stock	Yes	Yes	N/A	N/A
Others	Issuer’s plan for stabilizing the Company’s stock price and covenant regarding share repurchase measures within three years after the listing		36 months after completion of the IPO and listing of stock	Yes	Yes	N/A	N/A
Others	Controlling shareholder and the actual controller’s plan for stabilizing the Company’s stock price and covenant regarding share repurchase measures within three years after the listing			Yes	Yes	N/A	N/A
Others	Directors and senior officers’ plan for stabilizing the Company’s stock price and covenant regarding share repurchase measures within three years after the listing			Yes	Yes	N/A	N/A
Others	Issuer’s covenant regarding measures against fraud in IPO		Permanent	No	Yes	N/A	N/A

Others	Controlling shareholder, actual controller and their concert parties’ covenant regarding measures against fraud in IPO		Permanent	No	Yes	N/A	N/A
Others	Directors, supervisors and senior officers’ covenant regarding measures against fraud in IPO		Permanent	No	Yes	N/A	N/A
Others	Issuer’s covenant regarding remedial measures for diluted earnings in the current period		Permanent	No	Yes	N/A	N/A
Others	Controlling shareholder, actual controller and their concert parties’ covenant regarding remedial measures for diluted earnings in the current period		Permanent	No	Yes	N/A	N/A
Others	Directors and senior officers’ covenant regarding remedial measures for diluted earnings in the current period		Permanent	No	Yes	N/A	N/A
Others	Issuer’s covenant regarding profit distribution policy		Permanent	No	Yes	N/A	N/A
Others	Issuer’s covenant regarding restraint measures and liability for compensation in the event of failure to fulfill its covenants		Permanent	No	Yes	N/A	N/A

	Others	Controlling shareholder, actual controller and their concert parties’ covenant regarding restraint measures and liability for compensation in the event of failure to fulfill their covenants		Permanent	No	Yes	N/A	N/A
	Others	Directors, supervisors and senior officers’ covenant regarding restraint measures and liability for compensation in the event of failure to fulfill their covenants		Term of office	No	Yes	N/A	N/A
	Resolve horizontal competition issues	Controlling shareholder’s covenant on avoiding horizontal competition and regulating and reducing related-party transactions		Permanent	No	Yes	N/A	N/A
	Resolve related-party transaction issues	Actual controller’s covenant on avoiding horizontal competition and regulating and reducing related-party transactions		Permanent	No	Yes	N/A	N/A
Covenant related to share incentives	Others	Covenant by the grantee of share incentives regarding information disclosure documents	Please refer to the 2019 Restricted Share Incentive Plan (Draft),	Valid period of the incentive plan	No	Yes	N/A	N/A

		the 2021 Restricted Share Incentive Plan (Draft), the 2021 Second Restricted Share Incentive Plan (Draft) and the 2022 Restricted Share Incentive Plan (Draft) for details
Others	Company’s covenant on refraining from providing financial assistance	Please refer to the 2019 Restricted Share Incentive Plan (Draft), the 2021 Restricted Share Incentive Plan (Draft), the 2021 Second Restricted	Valid period of the incentive plan	No	Yes	N/A	N/A

ShareIncentivePlan (Draft)and the 2022RestrictedShareIncentivePlan (Draft)for details

II. Non-operating occupation of funds by the controlling shareholder and its affiliates during the reporting period

□ Applicable √ N/A

III. Guarantees in violation of applicable regulations

□ Applicable √ N/A

IV. Audit of semiannual report

□ Applicable √ N/A

V. Changes in matters involved by non-standard audit opinions in the previous annual report and treatment thereof

□ Applicable √ N/A

VI. Matters relating to bankruptcy and reorganization

□ Applicable √ N/A

VII. Material litigations and arbitrations

√ The Company was involved in material litigations or arbitration during the reporting period

□ The Company was not involved in material litigations or arbitration during the reporting period(I) Litigations and arbitrations already disclosed in interim announcements about which no new information is available

√ Applicable□ N/A

Summary and type of case	Reference
I. (2020) Yue 73 Zhi Min Chu No. 1335-1341, 1353, 1355-1361 In August 2020, the Company initiated a civil litigation on the ground that Delta Electronics (Shanghai) Co., Ltd., Delta Video Display System (Wujiang) Limited, Digital Protection (Beijing) Electronics Technology Co., Ltd. and other entities infringed the patents for invention ZL200880107739.5 and ZL200810065225.X owned by the Company, requesting the court to order to stop the acts of infringing the Company’s patent rights and pay the damages for infringement in the amount of RMB 80.00 million.	Please refer to the Announcement on Litigation Against Delta Electronics (Shanghai) Co., Ltd. and Other Entities (No. 2020-037) disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on August 11, 2020.
II. (2021) Chuan 01 Zhi Min Chu No. 685 and No. 686 In December 2021, Delta Electronics, Inc. initiated a civil litigation on the ground that the Company infringed the patents for invention ZL201410249663.7, ZL201610387831.8, and ZL201110041436.1, requesting the court to order to stop the acts of infringing the patent rights and pay the damages for infringement in the amount of RMB 32.02 million.	Please refer to the Announcement on Malicious Litigation Initiated by Delta Electronics (No. 2021-097) disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on December 21, 2021.

III. (2021) Yue 73 Zhi Min Chu No. 1860 In December 2021, Delta Electronics maliciously initiated an intellectual property litigation against the Company. Since such act infringed the rights and interests of the Company, the Company sued Delta to Guangzhou Intellectual Property Court on December 17, 2021 on the ground of such malicious litigation act, involving the amount of RMB 10.00 million in total.

Please refer to the Announcement on Malicious Litigation Initiated by Delta Electronics (No. 2021-097) disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on December 21, 2021.

(II) Litigations and arbitrations that have not been disclosed in interim announcements or about which there’s new information available

√ Applicable□ N/A

Unit: 0’000 Currency: RMB

During the reporting period:
Plaintiff/claimant	Defendant/respondent	Party jointly and severally liable	Type of litigation/arbitration	Background	Amount claimed	Whether any provision is recognized and the amount	Status	Result and effect	Enforcement of judgment/award
Delta Electronics, Inc.	Appotronics Corporation Limited	Futian SPN Projector & Video System Firm of Shenzhen	Infringement on patent for invention	Case of dispute over infringement on patents for invention (2019) Yue 73 Zhi Min Chu No. 662, the Plaintiff alleged that it is the owner of the patent for invention ZL201610387831.8 and the Defendant infringed such	1,614.53	No	RMB 10.00 million released, and in trial of the first instance	Trial not completed

				patent for invention of the Plaintiff and caused economic losses to the Plaintiff.
Delta Electronics, Inc.	Appotronics Corporation Limited	Fengmi (Beijing) Technology Co., Ltd.	Infringement on patent for invention	Case of dispute over infringement on patents for invention (2019) Jing 73 Min Chu No. 1275 and No. 1276, the Plaintiff alleged that it is the owner of the patents for invention ZL201410249663.7 and ZL201610387831.8, and the Defendant infringed such patents for invention of the Plaintiff and caused economic losses to the Plaintiff.	3,202.00	No	Judgment of first instance: held that all the claims of Delta Electronics should be dismissed. Under appeal of the second trial	Trial not completed
Delta Electronics, Inc.	Appotronics Corporation Limited	Shanghai Haichi Digital Technology Co., Ltd.	Infringement on patent for invention	Case of dispute over infringement on patents for invention (2021) Hu 73 Zhi Min Chu No. 1070, the Plaintiff alleged that it is the owner of	1,601.00	No	In trial of the first instance	Trial not completed

				the patent for invention ZL201110041436.1 and the Defendant infringed such patent for invention of the Plaintiff and caused economic losses to the Plaintiff.
Delta Electronics, Inc.	Appotronics Corporation Limited	Chengdu Jinxi Guangxian Information Technology Co., Ltd.	Infringement on patent for invention	Case of dispute over infringement on patents for invention (2021) Chuan 01 Zhi Min Chu No. 684, the Plaintiff alleged that it is the owner of the patent for invention ZL201410249663.7 and the Defendant infringed such patent for invention of the Plaintiff and caused economic losses to the Plaintiff.	1,601.00	No	The Plaintiff withdrew its case	The court ordered the case to be withdrawn.
Wanbo Technology Co., Ltd.	Shenzhen Appotronics Xiaoming Technology Co., Ltd.	Fengmi (Beijing) Technology Co., Ltd.;	Dispute over infringement on patent for design	Case of dispute over infringement on patent for design (2022) Zhe 01 Min	300.00	No	Under trial of the first instance	Trial not completed

		Zhejiang Tmall Network Co., Ltd.		Chu No. 157, the Plaintiff alleged that it is the owner of the patent for design ZL201930556138.3 and the Defendant infringed such patent for invention of the Plaintiff and caused economic losses to the Plaintiff.
GDC Technology Limited (Cayman Islands); GDC Technology Limited (British Virgin Islands)	Appotronics Corporation Limited	Appotronics Hong Kong Limited	Arbitration of dispute over the implementation of the Settlement Agreement	Arbitration case No. 01-22-0001-2735, the Plaintiff initiated the arbitration against the Company and its wholly-owned subsidiary Appotronics HK in respect of the dispute over the implementation of the Settlement Agreement.	USD 38 million	No	Pending trial	Trial not completed
Appotronics Corporation Limited	Delta Electronics (Shanghai) Co., Ltd.	Delta Video Display System (Wujiang) Limited;	Infringement on patent for invention	Case of dispute over infringement on patents for invention (2019) Yue 03 Min Chu No. 2943, 2944,	2,800.00	No	Judgment of the first instance held that the	Trial not completed

		Shenzhen Super Network Technology Co., Ltd.		2946, 2948 and 2951, the Plaintiff alleged that Defendant 1, Defendant 2 and Defendant 3 infringed the patent for invention 200810065225.X of the Plaintiff and caused economic losses to the Plaintiff.			Defendant Delta Electronics should compensate the Plaintiff for RMB 1,651,997. Under appeal of the second trial
Appotronics Corporation Limited	Delta Electronics, Inc.	/	Correcting the inventor of the patent	Case for correcting the inventor of patent 19-cv-00466-RGD-LRL, the Plaintiff requested that the sole inventor of the U.S. patent No. 9,024,241 should be changed to Dr. HU Fei and Dr. LI Yi.	/	No	The Parties settled and withdrew the case
Appotronics Corporation Limited, LI Yi, HU Fei	Delta Electronics, Inc.	ZHANG Kesu, HUA Jianhao, WANG Bo	Dispute over the ownership of patent right	(2021) Yue 03 Min Chu No. 2295, the Plaintiff petitioned the court to declare that the patent ZL201610387831.8 “phosphor color	30.00	No	Withdraw the case

				wheel and its applicable light source system” is owned by the Company.
Appotronics Corporation Limited; Appotronics Hong Kong Limited	GDC Technology Limited (Cayman Islands)	GDC Technology Limited (British Virgin Islands); actual controller ZHANG Wanneng and his management team	Arbitration counterclaims	Case of arbitration counterclaims 01-22-0001-2735. The Plaintiff raised counter-claims against GDC Cayman, GDC BVI, Mr. ZHANG Wanneng and his management team on the ground that GDC Cayman, GDC BVI, Mr. ZHANG Wanneng and his management team violated the provisions of the Shareholders’ Agreement and Settlement Agreement.	Not less than USD 40.00 million	No	Pending trial	Trial not completed
Appotronics Corporation Limited	Shenzhen Creality 3D Technology Co., Ltd.		Dispute over the sales contract	Case of dispute over the sales contract (2022) Yue 0305 Min Chu No. 10069, the Plaintiff initiated	21.99	No	Pending trial	Trial not completed

				a lawsuit with the court in respect of dispute over the sales contract, requesting the court to order the Defendant to make the payments for goods and pay the liquidated damages.
Qingda Appotronics (Xiamen) Technology Co., Ltd.	Yunzhi Feiyang (Beijing) Network Technology Co., Ltd.		Dispute over the sales contract	Arbitration case of dispute over the sales contract XA20220598, the Plaintiff initiated a lawsuit with the court in respect of dispute over the sales contract, requesting the court to order the Defendant to make the payments for goods and pay the liquidated damages.	21.48	No	Pending trial	Trial not completed

(III) Other description

√ Applicable□ N/A

(1) As of the end of this reporting period, a total of 15 invalidation petitions were raised against the Company’s patent for invention ZL200880107739.5, and atotal of 11 invalidation petitions were raised against the Company’s patent for invention ZL200810065225.X. Among these cases, 25 cases have been decided by

China National Intellectual Property Administration, with the patents sustained, or withdrawn by the petitioner, and 1 case is under the trial of China NationalIntellectual Property Administration.

(2) As of the end of this reporting period, a total of 5 invalidation petitions were raised against the Company’s patent for invention ZL201110086731.9. Amongthese cases, 4 cases have been decided by China National Intellectual Property Administration, with the patents sustained, or withdrawn by the petitioner, and 1 caseis under the trial of China National Intellectual Property Administration: in May 2022, the invalidation petitioner Shenzhen Hola Technology Development Co., Ltd.raised an invalidation petition with China National Intellectual Property Administration against the “high-brightness excitation method and light-emitting device basedon optical wavelength conversion” (Patent No.: 201110086731.9) as the patent for invention held by the Company, for which the case number is 4W114179.

(3) As of the end of the reporting period, there were 2 invalidation cases where the Company acted as a petitioner. These cases are under trial of China NationalIntellectual Property Administration, and are related to the invalidation petition against patents held by Delta Electronics, Inc..

VIII. Penalties imposed on the listed company and its directors, supervisors, senior officers,controlling shareholder, actual controller for suspected violation of laws and regulations andrectification of the relevant violations

□ Applicable √ N/A

IX. Credit standing of the Company and its controlling shareholder and actual controller during

the reporting period

□ Applicable √ N/A

X. Material related-party transactions(I) Related-party transactions in connection with day-to-day operation

1. Matters already disclosed in the interim announcements about which no new information isavailable

□ Applicable √ N/A

2. Matters already disclosed in the interim announcements about which there’s new informationavailable

√ Applicable□ N/A

Summary	Reference
The Company expects to engage in daily related-party transactions with China Film Equipment Co., Ltd. and its affiliates, Xiaomi Communications Technologies Co., Ltd. and its affiliates, Beijing DonView Education Technology Co., Ltd. and its affiliates, Cinionic Limited, GDC Technology Limited and its affiliates, YLX Incorporated and its affiliates for the amount of RMB 1.4673 billion in 2022.	Please refer to the Announcement on the Prediction of Daily Related-party Transactions in 2022 (No. 2022-039) disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on April 27, 2022.

3. Matters that have not been disclosed in any interim announcement

□ Applicable √ N/A

(II) Related-party transactions involving acquisition or sale of assets or equities

1. Matters already disclosed in the interim announcements about which no new information isavailable

□ Applicable √ N/A

2. Matters already disclosed in the interim announcements about which there’s new information

available

□ Applicable √ N/A

3. Matters that have not been disclosed in any interim announcement

□ Applicable √ N/A

4. Fulfillment of performance covenants (if any) during the reporting period

□ Applicable √ N/A

(III) Material related-party transactions involving joint external investments

1. Matters already disclosed in the interim announcements about which no new information is

available

√ Applicable□ N/A

Summary	Reference
On March 26, 2021, the Company held the 30th	Please refer to the Announcement on

meeting of the first Board of Directors and the 17th meeting of the first Board of Supervisors, approving the Proposal on Capital Increase by Formovie in a Wholly-owned Subsidiary and Acquisition of 51% Equity in WeCast Technology Corp. and the Related-party Transaction through deliberation, and agreeing Formovie (Chongqing) Innovative Technology Co., Ltd., a subsidiary in the scope of the Company’s consolidated financial statements to make additional contribution of USD 4.00 million to the wholly-owned subsidiary Formovie Limited, where the additional capital shall be used to subscribe for 51% equity in WeCast Technology Corp.. LI Yi, the actual controller and the Chairman of the Company, acts as a director of WeCast Technology Corp., and hence this subscription constitutes a related-party transaction.

Capital Increase by Formovie in a Wholly-owned Subsidiary and Subscription for 51% Equity in WeCast Technology Corp. and the Related-party Transactions (No. 2021-018) disclosed by the Company at the website of the Shanghai Stock Exchange (www.sse.com.cn) on March 27, 2021.

2. Matters already disclosed in the interim announcements about which there’s new information

available

□ Applicable √ N/A

3. Matters that have not been disclosed in any interim announcement

□ Applicable √ N/A

(IV) Accounts receivable from and payable to related parties

1. Matters already disclosed in the interim announcements about which no new information is

available

□ Applicable √ N/A

2. Matters already disclosed in the interim announcements about which there’s new information

available

□ Applicable √ N/A

3. Matters that have not been disclosed in any interim announcement

□ Applicable √ N/A

(V) Financial business between the Company and its affiliated financial companies, or between theCompany’s controlled financial companies and affiliates

□ Applicable √ N/A

(VI) Other material related-party transactions

□ Applicable √ N/A

(VII) Other information

□ Applicable √ N/A

XI. Material contracts and performance thereof(I) Trusteeship, contracting and lease

√ Applicable□ N/A

(1) Trusteeship

□ Applicable √ N/A

(2) Contracting

□ Applicable √ N/A

(3) Lease

√ Applicable□ N/A

Unit: 0’000 Currency: RMB

Name of lessor	Name of lessee	Leased assets	Amount of leased assets	Start date	End date	Lease income	Basis for determining lease income	Impact of lease income on the Company	Related-party transaction or not	Related-party relation
Shenzhen Meisheng Industry Co., Ltd.	Appotronics Corporation Limited	Office, R&D, factory, employee dormitory	1,231.93	January 1, 2020	November 30, 2022	/	/	/	No	None

Description of leaseNone

(II) Material guarantees that have been performed or have not yet been fully performed during the reporting period

√ Applicable□ N/A

Unit: 0’000 Currency: RMB

Total amount of guarantees provided during the reporting period (excluding those provided for the subsidiaries)

0.00

Total balance of guarantees as of the end of the reporting period (excluding those provided for the subsidiaries) (A)

0.00

Guarantees provided by the Company or its subsidiaries for the subsidiaries of the Company

Guarantor

Relationship between the guarantor and the listed company

Obligor

Relationship between the obligor and the listed company

Guaranteed amount

Commencement date of guarantee (signing date of agreement)

Inception date of guarantee

Expiry date of guarantee

Type of guarantee

Whether the obligation guaranteed has been discharged

Whether the obligation guaranteed has become overdue

Amount of the overdue obligation guaranteed

Whether there’s a counter guarantee

Appotronics Corporation Limited

Headquarters

CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.

Controlled subsidiary

50,000.00

2021-12-29

2021-12-29

Three years after the due date for the obligations under the master contract.

Joint and several liability

No

No

No

Appotronics Corporation Limited

Headquarters

CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.

Controlled subsidiary

23,000.00

2021-1-26

2021-1-26

Two years after the due date for the obligations.

Joint and several liability

No

No

No

Appotronics Corporation Limited

Headquarters

CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.

Controlled subsidiary

4,000.00

2021-12-27

2021-12-27

Three years after the due date for the obligations.

Joint and several liability

No

No

No

Appotronics Corporation Limited

Headquarters

CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.

Controlled subsidiary

5,000.00

2021-12-27

2021-12-27

The guarantee period is three years from the date of termination of claims determination period.

Joint and several liability

No

No

No

Appotronics Corporation Limited

Headquarters

Formovie (Chongqing) Innovative Technology Co., Ltd.

Controlled subsidiary

20,000.00

2021-9-10

2021-9-10

2028-4-25

Joint and several liability

No

No

No

Appotronics Corporation Limited

Headquarters

Formovie (Chongqing) Innovative Technology Co., Ltd.

Controlled subsidiary

9,000.00

2021-12-6

2021-12-6

2026-12-30

Joint and several liability

No

No

No

Appotronics Corporation Limited

Headquarters

Fengmi (Beijing) Technology Co., Ltd.

Controlled subsidiary

20,000.00

2022-3-29

2022-3-29

Three years after the due date for the obligations under the master contract.

Joint and several liability

No

No

No

Appotronics Corporation Limited

Headquarters

Formovie (Chongqing) Innovative Technology Co., Ltd.

Controlled subsidiary

17,500.00

2022-5-13

2022-5-13

Three yearsafter the duedate (withoutacceleratedmaturity) of thelatest financingdue andpayable amongall thefinancingsdrawn and used

Joint and several liability

No

No

No

during the period of occurrence of guaranteed debts under the master agreement or/and inter-bank borrowing.

Appotronics Corporation Limited

Headquarters

Fengmi (Beijing) Technology Co., Ltd.

Controlled subsidiary

2,500.00

2022-5-13

2022-5-13

Three years after the due date (without accelerated maturity) of the latest financing due and payable among all the financings drawn and used during the period of occurrence of guaranteed debts under the master agreement or/and inter-bank borrowing.

Joint and several liability

No

No

No

Appotronics Corporation Limited

Headquarters

Formovie (Chongqing) Innovative Technology Co., Ltd.

Controlled subsidiary

5,000.00

2021-12-29

2021-12-29

The guarantee period is three years from the date of termination of

Joint and several liability

No

No

No

claims determination period.

Appotronics Corporation Limited

Headquarters

Fengmi (Beijing) Technology Co., Ltd.

Controlled subsidiary

15,000.00

2022-6-13

2022-6-13

The guarantee period is three years from the date of termination of claims determination period.

Joint and several liability

No

No

No

Fengmi (Beijing) Technology Co., Ltd.

Controlled subsidiary

Formovie (Chongqing) Innovative Technology Co., Ltd.

Controlled subsidiary

15,000.00

2021-8-23

2021-8-23

Three years after the due date for the obligations under the master contract

Joint and several liability

No

No

No

Formovie (Chongqing) Innovative Technology Co., Ltd.

Controlled subsidiary

Fengmi (Beijing) Technology Co., Ltd.

Controlled subsidiary

20,000.00

2021-8-23

2021-8-23

Three years after the due date for the obligations under the master contract.

Joint and several liability

No

No

No

Total amount of guarantees provided for the subsidiaries during the reporting period

36,629.68

Total balance of guarantees provided for the subsidiaries as of the end of the reporting period (B)

61,444.78

Total amount of guarantees provided by the Company (including those provided for the subsidiaries)

Total amount guaranteed (A+B)

61,444.78

Proportion of total amount guaranteed to the net assets of the Company (%)

24.75

Including:

Total amount of guarantees provided for the shareholders, actual controller and their affiliates (C)

0

Total amount of debt guarantees directly or indirectly provided for the obligors whose equity-debt ratio exceeds 70% (D)	43,276.78
Total amount guaranteed in excess of 50% of the net assets of the Company (E)	0
Total amount guaranteed (C+D+E)	43,276.78
Explanation about outstanding guarantees for which the Company may assume joint and several liability for repayment	N/A
Explanation about guarantees	N/A

(III) Other material contracts

□ Applicable √ N/A

XII. Use of offering proceeds

√ Applicable□ N/A

(I) Overall use of offering proceeds

√ Applicable□ N/A

Unit: Yuan

Source of offering proceeds	Total offering proceeds	Net offering proceeds after deduction of offering expenses	Total offering proceeds committed	Total offering proceeds committed after adjustment (1)	Total offering proceeds used as of the end of the reporting period (2)	Cumulative investment progress as of the end of the reporting period (%) (3)=(2)/(1)	Amount invested in this year (4)	Ratio of the amount invested in this year (%) (5)=(4)/(1)
Initial public offering	1,190,000,000.00	1,062,470,797.73	1,062,470,797.73	1,062,470,797.73	654,943,331.58	61.64	92,549,183.63	8.71

(II) Breakdown of investment projects

√ Applicable□ N/A

Unit: Yuan

Item

Whether change of investment is involved

Source of offering proceeds

Total investment from the offering proceeds committed for the project

Total investment from the offering proceeds after adjustment (1)

Cumulative total offering proceeds used as of the end of the reporting period (2)

Cumulative investment progress as of the end of the reporting period (%) (3)=(2)/(1)

Date for the project to reach the working condition for its intended use

Completed or not

Whether the investment progress meets the progress planned

Specific reason for failing to achieve the plan of investment progress

Benefits or R&D results achieved by the project

Material changes in the project feasibility, and if any, describe the specific reasons

Balance amount and reasons thereof

R&D and industrialization of new generation of

No

Initial public offering

313,000,000.00

313,000,000.00

234,604,992.47

74.95

December 2022

No

No

On the principles of cost control and risk reduction, in the past two years, under the

N/A

No

N/A

laser display products

impact of COVID-19 and general chip shortage in the industry, the Company acted more diligently in production capacity expansion in consideration of the actual existing production capacity and demands to respond to uncertainties in the macro environment.

R&D center at the head office of Appotronics

No

Initial public offering

284,000,000.00

284,000,000.00

54,699,372.81

19.26

December 2023

No

No

The construction of the head office building was slowed down due to the repeated outbreak of COVID-19 and complex geological conditions on the site. This project may be fully implemented only after the construction of the head office building is completed. As a result, the project implementation is postponed.

N/A

No

N/A

Information system upgrade and development

No

Initial public offering

70,000,000.00

70,000,000.00

27,032,668.55

38.62

December 2023

No

No

Since the main body of the head office building of the Company is still under

N/A

No

N/A

construction, the prerequisites for implementing this project have not been satisfied.

Supplementary working capital

No

Initial public offering

333,000,000.00

333,000,000.00

335,395,037.62

100.72

N/A

Yes

Yes

N/A

N/A

No

N/A

Share repurchase

No

Initial public offering

20,000,000.00

20,000,000.00

3,211,260.13

16.06

September 2022

No

Yes

N/A

N/A

No

N/A

Other excess offering proceeds

No

Initial public offering

42,470,797.73

42,470,797.73

No

Yes

N/A

N/A

No

N/A

Note:

1. On March 18, 2022, the Company held the 9

th meeting of the second Board of Directors and the 8

th

meeting of the second Board of Supervisors, approving theProposal on Postponing Some Investment Projects through deliberation, and agreeing the Company to adjust the time for some investment projects to reach theworking condition for its intended use. Please refer to the Announcement on Postponing Some Investment Projects (No. 2022-019) disclosed by the Company at thewebsite of the Shanghai Stock Exchange (www.sse.com.cn) on March 21, 2022.

2. During the period of implementation of the Company’s investment projects using offering proceeds, the total wealth management returns of RMB 2.3950 millionwere realized from the special account of supplementary working capital, which have been put into use in the project (supplementary working capital). The specialaccount of supplementary working capital (Hua Xia Bank Co., Ltd. Houhai Branch, Shenzhen; account number: 10869000000251463) has been deregistered. Theinterest RMB 1,418.11 incurred after completion of this project has been paid to the basic account of the Company to be used as supplementary working capital.

3. Total offering proceeds used as of the end of the reporting period in respect of share repurchase include paid prices and related stamp duty, commissions and othertransaction expenses.(III) Change in investment projects during the reporting period

□ Applicable √ N/A

(IV) Other information about the use of offering proceeds during the reporting period

1. Early investment and replacement of offering proceeds

□ Applicable √ N/A

2. Temporarily supplement the working capital with idle offering proceeds

□ Applicable √ N/A

3. Cash management of idle offering proceeds, and investment in relevant products

√ Applicable□ N/A

The Proposal on Cash Management of Temporarily Idle Offering Proceeds was approved throughdeliberation at the 32

nd meeting of the first Board of Directors and the 19

thmeeting of the first Board ofSupervisors held by the Company on July 15, 2021. It was approved that, without affecting the normalimplementation of the investment plan for offering proceeds, a maximum of RMB 602 million temporarilyidle offering proceeds may be put under cash management to purchase investment products featuring highsecurity, good liquidity, and guarantee of the principal (including but not limited to structural deposits,agreement deposits, notice deposits, term deposits, large-amount deposit note, and return notes), wherethe total amount for purchasing return notes shall be no more than RMB 200 million for no more than 12months, which shall be effective within 12 months upon the review and approval by the Company.

The Proposal on Cash Management of Temporarily Idle Offering Proceeds was approved throughdeliberation at the 14

th meeting of the second Board of Directors and the 13

thmeeting of the second Boardof Supervisors held by the Company on June 29, 2022. It was approved that, without affecting the normalimplementation of the investment plan for offering proceeds, a maximum of RMB 469 million temporarilyidle offering proceeds may be put under cash management to purchase investment products featuring highsecurity, good liquidity, and guarantee of the principal (including but not limited to structural deposits,agreement deposits, notice deposits, term deposits, large-amount deposit note, and return notes), wherethe total amount for purchasing return notes shall be no more than RMB 100 million for no more than 12months, which shall be effective within 12 months upon the review and approval by the Company.

4. Permanently supplement working capital or repay bank loans with excess offering proceeds

□ Applicable √ N/A

5. Others

√ Applicable□ N/A

1. On March 18, 2022, the Company held the 9

thmeeting of the second Board of Directors and the

thmeeting of the second Board of Supervisors, approving the Proposal on Postponing Some InvestmentProjects through deliberation, and agreeing the Company to adjust the time for some investment projectsto reach the working condition for its intended use. Please refer to the Announcement on Postponing SomeInvestment Projects (No. 2022-019) disclosed by the Company at the website of the Shanghai StockExchange (www.sse.com.cn) on March 21, 2022.

2. The Company held the 9

th meeting of the second Board of Directors and the 1

stextraordinarygeneral meeting of shareholders in 2022 respectively on March 18, 2022 and March 29, 2022, approvingthe Proposal on Repurchase of Shares of the Company through Call Auction through deliberation, andagreeing the Company to use the excess offering proceeds to repurchase some RMB-denominated ordinaryshares (A shares) issued by it through call auction in the trading system of the Shanghai Stock Exchange,with the repurchase funds totaling not less than RMB 10 million (inclusive) but not more than RMB 20million (inclusive), the repurchase price not exceeding RMB 26.89 per share (inclusive, namely the priceafter adjustments to equity distribution in 2021) and the repurchase period being six months from the dateon which this repurchase plan is approved by the general meeting of shareholders.

As of June 30, 2022, the Company had repurchased 214,517 shares in the aggregate through callauction, representing 0.0474% of the Company’s total share capital, and paid RMB 3,211,260.13(including stamp duty, commissions and other transaction fees).

3. The Company held the 14

th

meeting of the second Board of Directors and the 13

th

meeting of thesecond Board of Supervisors on June 29, 2022, approving the Proposal on Adjusting Internal InvestmentStructure of Some Investment Projects through deliberation, and agreeing the Company to adjust theinternal investment structure of the investment project “R&D and industrialization of new generation oflaser display products”, and to decrease the “equipment purchase expenses” in the internal investmentstructure of the investment project by RMB 53.8020 million and increase the “R&D expenditures” byRMB 53.8020 million.XIII. Other significant matters

□ Applicable √ N/A

Section VII Changes in Shares and ShareholdersI. Changes in share capital(I) Statement of changes in shares

1. Statement of changes in shares

During the reporting period, there is no change in total ordinary shares and share capital structure of theCompany.

2. Explanation about changes in shares

□ Applicable √ N/A

3. Effect of the changes in shares on the earnings per share, net assets per share and otherfinancial indicators for the duration after the reporting period to the disclosure date of thesemiannual report (if any)

√ Applicable□ N/A

(1) On July 15, 2022, the Company disclosed the Announcement of Appotronics Corporation Limitedon the Vesting Result for the First Vesting Period in the Initial Grant of the Restricted Share IncentivePlan 2021 and Listing of Shares, completing registration of 2,881,497 vested shares. These shares becameavailable for trading on July 19, 2022, and the Company’s total share capital increased from 452,756,901shares to 455,638,398 shares.

(2) In July 2022, the Company repurchased 327,891 shares in the aggregate through call auction. Asof the date of disclosure of this report, the Company repurchased 542,408 shares in the aggregate throughcall auction in the trading system of the Shanghai Stock Exchange, representing 0.1190% of theCompany’s total share capital.

4. Other information disclosed as the Company deems necessary or required by the securities

regulatory authority

□ Applicable √ N/A

(II) Changes in non-tradable shares

□ Applicable √ N/A

II. Shareholder Situation(I) Total number of shareholders:

Total number of ordinary shareholders as of the end of the reporting period	13,652
Total number of shareholders of preferred shares whose voting rights have been restituted as of the end of the reporting period (accounts)	0
Total number of shareholders holding shares with special voting rights as of the end of the reporting period (accounts)	0

Number of holders of depository receipts

□ Applicable √ N/A

(II) Shares held by top 10 shareholders and top 10 holders of tradable shares as of the end of the

reporting periodShares held by top 10 shareholders through both the general securities account and the customercredit transaction guarantee securities account of a securities company

□ Applicable √ N/A

Unit: Share

Shares held by top 10 shareholders
Shareholder (Full name)	Change during the reporting period	Balance of shares held as of the end of the reporting period	Percentage (%)	Number of non-tradable shares held	Number of non-tradable shares held, including the shares lent out under the refinancing arrangement	Shares pledged, marked, or frozen		Shareholder nature
						Share status	Quantity
Shenzhen Appotronics Holdings Limited	0	79,762,679	17.62	79,762,679	79,762,679	None	0	Domestic non-stated owned corporation
Shenzhen Yuanshi Laser Industrial Investment Consulting Partnership (LP)	0	24,139,500	5.33	24,139,500	24,139,500	None	0	Domestic non-stated owned corporation
Nantong Strait Appotronics Investment Partnership (LP)	0	23,080,329	5.10	0	0	None	0	Domestic non-stated owned corporation
Shenzhen Appotronics Daye Investment Limited Partnership (LP)	0	20,430,250	4.51	20,430,250	20,430,250	None	0	Domestic non-stated owned corporation
Shenzhen Appotronics Hongye Investment Limited Partnership (LP)	0	15,662,374	3.46	15,662,374	15,662,374	None	0	Domestic non-stated owned corporation
CITIC PE Investment (Hong Kong) 2016 Limited	-7,514,969	14,218,034	3.14	0	0	None	0	Foreign corporation
Shenzhen Jinleijing Investment Limited Partnership (LP)	0	12,353,106	2.73	12,353,106	12,353,106	None	0	Domestic non-stated owned corporation
Green Future Holdings Limited	0	12,333,426	2.72	0	0	None	0	Foreign corporation
SAIF IV Hong Kong (China Investments) Limited	-6,654,249	11,330,029	2.50	0	0	None	0	Foreign corporation
Shenzhen Appotronics Chengye Consulting Partnership (LP)	0	10,394,846	2.30	10,394,846	10,394,846	None	0	Domestic non-stated owned corporation
Shares held by top 10 holders of tradable shares
Shareholder			Number of tradable shares held		Type and number of shares
					Category		Quantity
Nantong Strait Appotronics Investment Partnership (LP)			23,080,329		RMB-denominated ordinary share		23,080,329

CITIC PE Investment (Hong Kong) 2016 Limited	14,218,034	RMB-denominated ordinary share	14,218,034
Green Future Holdings Limited	12,333,426	RMB-denominated ordinary share	12,333,426
SAIF IV Hong Kong (China Investments) Limited	11,330,029	RMB-denominated ordinary share	11,330,029
Bank of China - Stable Income Bond Securities Investment Fund of E Fund	8,427,772	RMB-denominated ordinary share	8,427,772
Shenzhen Guochuang Chenggu Capital Management Co., Ltd. - Shenzhen Chengguhui Equity Investment Partnership (LP)	7,544,369	RMB-denominated ordinary share	7,544,369
LUO Xiaobin	6,735,000	RMB-denominated ordinary share	6,735,000
Bank of Ningbo Co., Ltd. - Invesco Great Wall Growth Leader One-year Holding Hybrid Securities Investment Fund	6,618,605	RMB-denominated ordinary share	6,618,605
China Construction Bank Corporation - Invesco Great Wall Environment Protection Advantageous Stock Securities Investment Fund	5,324,968	RMB-denominated ordinary share	5,324,968
Bank of China Co., Ltd. - Invesco Great Wall Selected Hybrid Securities Investment Fund	5,036,608	RMB-denominated ordinary share	5,036,608
Description of special repurchase shareholders among top 10 shareholders	N/A
Description of entrusting voting right, entrusted voting right and waiver of voting right of the shareholder above	N/A
Affiliates or concert parties among the shareholders stated above	1. As of June 30, 2022, the Company had received no statement from top 10 shareholders above of the Company to confirm there is a related-party relationship or concerted action, except the concerted action among Shenzhen Appotronics Holdings Limited, Shenzhen Yuanshi Laser Industrial Investment Consulting Partnership (LP), Shenzhen Appotronics Daye Investment Limited Partnership (LP), Shenzhen Appotronics Hongye Investment Limited Partnership (LP), Shenzhen Jinleijing Investment Limited Partnership (LP), and Shenzhen Appotronics Chengye Consulting Partnership (LP) in such top 10 shareholders of the Company. 2. The Company is not aware whether there are affiliates or concert parties as defined in the Administrative Measures for the Acquisition of the Listed Companies among other shareholders.
Holders of preferred shares whose voting rights have been restituted and the number of shares held by them	N/A

Top 10 holders of non-tradable shares and lock-up period

√ Applicable□ N/A

Unit: Share

No.	Holder of non-tradable shares	Number of non-tradable shares held	Unlocking of non-tradable shares		Lock-up period
			Unlock date	Number of shares newly unlocked
1	Shenzhen Appotronics Holdings Limited	79,762,679	July 22, 2022	0	36 months after the listing date

2	Shenzhen Yuanshi Laser Industrial Investment Consulting Partnership (LP)	24,139,500	July 22, 2022	0	36 months after the listing date
3	Shenzhen Appotronics Daye Investment Limited Partnership (LP)	20,430,250	July 22, 2022	0	36 months after the listing date
4	Shenzhen Appotronics Hongye Investment Limited Partnership (LP)	15,662,374	July 22, 2022	0	36 months after the listing date
5	Shenzhen Jinleijing Investment Limited Partnership (LP)	12,353,106	July 22, 2022	0	36 months after the listing date
6	Shenzhen Appotronics Chengye Consulting Partnership (LP)	10,394,846	July 22, 2022	0	36 months after the listing date
7	BLACKPINE Investment Corp.Limited	3,994,011	July 22, 2022	0	36 months after the listing date
Affiliates or concert parties among the shareholders stated above		As of June 30, 2022, the Company had received no statement from the shareholders of the restricted shares above of the Company to confirm there is a related-party relationship or concerted action, except the concerted action among Shenzhen Appotronics Holdings Limited, Shenzhen Yuanshi Laser Industrial Investment Consulting Partnership (LP), Shenzhen Appotronics Daye Investment Limited Partnership (LP), Shenzhen Appotronics Hongye Investment Limited Partnership (LP), Shenzhen Jinleijing Investment Limited Partnership (LP), Shenzhen Appotronics Chengye Consulting Partnership (LP) and BLACKPINE Investment Corp.Limited in the above-mentioned shareholders.

Statement of top 10 holders of domestic depository receipts as of the end of the reporting period

□ Applicable √ N/A

Number of non-tradable depository receipts held by top 10 holders and lock-up period

□ Applicable √ N/A

(III) Statement of top 10 shareholders by number of votes held as of the end of the reporting period

□ Applicable √ N/A

(IV) Strategic investors or general corporations that become top 10 shareholders as a result of

allotment of new shares/depository receipts

□ Applicable √ N/A

III. Directors, supervisors, senior officers and key technical staff(I) Changes in shareholding of current directors, supervisors, senior officers and key technical staffand the former directors, supervisors, senior officers and key technical staff who left the Companyduring the reporting period

□ Applicable √ N/A

Other description

□ Applicable √ N/A

(II) Share incentives granted to directors, supervisors, senior officers and key technical staff duringthe reporting period

1. Share options

□ Applicable √ N/A

2. Type I restricted shares

□ Applicable √ N/A

3. Type II restricted shares

√ Applicable□ N/A

Unit: Share

Name	Title	Number of restricted shares already granted as at the beginning of the reporting period	Number of restricted shares granted during the reporting period	Number of restricted shares that could be vested in the reporting period	Number of restricted shares that have been vested in the reporting period	Number of restricted shares already granted as of the end of the reporting period
ZHANG Wei	Director, Deputy General Manager	0	700,000	0	0	700,000
WANG Yingxia	Director, Financial Director	362,124	100,000	51,564	0	462,124
CHEN Yasha	Board Secretary	222,750	210,000	13,750	0	432,750
HU Fei	Key technical staff	370,316	150,000	120,316	0	520,316
YU Xin	Key technical staff	508,752	550,000	68,752	0	1,058,752
WANG Lin	Key technical staff	408,752	210,000	68,752	0	618,752
WANG Zeqin	Key technical staff	410,752	210,000	68,752	0	620,752
GUO Zuqiang	Key technical staff	404,752	210,000	68,752	0	614,752
Total	/	2,688,198	2,340,000	460,638	0	5,028,198

(III) Other description

□ Applicable √ N/A

IV. Changes in the controlling shareholder or actual controller

□ Applicable √ N/A

V. Implementation of and changes in arrangements relating to depository receipts during thereporting period

□ Applicable √ N/A

VI. Shares with special voting rights

Section VIII Preferred Shares

□ Applicable √ N/A

Section IX BondsI. Enterprise bonds, corporate bonds and non-financial corporate debt financing instruments

□ Applicable √ N/A

II. Convertible corporate bonds

□ Applicable √ N/A

Section X Financial ReportI. Auditor’s report

□ Applicable √ N/A

II. Financial statements

Consolidated Balance SheetAt June 30, 2022Prepared by: Appotronics Corporation Limited

Unit: Yuan Currency: RMB

Item	Note	Closing balance	Opening balance
Current Assets:
Cash and bank balances	VII. 1	1,045,392,014.30	957,729,831.15
Balances with clearing agencies
Placements with banks and other financial institutions
Held-for-trading financial assets	VII. 2	493,566,000.00	417,200,000.00
Derivative financial assets
Notes receivable	VII. 4	4,150,264.73	5,256,603.03
Accounts receivable	VII. 5	360,460,653.70	403,134,471.87
Receivables financing	VII. 6	3,289,265.10	244,860.00
Prepayments	VII. 7	62,817,169.05	98,116,970.83
Premiums receivable
Amounts receivable under reinsurance contracts
Reinsurer’s share of insurance contract reserves
Other receivables	VII. 8	32,621,049.15	30,472,595.66
Including: Interest receivable
Dividend receivable		13,288,572.00	12,623,886.00
Financial assets purchased under resale agreements
Inventories	VII. 9	793,836,954.44	769,621,133.00
Contract assets	VII. 10	2,655,553.13	3,903,859.23
Assets held for sale
Non-current assets due within one year	VII. 12	3,951,623.81	3,473,049.18
Other current assets	VII. 13	70,973,361.94	52,761,820.83
Total current assets		2,873,713,909.35	2,741,915,194.78
Non-current Assets:
Loans and advances
Debt investments
Other debt investments
Long-term receivables	VII. 16	5,484,318.52	5,793,552.74

Long-term equity investment	VII. 17	159,724,538.60	293,601,085.27
Investment in other equity instruments	VII. 18	7,075,419.38	7,075,419.38
Other non-current financial assets
Investment property
Fixed assets	VII. 21	454,010,462.80	470,410,450.18
Construction in progress	VII. 22	184,837,501.44	148,620,511.35
Productive biological assets
Oil and gas assets
Use right assets	VII. 25	47,546,507.50	26,803,910.76
Intangible assets	VII. 26	295,695,402.05	301,164,605.56
Development expenditure
Goodwill
Long-term prepaid expenses	VII. 29	7,490,537.22	10,126,164.82
Deferred tax assets	VII. 30	70,961,435.69	80,721,419.29
Other non-current assets	VII. 31	17,929,878.09	10,998,641.77
Total non-current assets		1,250,756,001.29	1,355,315,761.12
Total assets		4,124,469,910.64	4,097,230,955.90
Current Liabilities:
Short-term borrowings	VII. 32	130,045,205.48	5,570,878.11
Loans from the central bank
Taking from banks and other financial institutions
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable	VII. 35	121,047,156.20	134,378,967.61
Accounts payable	VII. 36	292,737,366.30	419,966,567.27
Advance from customers	VII. 37	117,280,983.73	130,288,312.62
Contract liabilities	VII. 38	50,350,874.58	45,541,629.55
Financial assets sold under repurchase agreements
Customer deposits and deposits from banks and other financial institutions
Funds from securities trading agency
Funds from underwriting securities agency
Employee benefits payable	VII. 39	27,603,680.75	64,119,087.51
Taxes payable	VII. 40	17,832,103.88	19,546,190.23
Other payables	VII. 41	52,311,833.50	54,115,784.80
Including: Interest payable
Dividend payable		3,103,823.79

Fees and commissions payable
Amounts payable under reinsurance contracts
Liabilities held for sale
Non-current liabilities due within one year	VII. 43	178,262,318.38	154,785,116.35
Other current liabilities	VII. 44	6,652,129.13	19,561,104.12
Total current liabilities		994,123,651.93	1,047,873,638.17
Non-current Liabilities:
Insurance contract reserves
Long-term borrowings	VII. 45	413,598,555.25	368,635,614.64
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities	VII. 47	29,884,884.77	10,789,352.69
Long-term payables
Long-term employee benefits payable
Provisions	VII. 50	36,479,555.35	36,428,688.94
Deferred income	VII. 51	7,675,521.05	10,266,982.08
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities		487,638,516.42	426,120,638.35
Total liabilities		1,481,762,168.35	1,473,994,276.52
Owners’ Equity (Shareholders’ Equity):
Paid-in capital (or share capital)	VII. 53	452,756,901.00	452,756,901.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserve	VII. 55	1,436,069,597.56	1,400,605,136.65
Less: Treasury shares	VII. 56	3,211,260.13
Other comprehensive income	VII. 57	-3,106,247.99	-16,840,512.60
Special reserve
Surplus reserve	VII. 59	56,265,868.31	56,265,868.31
General risk reserve
Undistributed profit	VII. 60	543,704,072.75	545,277,188.08
Total owners’ (or shareholders’) equity attributable to owners of the parent company		2,482,478,931.50	2,438,064,581.44
Minority interests		160,228,810.79	185,172,097.94

Total owners’ (or shareholders’) equity		2,642,707,742.29	2,623,236,679.38
Total liabilities and owners’ (or shareholders’) equity		4,124,469,910.64	4,097,230,955.90

Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the AccountingBody: WANG Yingxia

Balance Sheet of the Parent Company

At June 30, 2022Prepared by: Appotronics Corporation Limited

Unit: Yuan Currency: RMB

Item	Note	Closing balance	Opening balance
Current Assets:
Cash and bank balances		446,042,891.41	535,787,452.32
Held-for-trading financial assets		473,566,000.00	417,200,000.00
Derivative financial assets
Notes receivable		4,150,264.73	5,036,603.03
Accounts receivable	XVII. 1	669,416,825.13	616,216,169.96
Receivables financing		1,193,765.10	244,860.00
Prepayments		19,014,692.50	24,555,245.46
Other receivables	XVII. 2	11,109,739.71	6,645,181.15
Including: Interest receivable
Dividend receivable
Inventories		330,450,423.34	327,484,120.10
Contract assets		2,655,553.13	3,903,859.23
Assets held for sale
Non-current assets due within one year		2,774,799.41	2,688,446.82
Other current assets		6,599,115.10
Total current assets		1,966,974,069.56	1,939,761,938.07
Non-current Assets:
Debt investments
Other debt investments
Long-term receivables		3,624,762.28	3,528,917.07
Long-term equity investment	XVII. 3	447,485,952.76	440,559,012.12
Investment in other equity instruments		7,075,419.38	7,075,419.38
Other non-current financial assets
Investment property
Fixed assets		57,630,260.16	59,043,066.43
Construction in progress		175,877,819.68	133,111,026.64
Productive biological assets

Oil and gas assets
Use right assets		33,905,188.33	17,152,430.20
Intangible assets		299,786,385.15	305,569,269.44
Development expenditure
Goodwill
Long-term prepaid expenses		2,357,149.58	4,841,091.62
Deferred tax assets		17,128,298.35	22,028,444.60
Other non-current assets		12,477,994.32	6,093,687.23
Total non-current assets		1,057,349,229.99	999,002,364.73
Total assets		3,024,323,299.55	2,938,764,302.80
Current Liabilities:
Short-term borrowings		50,045,205.48
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable		78,067,305.33	41,601,830.90
Accounts payable		213,096,912.97	311,370,715.78
Advance from customers		616,661.03	999,484.03
Contract liabilities		24,966,870.30	14,130,218.03
Employee benefits payable		17,150,340.16	41,239,602.09
Taxes payable		10,667,346.31	11,755,599.27
Other payables		53,036,390.16	13,006,204.53
Including: Interest payable
Dividend payable		3,103,823.79
Liabilities held for sale
Non-current liabilities due within one year		41,906,988.49	43,166,652.33
Other current liabilities		2,039,622.12	839,898.70
Total current liabilities		491,593,642.35	478,110,205.66
Non-current Liabilities:
Long-term borrowings		85,104,112.51	54,497,768.01
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities		21,488,322.22	4,445,612.91
Long-term payables
Long-term employee benefits payable
Provisions		20,955,862.41	20,275,524.78
Deferred income		4,094,465.78	9,543,692.89
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities		131,642,762.92	88,762,598.59
Total liabilities		623,236,405.27	566,872,804.25

Owners’ equity (shareholders’ equity):
Paid-in capital (or share capital)		452,756,901.00	452,756,901.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserve		1,448,461,913.90	1,410,150,134.25
Less: Treasury shares		3,211,260.13
Other comprehensive income
Special reserve
Surplus reserve		54,988,327.58	54,988,327.58
Undistributed profit		448,091,011.93	453,996,135.72
Total owners’ (or shareholders’) equity		2,401,086,894.28	2,371,891,498.55
Total liabilities and owners’ (or shareholders’) equity		3,024,323,299.55	2,938,764,302.80

Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the AccountingBody: WANG Yingxia

Consolidated Income Statement

Jan. - Jun. 2022

Unit: Yuan Currency: RMB

Item	Note	Half year of 2022	Half year of 2021
I. Total operating income		1,269,322,202.11	1,104,689,243.59
Including: Operating income	VII. 61	1,269,322,202.11	1,104,689,243.59
Interest income
Premiums earned
Fee and commission income
II. Total operating costs		1,227,121,118.16	998,250,659.71
Including: Operating costs	VII. 61	884,560,607.88	723,612,305.19
Interest expenses
Fee and commission expenses
Surrenders
Claims and policyholder benefits (net of amounts recoverable from reinsurers)
Net withdrawal of insurance contract reserves
Insurance policyholder dividends
Expenses for reinsurance accepted
Taxes and surcharges	VII. 62	4,636,401.10	4,331,138.81
Selling expenses	VII. 63	120,302,361.36	89,686,195.83

Administrative expenses	VII. 64	106,015,842.36	83,960,516.92
R&D expenses	VII. 65	114,959,786.37	95,128,483.66
Financial expenses	VII. 66	-3,353,880.91	1,532,019.30
Including: Interest expense		12,510,421.43	11,013,330.17
Interest income		6,740,942.87	10,868,184.51
Add: Other income	VII. 67	21,565,810.43	54,890,296.70
Investment income (loss is indicated by “-”)	VII. 68	-4,567,473.71	9,128,665.03
Including: Income from investments in associates and joint ventures		-10,562,840.53	6,982,738.64
Gains from derecognition of financial assets at amortized assets (loss is indicated by “-”)
Foreign exchange gains (loss is indicated by “-”)
Gains from net exposure hedges (loss is indicated by “-”)
Gains from changes in fair values (loss is indicated by “-”)	VII. 70	-1,634,000.00	38,175,900.00
Losses of credit impairment (loss is indicated by “-”)	VII. 71	1,393,164.79	9,407,031.23
Impairment losses of assets (loss is indicated by “-”)	VII. 72	-19,822,363.99	-16,581,239.34
Gains from disposal of assets (loss is indicated by “-”)	VII. 73	17,213.16	2,806,008.82
III. Operating profit (loss is indicated by “-”)		39,153,434.63	204,265,246.32
Add: Non-operating income	VII. 74	167,888.31	22,240,680.14
Less: Non-operating expenses	VII. 75	1,511,909.47	405,501.61
IV. Total profits (total losses are indicated by “-”)		37,809,413.47	226,100,424.85
Less: Income tax expenses	VII. 76	19,269,471.17	46,305,525.16
V. Net profits (net losses are indicated by “-”)		18,539,942.30	179,794,899.69
(I) Categorized by the continuity of operation
1. Net profits from continuing operations (net losses are indicated by "-")		18,539,942.30	179,794,899.69
2. Net profits from discontinued operations (net losses are indicated by “-”)
(II) Categorized by the ownership
1. Net profits attributable to shareholders of the parent company (net losses are indicated by "-")		45,966,481.10	151,413,920.79

2. Profits or losses attributable to minority shareholders (net losses are indicated by “-”)		-27,426,538.80	28,380,978.90
VI. Other comprehensive income, net of tax		13,583,493.02	-4,739,767.89
(I) Other comprehensive income that can be attributable to owners of the parent company, net of tax		13,734,264.61	-4,763,298.65
1. Other comprehensive income that cannot be reclassified subsequently to profit or loss
(1) Changes from remeasurement of defined benefit plans
(2) Other comprehensive income that cannot be reclassified to profit or loss under the equity method
(3) Changes in fair value of investments in other equity instruments
(4) Changes in fair value of enterprises’ own credit risks
2. Other comprehensive income that will be reclassified to profit or loss		13,734,264.61	-4,763,298.65
(1) Other comprehensive income that will be reclassified to profit or loss under the equity method		-9,668,892.26	-1,223,181.05
(2) Changes in fair value of other debt investments
(3) Amount of financial assets reclassified to other comprehensive income
(4) Provision for credit impairment of other debt investments
(5) Reserve for cash flow hedges
(6) Exchange differences on translation of financial statements denominated in foreign currencies		23,403,156.87	-3,540,117.60
(7) Others
(II) Other comprehensive income that can be attributable to minority shareholders, net of tax		-150,771.59	23,530.76
VII. Total comprehensive income		32,123,435.32	175,055,131.80
(I) Total comprehensive income that can be attributable to owners of the parent company		59,700,745.71	146,650,622.14
(II) Total comprehensive income that can be attributable to minority shareholders		-27,577,310.39	28,404,509.66

VIII. Earnings per share:
(I) Basic earnings per share (RMB/share)		0.10	0.33
(II) Diluted earnings per share (RMB/share)		0.10	0.33

In the event of business combinations involving enterprises under common control, the net profits realizedprior to the combination by the party being absorbed is: RMB 0.00, and the net profits realized in the lastperiod by the party being absorbed is: RMB 0.00.Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the AccountingBody: WANG Yingxia

Income Statement of the Parent Company

Jan. - Jun. 2022

Unit: Yuan Currency: RMB

Item	Note	Half year of 2022	Half year of 2021
I. Operating income	XVII. 4	649,645,354.34	572,827,875.91
Less: Operating costs	XVII. 4	432,684,792.22	381,855,853.31
Taxes and surcharges		2,709,645.68	2,677,366.89
Selling expenses		34,971,927.98	31,778,439.77
Administrative expenses		70,191,714.62	51,914,220.61
R&D expenses		74,661,621.25	48,699,043.93
Financial expenses		-12,346,217.67	-13,332,493.36
Including: Interest expense		1,758,702.76	1,232,450.71
Interest income		9,044,664.08	15,462,791.57
Add: Other income		12,418,751.65	15,069,445.02
Investment income (loss is indicated by “-”)	XVII. 5	5,884,922.38	15,655,417.87
Including: Income from investments in associates and joint ventures
Gains from derecognition of financial assets at amortized assets (loss is indicated by “-”)
Gains from net exposure hedges (loss is indicated by “-”)
Gains from changes in fair values (loss is indicated by “-”)		-1,634,000.00
Losses of credit impairment (loss is indicated by “-”)		-970,107.59	61,742.84
Impairment losses of assets (loss is indicated by “-”)		-7,784,985.64	-9,536,087.28
Gains from disposal of assets (loss is indicated by “-”)
II. Operating profit (loss is indicated by “-”)		54,686,451.06	90,485,963.21
Add: Non-operating income		94,307.77	2,207,572.56
Less: Non-operating expenses		1,451,707.15	150,645.92

III. Total profits (total losses are indicated by “-”)		53,329,051.68	92,542,889.85
Less: Income tax expenses		11,694,579.04	13,606,250.04
IV. Net profits (net losses are indicated by “-”)		41,634,472.64	78,936,639.81
(I) Net profits from continuing operations (net losses are indicated by “-”)		41,634,472.64	78,936,639.81
(II) Net profits from discontinued operations (net losses are indicated by “-”)
V. Other comprehensive income, net of tax
(I) Other comprehensive income that cannot be reclassified subsequently to profit or loss
1. Changes from remeasurement of defined benefit plans
2. Other comprehensive income that cannot be reclassified to profit or loss under the equity method
3. Changes in fair value of investments in other equity instruments
4. Changes in fair value of enterprises’ own credit risks
(II) Other comprehensive income that will be reclassified to profit or loss
1. Other comprehensive income that will be reclassified to profit or loss under the equity method
2. Changes in fair value of other debt investments
3. Amount of financial assets reclassified to other comprehensive income
4. Provision for credit impairment of other debt investments
5. Reserve for cash flow hedges
6. Exchange differences on translation of financial statements denominated in foreign currencies
7. Others
VI. Total comprehensive income		41,634,472.64	78,936,639.81
VII. Earnings per share:
(I) Basic earnings per share (RMB/share)
(II) Diluted earnings per share (RMB/share)

Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the AccountingBody: WANG Yingxia

Consolidated Cash Flow Statement

Jan. - Jun. 2022

Unit: Yuan Currency: RMB

Item	Note	Half year of 2022	Half year of 2021
I. Cash Flows from Operating Activities:
Cash receipts from the sale of goods and the rendering of services		1,429,234,114.59	1,453,487,844.10
Net increase in customer deposits and deposits from banks and other financial institutions
Net increase in loans from the central bank
Net increase in taking from banks and other financial institutions
Cash receipts from premiums under direct insurance contracts
Net cash receipts from reinsurance business
Net cash receipts from policyholders’ deposits and investment contract liabilities
Cash receipts from interest, fees and commissions
Net increase in taking from banks
Net increase in financial assets sold under repurchase arrangements
Net cash received from securities trading agencies
Receipts of tax refunds		3,189,929.64	2,222,772.52
Other cash receipts relating to operating activities	VII. 78(1)	34,395,802.37	113,502,001.69
Sub-total of cash inflows from operating activities		1,466,819,846.60	1,569,212,618.31
Cash payments for goods purchased and services received		1,065,198,956.89	1,051,145,975.21
Net increase in loans and advances to customers
Net increase in balance with the central bank and due from banks and other financial institutions
Cash payments for claims and policyholders' benefits under direct insurance contracts
Net increase in placements with banks and other financial institutions

Cash payments for interest, fees and commissions
Cash payments for insurance policyholder dividends
Cash payments to and on behalf of employees		226,213,079.42	166,538,999.80
Payments of various types of taxes		47,664,436.15	46,982,376.14
Other cash payments relating to operating activities	VII. 78(2)	206,296,733.81	133,885,953.26
Sub-total of cash outflows from operating activities		1,545,373,206.27	1,398,553,304.41
Net cash flow from operating activities		-78,553,359.67	170,659,313.90
II. Cash Flows from Investing Activities:
Cash receipts from disposals and recovery of investments		1,047,763,409.68	228,000,000.00
Cash receipts from investment income		5,995,366.82	2,145,926.39
Net cash receipts from disposals of fixed assets, intangible assets and other long-term assets		2,210.00	7,250.00
Net cash receipts from disposals of subsidiaries and other business units
Other cash receipts relating to investing activities
Sub-total of cash inflows from investing activities		1,053,760,986.50	230,153,176.39
Cash payments to acquire or construct fixed assets, intangible assets and other long-term assets		53,593,529.31	27,639,815.32
Cash payments to acquire investments		995,000,000.00	568,048,387.32
Net increase in pledged loans receivables
Net cash payments for acquisitions of subsidiaries and other business units
Other cash payments relating to investing activities
Sub-total of cash outflows from investing activities		1,048,593,529.31	595,688,202.64
Net cash flows from investing activities		5,167,457.19	-365,535,026.25
III. Cash Flows from Financing Activities:
Cash receipts from capital contributions		8,866,332.86	10,131,579.00
Including: Cash receipts from capital contributions from minority shareholders of subsidiaries			10,131,579.00
Cash receipts from borrowings		260,569,353.56	113,544,066.34

Other cash receipts relating to financing activities			215,000,000.00
Sub-total of cash inflows from financing activities		269,435,686.42	338,675,645.34
Cash repayments of borrowings		70,016,183.00	191,867,810.44
Cash payments for distribution of dividends or profits or settlement of interest expenses		57,206,348.66	40,008,875.22
Including: Payments for distribution of dividends or profits to minority shareholders of subsidiaries			11,040,000.00
Other cash payments relating to financing activities	VII. 78(6)	17,704,289.67	31,210,615.17
Sub-total of cash outflows from financing activities		144,926,821.33	263,087,300.83
Net cash flows from financing activities		124,508,865.09	75,588,344.51
IV. Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents		9,162,860.18	-649,558.76
V. Net Increase in Cash and Cash Equivalents		60,285,822.80	-119,936,926.60
Add: Opening balance of cash and cash equivalents		891,195,166.73	983,525,089.44
VI. Closing Balance of Cash and Cash Equivalents		951,480,989.53	863,588,162.84

Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the AccountingBody: WANG Yingxia

Cash Flow Statement of the Parent Company

Jan. - Jun. 2022

Unit: Yuan Currency: RMB

Item	Note	Half year of 2022	Half year of 2021
I. Cash Flows from Operating Activities:
Cash receipts from the sale of goods and the rendering of services		682,350,809.37	695,738,828.66
Receipts of tax refunds		329,661.66	539,857.34
Other cash receipts relating to operating activities		42,069,540.58	102,652,212.97
Sub-total of cash inflows from operating activities		724,750,011.61	798,930,898.97
Cash payments for goods purchased and services received		519,893,495.98	460,644,038.55
Cash payments to and on behalf of employees		136,476,115.67	98,344,040.37

Payments of various types of taxes		25,813,452.99	32,447,369.04
Other cash payments relating to operating activities		51,239,349.11	59,619,379.08
Sub-total of cash outflows from operating activities		733,422,413.75	651,054,827.04
Net cash flow from operating activities		-8,672,402.14	147,876,071.93
II. Cash Flows from Investing Activities:
Cash receipts from disposals and recovery of investments		877,000,000.00	255,500,000.00
Cash receipts from investment income		5,884,922.38	9,597,926.39
Net cash receipts from disposals of fixed assets, intangible assets and other long-term assets
Net cash receipts from disposals of subsidiaries and other business units
Other cash receipts relating to investing activities
Sub-total of cash inflows from investing activities		882,884,922.38	265,097,926.39
Cash payments to acquire or construct fixed assets, intangible assets and other long-term assets		46,538,785.01	11,606,321.91
Cash payments to acquire investments		935,000,000.00	472,932,903.47
Net cash payments for acquisitions of subsidiaries and other business units
Other cash payments relating to investing activities
Sub-total of cash outflows from investing activities		981,538,785.01	484,539,225.38
Net cash flows from investing activities		-98,653,862.63	-219,441,298.99
III. Cash Flows from Financing Activities:
Cash receipts from capital contributions		8,866,332.86
Cash receipts from borrowings		80,569,353.56	3,494,734.74
Other cash receipts relating to financing activities
Sub-total of cash inflows from financing activities		89,435,686.42	3,494,734.74
Cash repayments of borrowings		500,000.00	11,737,867.15
Cash payments for distribution of dividends or profits or settlement of interest expenses		46,860,137.39	21,319,708.05
Other cash payments relating to financing activities		14,585,132.93	8,435,056.25
Sub-total of cash outflows from financing activities		61,945,270.32	41,492,631.45

Net cash flows from financing activities		27,490,416.10	-37,997,896.71
IV. Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents		1,342,904.11	-269,974.94
V. Net Increase in Cash and Cash Equivalents		-78,492,944.56	-109,833,098.71
Add: Opening balance of cash and cash equivalents		483,223,615.33	666,628,105.82
VI. Closing Balance of Cash and Cash Equivalents		404,730,670.77	556,795,007.11

Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the AccountingBody: WANG Yingxia

Consolidated Statement of Changes in Owners’ Equity

Jan. - Jun. 2022

Unit: Yuan Currency: RMB

Item	Half year of 2022
	Equity attributable to owners of the Parent Company													Minority interests	Total owner’s equity
	Paid-in capital (or share capital)	Other equity instruments			Capital reserve	Less: Treasury shares	Other comprehensive income	Special reserve	Surplus reserve	General risk reserve	Undistributed profit	Others	Sub-total
		Preferred shares	Perpetual bonds	Others
I. Closing balance of the preceding year	452,756,901.00				1,400,605,136.65		-16,840,512.60		56,265,868.31		545,277,188.08		2,438,064,581.44	185,172,097.94	2,623,236,679.38
Add: Changes in accounting policies
Corrections of prior period errors
Business combination involving enterprises under common control
Others
II. Opening balance of the current year	452,756,901.00				1,400,605,136.65		-16,840,512.60		56,265,868.31		545,277,188.08		2,438,064,581.44	185,172,097.94	2,623,236,679.38
III. Changes for the year (decrease is indicated by “-”)					35,464,460.91	3,211,260.13	13,734,264.61				-1,573,115.33		44,414,350.06	-24,943,287.15	19,471,062.91
(I) Total comprehensive income							13,734,264.61				45,966,481.10		59,700,745.71	-27,577,310.39	32,123,435.32
(II) Owners’ contributions and reduction in capital					35,464,460.91	3,211,260.13							32,253,200.78	2,634,023.24	34,887,224.02
1. Ordinary shares contributed by owners						3,211,260.13							-3,211,260.13		-3,211,260.13
2. Capital contribution from holders of other equity instruments
3. Share-based payment recognized in owners’ equity					35,464,460.91								35,464,460.91	2,634,023.24	38,098,484.15
4. Others

(III) Profit distribution											-47,539,596.43		-47,539,596.43		-47,539,596.43
1. Transfer to surplus reserve
2. Transfer to general risk reserve
3. Distributions to owners (or shareholders)											-47,539,596.43		-47,539,596.43		-47,539,596.43
4. Others
(IV) Transfers within owners’ equity
1. Capitalization of capital reserve
2. Capitalization of surplus reserve
3. Loss offset by surplus reserve
4. Retained earnings carried forward from changes in defined benefit plans
5. Retained earnings carried forward from other comprehensive income
6. Others
(V) Special reserve
1. Transfer to special reserve in the period
2. Amount utilized in the period
(VI) Others
IV. Closing balance of the current year	452,756,901.00				1,436,069,597.56	3,211,260.13	-3,106,247.99		56,265,868.31		543,704,072.75		2,482,478,931.50	160,228,810.79	2,642,707,742.29

Item	Half year of 2021
	Equity attributable to owners of the Parent Company	Minority interests	Total owner’s equity

	Paid-in capital (or share capital)	Other equity instruments			Capital reserve	Less: Treasury shares	Other comprehensive income	Special reserve	Surplus reserve	General risk reserve	Undistributed profit	Others	Sub-total
		Preferred shares	Perpetual bonds	Others
I. Closing balance of the preceding year	452,756,901.00				1,249,020,991.15		-3,214,291.93		35,242,179.57		357,793,891.96		2,091,599,671.75	93,812,755.26	2,185,412,427.01
Add: Changes in accounting policies									34,923.77		9,346.56		44,270.33	-11,248.64	33,021.69
Corrections of prior period errors
Business combination involving enterprises under common control
Others
II. Opening balance of the current year	452,756,901.00				1,249,020,991.15		-3,214,291.93		35,277,103.34		357,803,238.52		2,091,643,942.08	93,801,506.62	2,185,445,448.70
III. Changes for the year (decrease is indicated by “-”)					111,083,348.13		-4,763,298.65				126,512,291.23		232,832,340.71	-83,735,638.25	149,096,702.46
(I) Total comprehensive income							-4,763,298.65				151,413,920.79		146,650,622.14	28,404,509.66	175,055,131.80
(II) Owners’ contributions and reduction in capital					111,083,348.13								111,083,348.13	-101,100,147.91	9,983,200.22
1. Ordinary shares contributed by owners														20,175,439.00	20,175,439.00
2. Capital contribution from holders of

other equity instruments
3. Share-based payment recognized in owners’ equity					18,461,103.38								18,461,103.38	3,890,517.84	22,351,621.22
4. Others					92,622,244.75								92,622,244.75	-125,166,104.75	-32,543,860.00
(III) Profit distribution											-24,901,629.56		-24,901,629.56	-11,040,000.00	-35,941,629.56
1. Transfer to surplus reserve
2. Transfer to general risk reserve
3. Distributions to owners (or shareholders)											-24,901,629.56		-24,901,629.56	-11,040,000.00	-35,941,629.56
4. Others
(IV) Transfers within owners’ equity
1. Capitalization of capital reserve
2. Capitalization of surplus reserve
3. Loss offset by surplus reserve
4. Retained earnings carried forward from changes in defined benefit plans
5. Retained earnings carried forward from other comprehensive income
6. Others

(V) Special reserve
1. Transfer to special reserve in the period
2. Amount utilized in the period
(VI) Others
IV. Closing balance of the current year	452,756,901.00				1,360,104,339.28		-7,977,590.58		35,277,103.34		484,315,529.75		2,324,476,282.79	10,065,868.37	2,334,542,151.16

Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia

Statement of Changes in Owners’ Equity of the Parent Company

Jan. - Jun. 2022

Unit: Yuan Currency: RMB

Item	Half year of 2022
	Paid-in capital (or share capital)	Other equity instruments			Capital reserve	Less: Treasury shares	Other comprehensive income	Special reserve	Surplus reserve	Undistributed profit	Total owner’s equity
		Preferred shares	Perpetual bonds	Others
I. Closing balance of the preceding year	452,756,901.00				1,410,150,134.25				54,988,327.58	453,996,135.72	2,371,891,498.55
Add: Changes in accounting policies
Corrections of prior period errors
Others
II. Opening balance of the current year	452,756,901.00				1,410,150,134.25				54,988,327.58	453,996,135.72	2,371,891,498.55
III. Changes for the year (decrease is indicated by “-”)					38,311,779.65	3,211,260.13				-5,905,123.79	29,195,395.73

(I) Total comprehensive income										41,634,472.64	41,634,472.64
(II) Owners’ contributions and reduction in capital					38,311,779.65	3,211,260.13					35,100,519.52
1. Ordinary shares contributed by owners						3,211,260.13					-3,211,260.13
2. Capital contribution from holders of other equity instruments
3. Share-based payment recognized in owners’ equity					38,311,779.65						38,311,779.65
4. Others
(III) Profit distribution										-47,539,596.43	-47,539,596.43
1. Transfer to surplus reserve
2. Distributions to owners (or shareholders)										-47,539,596.43	-47,539,596.43
3. Others
(IV) Transfers within owners’ equity
1. Capitalization of capital reserve
2. Capitalization of surplus reserve
3. Loss offset by surplus reserve
4. Retained earnings carried forward from changes in defined benefit plans
5. Retained earnings carried forward from other comprehensive income

6. Others
(V) Special reserve
1. Transfer to special reserve in the period
2. Amount utilized in the period
(VI) Others
IV. Closing balance of the current year	452,756,901.00				1,448,461,913.90	3,211,260.13			54,988,327.58	448,091,011.93	2,401,086,894.28

Item	Half year of 2021
	Paid-in capital (or share capital)	Other equity instruments			Capital reserve	Less: Treasury shares	Other comprehensive income	Special reserve	Surplus reserve	Undistributed profit	Total owner’s equity
		Preferred shares	Perpetual bonds	Others
I. Closing balance of the preceding year	452,756,901.00				1,351,261,718.84				33,964,638.84	289,684,566.58	2,127,667,825.26
Add: Changes in accounting policies										349,237.72	349,237.72
Corrections of prior period errors
Others
II. Opening balance of the current year	452,756,901.00				1,351,261,718.84				33,964,638.84	290,033,804.30	2,128,017,062.98
III. Changes for the year (decrease is indicated by “-”)					19,006,591.95					54,035,010.25	73,041,602.20
(I) Total comprehensive income										78,936,639.81	78,936,639.81
(II) Owners’ contributions and reduction in capital					19,006,591.95						19,006,591.95
1. Ordinary shares contributed by owners

2. Capital contribution from holders of other equity instruments
3. Share-based payment recognized in owners’ equity					19,006,591.95						19,006,591.95
4. Others
(III) Profit distribution										-24,901,629.56	-24,901,629.56
1. Transfer to surplus reserve
2. Distributions to owners (or shareholders)										-24,901,629.56	-24,901,629.56
3. Others
(IV) Transfers within owners’ equity
1. Capitalization of capital reserve
2. Capitalization of surplus reserve
3. Loss offset by surplus reserve
4. Retained earnings carried forward from changes in defined benefit plans
5. Retained earnings carried forward from other comprehensive income
6. Others
(V) Special reserve
1. Transfer to special reserve in the period
2. Amount utilized in the period
(VI) Others

IV. Closing balance of the current year

452,756,901.00

1,370,268,310.79

33,964,638.84

344,068,814.55

2,201,058,665.18

Legal Representative: LI Yi Chief Accountant: WANG Yingxia Person in Charge of the Accounting Body: WANG Yingxia

III. Company profile

1. Profile

√ Applicable□ N/A

Appotronics Corporation Limited (hereinafter referred to as “Company” or “the Company”),formally named as Shenzhen Appotronics Optoelectronics Technology Inc. (hereinafter referred to as“Appotronics Inc.”), was jointly invested and established by LI Yi and XU Yanzheng and registered inNanshan Branch of Market Supervision and Regulation Bureau of Shenzhen on October 24, 2006 with thelegal person business license numbered in 4403011245637. Upon establishment, the registered capital ofAppotronics Inc. was RMB 100,000. On May 31, 2018, the benchmark date, Appotronics Inc was changedinto a company limited by shares entirety. On July 20, 2018, the Company completed the registration inNanshan Branch of Market Supervision and Regulation Bureau of Shenzhen and headquartered inShenzhen City, Guangdong Province. The Company holds the business license bearing the credibility code91440300795413991N. The Company’s registered capital is RMB 452,756,901.00 divided into452,756,901 shares (RMB 1.00 per share), including 166,736,766 outstanding shares subject to salerestrictions and 286,020,135 outstanding shares not subject to sale restrictions. The Company’s shareswere listed for trading on Shanghai Stock Exchange on July 22, 2019.

The Company can be classified into the computer, communication and other electronic equipmentmanufacturing industry. It mainly engages in research and development, production, sales and leasing oflaser display core devices and whole machines, and can provide customers with technical research anddevelopment services and customized products. Its products mainly include laser business and educationprojectors, smart mini projectors, laser TV, laser large venue projector and laser digital cinema projector.

These financial statements have been approved by the 15

thmeeting of the second Board of Directorson August 18, 2022 for public disclosure.

2. Scope of consolidated financial statements

√ Applicable□ N/A

The Company has included 26 subsidiaries into the consolidated financial statements for the currentperiod, including Beijing Orient Appotronics Technology Co., Ltd., Shenzhen Appotronics Laser DisplayTechnology Co., Ltd., Qingda Appotronics (Xiamen) Technology Co., Ltd., Shenzhen Appotronics LaserTechnology Co., Ltd., Appotronics Hong Kong Limited, Shenzhen Appotronics Software Technology Co.,Ltd., Shenzhen City Appotronics Xiaoming Technology Co., Ltd., Appotronics USA, Inc., JoveAI Limited,JoveAI Innovation, Inc., Appotronics Technology (Changzhou) Co., Ltd., Shenzhen Appotronics DisplayDevice Co., Ltd., WEMAX LLC, JoveAI Asia Company Limited, Tianjin Bonian Film Partnership (LP),Fengmi (Beijing) Technology Co., Ltd., Shenzhen Appotronics Home Line Technology Co., Ltd.,Formovie Technology Inc., Formovie (Chongqing) Innovative Technology Co., Ltd., Formovie Limited,Chongqing Guangbo Ecommerce Co., Ltd., Chongqing Ewei Ecommerce Co., Ltd., Shenzhen OrangeJuice Energy Technology Co., Ltd., Hongkong Orange Juice Energy Technology Co., Limited, WEMAXINC and CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd. Please refer to descriptions in VIIIand IX of Section X for details.

IV. Basis of preparation of financial statements

1. Basis of preparation

The Company’s financial statements are prepared on a going-concern basis.

2. Going concern

√ Applicable□ N/A

The Company has detected no events or circumstances that may cast significant doubt upon its ability tocontinue as a going concern within 12 months from the reporting period.V. Significant accounting policies and accounting estimatesSpecific accounting policies and accounting estimates:

√ Applicable□ N/A

IMPORTANT: The Company establishes the specific accounting policies and makes the specificaccounting estimates with respect to the impairment of financial instruments, depreciation of fixed assetsand use right assets, amortization of intangible assets, recognition of revenues and other transactions andevents according to its actual production and operation characteristics.

1. Statement of compliance with the Accounting Standards for Business EnterprisesThe financial statements prepared by the Company conform to the requirements of the AccountingStandards for Business Enterprises and truly and completely reflect the Company’s financial position,operating results, changes in shareholders’ equity, cash flows and other related information.

2. Accounting period

The Company’s accounting year is from January 1 to December 31 of each calendar year.

3. Operating cycle

√ Applicable□ N/A

The Company has a relatively short operating cycle, and determines the liquidity of assets and liabilitieson the basis of 12 months.

4. Functional currency

The Company adopts RMB as its functional currency. The following overseas subsidiaries operate outsideof China, and adopt the currency of their primary economic environment as the functional currency:

Appotronics Hong Kong Limited, Appotronics USA, Inc., JoveAI Limited, JoveAI Innovation, Inc.,WEMAX LLC, JoveAI Asia Company Limited, Formovie Technology Inc., Formovie Limited, HongkongOrange Juice Energy Technology Co., Limited, WEMAX INC, etc.

5. The accounting treatment of business combinations involving entities under common control

and not involving entities under common control

√ Applicable□ N/A

1. Accounting method for business combinations involving enterprises under common controlAssets and liabilities acquired from a business combination by the Company are measured at thecarrying amounts of the assets and liabilities of the acquiree in the consolidated financial statements of theultimate controller at the date of combination. The difference between the carrying amount of the owners’

equity of the acquiree as stated in the consolidated financial statements of the ultimate controller and thecarrying amount of the total consideration paid or total par value of the shares issued in connection withthe combination is treated as an adjustment to the capital reserve. In case the capital reserve is not sufficientto absorb the difference, the remaining balance is adjusted against the retained earnings.

2. Accounting treatment of business combinations involving entities not under common controlWhere the cost of combination exceeds the Company’s interest in the fair value of the acquiree’sidentifiable net assets, the difference is recognized as goodwill. Where the cost of combination is less thanthe Company’s interest in the fair value of the acquiree’s identifiable net assets, the Company firstlyreassesses the fair values of the acquiree’s identifiable assets, liabilities and contingent liabilities and themeasurement of the cost of combination. If after that reassessment, the cost of combination is still lessthan the Company’s interest in the fair value of the acquiree’s identifiable net assets, the acquirerrecognizes the remaining difference immediately in profit or loss for the current period.

6. Method of preparation of consolidated financial statements

√ Applicable□ N/A

The parent company includes all of its controlled subsidiaries in its consolidated financial statements.The consolidated financial statements are prepared by the parent company in accordance with theAccounting Standards for Business Enterprises No. 33 -- Consolidated Financial Statements, on the basisof the respective financial statements of the parent company and its subsidiaries, by reference to otherrelevant data.

7. Classification of joint arrangements and accounting treatment of joint operations

√ Applicable□ N/A

1. Joint arrangements are classified into joint operations and joint ventures.

2. When the Company is a party to a joint operation, the Company recognizes the following itemsrelating to its interest in the joint operation:

(1) the assets individually held by the Company, and the Company’s share of the assets held jointly;

(2) the liabilities incurred individually by the Company, and the Company’s share of the liabilitiesincurred jointly;

(3) the Company’s revenue from the sale of its share of output of the joint operation;

(4) the Company’s share of revenue from the sale of assets by the joint operation; and

(5) the expenses incurred individually by the Company, and the Company’s share of the expensesincurred jointly.

8. Recognition of cash and cash equivalents

Cash equivalents are the Group’s short-term (generally due within 3 months from the acquisitiondate), highly liquid investments that are readily convertible to known amounts of cash and which aresubject to an insignificant risk of changes in value.

9. Translation of transactions and financial statements denominated in foreign currencies

√ Applicable□ N/A

1. Transactions denominated in foreign currencies

A foreign currency transaction is recorded in RMB, on initial recognition, by applying the spotexchange rate on the date of the transaction. At the balance sheet date, foreign currency monetary itemsare translated into RMB using the spot exchange rates at the balance sheet date. Exchange differencesarising from such translations are recognized in profit or loss for the current period, except for thoseattributable to foreign currency borrowings that have been taken out specifically for the acquisition orconstruction of qualifying assets and accrued interest. Non-monetary items denominated in foreigncurrencies that are measured at historical cost are translated using the foreign exchange rates ruling at thetransaction dates, without adjusting the amounts in RMB. Non-monetary items denominated in foreigncurrencies that are measured at fair value are translated using the foreign exchange rates prevailing at thedates when the fair value was determined, with exchange differences arising from such translationsrecognized in profit or loss for the current period or other comprehensive income.

2. Translation of financial statements denominated in foreign currencies

Asset and liability items on the balance sheet are translated at the spot exchange rate prevailing at thebalance sheet date; shareholders’ equity items other than “retained profits” are translated at the spotexchange rates at the dates on which such items arose; income and expense items in the income statementare translated at the exchange rates that approximate the actual spot exchange rates on the dates of thetransactions. Exchange differences arising from such translations are recognized in other comprehensiveincome.

10. Financial instruments

√ Applicable□ N/A

1. Classification of financial assets and financial liabilities

On initial recognition, the Company’s financial assets are classified into three categories, including

(1) financial assets at amortized cost; (2) financial assets at fair value through other comprehensive income;and (3) financial assets at fair value through profit or loss.

Upon initial recognition, the Company’s financial liabilities are classified into four categories,including (1) financial liabilities at fair value through profit or loss for the current period; (2) financialliabilities arising as a result of the transfer of financial assets not meeting the criteria for derecognition orcontinuing involvement in the financial assets transferred; (3) financial guarantee contracts not fallingunder Clauses (1) and (2), and loan commitments not falling under Clause (1) and below market interestrate; and (4) financial liabilities at amortized cost.

2. Recognition, measurement and derecognition of financial assets and financial liabilities

(1) Recognition and initial measurement of financial assets and financial liabilities

When the Company becomes a party to a financial instrument contract, a financial asset or liabilityis recognized. Financial assets and liabilities are initially measured at fair value. Transaction costs relatingto financial assets or liabilities at fair value through profit or loss are directly recognized in profit or lossfor the current period. Transaction costs relating to other kinds of financial assets or liabilities are includedin their initially recognized amount. However, where the accounts that do not contain any significant

financing component or are recognized by the Company without taking into consideration the significantfinancing components under the contracts with a term of less than one year upon initial recognition areinitially measured at transaction price defined in the Accounting Standard for Business Enterprises No. 14--Revenue.

(2) Subsequent measurement of financial assets

1) Financial assets at amortized cost

Financial assets at amortized cost are subsequently measured at amortized cost using the effectiveinterest method. Gains or losses arising from financial assets at amortized cost that do not belong to anyhedging relationship are recognized in profit or loss for the current period upon derecognition,reclassification, amortization using the effective interest method or recognition of impairment.

2) Investments in debt instruments at fair value through other comprehensive income

Investments in debt instruments at fair value through other comprehensive income are subsequentlymeasured at fair value. Interest, impairment losses or gains and exchange gains or losses calculated usingthe effective interest method are recognized in profit or loss for the current period, and other gains orlosses are recognized in other comprehensive income. Upon derecognition, the aggregate gains or lossespreviously recognized in other comprehensive income are transferred to profit or loss for the current period.

3) Investments in equity instruments at fair value through other comprehensive income

Investments in debt instruments at fair value through other comprehensive income are subsequentlymeasured at fair value. Dividends received (other than those received as recovery of investment cost) arerecognized in profit or loss for the current period, and other gains or losses are recognized in othercomprehensive income. Upon derecognition, the accumulated gains or losses previously recognized inother comprehensive income are transferred to retained earnings.

4) Financial assets at fair value through profit or loss for the current period

Financial assets at fair value through profit or loss for the current period are subsequently measuredat fair value, with gains or losses arising therefrom, including interest and dividend income, recognized inprofit or loss for the current period, except the financial assets belonging to any hedging relationship.

(3) Subsequent measurement of financial liabilities

1) Financial liabilities at fair value through profit or loss for the current period

Financial liabilities at fair value through profit or loss for the current period include financialliabilities held for trading (including derivatives classified as financial liabilities), and financial liabilitiesdirectly designated as at fair value through profit or loss for the current period. Such financial liabilitiesare subsequently measured at fair value. Changes in the fair value of financial liabilities designated as atfair value through profit or loss for the period arising out of changes in the Company’s own credit risk arerecognized in other comprehensive income, unless such treatment will result in or increase any accountingmismatch in profit or loss. Other gains or losses arising from such financial liabilities, including interestexpenses and changes in fair value not arising out of changes in the Company’s own credit risk, arerecognized in profit or loss for the current period, except the financial liabilities belonging to any hedgingrelationship. Upon derecognition, the accumulated gains or losses previously recognized in other

comprehensive income are transferred to retained earnings.

2) Financial liabilities arising as a result of the transfer of financial assets not meeting the criteria forderecognition or continuing involvement in the financial assets transferredSuch financial liabilities are measured in accordance with the Accounting Standards for BusinessEnterprises No. 23 -- Transfer of Financial Assets.

3) Financial guarantee contracts not falling under Clauses 1) and 2), and loan commitments not fallingunder Clause 1) and below market interest rate

Such financial liabilities are subsequently measured at the higher of ① provision for impairmentlosses determined according to the policy for impairment of financial instruments; and ② balance of theinitially recognized amount after deduction of the accumulated amortization determined in accordancewith the relevant provisions of the Accounting Standard for Business Enterprises No. 14 -- Revenue.

4) Financial liabilities at amortized cost

Financial liabilities at amortized cost are subsequently measured at amortized cost using the effectiveinterest method. Gains or losses on financial liabilities at amortized cost that do not belong to any hedgingrelationship are recognized in profit or loss for the current period upon derecognition or amortization usingthe effective interest method.

(4) Derecognition of financial assets and financial liabilities

1) Financial assets are derecognized when:

① the contractual right to receive cash flows from the financial assets has expired; or

② the financial assets have been transferred and such transfer meets the criteria for derecognition offinancial assets as set forth in the Accounting Standards for Business Enterprises No. 23 -- Transfer ofFinancial Assets.

2) A financial liability (or part thereof) is derecognized when all or part of the outstanding obligationsthereon have been discharged.

3. Recognition and measurement of financial assets transferred

When a financial asset of the Company is transferred, if substantially all the risks and rewardsincidental to the ownership of the financial asset have been transferred, the financial asset is derecognized,and the rights and obligations incurred or retained in such transfer are separately recognized as assets orliabilities (as the case may be); if substantially all the risks and rewards incidental to the ownership of thefinancial asset have been retained, the financial asset transferred continues to be recognized. If theCompany neither transferred nor retained a substantial portion of all risks and rewards incidental to theownership of the financial asset, then: (1) if the Company does not retain control over the financial asset,the financial asset is derecognized, and the rights and obligations incurred or retained in such transfer areseparately recognized as assets or liabilities (as the case may be); and (2) if the Company retains controlover the financial asset, the financial asset continues to be recognized to the extent of the Company’scontinuing involvement in the financial asset transferred, and a corresponding liability is recognized.

If an entire transfer of a financial asset meets the criteria for derecognition, the difference between

(1) the carrying amount of the financial asset transferred at the date of derecognition; and (2) the sum of

the consideration received from the transfer and the portion of the accumulated amount of changes in fairvalue directly recorded as other comprehensive income originally that corresponds to the partderecognized (where the financial asset transferred is an investment in debt instruments at fair valuethrough other comprehensive income) is recognized in profit or loss for the current period. If part of afinancial asset is transferred and the part transferred entirely meets the criteria for derecognition, the totalcarrying amount of the financial asset immediately prior to the transfer is allocated between the partderecognized and the part not derecognized in proportion to their relative fair value at the date of transfer,and the difference between (1) the carrying amount of the part derecognized; and (2) the sum of theconsideration received from the transfer of the part derecognized and the portion of the accumulatedamount of changes in fair value directly recorded as other comprehensive income originally thatcorresponds to the part derecognized (where the financial asset transferred is an investment in debtinstruments at fair value through other comprehensive income) is recognized in profit or loss for thecurrent period.

4. Determination of fair value of financial assets and financial liabilities

The Company adopts the valuation techniques applicable to the current situations and with sufficientdata available and support of other information, to determine the fair value of financial assets and financialliabilities. The Company classifies the inputs used by the valuation techniques in the following levels anduses them in turn:

(1) Level 1 inputs: quoted market price (unadjusted) in an active market for an identical asset orliability available at the date of measurement;

(2) Level 2 inputs: inputs other than inputs included within Level 1 that are observable directly orindirectly. This category includes quoted prices for similar assets or liabilities in active markets, quotedprices for identical or similar assets or liabilities in inactive markets, observable inputs other than quotedprices (such as interest rate and yield curves observable during regular intervals of quotation), and inputsvalidated by the market;

(3) Level 3 inputs: inputs that are unobservable. This category includes interest rate or stock volatilitythat cannot be directly observed or validated by observable market data, future cash flows from retirementobligation incurred in business combinations, and financial forecasts made using own data.

5. Impairment of financial instruments

(1) Measurement and accounting treatment of impairment of financial instruments

The Company determines the impairment and assesses provision for impairment losses of financialassets at amortized cost, investments in debt instruments at fair value through other comprehensive income,contract assets, lease receivable, loan commitments other than financial liabilities designated at fair valuethrough profit or loss for the current period, and financial guarantee contracts other than financial liabilitiesdesignated at fair value through profit or loss for the current period and financial liabilities arising as aresult of the transfer of financial assets not meeting the criteria for derecognition or continuinginvolvement in the financial assets transferred, on the basis of expected credit losses.

Expected credit loss is the weighted average of credit losses on financial instruments taking intoaccount the possibility of default. Credit loss is the difference between all contractual cash flows receivableunder the contract and estimated future cash flows discounted at the original effective interest rate, i.e. thepresent value of all cash shortage, wherein the Company’s purchased or originated financial assets thathave become credit impaired are discounted at their credit-adjusted effective interest rate.With respect to purchased or originated financial assets that have become credit impaired, at thebalance sheet date, the Company recognizes a loss allowance equal to the accumulated amount of changesin lifetime expected credit losses since initial recognition.With respect to lease receivable, accounts receivable and contract assets that are formed fromtransactions under the Accounting Standards for Business Enterprises No. 14 -- Revenue, the Companyuses the simple measurement method and recognizes a loss allowance equal to the lifetime expected creditloss.

With respect to financial assets not using the measurement methods stated above, at each balancesheet date, the Company assesses whether the credit risk has increased significantly since initialrecognition, and recognizes a loss allowance equal to the lifetime expected credit loss if the credit risk hasincreased significantly since initial recognition, or to the expected credit losses within the next 12 monthsif the credit risk has not increased significantly since initial recognition.

The Company uses reasonable and supportable information, including forward-looking information,and compares the possibility of default at the balance sheet date with the possibility of default upon initialrecognition, to determine whether the credit risk of the financial instruments has increased significantlysince initial recognition.

At the balance sheet date, if the Company determines that a financial instrument only has low creditrisk, the Company assumes that its credit risk has not increased significantly since initial recognition.

The Company assesses expected credit risk and measures expected credit losses of financialinstruments individually or collectively. When assessing the financial instruments collectively, theCompany includes the financial instruments in different groups according to their common riskcharacteristics.

At each balance sheet date, the Company re-assesses the expected credit losses, with the amount ofincrease in or reversal of loss allowance recognized in profit or loss for the current period as impairmentlosses or gains. With respect to a financial asset at amortized cost, its carrying amount recorded in thebalance sheet is written off against the loss allowance. With respect to an investment in debt instrumentsat fair value through other comprehensive income, the Company recognizes the loss allowance in othercomprehensive income, without reducing its carrying amount.

(2) Financial instruments for which expected credit risk is assessed and expected credit losses aremeasured collectively

Item	Basis for determining a group	Method for measuring expected credit losses
Other receivables - group of deposit and security receivable	Nature of receivables	By reference to historic credit loss experience, and taking into account the current situations and prediction of future economic conditions, calculate the expected credit losses according to the default risk exposure and 12-month or rate of lifetime expected credit loss.
Other receivables- group of withholding receivable
Other receivables - group of receivables from related parties in the scope of consolidation	Receivables from related parties in the scope of consolidation
Other receivables - grouping by aging	Aging

(3) Accounts receivable for which expected credit losses are measured collectively and contractassets

1) Groups and method for measuring expected credit losses

Item	Basis for determining a group	Method for measuring expected credit losses
Bank acceptance bills receivable	Type of notes	By reference to historic credit loss experience, and taking into account the current situations and prediction of future economic conditions, calculate the expected credit losses according to the default risk exposure and rate of lifetime expected credit loss.
Commercial acceptance bills receivable
Accounts receivable - group of receivables from related parties in the scope of consolidation	Receivables from related parties in the scope of consolidation
Accounts receivable - grouping by aging	Aging	By reference to historic credit loss experience, and taking into account the current situations and prediction of future economic conditions, prepare a comparison table of the aging of accounts receivable and rate of lifetime expected credit loss, and calculate the expected credit losses.
Contract assets – contract assets from related parties in the scope of consolidation	Contract assets from related parties in the scope of consolidation	By reference to historic credit loss experience, and taking into account the current situations and prediction of future economic conditions, calculate the expected credit losses according to the default risk exposure and rate of lifetime expected credit loss.

Contract assets - group of aging	Aging	By reference to historic credit loss experience, and taking into account the current situations and prediction of future economic conditions, prepare a comparison table of the aging of contract assets and rate of lifetime expected credit loss, and calculate the expected credit losses.
Long-term receivables - grouping by aging	Aging	By reference to historic credit loss experience, and taking into account the current situations and prediction of future economic conditions, prepare a comparison table of the aging of long-term receivables and rate of lifetime expected credit loss, and calculate the expected credit losses.

2) Accounts receivable - comparison table of the age of accounts receivable and rate of lifetimeexpected credit loss

Aging	Accounts receivable Rate of expected credit loss for accounts receivable (%)
Within 1 year (including, the same below)	5.00
1-2 years	25.00
2-3 years	50.00
Over 3 years	100.00

6. Offsetting of financial assets and financial liabilities

Financial assets and financial liabilities are presented in the balance sheet separately, withoutoffsetting each other. However, the Company may represent the financial assets and financial liabilitieson a net basis in the balance sheet only if: (1) the Company has a legal right that is currently enforceableto set off the recognized financial assets and financial liabilities, and (2) the Company intends either tosettle on a net basis, or to realize the financial asset and settle the financial liability simultaneously.

With respect to the transfer of financial assets not meeting the criteria for derecognition, the Companydoes not offset the financial assets transferred against the relevant liabilities.

11. Notes receivable

Method for recognition of expected credit losses of notes receivable and relevant accountingtreatments

√ Applicable□ N/A

The Company’s method for recognition of expected credit losses of notes receivable and relevantaccounting treatments are disclosed in V.10 of Section X in details.

12. Accounts receivable

Method for recognition of expected credit losses of accounts receivable and relevant accountingtreatments

√ Applicable□ N/A

The Company’s method for recognition of expected credit losses of accounts receivable and relevantaccounting treatments are disclosed in V.10 of Section X in details.

13. Receivables financing

√ Applicable□ N/A

The Company’s policies on receivables financing and accounting are disclosed in V.10 of Section X indetails.

14. Other receivables

Method for recognition of expected credit losses of other receivables and relevant accountingtreatments

√ Applicable□ N/A

The Company’s method for recognition of expected credit losses of other receivables and relevantaccounting treatments are disclosed in V.10 of Section X in details.

15. Inventories

√ Applicable□ N/A

1. Categories of inventories

Inventories include finished goods or merchandise held by the Company for sale in the ordinarycourse of business, or work in progress in the process of production for such sale, or materials or suppliesto be consumed in the production process or in the rendering of services.

2. Valuation method of inventories upon delivery

The actual cost of inventories upon delivery is calculated using the moving weighted average method.

3. Basis for determining net realizable value of inventories

At the balance sheet date, inventories are measured at the lower of cost and net realizable value. Ifthe net realizable value is below the cost of inventories, a provision for decline in value of inventories ismade. For inventories directly used for sale, the net realizable value is determined as the estimated sellingprice in the ordinary course of business less the estimated costs necessary to make the sale and relevanttaxes. For inventories required for processing, the net realizable value is determined as the estimatedselling price of finished goods in the ordinary course of business less the estimated costs of completion,and the estimated costs necessary to make the sale and relevant taxes. As at the balance sheet date, if inthe same item of inventories, some are agreed with contractual prices while the others are not, the netrealizable value for such inventories is determined separately, and compared with the costs of the two partsof inventories distinctively, as to determine the provisions or reversal of provisions for decline in value ofinventories separately.

4. Inventory count system

The perpetual inventory system is maintained for stock system.

5. Amortization method for low cost and short-lived consumable items and packaging materials

(1) Low cost and short-lived consumable items

Low cost and short-lived consumable items are amortized using the immediate write-off method.

(2) Packaging materials

Packaging materials are amortized using the immediate write-off method.(XII) Contract costsAssets related to contract costs include contract acquisition costs and contract performance costs.If costs incurred by the Company for acquiring a contract are expected to be recovered, such costsare recognized as an asset as contract acquisition costs.The costs incurred by the Company for performing a contract are recognized as an asset of contractperformance costs if they do not fall within the scope of other relevant standards, like inventories, fixedassets, or intangible assets, and meet all the following conditions:

1. The cost is directly related to a present or expected contract, including direct labor, direct materials,manufacturing expenses (or similar expenses), costs explicitly to be borne by customers, and other costsarising from the contract;

2. The cost leads to the increase in resources of the Company for fulfilling its performance obligationsin the future; and

3. The cost is expected to be recovered.

Assets related to contract costs are amortized on the same basis as recognizing incomes from goodsrelated to assets, and are recognized in the profit or loss for the current period.

If the carrying amount of the assets related to contract costs is greater than the consideration expectedto be acquired by transferring the goods or services related to such assets less the costs expected to beincurred, the Company makes provision for impairment for the exceeding portion and recognizesimpairment loss of assets. In the event of a change in the factors causing impairment in a prior period, sothat the consideration expected to be acquired by transferring the goods or services related to such assetsless the costs expected to be incurred is greater than the carrying amount of such assets, the provision forimpairment made for such assets is reversed and recognized in the profit or loss for the current period;provided, however, that the reversed carrying amount of such assets shall not exceed the carrying amountof such assets at the reversal data on the assumption that no provision for impairment has been made.

16. Contract assets

(1). Recognition method and criteria of contract assets

√ Applicable□ N/A

The Company presents contract assets or contract liabilities in the balance sheet according to therelationship between the performance of contractual obligations and payment by customers. Contractassets and contract liabilities under a same contract are presented at the net amount after offsetting eachother.

The Company presents its owned right to unconditionally (that is, only depending on the lapse of

time) receive consideration from customers as the accounts receivable, and the right to receive theconsideration for which the goods that have been transferred to customers (that is, depending on factorsother than the lapse of time) as the contract assets.

(2). Method for recognition of expected credit losses of contract assets and relevant accountingtreatments

√ Applicable□ N/A

The method for recognition of expected credit losses of contract assets and relevant accountingtreatments are disclosed in V.10 of Section X in details.

17. Assets held for sale

□ Applicable √ N/A

18. Debt investments

Method for recognition of expected credit losses of debt investments and relevant accountingtreatments

□ Applicable √ N/A

19. Other debt investments

Method for recognition of expected credit losses of other debt investments and relevant accountingtreatments

□ Applicable √ N/A

20. Long-term receivables

Method for recognition of expected credit losses of long-term receivables and relevant accountingtreatments

√ Applicable□ N/A

The method for recognition of expected credit losses of long-term receivables and relevant accountingtreatments are disclosed in V.10 of Section X in details.

21. Long-term equity investments

√ Applicable□ N/A

1. Judgments on joint control and significant influence

Joint control is the contractually agreed sharing of control of an arrangement, which exists only whendecisions about the relevant activities of such arrangement require unanimous consent of the partiessharing control. Significant influence is the power to participate in the financial and operating policymaking of an entity, but does not control or jointly control over those policies.

2. Determination of investment cost

(1) In case of an equity investment acquired through a business combination involving entities undercommon control, if the acquirer pays consideration for the business combination by cash, transfer of non-monetary assets, assumption of liabilities or issuance of equity securities, the initial investment cost of thelong-term equity investment is the Company’s share of the carrying amount of the owners’ equity of the

acquiree in the consolidated financial statements of the ultimate controller at the date of combination. Thedifference between: (i) the initial investment cost of the long-term equity investment; and (ii) the carryingamount of the consideration paid for the combination or the total par value of the shares issued is treatedas an adjustment to the capital reserve. In case the capital reserve is not sufficient to absorb the difference,the remaining balance is adjusted against the retained earnings.

For a long-term equity investment acquired through business combination involving enterprisesunder common control that is achieved through multiple transactions by steps, the Company shall judgewhether such transactions constitute a package deal. If such transactions constitute a package deal, theCompany accounts for such transactions as one transaction to acquire control. If such transactions do notconstitute a package deal, the initial investment cost is the Company’s share of the carrying amount of theowners’ equity of the acquiree in the consolidated financial statements of the ultimate controller at the dateof combination. The difference between: (i) the initial investment cost of the long-term equity investmentat the date of combination; and (ii) the sum of the carrying amount of long-term equity investment beforethe combination and the carrying amount of the consideration paid for acquisition of the additional sharesat the date of combination is adjusted against the capital reserve. In case the capital reserve is not sufficientto absorb the difference, the remaining balance is adjusted against the retained earnings.

(2) In case of an equity investment acquired through a business combination not involving enterprisesunder common control, the initial investment cost is the fair value of the carrying amount of theconsideration paid for the combination at the date of acquisition.

With respect to a long-term equity investment acquired through a business combination not involvingenterprises under common control that is achieved through multiple transactions by steps, the accountingtreatment thereof in the separate financial statements is different from that in the consolidated financialstatements as stated below:

1) In the separate financial statements, the sum of the carrying amount of the equity investmentoriginally held in the acquiree and the additional investment cost incurred is recorded as the initialinvestment cost of the equity investment changed into the cost method.

2) In the consolidated financial statements, it is required to judge whether such transactions constitutea package deal. If such transactions constitute a package deal, the Company accounts for such transactionsas one transaction to acquire control. If such transactions do not constitute a “package deal”, the Companyre-measures the fair value of the equity held in the acquiree prior to the date of acquisition, and recordsthe difference between the fair value and the carrying amount as investment income for the current period;if the equity held in the acquiree prior to the date of acquisition involves other comprehensive incomeunder equity method, such other comprehensive income is transferred to the income of the period in whichthe date of acquisition falls, except for other comprehensive income arising from re-measurement by theinvestee of changes in net liabilities or net assets of defined benefit plans.

(3) In the event of no business combination: the initial investment cost is the purchase price actuallypaid if it is acquired by cash, or the fair value of the equity securities issued if it is acquired throughissuance of equity securities, or determined in accordance with the Accounting Standards for Business

Enterprises No. 12 -- Debt Restructuring if it is acquired through debt restructuring, or determined inaccordance with the Accounting Standards for Business Enterprises No. 7 -- Exchange of Non-monetaryAssets if it is acquired through exchange of non-monetary assets.

3. Subsequent measurement and recognition of profit or loss

Long-term equity investments in investees are measured using the cost method. Long-term equityinvestments in associates and joint ventures are measured using the equity method.

22. Investment properties

N/A

23. Fixed assets

(1). Criteria for recognition

√ Applicable□ N/A

Fixed assets are tangible assets held for production of goods, rendering of service, lease or operationand management with a useful life of more than one accounting year. A fixed asset is recognized if theeconomic benefits relating to it are very likely to flow to the Company and its cost can be reliably measured.

(2). Method of depreciation

√ Applicable□ N/A

Category	Method of depreciation	Depreciation period (years)	Residual value rate (%)	Annual depreciation rate (%)
Machinery and equipment	Straight line method	5	5.00	19.00
Transportation equipment	Straight line method	5	5.00	19.00
Electronic equipment and others	Straight line method	3-5	5.00	19.00-31.67
Operating leased equipment	Straight line method	3, 7	5.00	31.67, 13.57

(3). Identification basis, valuation method and depreciation method for fixed assets acquired under

finance leases

□ Applicable √ N/A

24. Construction in progress

√ Applicable□ N/A

1. A construction in progress is recognized if the economic benefits relating to it are very likely toflow to the Company and its cost can be reliably measured. A construction in progress is measured at theactual cost incurred before it is completed and ready for intended use.

2. When a construction in progress is ready for intended use, it is transferred to fixed assets at itsactual construction cost. A construction in progress that is ready for intended use but the final settlement

of which has not yet been completed is transferred to fixed assets at estimated value first, and after thecompletion of final settlement, the estimated value is adjusted according to the actual cost, but the accrueddepreciation is not adjusted.

25. Borrowing costs

√ Applicable□ N/A

1. Recognition for capitalization of borrowing costs

Borrowing costs incurred by the Company that are directly attributable to the acquisition,construction or production of a qualifying asset are capitalized as part of the cost of that asset. Otherborrowing costs are recognized as expenses and charged to the current profit or loss.

2. Capitalization period of borrowing costs

(1) Borrowing expenses are capitalized when all of the following conditions are met: 1) capitalexpenditure has been incurred; 2) borrowing expenses have been incurred; and 3) activities relating to theacquisition, construction or production of the asset that are necessary to prepare the asset for its intendeduse or sale have commenced.

(2) Where acquisition and construction or production of a qualified asset is interrupted abnormallyand the interruption period lasts for more than 3 months, the capitalization of the borrowing costs shall besuspended. The borrowing expenses incurred during these periods shall be recognized as expenses for thecurrent period until the acquisition, construction or production of a qualifying asset is resumed.

(3) Capitalization of borrowing expenses shall be ceased when acquisition, construction or productionof the qualifying asset has prepared for its intended use or sale.

3. Capitalization rate and capitalization amount of borrowing expenses

As for the specific borrowings for the acquisition and construction or production of assets qualifyingfor capitalization, the to-be-capitalized amount of interests shall be determined in light of the actual costincurred on the current specific borrowings (including the amortization of discounts or premiumsdetermined using the effective interest method) minus the income of interests earned from the unusedborrowings by depositing it in the bank or investment income from such borrowing by making it as atemporary investment; where a general borrowing is used for the acquisition and construction orproduction assets qualifying for capitalization, the Company shall calculate and determine the to-be-capitalized amount of interests on the general borrowing by multiplying the weighted average value of theaccumulative expenditures to asset minus the specific borrowing by the capitalization rate of the generalborrowing used.

26. Biological assets

□ Applicable √ N/A

27. Oil and gas assets

□ Applicable √ N/A

28. Use right assets

√ Applicable□ N/A

Use right assets are initially measured at cost; the cost includes: 1) Initial measurement amount ofleased liabilities; 2) lease payments paid on or prior to the commencement of the lease term, net of thelease incentives (if any) received; 3) initial direct expenses incurred by the lessee; and 4) costs expectedto be incurred by the lessee for dismantling and removing the leased assets, restoring the place of theleased assets, or restoring the leased assets to the state provided under lease provisions.The Company depreciates use right assets by using the straight-line method. If there is reasonablecertainty that the lessee will obtain ownership of the leased asset by the end of the lease term, the Companydepreciates the leased asset over its useful life. If there is no reasonable certainty that the lessee will obtainownership of the leased asset by the end of the lease term, the Company depreciates the leased asset overthe shorter of the lease term and its remaining useful life.

29. Intangible assets

(1). Measurement, service life and impairment test

√ Applicable□ N/A

1. Intangible assets include land use right, patents use right, and software, and are measured at costinitially.

2. An intangible asset with a finite useful life is amortized over its useful life in a systematical andrational expected realization of economic benefits relative to the intangible asset, or is amortized using thestraight-line method if it is impossible to determine expected realization reliably. The specific years are asfollows:

Item	Amortization period (years)
Land use right	30
Patents use right	10
Software	3-5

(2). Accounting policy on internal research and development expenditures

□ Applicable √ N/A

30. Impairment of long-term assets

√ Applicable□ N/A

For long-term equity investments, fixed assets, construction in progress, use right assets, intangibleassets with a finite useful life and other long-term assets, if there’s an indication of impairment at thebalance sheet date, the Company assesses their recoverable amount. Goodwill arising from businesscombinations and intangible assets with an infinite useful life are tested for impairment every yearregardless of whether there’s an indication of impairment. Goodwill is tested for impairment together withthe relevant groups of assets or combinations of groups of assets.

If the recoverable amount of a long-term asset is less than its carrying amount, the difference ismeasured as impairment loss of the asset and recognized in profit or loss for the current period.

31. Long-term prepaid expenses

√ Applicable□ N/A

Long-term prepaid expenses are expenses that have already been incurred but should be amortizedover a period of more than one year (excluding one year). Long-term prepaid expenses are stated as theamount actually incurred and shall be amortized evenly by stages within the benefit period or specifiedperiod. If an item of long-term prepaid expenses will not benefit the subsequent periods, the amortizedvalue of the item that has not yet been amortized is wholly transferred to profit or loss for the currentperiod.

32. Contract liabilities

Recognition method for contract liabilities

√ Applicable□ N/A

The Company presents contract assets or contract liabilities in the balance sheet according to therelationship between the performance of contractual obligations and payment by customers. Contractassets and contract liabilities under a same contract are presented at the net amount after offsetting eachother.

The obligations of the Company for transferring goods to customers corresponding to considerationsthat have been received or receivable are presented as contract liabilities.

33. Employee benefits

(1). Accounting treatment of short-term employee benefits

√ Applicable□ N/A

1. Employee benefits include short-term benefits, post-employment benefits, termination benefits andother long-term employee benefits.

2. Accounting treatment of short-term employee benefits

The short-term employee benefits actually incurred are recognized as liabilities in the accountingperiod during which employee services are rendered, and included in profit or loss for the current periodor the cost of related assets.

(2). Accounting treatment of post-employment benefits

√ Applicable□ N/A

Post-employment benefits are classified into defined contribution plans and defined benefit plans.

(1) In the accounting period during which employee services are rendered, the amount in contributionas calculated according to the defined contribution plan is recognized as liabilities and included in profitor loss for the current period or the cost of related assets.

(2) The accounting treatment of a defined benefit plan generally involves the following steps:

1) According to the projected unit credit method, use the unbiased and consistent actuarialassumptions to estimate demographic variables and financial variables, measure the obligation arisingfrom the defined benefit plan and determine the period to which the relevant obligation belongs.Meanwhile, discount the obligation arising from the defined benefit plan, in order to determine the presentvalue of the defined benefit plan obligation and the current service cost;

2) If the defined benefit plan has assets, the deficit or surplus resulting after reducing the presentvalue of the defined benefit plan obligation by the fair value of the defined benefit plan is recognized as anet liability or asset of the defined benefit plan. If the defined benefit plan has a surplus, the net assets ofthe defined benefit plan are measured at the lower of surplus in the defined benefit plan and asset ceiling;

3) At the end of the reporting period, the cost of employee benefits arising from the defined benefitplan is recorded as service cost, net interest on the net liabilities or net assets of the defined benefit plan,and changes arising from re-measurement of the net liabilities or net assets of the defined benefit plan,wherein the service cost and the net interest on the net liabilities or net assets of the defined benefit planare included in profit or loss for the current period or the cost of related assets, and the changes arisingfrom re-measurement of the net liabilities or net assets of the defined benefit plan are included in othercomprehensive income, which will not be reserved to profit or loss in subsequent periods, but may betransferred within the scope of equity.

(3). Accounting treatment of termination benefits

√ Applicable□ N/A

If dismissal benefits are provided to employees, the liabilities of employee benefits from the dismissalbenefits are recognized at the earlier of the following and are recognized in the profit or loss for the currentperiod: (1) when the Company can no longer withdraw the offer of termination benefits as a result oftermination of employment or redundancy; or (2) the Company recognizes the restructuring costs orexpenses relating to payment of termination benefits.

(4). Accounting treatment of other long-term employee benefits

√ Applicable□ N/A

Other long-term employee benefits are accounted for in accordance with the provisions applicable todefined contribution plans if they are qualified as defined contribution plans, otherwise, are accounted forin accordance with the provisions applicable to defined benefit plans. In order to simplify the accountingtreatment, the total net amount of the cost of employee benefits arising from the defined benefit plans thatis recorded as service cost, net interest on the net liabilities or net assets of other long-term employeebenefits, changes arising from re-measurement of the net liabilities or net assets of other long-termemployee benefits and other components is included in profit or loss for the current period or the cost ofrelated assets.

34. Lease liabilities

√ Applicable□ N/A

At the commencement date of the lease, the Company recognizes the present value of lease paymentsnot paid as lease liabilities. The interest rate implicit in the lease is used as the discount rate for calculatingthe present value of the lease payments; if the interest rate implicit in the lease cannot be determined, theincremental borrowing interest rate of the Company is used as the discount rate. The difference betweenthe lease payments and the present value thereof is considered as unrecognized finance charges; in eachperiod during the lease term, interest expenses are recognized in the profit or loss for the current period

according to the discount rate of the present value of recognized lease payments. Variable lease paymentsnot included in measurement of lease liabilities are recognized in the profit or loss for the current periodwhen the actually arise.Where, after the lease inception date, there are changes in the substantial fixed payment, the payablesexpected on the basis of the residual value of the guarantee, the index or ratio used for determining thelease payment, the evaluation results or actual exercising of purchase option, renewal option or leasetermination option, the Company re-measures the lease liability as per the present value of the leasepayment after change, and adjust the carrying amount of the use right assets accordingly. Where thecarrying amount of the use right asset has been reduced to zero, but the lease liability still needs to befurther reduced, the Company includes the residual amount in the current profit or loss.

35. Provisions

√ Applicable□ N/A

1. An obligation arising from any external guarantee, instigation, product quality warranty, onerouscontract or other contingencies is recognized as a provision if it is a present obligation assumed by theCompany, and it is probable that an outflow of resources embodying economic benefits will be requiredto settle the obligation, and the amount of the obligation can be reliably measured.

2. The amount recognized as a provision is the best estimate of the consideration required to settlethe present obligation. The carrying amount of provisions is reviewed at the balance sheet date.

36. Share-based payments

√ Applicable□ N/A

1. Categories of share-based payments

Share-based payments include equity-settled share-based payments and cash-settled share-basedpayments.

2. Accounting treatment for implementation, modification and termination of share-based paymentplan

(1) Equity-settled share-based payments

Equity-settled share-based payments in exchange for services rendered by employees that can beexecuted immediately upon being granted, are measured at the fair value of the equity instruments at thegrant date, and recognized as related costs or expenses with a corresponding adjustment to capital reserve.At each balance sheet date during the vesting period, equity-settled share-based payments in exchange forservices rendered by employees that cannot be executed until services in the vesting period are completedor required performance conditions are satisfied, are measured at the fair value of the equity instrumentsat the grant date based on the best estimate of exercisable numbers of equity instruments, and recognizedas related costs or expenses with a corresponding adjustment to capital reserve.

For equity-settled share-based payments in exchange for services rendered by other parties, if the fairvalue of services from other parties can be measured reliably, they are measured at the fair value of servicesfrom other parties at the date when such services are received. If the fair value of services from otherparties cannot be measured reliably but the fair value of the equity instruments can be measured reliably,

they are measured at the fair value of the equity instruments at the date when such services are received.The fair value of the equity instruments are recognized as related costs or expenses, with a correspondingincrease in owners’ equity.

(2) Cash-settled share-based payments

Cash-settled share-based payments in exchange for services rendered by employees that can beexecuted immediately upon being granted, are recognized as related costs or expenses based on the fairvalue of liabilities assumed by the Company at the grant date, with a corresponding increase in liability.At each balance sheet date during the vesting period, cash-settled share-based payments in exchange forservices rendered by employees that cannot be executed until services in the vesting period are completedor required performance conditions are satisfied, are measured at the fair value of liabilities assumed bythe Company based on the best estimate of exercisable conditions, and recognized as related costs orexpenses and relevant liabilities.

(3) Modification and termination of share-based payment plan

If the modification increases the fair value of the equity instruments granted, the Company willinclude the incremental fair value of the equity instruments granted in the measurement of the amountrecognized for services received. If the modification increases the number of the equity instrumentsgranted, the Company will include the fair value of additional equity instruments granted in themeasurement of the amount recognized for services received. If the Company modifies the exercisableconditions of the share-based payment plan in a manner beneficial to the employee, the Company willconsider the modified exercisable conditions when dealing with exercisable conditions.

If the modification decreases the fair value of the equity instruments granted, the Company willcontinue to measure the amount recognized for services received at the fair value of the equity instrumentsat the grant date without including the decremental fair value of the equity instruments. If the modificationdecreases the number of the equity instruments granted, the Company will treat the decreased number asthe cancelled number of equity instruments granted. If the Company modifies the exercisable conditionsin a manner unbeneficial to the employee, the Company will not consider the modified exercisableconditions when dealing with exercisable conditions.If cancellation or settlement of the equity instruments granted occurs (not due to unsatisfaction ofexercisable conditions) during the vesting period, the Company will account for the cancellation orsettlement of the equity instruments granted as an acceleration of vesting, and recognize immediately theamount that otherwise would have been recognized over the remainder of the vesting period.

37. Preferred shares, perpetual bonds and other financial instruments

□ Applicable √ N/A

38. Revenue

(1). Accounting policies adopted for income recognition and measurement

√ Applicable□ N/A

1. Principles for revenue recognition

On the commencement date of a contract, the Company evaluates the contract, identifies eachindividual performance obligation contained therein and determine whether each individual performanceobligation is performed over time or at a certain point in time.When meeting one of the following criteria, it belongs to the obligation performed over time,otherwise it constitutes the obligation performed at a certain point in time: (1) the customer obtains andconsumes the economic benefits generated by the Company’s performance when the Company performsthe contract; (2) the customer can control the products under construction in the process of the Company’sperformance; (3) the products produced in the process of the Company’s performance have irresplaceableuses, and the Company has the right to collect payment for the cumulative performance that has beencompleted up to date throughout the term of the contract.For the obligation performed over time, the Company recognizes the revenue based on theperformance progress over time. When the performance progress cannot be reasonably determined, andthe costs incurred are expected to be recoverable, revenue is recognized to the extent of costs incurreduntil the performance progress can be reasonably determined. For the obligation performed at a certainpoint in time, the revenue is recognized at the time point when the customer obtains the control of therelated goods and services. When judging whether the customer has obtained the control of goods, theCompany considers the followings signs: (1) the Company has the current right to receive payment forsuch goods, that is, the customer has the current obligation to make payment for such goods; (2) theCompany has transferred the legal ownership of such goods to the customer, that is, the customer has thelegal ownership of such goods; (3) the Company has transferred such goods to the customer physically,that is, the customer has taken possession of such goods physically; (4) the Company has transferredmaterial risks and rewards of such goods to the customer, that is, the customer has obtained material risksand rewards of such goods; (5) the customer has accepted such goods; and (6) other signs that the customerhas obtained control of such goods.

2. Principles for revenue measurement

(1) The Company measures the revenue based on the transaction price allocated to individualperformance obligations. The transaction price is the amount of consideration to which the Company isentitled arising from the transfer of goods or services to the customer, excluding the amount collected onbehalf of a third party and expected to be returned to the customer.

(2) If there is variable consideration in the contract, the Company determines the best estimate of thevariable consideration based on the expected value or the most likely amount. However, variableconsideration is included in the transaction price if, and to the extent that, it is highly probable that itsinclusion will not result in a significant revenue reversal of accumulatively recognized revenue in thefuture when the uncertainty has been subsequently resolved.

(3) If there is a major financing component in the contract, the Company determines the transactionprice based on the presumed amount payable in cash when the customer obtains the control of goods orservices. The difference between the transaction price and contract consideration is amortized using theeffective interest method during the term of the contract. If on the commencement of a contract, the

Company expects that the customer’s acquisition of control of goods or services is not more than one yearfrom the customer’s payment therefor, the major financing component in the contract will not beconsidered.

(4) If the contract has two or multiple performance obligations, the Company, on the commencementof a contract, allocates the transaction price to each individual performance obligation in the contract byreference to relative standalone selling prices of goods promised thereby.

3. Specific methods for revenue recognition

(1) Revenue from sales of goods

The performance obligation concerning sales of goods (primarily dividing into goods sold to thedomestic market and goods exported to overseas markets) by the Company is taken as one satisfied at acertain point in time for the recognition of revenue.

Goods sold to the domestic market: 1) Under the direct sale model and the distribution model, theCompany recognizes the revenue when the goods sent have been delivered to customers with customers’receipt given to the Company. For goods sold attached with return conditions, the Company recognizesthe revenue according to the amount of consideration to which it expects to be entitled in exchange fortransferring goods to customers, and recognize the liabilities according to the expected amount to bereturned due to sales return against the revenue; for goods required for installment and inspection aftersales, the Company recognizes the revenue when such goods have been installed and inspected withcustomers’ acceptance certificate given to the Company; for goods sold to lower-tier end customers whoseselling profits are shared by the Company, the Company recognizes the revenue when such goods aredelivered to the customers and reconciliation is conducted according to the mutually predetermined priceof the goods, and recognizes the share of the profits when the selling profits of the goods are realizedaccording to the share statement. 2) Under the commissioned sales mode, the Company recognizes therevenue when it receives the list of commissioned sales from the customer.

Goods exported to overseas markets: The Company mainly adopts FCA for export of goods. Underthis mode, the Company recognizes revenue when it delivers goods at the designated location with exportcustoms clearance procedures completed.

(2) Other incomes

Any other performance obligation of the Company is taken as one satisfied over time/at a certainpoint in time for the recognition of revenue. For installation services provided by the Company, theCompany recognizes the revenue when it has completed the services and received customers’ acceptancecertificate; for repair and maintenance services provided by the Company, the Company recognizes therevenue when it has completed the services and received payments; for patent licensing services providedby the Company, the Company recognizes the revenue when the patent licensing is completed and handedover; and for technology development services provided by the Company, the Company recognizes therevenue when it has completed the services or when the agreed time point of service acceptance is reached.

(2). Description of differences in the accounting policies in revenue recognition due to differentoperating modes adopted for the same business type

□ Applicable √ N/A

39. Contract costs

√ Applicable□ N/A

Assets related to contract costs include contract acquisition costs and contract performance costs.If costs incurred by the Company for acquiring a contract are expected to be recovered, such costsare recognized as an asset as contract acquisition costs.

The costs incurred by the Company for performing a contract are recognized as an asset of contractperformance costs if they do not fall within the scope of other relevant standards, like inventories, fixedassets, or intangible assets, and meet all the following conditions:

1. The cost is directly related to a present or expected contract, including direct labor, direct materials,manufacturing expenses (or similar expenses), costs explicitly to be borne by customers, and other costsarising from the contract;

2. The cost leads to the increase in resources of the Company for fulfilling its performance obligationsin the future; and

3. The cost is expected to be recovered.

Assets related to contract costs are amortized on the same basis as recognizing incomes from goodsrelated to assets, and are recognized in the profit or loss for the current period.

If the carrying amount of the assets related to contract costs is greater than the consideration expectedto be acquired by transferring the goods or services related to such assets less the costs expected to beincurred, the Company makes provision for impairment for the exceeding portion and recognizesimpairment loss of assets. In the event of a change in the factors causing impairment in a prior period, sothat the consideration expected to be acquired by transferring the goods or services related to such assetsless the costs expected to be incurred is greater than the carrying amount of such assets, the provision forimpairment made for such assets is reversed and recognized in the profit or loss for the current period;provided that the reversed carrying amount of such assets shall not exceed the carrying amount of suchassets at the reversal data on the assumption that no provision for impairment has been made.

40. Government grants

√ Applicable□ N/A

1. Government grants are recognized if (1) the Company meets the conditions attaching to thegovernment grants; and (2) the Company will receive the government grants. Government grants in theform of monetary assets are measured at the amount received or receivable. Government grants in theform of monetary assets are measured at the amount received or receivable. Government grants in theform of non-monetary assets are measured at fair value, or if their fair value is unavailable, at nominalamount.

2. Determination and accounting treatment of government grants related to assets

Government grants related to assets are government grants which are offered for purchasing,constructing or otherwise acquiring long-term assets as provided by the applicable government documents.In the absence of such express provision in the applicable government documents, government grantsrelated to assets are those with a primary condition that the Company should purchase, construct orotherwise acquire long-term assets. Government grants related to assets are offset against the carryingamount of the relevant assets or recognized as deferred income. Government grants related to assetsrecognized as deferred income shall be included in profit or loss over the service life of the relevant assetson a reasonable and systemic basis. Government grants measured at nominal amount are directlyrecognized in profit or loss for the current period. In case of sale, transfer, retirement or damage of therelevant assets before the end of intended service life, the balance of the unallocated deferred income istransferred to profit or loss for the period in which the assets are disposed of.

3. Determination and accounting treatment of government grants related to income

Government grants related to income are government grants other than those related to assets.Government grants related to both assets and income in which it is difficult to make a distinction betweenthe portion related to assets and the portion related to income are wholly classified as government grantsrelated to income. Government grants related to income as compensation for expenses or losses to beincurred in subsequent periods are recognized as deferred income and in the period for recognizing therelevant costs, expenses or losses, included in profit or loss for the current period or offset against therelevant costs. Government grants related to income as compensation for expenses or losses alreadyincurred are directly included in profit or loss for the current period or offset against the relevant costs.

4. Government grants related to daily operations of the Company are recognized in other income oroffset against the relevant costs and expenses depending on the nature of economic business. Governmentgrants not related to daily operations of the Company are recognized in non-operating income or expenses.

5. Accounting treatment of policy preferential loans and interest subsidies

(1) If the Ministry of Finance appropriates the interest subsidies to the lending bank, who then grantsthe loan to the Company at the policy preferential rate, the loan is stated as the amount actually received,and the borrowing cost is calculated according to the principal of the loan and the policy preferential rate.

(2) If the Ministry of Finance directly appropriates the interest subsidies to the Company, the interestsubsidies are offset against the borrowing cost.

41. Deferred tax assets and deferred tax liabilities

√ Applicable□ N/A

1. The difference between the tax base of an asset or liability and its carrying amount (or in case ofan item not recognized as asset or liability whose tax base can be determined according to the applicabletax law, the difference between its tax base and carrying amount) is recognized as a deferred tax asset ordeferred tax liability according to the tax rate applicable to the period in which the asset or liability isexpected to be recovered or settled.

2. Deferred tax assets are recognized to the extent of the amount of income tax payable that will beavailable in future periods against which deductible temporary differences are deductible. At the balance

sheet date, deferred tax assets not recognized in prior periods are recognized if there’s conclusive evidencethat it is probable that sufficient taxable income will be available in future periods against which thedeductible temporary differences are deductible.

3. At the balance sheet date, the carrying amount of deferred tax assets is reviewed and reduced tothe extent that it is no longer probable that sufficient taxable income will be available in future periods toallow the benefit of the deferred tax assets to be utilized. If it is probable that sufficient taxable incomewill be available, the reduced amount is reversed.

4. The income taxes and deferred taxes are included in profit or loss for the current period as incometax expenses or gains, except the income taxes arising from any: (i) business combination; or (ii)transaction or event directly recognized in owners’ equity.

42. Leases

(1). Accounting treatment of operating leases

□ Applicable √ N/A

(2). Accounting treatment of finance leases

□ Applicable √ N/A

(3). Method for determination and accounting treatments of lease under the New Lease Standard

√ Applicable□ N/A

1. The Company as the lessee

On the lease inception date, the Company recognizes a lease with a lease term of not more than 12months and not containing an option as a short-term lease, and recognizes a low-value assets lease for alease in which individually leased assets have a low value when they are new. If the Company subleasesor expects to sublease the leased asset, the original lease is not recognized as a low-value assets lease.

For short-term leases and low-value assets leases, the Company recognizes lease payment in the costsof relevant assets or the profit or loss for the current period by using the straight-line method in each periodduring the lease term.

Except for short-term leases and low-value assets leases subject to simplified treatment above, on thelease inception date, the Company recognizes use right assets and lease liabilities for leases.

(1) Use right assets

Use right assets are initially measured at cost; the cost includes: 1) initial measurement amount ofleased liabilities; 2) lease payments paid on or prior to the commencement of the lease term, net of thelease incentives (if any) received; 3) initial direct expenses incurred by the lessee; and 4) costs expectedto be incurred by the lessee for dismantling and removing the leased assets, restoring the place of theleased assets, or restoring the leased assets to the state provided under lease provisions.

The Company depreciates use right assets by using the straight-line method. If there is reasonablecertainty that the lessee will obtain ownership of the leased asset by the end of the lease term, the Companydepreciates the leased asset over its useful life. If there is no reasonable certainty that the lessee will obtainownership of the leased asset by the end of the lease term, the Company depreciates the leased asset over

the shorter of the lease term and its remaining useful life.

(2) Lease liabilities

At the commencement date of the lease, the Company recognizes the present value of lease paymentsnot paid as lease liabilities. The interest rate implicit in the lease is used as the discount rate for calculatingthe present value of the lease payments; if the interest rate implicit in the lease cannot be determined, theincremental borrowing interest rate of the Company is used as the discount rate. The difference betweenthe lease payments and the present value thereof is considered as unrecognized finance charges; in eachperiod during the lease term, interest expenses are recognized in the profit or loss for the current periodaccording to the discount rate of the present value of recognized lease payments. Variable lease paymentsnot included in measurement of lease liabilities are recognized in the profit or loss for the current periodwhen the actually arise.

Where, after the lease inception date, there are changes in the substantial fixed payment, the payablesexpected on the basis of the residual value of the guarantee, the index or ratio used for determining thelease payment, the evaluation results or actual exercising of purchase option, renewal option or leasetermination option, the Company re-measures the lease liability as per the present value of the leasepayment after change, and adjust the carrying amount of the use right assets accordingly. Where thecarrying amount of the use right asset has been reduced to zero, but the lease liability still needs to befurther reduced, the Company includes the residual amount in the current profit or loss.

2. The Company as the lessor

On the lease inception date, the Company classifies a lease in which almost all the risks and rewardsrelated to the ownership of the leased asset have been substantially transferred as a finance lease, andrecognizes all other leases as operating leases.

(1) Operating lease

In each period during the lease term, the Company recognizes lease payments as rental incomes byusing the straight-line method/units of production method; initial direct expenses incurred are capitalized,and amortized on the same basis for recognizing lease incomes for recognizing in the profit or loss foreach period. The variable lease payments acquired by the Company that are related to operating leases andnot recognized in lease payments are recognized in the profit or loss for the current period when theyactually occur.

43. Other significant accounting policies and accounting estimates

□ Applicable √ N/A

44. Changes in significant accounting policies and accounting estimates

(1). Changes in significant accounting policies

□ Applicable √ N/A

(2). Changes in significant accounting estimates

□ Applicable √ N/A

45. Other description

□ Applicable √ N/A

VI. Taxes

1. Major categories of taxes and tax rates

Description of major categories of taxes and tax rates

√ Applicable□ N/A

Category of tax	Basis of tax computation	Tax rate
Value-added tax (VAT)	VAT payable is the difference of the output tax calculated based on the incomes from selling goods and taxable services in accordance with the Tax Law, less the input tax allowed to be reduced in the period	3%, 6%, 9%, 13%
City maintenance and construction tax	Turnover tax payable	7%
Enterprise income tax	Taxable income	4%, 8.25%, 8.70%, 8.84%, 15%, 16.5%, 20%, 21% and 25%
Education surcharges	Turnover tax payable	3%
Local education surcharges	Turnover tax payable	2%

Disclosure of taxpayers with different rates of enterprise income tax:

√ Applicable□ N/A

Taxpayer	Rate of enterprise income tax (%)
Appotronics Corporation Limited	15%
Fengmi (Beijing) Technology Co., Ltd.	15%
Appotronics Hong Kong Limited	8.25%, 16.5%
Beijing Orient Appotronics Technology Co., Ltd.	20%
JoveAI Innovation, Inc.	8.70%、8.84%、21%
Appotronics USA, Inc.	21%
FORMOVIE TECHNOLOGY INC	21%
JoveAI Limited	Tax exemption
WEMAX LLC	21%
Shenzhen Appotronics Display Device Co., Ltd.	20%
Appotronics Technology (Changzhou) Co., Ltd.	20%
Qingda Appotronics (Xiamen) Technology Co., Ltd.	20%
Shenzhen Appotronics Home Line Technology Co., Ltd.	20%
Shenzhen Appotronics Laser Technology Co., Ltd.	20%
Shenzhen Appotronics Xiaoming Technology Co., Ltd.	20%
JoveAI Asia Company Limited	20%
Formovie Limited	8.25%, 16.5%
Chongqing Ewei Ecommerce Co., Ltd.	20%
Chongqing Guangbo Ecommerce Co., Ltd.	20%
Shenzhen Orange Juice Energy Technology Co., Ltd.	20%
Tianjin Bonian Film Partnership (LP)	Tax exemption
CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.	15%

WEMAX INC	4%, 21%
Hongkong Orange Juice Energy Technology Co., Limited	8.25%, 16.5%
Other taxpayers except above	25%

Note:

1. Appotronics Hong Kong Limited, Formovie Limited and Hongkong Orange Juice EnergyTechnology Co., Limited were incorporated in Hong Kong. One of related entities in Hong Kong canapply the two-level income tax system, namely, applying the tax rate of 8.25% for the first HKD 2 milliontaxable income and 16.5% for the remaining taxable income.

2. JoveAI Limited, as domiciled in the Cayman Islands, is exempt from enterprise income tax.

3. Appotronics USA, Inc., as domiciled in the United States, applies the federal enterprise incometax rate of 21%.

4. JoveAI Innovation, Inc., as domiciled in the United States, applies the federal enterprise incometax rate of 21%, the California state enterprise income tax rate of 8.84%, and the Delaware state enterpriseincome tax rate of 8.70%.

5. FORMOVIE TECHNOLOGY INC, as domiciled in the United States, applies the federalenterprise income tax rate of 21%.

6. JoveAI Asia Company Limited, as domiciled in Vietnam, applies the enterprise income tax rate of20%.

7. WEMAX LLC, as domiciled in the United States, applies the federal enterprise income tax rate of21%.

8. Wemax Inc, as domiciled in the United States, applies the federal enterprise income tax rate of21%, and the New York state enterprise income tax rate of 4%.

2. Tax incentives

√ Applicable□ N/A

1. Enterprise income tax

(1) On December 9, 2019, the Company obtained the High-tech Enterprise Certificate (CertificateNo.: GR201944204257) jointly issued by Shenzhen Science and Technology Innovation Commission,Shenzhen Finance Bureau and Shenzhen Tax Service of State Taxation Administration with a valid termof three years. Therefore, the Company paid the enterprise income tax at a rate of 15% in 2022.

(2) On December 17, 2021, Fengmi (Beijing) Technology Co., Ltd. obtained the High-tech EnterpriseCertificate (Certificate No.: GR202111004001) jointly issued by Beijing Municipal Science andTechnology Commission, Beijing Finance Bureau and Beijing Tax Service of State TaxationAdministration with a valid term of three years. Therefore, the Company paid the enterprise income tax ata rate of 15% in 2022.

(3) On October 15, 2019, CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd. obtained theHigh-tech Enterprise Certificate (Certificate No.: GR201911002720) jointly issued by Beijing MunicipalScience and Technology Commission, Beijing Finance Bureau and Beijing Tax Service of State TaxationAdministration with a valid term of three years. Therefore, the Company paid the enterprise income tax ata rate of 15% in 2022.

(4) In accordance with the Notice of the Ministry of Finance and the State Taxation Administrationon Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small Enterprises(Cai Shui [2019] No. 13), and the Announcement of the Ministry of Finance and the State TaxationAdministration on Implementing Preferential Income Tax Policies for Micro and Small Enterprises andIndividually-owned Businesses (Announcement No. 12 in 2021 of the Ministry of Finance and the StateTaxation Administration), the annual taxable income of a small low-profit enterprise that is not more thanRMB 1 million shall be calculated at a discount of 12.5%, namely, for which the applicable enterpriseincome tax rate is 20%; for the annual taxable income more than RMB 1 million but no more than RMB3 million, the taxable income shall be calculated at a discount of 50%, namely, for which the applicableenterprise income tax rate is 20%. The following companies are qualified for enjoying such tax incentives:

Beijing Orient Appotronics Technology Co., Ltd., Shenzhen Appotronics Display Device Co., Ltd.,Appotronics Technology (Changzhou) Co., Ltd., Qingda Appotronics (Xiamen) Technology Co., Ltd.,Shenzhen Appotronics Home Line Technology Co., Ltd., Shenzhen Appotronics Laser Technology Co.,Ltd., Shenzhen City Appotronics Xiaoming Technology Co., Ltd., Chongqing Ewei Ecommerce Co., Ltd.,Chongqing Guangbo Ecommerce Co., Ltd., and Shenzhen Orange Juice Energy Technology Co., Ltd.

2. Value-added tax (VAT)

In accordance with the Notice of the Ministry of Finance and the State Administration of Taxationon Value-added Tax Policies for Software Products (Cai Shui [2011] No. 100), for self-developed andproduced software products sold by general VAT taxpayers, the tax-refund-upon-collection policy isapplicable to the part of their actual VAT burden in excess of 3% after the VAT has been collected at atax rate of 17%. The Company, its subsidiary Fengmi (Beijing) Technology Co., Ltd. and ShenzhenAppotronics Software Technology Co., Ltd. are qualified for enjoying such tax incentives.

3. Others

□ Applicable √ N/A

VII. Notes to items in the consolidated financial statements

1. Cash and bank balances

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Cash on hand	5,624.61	5,680.24
Bank deposits	954,395,647.47	924,308,952.81
Other monetary funds	90,990,742.22	33,415,198.10
Total	1,045,392,014.30	957,729,831.15
Including: Total oversea deposits	258,228,700.86	71,132,556.44

Other description:

In other monetary funds, an amount of RMB 50,315,805.66 is restricted for being used as margins;while in bank deposits, an amount of RMB 40,000,000.00 as 3-year time deposits, an amount of RMB3,293,156.61 as pledged time deposits and an amount of RMB 302,062.50 as undue interest are restrictedfor being used.

2. Held-for-trading financial assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Financial assets at fair value through profit or loss	493,566,000.00	417,200,000.00
Including:
Equity instrument investment	44,566,000.00	46,200,000.00
Structural deposits	449,000,000.00	371,000,000.00
Total	493,566,000.00	417,200,000.00

Other description:

□ Applicable √ N/A

3. Derivative financial assets

□ Applicable √ N/A

4. Notes receivable

(1). Categories of notes receivable

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Project	Closing balance	Opening balance
Bank acceptances	798,660.00	4,020,000.00
Commercial acceptances	3,351,604.73	1,236,603.03
Total	4,150,264.73	5,256,603.03

(2). Notes receivable pledged by the Company at the end of the period

□ Applicable √ N/A

(3). Notes receivable which are undue as at the balance sheet date but endorsed or discounted bythe Company at the end of the period

□ Applicable √ N/A

(4). Notes transferred to accounts receivable due to drawer’s failure in cashing at the end of theperiod

□ Applicable √ N/A

(5). Disclosure by categories of provision for bad debts

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Category	Closing balance			Opening balance
	Carrying amount	Provision for bad debts	Carrying amount	Carrying amount	Provision for bad debts	Carrying amount

	Amount	Percentage (%)	Amount	Percentage of provision (%)		Amount	Percentage (%)	Amount	Percentage of provision (%)
Provision for bad debts made individually
Including:
Provision for bad debts made by group	4, 326,664.98	100.00	176,400.25	4.08	4,150,264.73	5,321,687.40	100.00	65,084.37	1.22	5,256,603.03
Including:
Bank acceptance bills	798,660.00	18.46			798,660.00	4,020,000.00	75.54			4,020,000.00
Commercial acceptance bills	3,528,004.98	81.54	176,400.25	5.00	3,351,604.73	1,301,687.40	24.46	65,084.37	5.00	1,236,603.03
Total	4,326,664.98	/	176,400.25	/	4,150,264.73	5,321,687.40	/	65,084.37	/	5,256,603.03

Provision for bad debts made individually:

□ Applicable √ N/A

Provision for bad debts made by group:

√ Applicable□ N/A

Item by group: Commercial acceptance bills and bank acceptance bills

Unit: Yuan Currency: RMB

Name	Closing balance
	Notes receivable	Provision for bad debts	Percentage of provision (%)
Group of bank acceptance bills	798,660.00
Commercial acceptance bills group	3,528,004.98	176,400.25	5.00
Total	4,326,664.98	176,400.25	4.08

Recognition criterion to make the Provision for bad debts by group and explanation

□ Applicable √ N/A

If a provision for bad debts of accounts receivable is made in accordance with the general model ofECL, please disclose relevant information subject to the disclosure of the provision for bad debts forother receivables:

□ Applicable √ N/A

(6). Provision for bad debts

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Category	Opening balance	Changes for the current period			Closing balance
		Provision	Recovery or reversal	Write off or cancellation
Commercial acceptance bills	65,084.37	111,315.88			176,400.25
Total	65,084.37	111,315.88			176,400.25

Including significant amounts recovered or reversed from the current provision for bad debts:

□ Applicable √ N/A

Other description:

None

(7). Notes receivable actually canceled in the current period

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

5. Accounts receivable

(1). Disclosure by aging

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Aging	Closing balance of carrying amount
Within 1 year
Including: Subitems within 1 year
Sub-total of items within 1 year	374,415,347.02
1 to 2 years	7,248,639.32
2 to 3 years	235,957.26
Over 3 years	1,287,951.19
Total	383,187,894.79

(2). Disclosure by categories of provision for bad debts

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Category	Closing balance					Opening balance
	Carrying amount		Provision for bad debts		Carrying amount	Carrying amount		Provision for bad debts		Carrying amount
	Amount	Percentage (%)	Amount	Percentage of provision (%)		Amount	Percentage (%)	Amount	Percentage of provision (%)
Provision for bad debts made individually	852,162.42	0.22	852,162.42	100.00		2,117,500.23	0.50	1,279,675.64	60.43	837,824.59
Including:
Provision for bad debts made individually	852,162.42	0.22	852,162.42	100.00		2,117,500.23	0.50	1,279,675.64	60.43	837,824.59
Provision for bad debts made by group	382,335,732.37	99.78	21,875,078.67	5.72	360,460,653.70	425,509,438.81	99.50	23,212,791.53	5.46	402,296,647.28
Including:
Accounts receivable for which the provision for bad debts is made by aging group	382,335,732.37	99.78	21,875,078.67	5.72	360,460,653.70	425,509,438.81	99.50	23,212,791.53	5.46	402,296,647.28
Total	383,187,894.79	/	22,727,241.09	/	360,460,653.70	427,626,939.04	/	24,492,467.17	/	403,134,471.87

Provision for bad debts made individually:

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Name	Closing balance
	Carrying amount	Provision for bad debts	Percentage of provision (%)	Reason for provision
Legal person 1	782,311.37	782,311.37	100.00	The amounts are expected to be unrecoverable
Legal person 2	69,851.05	69,851.05	100.00	The amounts are expected to be unrecoverable
Total	852,162.42	852,162.42	100.00	/

Explanation about provision for bad debts made individually:

□ Applicable √ N/A

Provision for bad debts made by group:

√ Applicable□ N/A

Item by group: Accounts receivable for which the provision for bad debts is made by aging group

Unit: Yuan Currency: RMB

Name	Closing balance
	Accounts receivable	Provision for bad debts	Percentage of provision (%)
Within 1 year	373,669,035.65	18,683,451.78	5.00
1-2 years	7,142,788.27	1,785,697.07	25.00
2-3 years	235,957.26	117,978.63	50.00
Over 3 years	1,287,951.19	1,287,951.19	100.00
Total	382,335,732.37	21,875,078.67	5.72

Recognition criterion to make the provision for bad debts by group and explanation:

□ Applicable √ N/A

If a provision for bad debts of accounts receivable is made in accordance with the general model of ECL,please disclose relevant information subject to the disclosure of the provision for bad debts for otherreceivables:

□ Applicable √ N/A

(3). Provision for bad debts

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Category	Opening balance	Changes for the current period				Closing balance
		Provision	Recovery or reversal	Write off or cancellation	Other changes
Provision for bad debts made	1,279,675.64	-55,513.22		372,000.00		852,162.42

individually
Provision for bad debts made by group	23,212,791.53	-1,334,262.86		3,450.00		21,875,078.67
Total	24,492,467.17	-1,389,776.08		375,450.00		22,727,241.09

Including significant amounts recovered or reversed from the current provision for bad debts:

□ Applicable √ N/A

(4). Accounts receivable actually canceled in the current period

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Cancellation amount
Accounts receivable actually canceled	375,450.00

In which significant amounts canceled are described as below:

□ Applicable √ N/A

Description of accounts receivable cancellation:

□ Applicable √ N/A

(5). Top five closing balances of accounts receivable categorized by debtors

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Entity	Closing balance	Proportion to the total closing balance of accounts receivable (%)	Closing balance of provision for bad debts
Customer 1	116,359,517.65	30.37	5,817,975.88
Customer 2	45,842,962.06	11.96	2,292,148.10
Customer 3	36,728,857.51	9.59	1,836,442.88
Customer 4	33,135,753.04	8.65	1,711,165.15
Customer 5	22,392,637.75	5.84	1,119,631.89
Total	254,459,728.01	66.41	12,777,363.90

(6). Accounts receivable derecognized due to transfer of financial assets

□ Applicable √ N/A

(7). Assets and liabilities arising from transfer of accounts receivable and continued involvement

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

6. Receivables financing

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Bank acceptance bills	3,289,265.10	244,860.00
Total	3,289,265.10	244,860.00

Changes in amount and fair value of receivables financing:

□ Applicable √ N/A

If a provision for bad debts of accounts receivable is made in accordance with the general model of ECL,please disclose relevant information subject to the disclosure of the provision for bad debts for otherreceivables:

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

7. Prepayments

(1). Disclosure of prepayments by aging

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Aging	Closing balance		Opening balance
	Amount	Percentage (%)	Amount	Percentage (%)
Within 1 year	51,598,219.53	82.14	90,997,714.13	92.74
1 to 2 years	10,747,157.53	17.11	7,119,256.70	7.26
2 to 3 years	471,791.99	0.75
Over 3 years
Total	62,817,169.05	100.00	98,116,970.83	100.00

Reasons for overdue settlement of prepayments with significant amounts aged more than 1 year:

Entity	Closing balance	Reasons for no settlement
Supplier 2	6,040,260.00	Advance payment has been made for high-end lasers, which have not been produced

(2). Top five closing balances of prepayments categorized by receivers

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Entity	Closing balance	Proportion to the balance of prepayments (%)
Supplier 1	22,710,986.82	36.15%
Supplier 2	6,040,260.00	9.62%
Supplier 3	3,259,084.05	5.19%
Supplier 4	2,894,278.45	4.61%

Supplier 5	2,331,689.44	3.71%
Sub-total	37,236,298.76	59.28%

Other description

□ Applicable √ N/A

8. Other receivables

Presented by items

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Interest receivable
Dividends receivable	13,288,572.00	12,623,886.00
Other receivables	19,332,477.15	17,848,709.66
Total	32,621,049.15	30,472,595.66

Other description:

□ Applicable √ N/A

Interest receivable

(1). Categories of interest receivable

□ Applicable √ N/A

(2). Significant interests overdue

□ Applicable √ N/A

(3). Provision for bad debts

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

(1). Dividensd receivable

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Project (or investee)	Closing balance	Opening balance
GDC Technology Limited (BVI)	13,288,572.00	12,623,886.00
Total	13,288,572.00	12,623,886.00

(2). Dividends receivable with significant amounts aged more than 1 year

□ Applicable √ N/A

(3). Provision for bad debts

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

Other receivables

(4). Disclosure by aging

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Aging	Closing balance of carrying amount
Within 1 year
Including: Subitems within 1 year
Sub-total of items within 1 year	15,521,199.91
1 to 2 years	1,099,493.27
2 to 3 years	3,687,618.00
Over 3 years
Total	20,308,311.18

Categories by the nature of other receivables

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Nature of receivables	Closing balance of carrying amount	Opening balance of carrying amount
Deposits/margins/petty cash	10,074,155.37	9,664,667.87
Withholding	791,629.13	727,191.75
Temporary receivables	1,388,846.68	735,913.53
Indemnity receivable	8,053,680.00	7,650,840.00
Total	20,308,311.18	18,778,613.15

(5). Provision for bad debts

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Provision for bad debts	Stage I	Stage II	Stage III	Total
	12-month ECL in the future	Lifetime ECL (without credit impairment)	Lifetime ECL (with credit impairment)
Balance as at January 1, 2022	895,737.89	34,165.60		929,903.49
Balance as at January 1, 2022 in the current period
--transferred to Stage II
--transferred to Stage III
--reversed to Stage II
--reversed to Stage I
Provision	80,096.15	-34,165.60		45,930.55
Reversal

Write-off
Cancellation
Other changes
Balance as at June 30, 2022	975,834.04			975,834.04

Description of significant changes in the balance of other receivables with changed provisions for losses inthe current period:

□ Applicable √ N/A

Basis for recognizing the amount of provision for bad debts and evaluating whether the credit risk offinancial instruments has been increased significantly in the current period:

□ Applicable √ N/A

(6). Provision for bad debts

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Category	Opening balance	Changes for the current period				Closing balance
		Provision	Recovery or reversal	Write off or cancellation	Other changes
Provision for bad debts made by group	929,903.49	45,930.55				975,834.04
Total	929,903.49	45,930.55				975,834.04

Including significant amounts recovered or reversed from the current provision for bad debts:

□ Applicable √ N/A

(7). Other receivables actually canceled in the current period

□ Applicable √ N/A

(8). Top five closing balances of other receivables categorized by debtors

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Entity	Nature of other receivables	Closing balance	Aging	Proportion to the balance of other receivables (%)	Provision for bad debts Closing balance
Top 1	Compensation receivable	8,053,680.00	Within 1 year	39.67%	402,684.00
Top 2	Deposits/margins/petty cash	3,574,618.00	Over 3 years	17.61%	178,730.90
Top 3	Deposits/margins/petty cash	1,257,075.20	2-3 years, over 3 years	6.19%	62,853.76

Top 4	Deposits/margins/petty cash	800,000.00	Within 1 year, 1-2 years	3.94%	40,000.00
Top 5	Deposits/margins/petty cash	756,267.64	Within 1 year, 1-2 years, 2-3 years	3.72%	37,813.38
Total	/	14,441,640.84	/	71.11%	722,082.04

(9). Accounts receivable involving government grants

□ Applicable √ N/A

(10). Other receivables derecognized due to transfer of financial assets

□ Applicable √ N/A

(11). Assets and liabilities arising from transfer of other receivables and continued involvement

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

9. Inventories

(1). Categories of inventories

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance			Opening balance
	Carrying amount	Provision for decline in value of inventories/impairment of contract performance cost	Carrying amount	Gross carrying amount	Provision for decline in value of inventories/impairment of contract performance cost	Carrying amount
Raw materials	506,668,884.62	24,245,986.64	482,422,897.98	493,448,593.04	21,083,424.30	472,365,168.74
Work in progress	8,826,860.01	364,460.32	8,462,399.69	30,541,893.32	2,147,311.13	28,394,582.19
Goods on hand	292,483,208.03	15,446,858.33	277,036,349.70	229,438,709.58	13,362,893.39	216,075,816.19
Goods upon delivery	17,108,752.70	1,607,100.04	15,501,652.66	43,433,678.08	1,652,492.43	41,781,185.65
Materials for consigned processing	10,784,375.08	408,773.77	10,375,601.31	4,492,945.01	22,530.31	4,470,414.70

Contract performance cost	38,053.10		38,053.10	7,263,873.33	729,907.80	6,533,965.53
Total	835,910,133.54	42,073,179.10	793,836,954.44	808,619,692.36	38,998,559.36	769,621,133.00

(2). Provision for decline in value of inventories and impairment of contract performance cost

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase		Decrease		Closing balance
		Provision	Others	Reversal or write-off	Others
Raw materials	21,083,424.30	9,422,857.56		6,260,295.22		24,245,986.64
Work in progress	2,147,311.13	104,143.42		1,886,994.23		364,460.32
Goods on hand	13,362,893.39	12,777,635.03		10,693,670.09		15,446,858.33
Goods upon delivery	1,652,492.43			45,392.39		1,607,100.04
Materials for consigned processing	22,530.31	408,310.07		22,066.61		408,773.77
Contract performance cost	729,907.80			729,907.80
Total	38,998,559.36	22,712,946.08		19,638,326.34		42,073,179.10

Specify reasons for specific determination basis of net realizable value, and reversal or write-off ofthe provision for decline in value of inventories

Item	Specific basis for determining the net realizable value	Reason for reversal to the provisions for loss on inventories in the current period	Reason for reversal to the provisions for loss on inventories in the current period
Raw materials	The net realizable value of raw materials is determined as the historical average selling price or actual average selling price of finished goods in the ordinary course of business less the estimated costs of completion, and the estimated costs necessary to make the sale and relevant taxes	For the inventories of which a provision for decline in value has been made in prior period, their net realizable values have increased

The Companyhasconsumed/soldthe inventoriesfor which aprovision fordecline in valuehas been made atthe beginning ofthe currentperiod

Item	Specific basis for determining the net realizable value	Reason for reversal to the provisions for loss on inventories in the current period	Reason for reversal to the provisions for loss on inventories in the current period
Work in progress	The net realizable value of work in progress is determined as the historical average selling price or actual average selling price of finished goods in the ordinary course of business less the estimated costs of completion, and the estimated costs necessary to make the sale and relevant taxes	No reversal	The Company has consumed the inventories for which a provision for decline in value has been made at the beginning of the current period
Goods on hand	For inventories directly used for sale, the net realizable value is determined as the historical average selling price or actual average selling price less the estimated costs necessary to make the sale and relevant taxes	For the inventories of which a provision for decline in value has been made in prior period, their net realizable values have increased

The Companyhasconsumed/soldthe inventoriesfor which aprovision fordecline in valuehas been made atthe beginning ofthe currentperiod

Materials for consigned processing

The net realizable value is determined as the historical average selling price or actual average selling price of finished goods in the ordinary course of business less the estimated costs of completion, and the estimated costs necessary to make the sale and relevant taxes

No reversal

The Company has consumed the inventories for which a provision for decline in value has been made at the beginning of the current period

Contract performance cost

Item	Opening balance	Increase	Amortization	Provision for or write-off of impairment made in the current period	Closing balance
Entrusted development	1,934,228.95	1,292,027.89	3,918,111.54	-729,907.80	38,053.10
Overseas freight	4,599,736.58		4,599,736.58

Item	Opening balance	Increase	Amortization	Provision for or write-off of impairment made in the current period	Closing balance
Sub-total	6,533,965.53	1,292,027.89	8,517,848.12	-729,907.80	38,053.10

(3). Description of capitalized amount of borrowing costs included in the closing balance ofinventories

□ Applicable √ N/A

(4). Description of amortization of contract performance cost during the period

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

10. Contract assets

(1). Description of contract assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance			Opening balance
	Gross carrying amount	Provision for impairment	Carrying amount	Gross carrying amount	Provision for impairment	Carrying amount
Warranty security receivable	1,187,480.38	279,647.39	907,832.99	292,607.50	198,551.88	94,055.62
Goods payment	3,237,477.43	1,489,757.29	1,747,720.14	5,342,438.43	1,532,634.82	3,809,803.61
Total	4,424,957.81	1,769,404.68	2,655,553.13	5,635,045.93	1,731,186.70	3,903,859.23

(2). Amount and reasons of major changes in the carrying amount during the reporting period

□ Applicable √ N/A

(3). Description of provision for impairment made on contract assets during the period

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Provision	Reversal	Write-off/cancellation in the period	Reason
Provision for impairment made by group	38,217.99
Total	38,217.99			/

If a provision for bad debts of accounts receivable is made in accordance with the general model of ECL,please disclose relevant information subject to the disclosure of the provision for bad debts for otherreceivables:

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

11. Held-for-sale assets

□ Applicable √ N/A

12. Non-current assets due within one year

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Debt investments due within one year
Other debt investments due within one year
Long-term receivables due within one year	3,951,623.81	3,473,049.18
Total	3,951,623.81	3,473,049.18

Debt investments and other debt investments with significant amounts at the end of the period

□ Applicable √ N/A

Other description:

Item	Closing balance			Opening balance
	Gross carrying amount	Provision for impairment	Carrying amount	Gross carrying amount	Provision for impairment	Carrying amount
Long-term receivables due within one year	5,018,773.81	1,067,150.00	3,951,623.81	4,520,449.18	1,047,400.00	3,473,049.18
Total	5,018,773.81	1,067,150.00	3,951,623.81	4,520,449.18	1,047,400.00	3,473,049.18

13. Other current assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Cost of returned goods receivable	484,962.82	503,062.91
Input VAT to be deducted	70,486,385.97	52,258,757.92

Prepaid income tax	2,013.15
Total	70,973,361.94	52,761,820.83

Other description:

None

14. Debt investments

(1). Description of debt investments

□ Applicable √ N/A

(2). Debt investments with significant amounts at the end of the period

□ Applicable √ N/A

(3). Description of provision for impairment

□ Applicable √ N/A

15. Other debt investments

(1). Description of other debt investments

□ Applicable √ N/A

(2). Other debt investments with significant amounts at the end of the period

□ Applicable √ N/A

(3). Description of provision for impairment

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

16. Long-term receivables

(1) Description of long-term receivables

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance			Opening balance			Range of discount rate
	Gross carrying amount	Provision for bad debts	Carrying amount	Gross carrying amount	Provision for bad debts	Carrying amount
Financing lease payment
Including: Financing income not realized

Goods sold on installment payment	7,054,000.00	1,352,700.00	5,701,300.00	7,528,000.00	1,376,400.00	6,151,600.00
Labor service by installment receivable
Less: Financing income not realized	-216,981.48		-216,981.48	-358,047.26		-358,047.26
Total	6,837,018.52	1,352,700.00	5,484,318.52	7,169,952.74	1,376,400.00	5,793,552.74	/

(2) Provision for bad debts

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Provision for bad debts	Stage I	Stage II	Stage III	Total
	12-month ECL in the future	Lifetime ECL (without credit impairment)	Lifetime ECL (with credit impairment)
Balance as at January 1, 2022	1,376,400.00			1,376,400.00
Balance as at January 1, 2022 in the current period
--transferred to Stage II
--transferred to Stage III
--reversed to Stage II
--reversed to Stage I
Provision
Reversal	23,700.00			23,700.00
Write-off
Cancellation
Other changes
Balance as at June 30, 2022	1,352,700.00			1,352,700.00

Description of significant changes in the balance of long-term receivables with changed provisions forlosses in the current period:

□ Applicable √ N/A

Basis for recognizing the amount of provision for bad debts and evaluating whether the credit risk of

financial instruments has been increased significantly in the current period:

□ Applicable √ N/A

(3) Long-term receivables derecognized due to transfer of financial assets

□ Applicable √ N/A

(4) Assets and liabilities arising from transfer of long-term receivables and continued involvement

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

17. Long-term equity investments

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Investees	Opening balance	Changes for the current period								Closing balance	Closing balance of provision for impairment
		Additional investment	Decreased investment	Investment profit or loss under equity method	Adjustment in other comprehensive income	Other equity changes	Declared cash dividends or profits	Provision for impairment	Others
I. Joint venture
Sub-total
II. Associates
Cinionic Limited	126,924,427.40		127,552,984.81	4,164,020.29	-3,535,462.88					0.00
GDC Technology Limited (BVI)	166,676,657.87			-9,474,040.94	-6,331,313.82				8,853,235.49	159,724,538.60
Sub-total	293,601,085.27		127,552,984.81	-5,310,020.65	-9,866,776.70				8,853,235.49	159,724,538.60
Total	293,601,085.27		127,552,984.81	-5,310,020.65	-9,866,776.70				8,853,235.49	159,724,538.60

Other descriptionNone

18. Other equity instrument investments

(1). Description of other equity instrument investments

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Shen Zhen Timewaying Technology Co., Ltd.	7,075,419.38	7,075,419.38
Shenzhen Bevix Technology Co., Ltd.
Total	7,075,419.38	7,075,419.38

(2). Description of equity investments not held for trading

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Dividends income recognized for the current period	Accumulated gains	Accumulated losses	Amounts to retained earnings from other comprehensive income	Reasons for designating as financial assets at fair value through other comprehensive income	Reasons for transferring to retained earnings from other comprehensive income
Shen Zhen Timewaying Technology Co., Ltd.					Subject to the management’s intention of holding
Shenzhen Bevix Technology Co., Ltd.					Subject to the management’s intention of holding

Other description:

√ Applicable□ N/A

The Company’s equity investments in Shen Zhen Timewaying Technology Co., Ltd. are made mainlyfor promoting business cooperation in the future, but not for trading, which are accordingly designated asequity investments at fair value through other comprehensive income.

19. Other non-current financial assets

□ Applicable √ N/A

20. Investment properties

Measurement mode of investment propertiesN/A

21. Fixed assets

Presented by items

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Fixed assets	454,010,462.80	470,410,450.18
Disposal of fixed assets
Total	454,010,462.80	470,410,450.18

Other description:

NoneFixed assets

(1). Description of fixed assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Machinery and equipment	Transportation equipment	Electronic equipment and others	Operating leased equipment	Total
I. Costs:
1. Opening balance	129,590,613.35	1,171,400.05	49,253,347.48	650,822,359.27	830,837,720.15
2. Increase	16,288,129.09		5,729,928.96	30,812,228.88	52,830,286.93
(1) Purchase	16,052,855.85		5,596,524.59		21,649,380.44
(2) Transfer from construction in progress				30,812,228.88	30,812,228.88
(3) Transfer from inventories
(4) Currency movement	235,273.24		133,404.37		368,677.61
3. Decrease	6,341,057.20		1,155,472.58	3,036,214.94	10,532,744.72
(1) Disposal or retirement	6,321,588.18		1,155,472.58	843,589.81	8,320,650.57
(2) Transfer to inventories	19,469.02			2,192,625.13	2,212,094.15
4. Closing balance	139,537,685.24	1,171,400.05	53,827,803.86	678,598,373.21	873,135,262.36
II. Accumulated depreciation
1. Opening balance	56,949,056.23	593,333.19	23,152,360.80	279,402,867.35	360,097,617.57
2. Increase	11,474,965.21	82,393.80	4,207,299.80	45,320,797.10	61,085,455.91
(1) Provision	11,404,187.19	82,393.80	4,149,252.93	45,320,797.10	60,956,631.02
(2) Currency movement	70,778.02		58,046.87		128,824.89
3. Decrease	1,120,191.17		392,778.04	1,246,944.65	2,759,913.86

(1) Disposal or retirement	1,118,649.87		392,778.04	433,003.33	1,944,431.24
(2) Transfer to inventories	1,541.30			813,941.32	815,482.62
4. Closing balance	67,303,830.27	675,726.99	26,966,882.56	323,476,719.80	418,423,159.62
III. Provision for impairment
1. Opening balance				329,652.40	329,652.40
2. Increase				405,917.49	405,917.49
(1) Provision				405,917.49	405,917.49
3. Decrease				33,929.95	33,929.95
(1) Disposal or retirement				33,929.95	33,929.95
4. Closing balance				701,639.94	701,639.94
IV. Carrying amount
1. Closing balance	72,233,854.97	495,673.06	26,860,921.30	354,420,013.47	454,010,462.80
2. Opening balance	72,641,557.12	578,066.86	26,100,986.68	371,089,839.52	470,410,450.18

(2). Temporarily idle fixed assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Costs	Accumulated depreciation	Provision for impairment	Carrying amount	Remark
Operating leased equipment	44,230,318.99	25,441,727.85	608,794.01	18,179,797.12

(3). Fixed assets acquired under finance lease

□ Applicable √ N/A

(4). Fixed assets leased out under operating lease

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance of carrying amount
Operating leased equipment	354,420,013.47

(5). Fixed assets of which certificates of title have not been obtained

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

Disposal of fixed assets

□ Applicable √ N/A

22. Construction in progress

Presented by items

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Construction in progress	184,837,501.44	148,620,511.35
Materials for construction
Total	184,837,501.44	148,620,511.35

Other description:

None

Construction in progress

(1). Description of construction in progress

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance			Opening balance
	Gross carrying amount	Provision for impairment	Carrying amount	Gross carrying amount	Provision for impairment	Carrying amount
Headquarter buildings	175,877,819.68		175,877,819.68	133,111,026.64		133,111,026.64
Decoration construction				18,265.97		18,265.97
Light sources to be leased	8,959,681.76		8,959,681.76	15,491,218.74		15,491,218.74
Total	184,837,501.44		184,837,501.44	148,620,511.35		148,620,511.35

(2). Changes in significant constructions in progress for the current period

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Budget amount	Opening balance	Increase	Amount transferred to fixed assets	Other decreases	Closing balance	Amount injected as a proportion of budget amount (%)	Construction progress	Amount of accumulated capitalized interest	Including: Capitalized interest for the period	Interest capitalization rate for the period (%)	Source of funds
Headquarter buildings	534,635,200.00	133,111,026.64	42,766,793.04			175,877,819.68	32.90	32.90	2,295,129.84	1,605,921.71	4.61	Self-raised capital
Light sources to be leased		15,491,218.74	24,280,691.90	30,812,228.88		8,959,681.76						Self-funded capital
Total	534,635,200.00	148,602,245.38	67,047,484.94	30,812,228.88		184,837,501.44	/	/	2,295,129.84	1,605,921.71	/	/

(3). Provision for impairment losses for construction in progress in the current period

□ Applicable √ N/A

Other description

□ Applicable √ N/A

Materials for construction

□ Applicable √ N/A

23. Productive biological assets

(1). Productive biological assets measured at cost

□ Applicable √ N/A

(2). Productive biological assets measured at fair value

□ Applicable √ N/A

Other description

□ Applicable √ N/A

24. Oil and gas assets

□ Applicable √ N/A

25. Use right assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Houses and buildings	Total
I. Costs
1. Opening balance	79,510,041.05	79,510,041.05
2. Increase	35,228,911.20	35,228,911.20
(1) Lease in	34,800,798.32	34,800,798.32
(2) Other changes	428,112.88	428,112.88
3. Decrease	10,085,145.63	10,085,145.63
(1) Disposal	10,085,145.63	10,085,145.63
4. Closing balance	104,653,806.62	104,653,806.62
II. Accumulated depreciation
1. Opening balance	52,706,130.29	52,706,130.29
2. Increase	13,929,977.13	13,929,977.13
(1) Provision	13,511,079.53	13,511,079.53
(2) Other changes	418,897.60	418,897.60
3. Decrease	9,528,808.30	9,528,808.30
(1) Disposal	9,528,808.30	9,528,808.30
4. Closing balance	57,107,299.12	57,107,299.12
III. Provision for impairment
1. Opening balance
2. Increase
(1) Provision

3. Decrease
(1) Disposal
4. Closing balance
IV. Carrying amount
1. Closing balance	47,546,507.50	47,546,507.50
2. Opening balance	26,803,910.76	26,803,910.76

Other description:

None

26. Intangible assets

(1). Description of intangible assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Land use rights	Patents	Software	Total
I. Costs
1. Opening balance	330,630,000.00	20,059,950.00	16,430,346.40	367,120,296.40
2. Increase			1,669,892.32	1,669,892.32
(1) Purchase			1,639,231.72	1,639,231.72
(2) Currency movement			30,660.60	30,660.60
3. Decrease
(1) Disposal
4. Closing balance	330,630,000.00	20,059,950.00	18,100,238.72	368,790,188.72
II. Accumulated amortization
1. Opening balance	38,573,500.14	16,390,600.14	7,322,240.70	62,286,340.98
2. Increase	5,510,500.02		1,628,595.81	7,139,095.83
(1) Provision	5,510,500.02		1,599,345.03	7,109,845.05
(2) Currency movement			29,250.78	29,250.78
3. Decrease
(1) Disposal
4. Closing balance	44,084,000.16	16,390,600.14	8,950,836.51	69,425,436.81
III. Provision for impairment
1. Opening balance		3,669,349.86		3,669,349.86
2. Increase
(1) Provision
3. Decrease
(1) Disposal
4. Closing balance		3,669,349.86		3,669,349.86
IV. Carrying amount
1. Closing balance	286,545,999.84		9,149,402.21	295,695,402.05

2. Opening balance

292,056,499.86

9,108,105.70

301,164,605.56

The proportion of intangible assets generated by the Company’s internal research and development tothe balance of intangible assets at the end of the period is 0.

(2). Land use rights of which certificates of title have not been obtained

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

27. Development expenditure

□ Applicable √ N/A

28. Goodwill

(1). Gross carrying amount of goodwill

□ Applicable √ N/A

(2). Impairment provision of goodwill

□ Applicable √ N/A

(3). Relevant information of groups of assets or combinations of groups of assets where the goodwill

is recognized

□ Applicable √ N/A

(4). Specify test procedure, key parameters of impairment of goodwill (such as increase rate at

the projection period, increase rate at the steady period, profit rate, discount rate, andprojection period upon the estimates of the present value of future cash flow) as well asrecognition method for impairment loss

□ Applicable √ N/A

(5). Impacts of test of goodwill impairment

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

29. Long-term prepaid expenses

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase	Amortization	Other decreases	Closing balance
Decoration construction	9,875,718.38	975,864.48	3,496,121.74		7,355,461.12
RTO gas for the screen project	88,073.42		16,513.74		71,559.68

Leased software	162,373.02	69,290.57	168,147.17		63,516.42
Total	10,126,164.82	1,045,155.05	3,680,782.65		7,490,537.22

Other description:

None

30. Deferred tax assets and deferred tax liabilities

(1). Deferred tax assets that are not offset

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance		Opening balance
	Deductible temporary differences	Deferred tax assets	Deductible temporary differences	Deferred tax assets
Provision for impairment of assets	43,819,798.64	6,575,327.79	43,598,496.34	6,542,132.46
Unrealized profits for inside transactions	333,544,330.97	50,031,649.65	359,910,538.71	53,986,580.82
Deductible losses
Provisions	27,851,054.79	4,177,658.22	30,413,119.32	4,561,967.90
Deferred income	4,109,603.31	616,440.50	10,035,489.25	1,505,323.38
Share-based payment expenses	71,536,988.07	10,758,048.19	103,555,776.28	15,645,325.93
Leases	809,710.26	121,992.06	1,474,346.78	221,152.02
Total	481,671,486.04	72,281,116.41	548,987,766.68	82,462,482.51

(2). Deferred tax liabilities that are not offset

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance		Opening balance
	Taxable temporary differences	Deferred tax liabilities	Taxable temporary differences	Deferred tax liabilities
Gains from changes in fair values	566,000.00	84,900.00	2,200,000.00	330,000.00
Long-term receivables	8,231,871.49	1,234,780.72	9,407,088.13	1,411,063.22
Total	8,797,871.49	1,319,680.72	11,607,088.13	1,741,063.22

(3). Deferred tax assets or deferred tax liabilities that are presented at the net amount after offset

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item

Closing set-off amounts of

Closing balance of deferred tax

Opening set-off amount of

Opening balance of

	deferred tax assets and liabilities	assets or liabilities after set-off	deferred tax assets and liabilities	deferred tax assets or liabilities after set-off
Deferred tax assets	1,319,680.72	70,961,435.69	1,741,063.22	80,721,419.29
Deferred tax liabilities	1,319,680.72		1,741,063.22

(4). Details of unrecognized deferred tax assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Provision for impairment of assets	30,791,658.75	29,041,507.01
Unrealized profits for inside transactions	36,696,412.08	36,978,135.00
Provisions	8,628,500.56	6,015,569.62
Deferred income	3,565,917.74	231,492.83
Share-based payment expenses	7,049,367.49	11,982,368.41
Leases	2,524,155.15	1,726,120.92
Profit distribution from partnership enterprises		40,790.41
Provision for impairment of other equity instrument investments	4,900,000.00	4,900,000.00
Deductible losses	373,924,852.56	326,263,103.27
Total	468,080,864.33	417,179,087.47

(5). Deductible losses, for which no deferred tax assets are recognized, will expire in the followingyears

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Year	Closing balance	Opening balance	Remark
2022	1,747,737.55	1,747,737.55
2023	13,041,148.40	27,969,288.80
2024	66,901,681.33	66,901,681.33
2025	68,119,959.02	68,119,959.02
2026	116,688,163.53	98,077,911.35
2027	44,877,784.08
No expiry date	62,548,378.65	63,446,525.22
Total	373,924,852.56	326,263,103.27	/

Other description:

□ Applicable √ N/A

Overseas subsidiaries have the deductible loss of RMB 62,548,378.65, for which there is no expiry date.

31. Other non-current assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance			Opening balance
	Gross carrying amount	Provision for impairment	Carrying amount	Gross carrying amount	Provision for impairment	Carrying amount
Prepayment for purchase of long-term assets	17,929,878.09		17,929,878.09	10,998,641.77		10,998,641.77
Total	17,929,878.09		17,929,878.09	10,998,641.77		10,998,641.77

Other description:

None

32. Short-term borrowings

(1). Categories of short-term borrowings

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Guaranteed loans		5,560,000.00
Credit loans	50,000,000.00	2,468.61
Notes discount	80,000,000.00
Interest	45,205.48	8,409.50
Total	130,045,205.48	5,570,878.11

Description for categories of short-term borrowings:

None

(2). Short-term borrowings overdue but not yet repaid

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

33. Held-for-trading financial liabilities

□ Applicable √ N/A

34. Derivative financial liabilities

□ Applicable √ N/A

35. Notes payable

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Category

Closing balance

Opening balance

Bank acceptance bills	121,047,156.20	134,378,967.61
Total	121,047,156.20	134,378,967.61

Total notes payable matured but not paid yet is RMB 0 at the end of the period.

36. Accounts payable

(1). Presented by accounts payable

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Amounts payable for purchase	292,737,366.30	419,966,567.27
Total	292,737,366.30	419,966,567.27

(2). Accounts payable with significant amounts aged more than 1 year

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

37. Receipts in advance

(1). Presented by receipts in advance

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Advance payments of recharge fees	117,280,983.73	130,288,312.62
Total	117,280,983.73	130,288,312.62

(2). Receipts in advance with significant amounts aged more than 1 year

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Reasons for not repaid or carried-forward
Jiangsu Happy Blue Sea Cinema Development Co., Ltd.	17,998,074.51	Lease payments received in advance
Total	17,998,074.51	/

Other description:

□ Applicable √ N/A

38. Contract liabilities

(1). Description of contract liabilities

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Goods payment	50,350,874.58	45,541,629.55
Total	50,350,874.58	45,541,629.55

(2). Amount and reasons of major changes in the carrying amount during the reporting period

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

39. Employee benefits payable

(1). Presented by employee benefits payable

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase	Decrease	Closing balance
I. Short-term benefits	63,900,756.64	171,029,821.49	207,500,793.87	27,429,784.26
II. Post-employment benefits-defined contribution plan	186,233.66	9,157,356.37	9,169,693.54	173,896.49
III. Dismissal benefits	32,097.21	628,601.19	660,698.40
IV. Other benefits due within one year
Total	64,119,087.51	180,815,779.05	217,331,185.81	27,603,680.75

(2). Presented by short-term employee benefits

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase	Decrease	Closing balance
I. Wages or salaries, bonuses, allowances and subsidies	63,421,218.21	153,862,585.68	190,188,009.33	27,095,794.56
II. Staff welfare	291,000.00	776,088.67	896,157.67	170,931.00
III. Social security contributions	122,585.37	6,171,801.67	6,198,239.86	96,147.18
Including: Medical insurance	117,296.06	5,845,598.80	5,871,885.58	91,009.28
Work injury insurance	5,272.33	188,734.97	188,886.38	5,120.92
Maternity insurance	16.98	137,467.90	137,467.90	16.98
IV. Housing funds		9,993,004.40	9,993,004.40
V. Union running costs and employee education costs	65,953.06	226,341.08	225,382.62	66,911.52

VI. Short-term paid leaves
VII. Short-term profit sharing plan
Total	63,900,756.64	171,029,821.49	207,500,793.87	27,429,784.26

(3). Presented by defined contribution plan

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase	Decrease	Closing balance
1. Basic pensions	180,578.08	8,899,720.16	8,911,903.06	168,395.18
2. Unemployment insurance	5,655.58	257,636.21	257,790.48	5,501.31
3. Enterprise annuity contribution
Total	186,233.66	9,157,356.37	9,169,693.54	173,896.49

Other description:

□ Applicable √ N/A

40. Taxes payable

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Value-added tax (VAT)	5,501,965.68	4,246,010.43
Enterprise income tax	10,009,895.89	11,889,909.01
Individual income tax	1,440,376.01	1,613,116.75
City maintenance and construction tax	279,773.21	552,264.60
Education surcharges	119,902.81	242,838.49
Local education surcharges	79,935.19	161,892.32
Stamp duty	391,340.77	832,145.97
Annual franchise right tax		8,012.66
Urban land use tax	8,914.32
Total	17,832,103.88	19,546,190.23

Other description:

None

41. Other payables

Presented by items

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item

Closing balance

Opening balance

Interest payable
Dividend payable	3,103,823.79
Other payables	49,208,009.71	54,115,784.80
Total	52,311,833.50	54,115,784.80

Other description:

NoneInterest payable

□ Applicable √ N/A

Dividends payable

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Dividends on ordinary shares	3,103,823.79
Total	3,103,823.79

Other description, including significant dividend payable with ageing of over 1 year, and the reason ofnon-payment shall be disclosed:

NoneOther payables

(1). Other payables presented by nature

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Withholding	114,699.81	117,948.38
Deposits/margins	9,567,042.99	6,388,325.48
Withdrawals in advance	24,348,975.44	43,694,291.49
Temporary receipts payable	6,310,958.61	3,915,219.45
Subscription payment for restricted stocks	8,866,332.86
Total	49,208,009.71	54,115,784.80

(2). Other payables with significant amounts aged more than 1 year

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

42. Liabilities held for sale

□ Applicable √ N/A

43. Non-current liabilities due within one year

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item

Closing balance

Opening balance

Long-term borrowings due within one year	157,087,655.00	135,843,834.00
Lease liabilities due within one year	20,995,488.14	18,770,827.17
Interest payable	179,175.24	170,455.18
Total	178,262,318.38	154,785,116.35

Other description:

None

44. Other current liabilities

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Amounts payable for goods returned	1,531,920.02	16,804,816.23
Taxes to be written off	5,120,209.11	2,756,287.89
Total	6,652,129.13	19,561,104.12

Changes in short-term bonds payable:

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

45. Long-term borrowings

(1). Categories of long-term borrowings

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Mortgage borrowings	85,000,198.22
Guaranteed loans	328,099,990.00	313,799,994.00
Guaranteed loans and loans against collateral		54,430,844.66
Interest payable	498,367.03	404,775.98
Total	413,598,555.25	368,635,614.64

Description for categories of long-term borrowings:

NoneOther description, including interest range:

□ Applicable √ N/A

46. Bonds payable

(1). Bonds payable

□ Applicable √ N/A

(2). Changes in bonds payable (excluding other financial instruments such as preferred shares,perpetual bonds classified as financial liabilities)

□ Applicable √ N/A

(3). Description of converting terms and period of convertible corporate bonds

□ Applicable √ N/A

(4). Description of other financial instruments classified as financial liabilitiesBasic information of other financial instruments including outstanding preferred shares and perpetualbonds at the end of the period

□ Applicable √ N/A

Changes in financial instruments including outstanding preferred shares and perpetual bonds at the endof the period

□ Applicable √ N/A

Description of other financial instruments classified as financial liabilities

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

47. Lease liabilities

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Lease payment	29,884,884.77	10,789,352.69
Total	29,884,884.77	10,789,352.69

Other description:

None

48. Long-term payables

Presented by items

□ Applicable √ N/A

Long-term payables

□ Applicable √ N/A

Special payables

□ Applicable √ N/A

49. Long-term employee benefits payable

□ Applicable √ N/A

50. Provisions

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Closing balance	Reason
Product quality warranty	35,744,039.63	35,651,878.75	Expenses for “three guarantees” services
Amounts payable for goods returned	684,649.31	827,676.60
Total	36,428,688.94	36,479,555.35	/

Other description, including significant assumptions and estimates relative to material provisions:

None

51. Deferred income

Description of deferred income

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase	Decrease	Closing balance	Reason
Government grants	10,266,982.08	7,413,400.00	10,004,861.03	7,675,521.05
Total	10,266,982.08	7,413,400.00	10,004,861.03	7,675,521.05	/

Items relating to government grants:

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Liabilities	Opening balance	Increased government grants for the current period	Amount recognized in non-operating income for the current period	Amount recognized in other income for the current period	Other changes	Closing balance	Related to assets/income
8K Ultra High Definition Laser Display Technology Engineering Research Center	924,464.60	3,000,000.00		485,736.78		3,438,727.82	Related to assets
Industry support funds		4,000,000.00		454,545.45		3,545,454.55	Related to assets
Trichromatic Laser Display Complete Equipment Production Demonstration Line	8,679,443.32			8,401,504.64		277,938.68	Related to income

R&D of key technologies for ultra high-definition micro laser projector optical engine based on light-emitting ceramic devices	663,074.16			663,074.16			Related to income
Research of trichromatic laser light sources and LCoS optical engine		413,400.00				413,400.00	Related to income
Sub-total	10,266,982.08	7,413,400.00		10,004,861.03		7,675,521.05

Other description:

√ Applicable□ N/A

Government grants included in the current profit or loss are disclosed in VII.84 of Section X in details.

52. Other non-current liabilities

□ Applicable √ N/A

53. Share capital

√ Applicable□ N/A

Unit: Yuan Currency: RMB

	Opening balance	Changes (+, -)					Closing balance
		New issue of shares	Bonus shares	Capitalization of capital reserve	Others	Sub-total
Total shares	452,756,901.00						452,756,901.00

Other description:

None

54. Other equity instruments

(1) Basic information of other financial instruments including outstanding preferred shares andperpetual bonds at the end of the period

□ Applicable √ N/A

(2) Changes in financial instruments including outstanding preferred shares and perpetual bondsat the end of the period

□ Applicable √ N/A

Changes of other equity instruments in the current period, reasons for such change and basis for relatedaccounting treatments:

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

55. Capital reserve

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase	Decrease	Closing balance
Capital premium (Share premium)	1,241,202,420.08			1,241,202,420.08
Other capital reserve	159,402,716.57	35,464,460.91		194,867,177.48
Total	1,400,605,136.65	35,464,460.91		1,436,069,597.56

Other description, including changes in the current period and reasons for changes:

(1) The total expense of equity-settled share-based payments amounted to RMB 44,277,773.58, in

which RMB 41,390,101.79 was recognized in the capital reserve (other capital reserve) and RMB2,887,671.79 was charged to the amount attributable to minority interests.

(2) With respect to the temporary difference by which the fair value at the end of period of restricted

shares granted by the Company in the current period is greater than the fair value at the grant date,the Company recognized the decrease in deferred tax assets by RMB 6,179,289.43, the decreasein the capital reserve (other capital reserve) by RMB 5,925,640.88, and the decrease in theminority interests by RMB 253,648.55.

56. Treasury shares

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase	Decrease	Closing balance
Repurchase of treasury shares		3,211,260.13		3,211,260.13
Total		3,211,260.13		3,211,260.13

Other description, including changes in the current period and reasons for changes:

The Company held the 9

th

meeting of the second Board of Directors and the 1

stextraordinary generalmeeting of shareholders in 2022 respectively on March 18, 2022 and March 29, 2022, approving theProposal on Repurchase of Shares of the Company through Call Auction through deliberation, andagreeing the Company to use the excess offering proceeds to repurchase some RMB-denominated ordinaryshares (A shares) issued by it through call auction in the trading system of the Shanghai Stock Exchange,with the repurchase funds totaling not less than RMB 10 million (inclusive) but not more than RMB 20

million (inclusive), the repurchase price not exceeding RMB 27 per share (inclusive) and the repurchaseperiod being six months from the date on which this repurchase plan is approved by the general meetingof shareholders. As of June 30, 2022, the Company repurchased 214,517 shares in the aggregate throughcall auction, and paid RMB 3,211,260.13 (including stamp duty, commissions and other transaction fees).

57. Other comprehensive income

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Amount recognized in the current period						Closing balance
		Amount incurred for current period before tax	Less: Amount previously included in other comprehensive income and transferred to profit or loss for the period	Less: Amount previously included in other comprehensive income and transferred to retained earnings for the period	Less: Income tax expenses	Attributable to the parent company after tax	Attributable to minority shareholders after tax
I. Other comprehensive income that cannot be reclassified subsequently to profit or loss	-4,900,000.00							-4,900,000.00
Including: Changes from remeasurement of defined benefit plans
Other comprehensive

income that cannot be reclassified to profit or loss under the equity method
Changes in fair value of investments in other equity instruments	-4,900,000.00							-4,900,000.00
Changes in fair value of enterprises’ own credit risks
II. Other comprehensive income that will be reclassified to profit or loss	-11,940,512.60	13,583,493.02				13,734,264.61	-150,771.59	1,793,752.01
Including: Other comprehensive income that will be reclassified to profit or loss under the equity method	-366,814.82	-9,668,892.26				-9,668,892.26		-10,035,707.08
Changes in fair value of other debt investments

Amount of financial assets reclassified to other comprehensive income
Provision for credit impairment of other debt investments
Reserve for cash flow hedges
Exchange differences on translation of financial statements denominated in foreign currencies	-11,573,697.78	23,252,385.28				23,403,156.87	-150,771.59	11,829,459.09
Total other comprehensive income	-16,840,512.60	13,583,493.02				13,734,264.61	-150,771.59	-3,106,247.99

Other description, including adjustments on transferring effective portion of cash flow hedges to amount upon initial recognition of the hedged item:

58. Special reserve

□ Applicable √ N/A

59. Surplus reserve

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Opening balance	Increase	Decrease	Closing balance
Statutory surplus reserve	56,265,868.31			56,265,868.31
Total	56,265,868.31			56,265,868.31

Surplus reserve description, including changes in the current period and reasons for changes:

None

60. Undistributed profits

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Current period	Last year
Undistributed profits at the end of prior period before adjustment	545,277,188.08	357,793,891.96
Total adjusted undistributed profits at the beginning of the period (Add: +; Less: -)		9,346.56
Undistributed profits at the beginning of the period after adjustment	545,277,188.08	357,803,238.52
Add: Net profit attributable to owners of the parent company for the period	45,966,481.10	233,364,344.09
Less: Appropriation to statutory surplus reserve		20,988,764.97
Appropriation to discretionary surplus reserve
Appropriation to general risk reserve
Declaration of dividends on ordinary shares
Conversion of ordinary shares’ dividends into share capital
Distributed dividend	47,539,596.43	24,901,629.56
Undistributed profits at the end of the period	543,704,072.75	545,277,188.08

Details of adjustments to undistributed profits at the beginning of the period:

1. As a result of the retrospective adjustment of the Accounting Standards for Business Enterprises andrelated new regulations, undistributed profits at the beginning of the period were affected by RMB 0.00.

2. Undistributed profits at the beginning of the period were affected by RMB 0.00 due to changes inaccounting policies.

3. Undistributed profits at the beginning of the period were affected by RMB 0.00 due to the correction ofsignificant accounting errors.

4. Undistributed profits at the beginning of the period were affected by RMB 0.00 due to changes in thescope of consolidation resulting from business combination involving entities under common control.

5. Undistributed profits at the beginning of the period were affected by RMB 0.00 in total due to otheradjustments.

61. Operating income and operating costs

(1). Description of operating income and operating costs

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period		Amount for the prior period
	Income	Cost	Income	Cost
Main business	1,269,322,202.11	884,560,607.88	1,104,689,243.59	723,612,305.19
Other business
Total	1,269,322,202.11	884,560,607.88	1,104,689,243.59	723,612,305.19

(2). Description of incomes from contracts

□ Applicable √ N/A

(3). Description of performance obligations

□ Applicable √ N/A

(4). Description of allocation to remaining performance obligations

□ Applicable √ N/A

Other description:

Breakdown of revenue from contracts with customers by category:

Item	Sub-total
By business area:
Domestic	982,431,749.79
Overseas	151,675,564.56
Sub-total	1,134,107,314.35
By product：
Laser optical engine	227,366,190.32
Complete laser projector	797,685,682.96
Others	109,055,441.07
Sub-total	1,134,107,314.35
By revenue recognition time:
Revenue recognized at a time point	1,133,767,224.50
Revenue recognized for a period of time	340,089.85
Sub-total	1,134,107,314.35

62. Taxes and surcharges

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
City maintenance and construction tax	1,854,709.81	1,720,331.86
Education surcharges	837,797.56	741,743.40
Stamp duty	1,328,656.61	1,096,478.56
Local education surcharges	596,844.97	499,046.18
Others	18,392.15	273,538.81

Total

4,636,401.10

4,331,138.81

Other description:

None

63. Selling expenses

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Employee benefits	38,321,847.96	32,606,069.47
Marketing fees	56,105,203.98	35,119,978.09
After-sale repair expenses	7,794,363.57	6,280,390.31
Advertising and business promotion expenses	2,152,634.28	2,043,151.94
Travel expenses	1,140,208.55	1,601,757.27
Business entertainment expenses	874,145.73	1,073,975.75
Other expenses	13,913,957.29	10,960,873.00
Total	120,302,361.36	89,686,195.83

Other description:

None

64. Administrative expenses

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Employee benefits	36,480,928.08	31,797,608.54
Rent expense	4,851,517.81	4,795,962.93
Service fees	11,634,987.32	16,698,545.91
Depreciation and amortization expenses	4,665,199.81	3,365,970.11
Share-based payment expenses	44,301,483.42	22,312,482.85
Other expenses	4,081,725.92	4,989,946.58
Total	106,015,842.36	83,960,516.92

Other description:

None

65. R&D expenses

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Employee benefits	76,416,118.90	60,494,851.79
Material consumption expenses	13,749,893.95	8,429,853.23
Rent expense	3,720,732.39	4,649,585.35
Service fees	4,297,638.31	7,094,850.80
Depreciation and amortization expenses	3,961,800.74	4,710,875.84
Testing expenses	4,511,335.54	2,384,569.29
Patent fees	836,908.48	2,067,359.08
Other expenses	7,465,358.06	5,296,538.28

Total

114,959,786.37

95,128,483.66

Other description:

None

66. Financial expenses

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Interest expenses	12,510,421.43	11,013,330.17
Less: Interest income	-6,740,942.87	-10,868,184.51
Exchange profit or loss	-10,026,339.12	508,948.95
Bank service charges	902,979.64	877,924.69
Total	-3,353,880.91	1,532,019.30

Other description:

None

67. Other income

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Government grants related to assets	940,282.23	382,994.93
Government grants related to income	18,812,831.21	51,598,892.61
Refund of transaction fees for withholding individual income taxes	364,144.36	571,819.77
Additional deduction of input VAT	1,448,552.63	2,336,589.39
Total	21,565,810.43	54,890,296.70

Other description:

Government grants recognized in other income in the current period are disclosed in VII.84 of Section Xin details.

68. Investment income

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Long-term equity investment income accounted for using the equity method	-5,951,760.87	6,982,738.64
Investment income from disposal of long-term equity investments	-4,611,079.66
Investment income from held-for-trading financial assets during the holding period	200,000.00
Investment income from disposal of held-for-trading financial assets	5,795,366.82	2,145,923.39
Others		3.00
Total	-4,567,473.71	9,128,665.03

Other description:

None

69. Income from net exposure hedges

□ Applicable √ N/A

70. Gains from changes in fair values

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Source of gains from changes in fair values	Amount for the current period	Amount for the prior period
Held-for-trading financial assets	-1,634,000.00	38,175,900.00
Including: Gains from changes in fair values of derivative financial instruments
Held-for-trading financial liabilities
Investment properties measured at fair value
Total	-1,634,000.00	38,175,900.00

Other description:

None

71. Losses of credit impairment

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Bad debt losses	1,393,164.79	9,407,031.23
Total	1,393,164.79	9,407,031.23

Other description:

None

72. Impairment losses of assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
I. Bad debt losses	-38,217.98	-43,168.95
II. Losses of decline in value of inventories and impairment losses of contract performance cost	-19,378,228.52	-16,538,070.39
III. Impairment losses of long-term equity investments
IV. Impairment losses of investment properties
V. Impairment losses of fixed assets	-405,917.49
Total	-19,822,363.99	-16,581,239.34

Other description:

None

73. Gains on disposal of assets

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Gains from disposal of fixed assets	106.88	2,806,008.82
Gains from disposal of use right assets	17,106.28
Total	17,213.16	2,806,008.82

Other description:

□ Applicable √ N/A

74. Non-operating income

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period	Amount included in non-recurring profit or loss for the period
Total gains from disposal of non-current assets	7,964.60	4,100.00	7,964.60
Including: Gains from disposal of fixed assets	7,964.60	4,100.00	7,964.60
Gains from disposal of intangible assets
Gains from debt restructuring
Gains from exchange of non-monetary assets
Donation receipts
Government grants		21,500,000.00
Indemnity		630,000.00
Others	159,923.71	106,580.14	159,923.71
Total	167,888.31	22,240,680.14	167,888.31

Government grants included in profit or loss for the period

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

75. Non-operating expenses

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period	Amount included in non-recurring profit or loss for the period
Total losses from disposal of non-current assets	353,535.44	170,231.21	353,535.44
Including: Losses from disposal of fixed assets	353,535.44	170,231.21	353,535.44

External donations	1,011,354.98		1,011,354.98
Penalties and overdue fines	141,821.94	18,205.90	141,821.94
Others	5,197.11	217,064.50	5,197.11
Total	1,511,909.47	405,501.61	1,511,909.47

Other description:

None

76. Income tax expense

(1) Statement of income tax expense

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Income tax expense in the current period	15,688,777.00	52,765,981.28
Deferred income tax expenses	3,580,694.17	-6,460,456.12
Total	19,269,471.17	46,305,525.16

(2) Reconciliation of income tax expenses to the accounting profit

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period
Total profit	37,809,413.47
Income tax expense calculated based on statutory/applicable tax rate	5,671,412.03
Effect of different tax rates of subsidiaries operating in other jurisdictions	-3,602,239.40
Effect of income tax for the period before adjustment	-209,664.93
Effect of non-taxable income	2,032,381.30
Effect of non-deductible cost, expense and loss	4,804,348.73
Effect of utilizing deductible loss not recognized for deferred tax assets for prior period	-4,444,736.53
Effect of deductible temporary difference or deductible loss not recognized for deferred tax assets for the current period	15,637,543.63
Other effects	-619,573.65
Income tax expenses	19,269,471.17

Other description:

□ Applicable √ N/A

77. Other comprehensive income

√ Applicable□ N/A

Please refer to VII. 57 of Section X in details.

78. Items in cash flow statement

(1). Other cash receipts relating to operating activities

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Interest income	6,586,011.83	11,045,718.76
Government grants	14,967,754.76	72,650,106.88
Recovery of security deposits	9,021,162.77	21,445,628.07
Non-operating income	78,226.30	665,006.61
Other transaction accounts	3,742,646.71	7,695,541.37
Total	34,395,802.37	113,502,001.69

Description of other cash receipts relating to operating activities:

None

(2). Other cash payments relating to operating activities

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Administrative expenses, selling expenses, and R&D expenses paid in cash	135,601,238.70	95,588,810.53
Non-operating expenses	138,934.57	47,599.90
Payment of security deposits	67,068,694.27	28,107,696.66
Service charges	757,068.27	1,863,849.47
Other transaction accounts	2,730,798.00	8,277,996.70
Total	206,296,733.81	133,885,953.26

Description of other cash payments relating to operating activities:

None

(3). Other cash receipts relating to investing activities

□ Applicable √ N/A

(4). Other cash payments relating to operating activities

□ Applicable √ N/A

(5). Other cash receipts relating to financing activities

□ Applicable √ N/A

(6). Other cash payments relating to financing activities

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Dividend payments		20,559.65
Actual lease payment	14,493,029.54	11,870,055.52
Repayment of shareholder loans		19,320,000.00
Share repurchase payment	3,211,260.13
Total	17,704,289.67	31,210,615.17

Description of other cash payments relating to financing activities:

None

79. Supplementary information to the cash flow statement

(1) Supplementary information to the cash flow statement

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Supplemental information	Amount for the current period	Amount for the prior period
1. Reconciliation of net profit to cash flow from operating activities:
Net profit	18,539,942.30	179,794,899.69
Add: Provision for impairment of assets	19,822,363.99	16,581,239.34
Impairment losses of credit	-1,393,164.79	-9,407,031.23
Depreciation of fixed assets, depletion of oil and gas assets, depreciation of productive biological assets	60,956,631.02	52,443,098.86
Amortization of use right assets	13,511,079.53	9,471,534.54
Amortization of intangible assets	1,599,345.03	2,236,018.62
Amortization of long-term prepaid expenses	3,680,782.65	3,551,972.20
Losses on disposal of fixed assets, intangible assets and other long-term assets (gains are indicated by “-”)	-17,213.16	-2,806,008.82
Losses on retirement of fixed assets (gains are indicated by “-”)	345,570.84	166,131.21
Losses on changes in fair values (gains are indicated by “-”)	1,634,000.00	-38,175,900.00
Financial expenses (income is indicated by “-”)	2,484,082.32	11,522,279.12
Investment losses (income is indicated by “-”)	4,567,473.71	-9,128,665.03
Decrease in deferred tax assets (increase is indicated by “-”)	3,580,734.09	-7,154,581.92
Increase in deferred tax liabilities (decrease is indicated by “-”)
Decrease in inventories (increase is indicated by “-”)	-33,033,292.19	-272,867,132.22
Decrease in receivables from operating activities (increase is indicated by “-”)	36,305,146.46	154,269,042.05
Increase in payables from operating activities (decrease is indicated by “-”)	-255,297,259.11	58,149,792.82
Others	44,160,417.64	22,012,624.67
Net cash flow from operating activities	-78,553,359.67	170,659,313.90
2. Significant investing and financing activities that do not involve cash receipts and payments:
Conversion of debt into capital

Convertible corporate bonds due within one year
Fixed assets acquired under finance leases
3. Net changes in cash and cash equivalents:
Closing balance of cash	951,480,989.53	863,588,162.84
Less: Opening balance of cash	891,195,166.73	983,525,089.44
Add: Closing balance of cash equivalents
Less: Opening balance of cash equivalents
Net increase in cash and cash equivalents	60,285,822.80	-119,936,926.60

(2) Net cash paid to acquire subsidiaries for the current period

□ Applicable √ N/A

(3) Net cash receipts from disposal of subsidiaries for the current period

□ Applicable √ N/A

(4) Composition of cash and cash equivalents

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
I. Cash	951,480,989.53	891,195,166.73
Including: Cash on hand	5,624.61	5,680.24
Bank deposits that can be paid at any time	914,093,584.97	883,906,202.81
Other monetary funds that can be paid at any time	37,381,779.95	7,283,283.68
Deposits in the central bank that can be used for payments
Deposits made with other banks
Placements with banks
II. Cash equivalents
Including: Investments in debt securities due within three months
III. Closing balance of cash and cash equivalents	951,480,989.53	891,195,166.73
Including: Restricted cash and cash equivalents of the parent company or subsidiaries within the Group

Other description:

□ Applicable √ N/A

80. Notes to items in the statement of changes in owners’ equity

Describe matters such as the names and the adjusted amounts of the items included in “others” in respectof adjustments to the closing balances of the prior year:

□ Applicable √ N/A

81. Assets with limited ownership or use right

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Item	Closing balance of carrying amount	Reason
Bank deposits	40,000,000.00	Term deposits
Bank deposits	3,293,156.61	Pledged term deposits
Bank deposits	302,062.50	Interests accrued
Other monetary funds	50,315,805.66	Margins
Intangible assets	286,545,999.84	Mortgage collateral
Total	380,457,024.61	/

Other description:

None

82. Foreign currency monetary items

(1). Foreign currency monetary items

√ Applicable□ N/A

Unit: Yuan

Item	Closing balance of foreign currency	Exchange rate	Closing balance of RMB equivalent
Cash and bank balances	-	-	319,881,035.51
Including: USD	27,541,131.87	6.7114	184,839,552.43
GBP	365.96	8.1365	2,977.63
HKD	157,860,193.17	0.8552	135,000,458.60
VND	131,917,373.00	0.0003	38,046.85
Accounts receivable	-	-	69,782,163.29
Including: USD	10,380,618.47	6.7114	69,668,482.80
MYR	14,331.50	0.6557	9,397.45
PHP	218,429.36	0.1216	26,561.01
EUR	11,089.84	7.0084	77,722.03
Accounts payable	-	-	16,682,071.87
Including: USD	2,483,185.90	6.7114	16,665,653.85
HKD	19,198.10	0.8552	16,418.02

Other description:

None

(2). Description of overseas operating entities, including significant overseas operating entities, of

which the major operation place, functional currency and choosing basis as well as the reasonfor change of functional currency should be disclosed

√ Applicable□ N/A

Item	Major overseas operation place	Functional currency	Choosing basis
Appotronics Hong Kong Limited	Hong Kong	USD	Common currency
Appotronics USA, Inc.	USA	USD	Local currency
JoveAI Limited	Cayman Islands	USD	Common currency
JoveAI Innovation, Inc.	USA	USD	Local currency

FORMOVIE TECHNOLOGY INC	USA	USD	Local currency
JoveAI Asia Company Limited	Vietnam	VND	Local currency
WEMAX LLC	USA	USD	Local currency
Hongkong Orange Juice Energy Technology Co., Limited	Hong Kong	USD	Common currency
WEMAX INC	USA	USD	Local currency

83. Hedge

□ Applicable √ N/A

84. Government grants

1. Basic information of government grants

√ Applicable□ N/A

Unit: Yuan Currency: RMB

Category	Amount	Item presented	Amount recognized in current profit or loss
Government grants related to assets	7,000,000.00	Other income	940,282.23
Government grants related to income and used for compensation of the Company’s relevant costs or losses in subsequent periods	413,400.00	Other income	9,064,578.80
Government grants related to income and used for compensation of the Company’s relevant costs or losses that have been incurred	9,748,252.41	Other income	9,748,252.41
Interest subsidies	70,200.00	Financial expenses	70,200.00

Note: The amount refers to government grants actually received in the current period.

2. Refund of government grants

□ Applicable √ N/A

Other description

(1) Government grants related to assets

Item	Opening deferred income	Increase	Amortization	Closing deferred income	Amortization of items presented in the current period
8K Ultra High Definition Laser Display Technology Engineering Research Center	924,464.60	3,000,000.00	485,736.78	3,438,727.82	Other income
Industry support funds		4,000,000.00	454,545.45	3,545,454.55	Other income
Sub-total	924,464.60	7,000,000.00	940,282.23	6,984,182.37

(2) Government grants related to income and used for compensation of the Company’s relevant costs

or losses in subsequent periods

Item	Opening deferred income	Increase	Amortization	Closing deferred income	Amortization of items presented in the current period
Trichromatic Laser Display Complete Equipment Production Demonstration Line	8,679,443.32		8,401,504.64	277,938.68	Other income
R&D of key technologies for ultra high-definition micro laser projector optical engine based on light-emitting ceramic devices	663,074.16		663,074.16		Other income
Research of trichromatic laser light sources and LCoS optical engine		413,400.00		413,400.00	Other income
Sub-total	9,342,517.48	413,400.00	9,064,578.80	691,338.68

(3) Government grants related to income and used for compensation of the Company’s relevant costs

or losses that have been incurred

Item	Amount	Item presented	Description
Refunds of value-added taxes	3,796,493.89	Other income
Grants for maintaining job position	138,849.88	Other income
Refund of unemployment insurance	18,960.00	Other income
Maternity grants from Shenzhen Social Security Bureau	74,980.09	Other income	Provisions of Guangdong for Maternity Insurance of Employees, Shenzhen Social Insurance Fund Administration
Employment Assurance Scheme of Hong Kong Government	60,039.17	Other income	List of Enterprises for Grants of Employment Assurance, Hong Kong Government
Subsidies for properties rent of micro- and small-sized enterprises (individually-owned businesses) during 2022 epidemic	15,000.00	Other income	Special support measure to help enterprises (individually-owned businesses) in Nanshan District in 2022
Special funds for the development of cultural industry (original research and development projects)	1,480,000.00	Other income	Notice on Formalities for Allocating 2021 Special Funds for the Development of Cultural Industry (Original Research and Development Projects),

			Shenzhen City Bureau of Culture, Radio, Television, Tourism and Sports
2021 1st settlement for grants for trademark registration in Shenzhen	54,000.00	Other income	Notice on Formalities of Receiving 2021 Grants for Trademark Registration and Grants for Copyright Registration by Shenzhen Administration for Market Regulation
Standard Field of Shenzhen in 2021	90,000.00	Other income	List of Standard Activities of Shenzhen Being Granted with Special Funds in 2021
Subsidies for cross-border water transportation during 2022 epidemic	5,000.00	Other income	Disclosure of the List of Sponsored Projects to be Deliberated by the Leader Group of Nanshan District Independent Innovation Industry Development Special Fund at Its Fifth Meeting in 2022 (Special Projects Supported by District Industry and Information Technology Bureau in 2022)
Shenzhen City Nanshan District Bureau of Culture, Radio, Television, Tourism and Sports (this level): incentives for “enterprises above designated size” in the library in culture industry with increase in operating income	1,000,000.00	Other income	Disclosure of the List of Sponsored Projects to be Deliberated by the Leader Group of Nanshan District Independent Innovation Industry Development Special Fund at Its Fifth Meeting in 2022 (Subitems of cultural industry development)
Projects to be funded under the plan of supports for science and technology rewards	200,000.00	Other income	List of Sponsored Projects to be Deliberated by the Leader Group of Nanshan District Independent Innovation Industry Development Special Fund at Its Fifth Meeting in 2022 (Subitems of science and technology development)
Support funds for “Investment and Loan Award”	329,529.38	Other income	Notice on Review of Applications for Support Funds for “Investment and Loan Award” of Beijing Cultural Enterprises in 2021
Subsidies for cultural industry	2,485,400.00	Other income	Announcement of Shunyi Publicity Department on

			Publicly Collecting the 2021 Projects Supported by the Special Funds for the Development of Cultural Industry in Shunyi District
Sub-total	9,748,252.41

(4) Interest subsidies

Item	Amount	Item presented	Description
Interest subsidy for loans	70,200.00	Financial expenses

85. Others

□ Applicable √ N/A

VIII. Changes in scope of consolidation

1. Business combination not involving entities under common control

□ Applicable √ N/A

2. Business combination involving entities under common control

□ Applicable √ N/A

3. Counter purchase

□ Applicable √ N/A

4. Disposal of subsidiaries

Single disposal of investments in subsidiaries, i.e. the loss of control

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

5. Changes in scope of consolidation for other reasons

Description of changes in the scope of consolidation for other reasons (e.g., new subsidiary establishment,subsidiary liquidation, etc.) and the relevant information:

√ Applicable□ N/A

Increased scope of combination

Company	Method of obtaining equity	Time point of obtaining equity	Capital contribution	Proportion of contribution
Hongkong Orange Juice Energy Technology Co., Limited	Newly established	March 15, 2022		33.31%
Wemax Inc.	Newly established	March 19, 2022		33.31%

6. Others

□ Applicable √ N/A

IX. Equity in other entities

1. Equity in subsidiaries

(1). Composition of enterprise group

√ Applicable□ N/A

Subsidiary Name	Principal operation place	Registration place	Business nature	Proportion of shareholding (%)		Acquisition method
				Direct	Indirect
Shenzhen Appotronics Laser Display Technology Co., Ltd.	Shenzhen	Shenzhen	Research and development and sales of laser display products	100.00		Business combination involving enterprises under common control
Appotronics Technology (Changzhou) Co., Ltd.	Changzhou	Changzhou	Technical research and development of projection equipment, screen and electronic computer.	100.00		Establishment
Shenzhen Appotronics Software Technology Co., Ltd.	Shenzhen	Shenzhen	Technology development and sales of computer software and hardware	100.00		Establishment
Shenzhen Appotronics Display Device Co., Ltd.	Shenzhen	Shenzhen	Technical development, sales, and technical services for display products; import and export business	100.00		Establishment
WEMAX LLC	USA	USA	Sales of laser equipment		100.00	Establishment
Shenzhen Appotronics Xiaoming Technology Co., Ltd.	Shenzhen	Shenzhen	Development, consultation and transfer of laser display technology	100.00		Establishment
Shenzhen Appotronics Home	Shenzhen	Shenzhen	Software development	100.00		Establishment

Line Technology Co., Ltd.			related to semiconductor optoelectronic products
Shenzhen Appotronics Laser Technology Co., Ltd.	Shenzhen	Shenzhen	Software development for semiconductor optoelectronic devices	100.00		Establishment
Tianjin Bonian Film Partnership (LP)	Tianjin	Tianjin	No specific business conducted	99.00	1.00	Business combination not involving enterprises under common control
Beijing Orient Appotronics Technology Co., Ltd.	Beijing	Beijing	Technology promotion; computer systems, application software services	59.00		Establishment
Qingda Appotronics (Xiamen) Technology Co., Ltd.	Shenzhen	Xiamen	Information technology consulting services	51.00		Establishment
Formovie (Chongqing) Innovative Technology Co., Ltd.	Chongqing	Chongqing	Technology and software development	39.19		Establishment
Fengmi (Beijing) Technology Co., Ltd.	Beijing	Beijing	Technology and software development		39.19	Establishment
Chongqing Guangbo Ecommerce Co., Ltd.	Chongqing	Chongqing	No specific business conducted		39.19	Establishment
Chongqing Ewei Ecommerce Co., Ltd.	Chongqing	Chongqing	No specific business conducted		39.19	Establishment
Shenzhen Orange Juice Energy Technology Co., Ltd.	Shenzhen	Shenzhen	Technology and software development		33.31	Establishment

Formovie Limited	Hong Kong	Hong Kong	No specific business conducted		39.19	Establishment
FORMOVIE TECHNOLOGY INC	USA	USA	No specific business conducted		39.19	Establishment
CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.	Beijing	Beijing	Research and development, production, technical services, sales and lease of laser cinema projection equipment	24.84	38.36	Business combination involving enterprises under common control
Appotronics Hong Kong Limited	Hong Kong	Hong Kong	Production, research, and development of semiconductor optoelectronic products, sales and consulting, investment and video content value-added services	100.00		Establishment
Appotronics USA, Inc.	USA	USA	R&D, manufacture and sales of semiconductor optoelectronic products		100.00	Business combination involving enterprises under common control
JoveAI Limited	Cayman Islands	Cayman Islands	No specific business conducted		64.29	Establishment
JoveAI Innovation, Inc.	USA	USA	Research and development of laser display software system		64.29	Establishment
JoveAI Asia Company Limited	Vietnam	Vietnam	Technical research and development of projection equipment,		64.29	Establishment

			screen and electronic computer.
Hongkong Orange Juice Energy Technology Co., Limited	Hong Kong	Hong Kong	Sales		33.31	Establishment
Wemax Inc.	USA	USA	Sales		33.31	Establishment

Description of the difference between the proportion of shareholding and the proportion of votingrights in a subsidiary:

Fengmi (Beijing) Technology Co., Ltd, FORMOVIE TECHNOLOGY INC, Formovie Limited,Chongqing Ewei Ecommerce Co., Ltd , Chongqing Guangbo Ecommerce Co., Ltd. are wholly-ownedsubsidiaries of Formovie (Chongqing) Innovation Technology Co., Ltd.. Shenzhen Orange Juice EnergyTechnology Co., Ltd. is a wholly-owned subsidiary of Formovie (Chongqing) Innovative Technology Co.,Ltd., Hongkong Orange Juice Energy Technology Co., Limited is a wholly-owned subsidiary of ShenzhenOrange Juice Energy Technology Co., Ltd., and Wemax Inc. is a wholly-owned subsidiary of HongkongOrange Juice Energy Technology Co., Limited.

The Company and Shenzhen Fengye Investment Consulting Limited Partnership (LimitedPartnership), a party acting in concert with the Company, hold a total of 53.6250% voting rights inFormovie (Chongqing) Innovative Technology Co., Ltd., for which the voting rights are exercisedaccording to the opinions of the Company. Since the voting rights are sufficient to exercise significantinfluence on the resolution of the general meeting, the Company becomes the controlling shareholder ofFormovie (Chongqing) Innovative Technology Co., Ltd.

Basis for holding half of the voting rights or below but still controlling the investee, and holding overhalf voting rights but having no control over the investee:

Fengmi (Beijing) Technology Co., Ltd, FORMOVIE TECHNOLOGY INC, Formovie Limited,Chongqing Ewei Ecommerce Co., Ltd , Chongqing Guangbo Ecommerce Co., Ltd. are wholly-ownedsubsidiaries of Formovie (Chongqing) Innovation Technology Co., Ltd.. Shenzhen Orange Juice EnergyTechnology Co., Ltd. is a wholly-owned subsidiary of Formovie (Chongqing) Innovative Technology Co.,Ltd., Hongkong Orange Juice Energy Technology Co., Limited is a wholly-owned subsidiary of ShenzhenOrange Juice Energy Technology Co., Ltd., and Wemax Inc. is a wholly-owned subsidiary of HongkongOrange Juice Energy Technology Co., Limited.

The Company and Shenzhen Fengye Investment Consulting Limited Partnership (LimitedPartnership), a party acting in concert with the Company, hold a total of 53.6250% voting rights inFormovie (Chongqing) Innovative Technology Co., Ltd., for which the voting rights are exercisedaccording to the opinions of the Company. Since the voting rights are sufficient to exercise significantinfluence on the resolution of the general meeting, the Company becomes the controlling shareholder ofFormovie (Chongqing) Innovative Technology Co., Ltd.Basis for controls over significant structured entities included in consolidation scope:

NoneBasis to determine the company acts as the agent or the principal:

NoneOther description:

None

(2). Significant non-wholly subsidiaries

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Subsidiaries	Shareholding by minority shareholders Percentage (%)	Profit or loss attributable to minority shareholders for the current period	Dividends declared for distribution to minority shareholders in the current period	Closing balance of minority interests
Formovie (Chongqing) Innovative Technology Co., Ltd.	60.81%	-27,600,522.80	0.00	8,273,599.33
CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.	36.80%	2,342,157.88	0.00	162,326,507.23

Description of the difference between the proportion of shareholding by minority shareholders and theirproportion of voting rights in a subsidiary:

√ Applicable □ N/A

Please refer to the above.Other description:

□ Applicable √ N/A

(3). Significant financial information of significant non-wholly subsidiaries

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Subsidiaries	Closing balance						Opening balance
	Current assets	Non-current assets	Total assets	Current liabilities	Non-current liabilities	Total liabilities	Current assets	Non-current assets	Total assets	Current liabilities	Non-current liabilities	Total liabilities
Formovie (Chongqing) Innovative Technology Co., Ltd.	915,026,931.78	48,227,602.91	963,254,534.69	696,276,995.25	254,565,924.23	950,842,919.48	923,415,138.40	42,178,494.73	965,593,633.13	735,633,264.62	172,919,867.39	908,553,132.01
CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.	191,634,575.99	690,147,557.01	881,782,133.00	342,380,760.18	98,296,733.62	440,677,493.80	231,461,535.13	738,260,940.26	969,722,475.39	377,533,503.17	161,248,165.77	538,781,668.94

Subsidiaries	Amount for the current period				Amount for the prior period
	Operating income	Net profit	Total comprehensive income	Cash flow from operating activities	Operating income	Net profit	Total comprehensive income	Cash flow from operating activities
Formovie (Chongqing) Innovative Technology Co., Ltd.	609,588,390.19	-46,582,172.21	-46,665,717.96	-113,145,829.78	531,216,939.04	12,761,375.30	12,761,391.07	31,963,176.54

CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.

161,099,444.15

6,364,559.45

6,364,559.45

37,271,780.44

244,006,736.50

59,012,508.09

59,012,508.09

99,458,332.40

Other description:

None

(4). Significant limitations on use of the group assets and payment of the group debts:

□ Applicable √ N/A

(5). Financial or other support provided to structured entities included in consolidated financialstatements ：

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

2. Changes of shares of owners’ equity in subsidiaries but continue to remain control over

transactions of subsidiaries

□ Applicable □ N/A

(1). Description of changes in the share in the owner's equity of subsidiaries

□ Applicable √ N/A

(2). Effect of the transaction on the minority interests and the equity attributable to owners of theparent company

□ Applicable √ N/A

Other description

□ Applicable √ N/A

3. Equity in joint ventures or associates

√ Applicable □ N/A

(1). Significant associates or joint ventures

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Associates or joint ventures	Principal operation place	Registration place	Business nature	Proportion of shareholding (%)		Accounting treatment method for investments in joint ventures or associates
				Direct	Indirect
GDC Technology Limited (BVI)	Asia and North America	British Virgin Islands	R&D, production, and sales of digital cinema servers and cinema management system		44.00	Accounting for under equity method

Description of the difference between the proportion of shareholding and the proportion of voting rightsin joint ventures or associates:

NoneBasis that the Company owns less than 20% voting rights but may exercise major impact, or that theCompany owns 20% or over voting rights but does not have major impact:

None

(2). Major financial information of significant joint ventures

□ Applicable √ N/A

(3). Major financial information of significant associates

√ Applicable □ N/A

Unit: Yuan Currency: RMB

	Closing balance/Amount for the current period	Opening balance/Amount for the prior period
	GDC	GDC
Current assets	545,678,168.47	648,413,809.69
Non-current assets	32,522,787.49	53,380,720.39
Total assets	578,200,955.96	701,794,530.08
Current liabilities	368,124,353.15	458,123,239.33
Non-current liabilities	14,699,712.24	25,008,058.43
Total liabilities	382,824,065.39	483,131,297.76
Minority interests
Interests attributable to shareholders of the parent company	195,376,890.57	218,663,232.32
Share of net assets calculated by ownership percentage	85,965,831.85	96,211,822.22
Adjustment	75,624,935.63	76,520,776.40
--Goodwill	77,772,341.43	77,772,341.43
--Unrealized profits for insider transactions	-2,147,405.80	-1,251,565.03
--Others
Carrying amount of investment of associates	159,724,538.60	166,676,657.87
Fair values of equity investments in associates having publicly quoted prices
Operating income	113,618,609.56	133,586,629.37
Net profit	-19,899,972.82	14,713,439.07
Net profit of discontinued operations
Other comprehensive income	-2,383,768.26	3,894,036.4
Total comprehensive income	-22,283,741.07	18,607,475.46
Dividends received from associates in the current year

Other descriptionNone

(4). Summary financial information of insignificant joint ventures and associates

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Closing balance/Amount for the current period

Opening balance/Amount for the prior period

Joint ventures:
Total carrying amount of investments
Total amounts calculated based on shareholding proportions
--Net profit
--Other comprehensive income
--Total comprehensive income
Associates:
Total carrying amount of investments	0.00	126,924,427.40
Total amounts calculated based on shareholding proportions
--Net profit	-148,672.23	1,131,089.51
--Other comprehensive income	-3,495,875.44	-2,612,904.61
--Total comprehensive income	-3,644,547.67	-1,481,815.09

Other descriptionLong-term equity investments in Cinionic Limited as an associate are transferred to others in the currentperiod.

(5). Descriptions of significant limitations over the ability of joint ventures or associates totransfer funds to the Company

□ Applicable √ N/A

(6). Excessive loss of joint venture or associates

□ Applicable √ N/A

(7). Unrecognized commitment relating to investments in joint ventures

□ Applicable √ N/A

(8). Contingent liabilities relating to investments in joint ventures or associates

□ Applicable √ N/A

4. Significant joint operations

□ Applicable √ N/A

5. Interests in structured entities that are not included in consolidated financial statementsDescription of structured entities that are not included in consolidated financial statements:

□ Applicable √ N/A

6. Others

□ Applicable √ N/A

X. Risks associated with financial instruments

√ Applicable □ N/A

The Company’s risk management objectives are to achieve a balance between risks and yield,minimize the adverse impacts of risks on the Company’s operation performance, and maximize thebenefits of the shareholders and other stakeholders. Based on these risk management objectives, theCompany’s basic risk management strategy is to identify and analyze its exposure to various risks,establish an appropriate minimum tolerance to risk, implement risk management, and monitor regularlyand effectively these exposures to ensure the risks are monitored at a certain level.The Company is exposed to various risks associated with financial instruments in its daily routines,primarily including credit risk, liquidity risk and market risk. The management has reviewed and approvedpolicies to manage these risks, summarized as below.

(I) Credit riskCredit risk refers to the risk that a party of the financial instrument will default on its obligationsresulting in financial loss to the counterparty.

1. Management of credit risk

(1) Evaluation method of credit risk

The Company assesses at each balance sheet date whether the credit risk of the underlying financialinstruments has increased significantly since initial recognition. In determining whether the credit risk hasincreased significantly since initial recognition, the Company considers reasonable and supportableinformation that is available without undue cost or effort, including qualitative and quantitative analysisbased on historical data, ranking of external credit risks and forward-looking information. The Companycompares the risk of a default occurring on a financial instrument as at the balance sheet date with the riskof a default occurring on the financial instrument as at the date of initial recognition based on individualfinancial instrument or a group of financial instruments with similar credit risk characteristic, to determinethe change of the risk of a default occurring on a financial instrument over the expected life.The Company considers the credit risk of financial instruments has increased significantly when oneor more of the following quantitative and qualitative criteria are met:

1) The quantitative criterion primarily refers to a certain percentage of increase in the probability ofdefault over the remaining life of the financial instruments as of the balance sheet date when comparingwith that at initial recognition of the financial instruments;

2) The qualitative criterion includes, inter alia, adverse material changes in business or financialconditions that are expected to cause a significant decrease in the debtor’s ability to meet its debtobligations, and an actual or expected significant adverse change in the technological, market, economic,or legal environment of the debtor that results in a significant decrease in the debtor’s ability to meet itsdebt obligations.

(2) Definition of defaulted or credit-impaired assets

A financial asset is defined as defaulted when the financial instrument meets one or more conditionsstated as below, and the criterion of defining defaulted asset is consistent with that of defining credit-impaired asset:

1) significant financial difficulty of the debtor;

2) a breach of contract terms with binding force by the debtor;

3) it is becoming probable that the debtor will enter bankruptcy or other financial reorganization;

4) the creditor of the debtor, for economic or contractual reasons relating to the debtor’s financialdifficulty, has granted to the debtor a concession(s) that the creditor would not otherwise consider.

2. Measurement of ECL

Key parameters to measure ECL include the probability of default, loss given default and theexposure at default. The Company established models of the probability of default, loss given default andthe exposure at default on the basis of qualitative analysis on historical statistical data (such as counterpartyranking, guarantee methods, collateral category, and repayment way) and forward-looking information.

3. Details of reconciliation of the opening balance and the closing balance of provision for impairmentof financial instruments can refer to the description in VII 4, 5, 6, 8, 10 and 16 of Section X.

4. Credit risk exposure and credit risk concentration

The Company’s credit risk is primarily from cash and bank balances and receivables. In order tocontrol the risks associated with aforementioned items, the Company has taken the following measures.

(1) Cash and bank balances

The credit risk of the Company is limited because the Company has deposited bank deposits andother monetary funds in banks with high credit ratings.

(2) Receivables

The Company regularly evaluates the creditworthiness of its customers with deals on credit, andselects to deal with approved and creditworthy customers subject to the results of the credit assessment

with monitoring the balance of its receivables, so as to ensure that the Company is not exposed tosignificant risk of bad debt.

No collaterals are required since the Company only deals with third parties that are approved andcreditworthy. The concentrated credit risks are managed by customers. As of June 30, 2022, the Companyis exposed to certain concentration of credit risks, as the Company’s accounts receivable from top 5customers have accounted for 66.41% of the total balance of accounts receivable (December 31, 2020:

67.07%). The Company held no collateral or other credit ranking measures for the balance of accountsreceivable.

The maximum exposure to the Company is the carrying amount of each financial asset in the balancesheet.

(II) Liquidity risk

Liquidity risk refers to the risk that the Company is in shortage of funds in performing obligationsthat are settled by delivering cash or another financial asset. Liquidity risk may arise from an inability tosell a financial asset at fair value as soon as possible, a counterparty’s inability to pay its contractualliabilities, the accelerated maturity of liabilities, or an inability to generate expected cash flows.

In order to control this risk, the Company balances the continuity and flexibility of financing by usingvarious financing measures such as notes settlement and bank loans comprehensively and adopting bothlong-term and short-term financing methods to optimize the financing structure. The Company hasreceived credit facilities from a number of commercial banks to satisfy its working capital requirementsand capital expenditures.

Financial liabilities classified by remaining maturity dates

Item	Closing balance
	Carrying amount	Undiscounted contract amount	Within 1 year	1-3 years	Over 3 years
Bank borrowings	700,187,843.22	743,977,943.65	395,238,016.30	348,395,706.64	344,220.71
Notes payable	121,047,156.20	121,047,156.20	121,047,156.20
Accounts payable	292,737,366.30	292,737,366.30	292,737,366.30
Other payables	52,311,833.50	52,311,833.50	52,311,833.50
Lease liabilities	50,880,372.91	54,579,686.15	22,771,775.29	23,238,816.18	8,569,094.68
Sub-total	1,217,164,572.13	1,264,653,985.80	884,106,147.59	371,634,522.82	8,913,315.39

(Continued to above table)

Item	Closing balance of last year
	Carrying amount	Undiscounted contract amount	Within 1 year	1-3 years	Over 3 years
Bank borrowings	509,637,141.27	565,968,031.25	161,844,102.83	335,211,636.92	68,912,291.50
Notes payable	144,456,001.87	144,456,001.87	144,456,001.87
Accounts payable	409,889,533.01	409,889,533.01	409,889,533.01
Other payables	54,115,784.80	54,115,784.80	54,115,784.80

Item	Closing balance of last year
	Carrying amount	Undiscounted contract amount	Within 1 year	1-3 years	Over 3 years
Lease Liabilities	29,560,179.86	30,987,424.69	19,686,637.60	10,725,062.82	575,724.27
Sub-total	1,147,658,640.81	1,205,416,775.62	789,992,060.11	345,936,699.74	69,488,015.77

(III) Market riskMarket risk refers to the risk that the fair value or future cash flows of a financial instrument willfluctuate because of changes in market prices. Market risk mainly includes interest rate risk and currencyrisk.

1. Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument willfluctuate because of changes in market interest rates. The Company is exposed to the risk of fair valueinterest rate due to financial instruments with a fixed interest rate and to the risk of cash value interest ratedue to financial instruments with a floating interest rate. The Company determines the proportion betweenthe fixed-rate financial instruments and the floating-rate financial instruments based on market conditions,and maintains appropriate portfolios of financial instruments through regular review and monitoring. Thecash flow interest rate risk exposed to the Company relates primarily to the Company’s floating-rateinterest-bearing bank borrowings.As of June 30, 2022, the principal of the Company’s floating-rate interest-bearing bank borrowingsamounted to RMB 481,187,843.22 (December 31, 2021: RMB 509,637,141.27). On the basis of theassumption that the interest rate has changed 50 basic points, where all other variables are held constant,it will bring no material impacts on the Company's total profits and shareholders’ equity.

2. Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuatebecause of changes in foreign exchange rates. The Company’s exposure to the currency risk is primarilyassociated with the Company’s monetary assets and liabilities dominated in foreign currencies. If themonetary assets and liabilities dominated in foreign currencies are imbalanced in a short time, theCompany will purchase and sell foreign currencies at the market exchange rate to keep the net riskexposure acceptable.

The closing balance of the Company’s monetary assets and liabilities dominated in foreign currenciesare disclosed in VII.82 of Section X in details.XI. Disclosure of fair value

1. The closing balance of the fair value of assets and liabilities measured at fair value

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Closing balance of fair value
	Level 1	Level 2	Level 3	Total
I. Continuous fair value measurement
(I) Held-for-trading financial assets		14,566,000.00	479,000,000.00	493,566,000.00
1. Financial assets at fair value through profit or loss		14,566,000.00	479,000,000.00	493,566,000.00
(1) Investment in debt instrument

(2) Investment in equity instrument		14,566,000.00	30,000,000.00	44,566,000.00
(3) Derivative financial assets
(4) Structural deposits			449,000,000.00	449,000,000.00
2. Designated as financial assets at fair value through profit or loss
(1) Investment in debt instrument
(2) Investment in equity instrument
(II) Other debt investments
(III) Other equity instrument investments			7,075,419.38	7,075,419.38
(IV) Investment properties
1. Land use right for leasing purpose
2. Buildings leased
3. Land use right held for the purpose of transfer after value appreciation
(V) Biological assets
1. Consumable biological assets
2. Productive biological assets
Receivables financing			3,289,265.10	3,289,265.10
Total assets continuously measured at fair value		14,566,000.00	489,364,684.48	503,930,684.48

2. Basis for determining the market price of continuous and non-continuous level 1 fair valuemeasurement items

□ Applicable √ N/A

3. Valuation techniques and qualitative and quantitative information of key parameters adoptedfor continuous and non-continuous level 2 fair value measurement items

√ Applicable □ N/A

The equity instrument investment presented stocks subscribed on the New Third Board; consideringthe factors including the level of activity for trading of stocks on the New Third Board, the Companyclassified stocks on the New Third Board as level 2 for the measurement of fair value, where the fair valueis determined according to the average closing price of the previous 20 trading days.

4. Valuation techniques and qualitative and quantitative information of key parameters adopted

for continuous and non-continuous level 3 fair value measurement items

√ Applicable□ N/A

No public market is available for equity instrument investments, structural deposits, receivablesfinancing, and investment in other equity instruments, hence the fair value of the foregoing are measuredat cost.

5. Reconciliation between opening and closing carrying amounts and sensitivity analysis ofunobservable parameters for continuous level 3 fair value measurement items

□ Applicable √ N/A

6. Where transfers among levels occurred in the period, transfer reasons and policies for

determining transfer time point for continuous fair value measurement items

□ Applicable √ N/A

7. Changes in valuation techniques in the period and reasons for changes

□ Applicable √ N/A

8. Fair value of financial assets and financial liabilities not measured at fair value

□ Applicable √ N/A

9. Others

□ Applicable √ N/A

XII. Related-party relationships and transactions

1. Parent of the Company

√ Applicable□ N/A

Unit: 0’000 Currency: RMB

Parent company	Registration place	Business nature	Registered capital	Proportion of the Company’s shares held by the parent company (%)	Proportion of the Company’s voting right held by the parent company (%)
Shenzhen Appotronics Holdings Limited	Shenzhen	R&D and sales of semiconductor products	1,000	17.62	17.62

Description of the parent company of the CompanyNoneThe ultimate controlling party of the Company is LI Yi.Other description:

None

2. Subsidiaries of the Company

Refer to the Notes for details about the subsidiaries of the Company

√ Applicable □ N/A

Refer to the description in IX.1 of Section X for details about the subsidiaries of the Company.

3. Associates and joint ventures of the Company

Information of the significant joint ventures or associates of the Company are disclosed in the Annex.

√ Applicable □ N/A

Refer to the description in Note IX.3 of Section X for details about the associates of the Company.Details of other joint ventures or associates having related-party transactions and balances with theCompany in the period or in prior periods:

√ Applicable □ N/A

Associates or joint ventures	Relationship with the Company
Cinionic Limited	Associate
GDC Technology Limited (BVI)	Associate

Other description

□ Applicable √ N/A

4. Other related parties of the Company

√ Applicable □ N/A

Other related party	Relationship between other related party and the Company
Beijing Donview Education Technology Co., Ltd. and its affiliates	Minority shareholders holding more than 10% shares in the subsidiary and their affiliates
Shenzhen YLX Technology Development Co., Ltd.	Controlled by the same actual controller
Xiaomi Communications Technologies Co., Ltd. and its affiliates	Minority shareholders holding more than 10% shares in the subsidiary and their affiliates
CFEC and its affiliates	Minority shareholders holding more than 10% shares in the subsidiary and their affiliates
WeCast and its affiliates	Enterprise in which the actual controller holds the post of director
Shenzhen Bevix Technology Co., Ltd.	Holding more than 5% of shares in the company

Other descriptionNone

5. Related-party transactions

(1). Sales and purchase of goods, rendering and receipt of services

Purchase of goods/receipt of services

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Related party	Subject matter	Amount for the current period	Amount for the prior period
Xiaomi Communications Technologies Co., Ltd. and its affiliates	Electronic components and services	102,666,791.40	151,065,707.11
CFEC and its affiliates	Power, water cooling and services	10,702,327.46	14,313,447.67
GDC and its affiliates	Electronic components		5,711,956.57
WeCast and its affiliates	Sale agency services		155,309.88
Beijing Donview Education Technology Co., Ltd. and its affiliates	Maintenance services	8,962.26	9,911.50
Shenzhen YLX Technology Development Co., Ltd.	Electronic components	533,349.16
Total		113,911,430.28	171,256,332.73

Sales of goods/rendering of services

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Related party	Subject matter	Amount for the current period	Amount for the prior period
Xiaomi Communications Technologies Co., Ltd. and its affiliates	Laser TV, smart mini projector	302,360,399.65	341,732,526.82

CFEC and its affiliates	Laser light source and cinema projection services	16,119,369.88	42,679,705.11
CINIONIC and its affiliates	Cinema light source	50,666,582.80	3,130,401.43
Beijing Donview Education Technology Co., Ltd. and its affiliates	Education projector	1,533,749.83	686,049.45
GDC and its affiliates	Cinema projectors	7,493,997.70	3,729,645.10
WeCast and its affiliates	Laser TV, smart mini projector	-7,681,578.96	6,196,785.06
Shenzhen YLX Technology Development Co., Ltd.	Electronic components	950,681.50
Total		371,443,202.39	398,155,112.97

Description of sales and purchase of goods, rendering and receipt of services

□ Applicable √ N/A

(2). Details of trust with related parties/subcontracting and trust management/contract-issuingDetails of trust/contracting where a group entity is the trustor/main contractor:

□ Applicable √ N/A

Description of trust/subcontracting with related parties

□ Applicable √ N/A

Details of trust/contracting where a group entity is the trustor/main contractor ：

□ Applicable √ N/A

Description of management/contract-issuing with related parties

□ Applicable √ N/A

(3). Leases with related parties

The Company as the lessor:

□ Applicable √ N/A

The Company as the lessee:

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Lessor	Type of leased assets	Paid rent		Assumed interest expenses of lease liabilities		Added use right assets
		Amount for the current period	Amount for the prior period	Amount for the current period	Amount for the prior period	Amount for the current period	Amount for the prior period
CFEC and its affiliates	Housing lease	379,304.00	605,733.32	27,641.32	52,464.37	-1,086,329.01	698,685.87

Description of leases with related parties

□ Applicable √ N/A

(4). Guarantees with related parties

The Company as a guarantor:

□ Applicable √ N/A

The Company as a guaranteed party:

□ Applicable √ N/A

Description of guarantees with related parties

□ Applicable √ N/A

(5). Borrowings/loans with related parties

□ Applicable √ N/A

(6). Assets transfer/debt restructuring with related parties

□ Applicable √ N/A

(7). Compensation for key management personnel

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Amount for the current period	Amount for the prior period
Compensation for key management personnel	469.87	659.61

(8). Other related-party transactions

□ Applicable √ N/A

6. Amounts due from/to related parties

(1). Amounts due from related parties

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Related party	Closing balance		Opening balance
		Gross carrying amount	Provision for bad debts	Gross carrying amount	Provision for bad debts
Accounts receivable	Beijing Donview Education Technology Co., Ltd. and its affiliates	900,000.00	45,000.00	912,982.89	45,649.14
	GDC and its affiliates	7,390,544.48	369,527.22	5,159,950.72	257,997.54
	Xiaomi Communications Technologies Co., Ltd. and its affiliates	116,359,517.65	5,817,975.88	132,000,017.31	6,600,000.87
	WeCast and its affiliates	13,935,573.73	696,778.69	20,597,638.81	1,029,881.92
	CFEC and its affiliates	170,737.78	8,667.92	1,019,071.79	51,248.40

	CINIONIC and its affiliates	34,402,971.97	1,720,148.60	26,592,355.61	1,329,617.78
Sub-total	/	173,159,345.61	8,658,098.31	186,282,017.13	9,314,395.65
Prepayments	CFEC and its affiliates	781,079.65		1,369,286.22
	Xiaomi Communications Technologies Co., Ltd. and its affiliates			40,000.00
Sub-total	/	781,079.65		1,409,286.22
Other receivables	CFEC and its affiliates	185,111.00	9,255.55	229,355.00	11,467.75
	GDC and its affiliates	21,342,252.00	402,684.00	20,286,601.00	383,135.75
	Xiaomi Communications Technologies Co., Ltd. and its affiliates	200,000.00	10,000.00
Sub-total	/	21,727,363.00	421,939.55	20,515,956.00	394,603.50

(2). Amounts due to related parties

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Related party	Closing balance of carrying amount	Opening balance of carrying amount
Accounts payable	CFEC and its affiliates	19,596,891.45	17,315,868.17
	GDC and its affiliates		5,593.76
	Xiaomi Communications Technologies Co., Ltd. and its affiliates	33,911,552.54	65,042,097.29
	Shenzhen YLX Technology Development Co., Ltd.	1,462.94	1,147,275.29
Sub-total	/	53,509,906.93	83,510,834.51
Notes payable	CFEC and its affiliates		5,049,000.17
Sub-total	/		5,049,000.17
Advance from customers	CFEC and its affiliates	1,402,873.19	11,025,498.93
Sub-total	/	1,402,873.19	11,025,498.93
Contract liabilities	GDC and its affiliates	37,082.55	3,469.81
	CFEC and its affiliates	1,902,665.49	4,396,474.85
	Beijing Donview Education Technology Co., Ltd. and its affiliates	396,411.74

	WeCast and its affiliates	127,651.23
	Xiaomi Communications Technologies Co., Ltd. and its affiliates	67,136.28
Sub-total	/	2,530,947.29	4,399,944.66
Other payables	CFEC and its affiliates	10,000.00
	Beijing Donview Education Technology Co., Ltd. and its affiliates	100,000.00	10,800.00
	Xiaomi Communications Technologies Co., Ltd. and its affiliates		1,976.10
	GDC and its affiliates	270.00
Sub-total	/	110,270.00	12,776.10
Other current liabilities	GDC and its affiliates	2,224.95
	CFEC and its affiliates	247,346.51
	Beijing Donview Education Technology Co., Ltd. and its affiliates	51,533.53
	Xiaomi Communications Technologies Co., Ltd. and its affiliates	1,540,647.74	16,804,816.23
Sub-total	/	1,841,752.73	16,804,816.23

7. Related party commitments

□ Applicable √ N/A

8. Others

□ Applicable √ N/A

XIII. Share-based payments

1. Summary of share-based payments

√ Applicable □ N/A

Unit: Share Currency: RMB

Item	Company	Formovie
Total number of the Company’s equity instruments granted during the period	11,900,000
Total number of the Company’s equity instruments executed during the period
Total number of the Company’s equity instruments lapsed during the period	2,708,860.00

Range of exercise prices and remaining contractual life of the Company’s share options outstanding at the end of the period	Grant date: October 14, 2019; grant price: RMB 17.265/share; 4 months Grant date: October 13, 2020; grant price: RMB 17.265/share; 4 months Grant date: January 1, 2021; grant price: RMB 4.30/share; 6 months Grant date: April 22, 2021; grant price: RMB 20.84/share; 21 months Grant date: April 22, 2021; grant price: RMB 18.34/share; 21 months Grant date: April 22, 2021; grant price: RMB 17.34/share; 21 months Grant date: December 7, 2021; grant price: RMB 19.895/share; 29 months Grant date: December 7, 2021; grant price: RMB 22.895/share; 29 months Grant date: March 11, 2022; grant price: RMB 18.34/share; 21 months Grant date: March 11, 2022; grant price: RMB 19.895/share; 21 months Grant date: March 11, 2022; grant price: RMB 22.895/share; 29 months Grant date: May 25, 2022; grant price: RMB 15.395/share; 23 months	Grant date: December 31, 2021; grant price: RMB 1/share; 48 months
Range of exercise prices and remaining contractual life of the Company’s other equity instruments outstanding at the end of the period	None	None

Other descriptionNone

2. Equity-settled share-based payments

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Company	Formovie
The method of determining the fair value of equity instruments at the grant date	Option pricing model	Evaluation of all shareholder’s equity interests
The basis of determining the number of equity instruments expected to be executed	Actual grant amount	Actual grant amount
Reasons for the significant difference between the estimate in the current period and that in the prior period	None	None
Amounts of equity-settled share-based payments accumulated in capital reserve	116,375,739.84	10,998,484.23
Total expenses recognized arising from equity-settled share-based payments	43,682,773.93	594,999.63

Other descriptionNone

3. Cash-settled share-based payments

□ Applicable √ N/A

4. Modification to and termination of share-based payments

□ Applicable √ N/A

5. Others

□ Applicable √ N/A

XIV. Commitments and contingencies

1. Significant commitments

√ Applicable □ N/A

Significant external commitments, and nature and amount thereof as of the balance sheet date

Significant lease contracts which the Company has entered into or will perform and their financialimpacts are disclosed in the following table:

No.	Rent address	Rent area (square meters)	Rent purpose	Rent period	Rent expense/year
1	20/F, 21/F, 22/F, United Headquarter Building, High-Tech Zone, No. 63 Xuefu Road, Nanshan District, Shenzhen	5,808.79	Research and development, office administration	From January 1, 2022 to December 31, 2026	5,310,893.71
2	Yaochuan Industrial Zone, Tangwei Community, Fuhai Street, Bao’an District, Shenzhen	23,765.57	Plant	From December 1, 2018 to November 30, 2022	12,319,285.88

2. Contingencies

(1). Significant contingencies as of the balance sheet date

√ Applicable □ N/A

Pending litigation

1. Civil litigation and arbitration where the Company acted as the plaintiff

As of June 30, 2022, there are 24 civil litigation cases where the Company acted as a plaintiff,specifically including:

Case No.	Cause of action	Plaintiff/Appellant	Defendant/Appelee	Patents involved	Amount	Progress
(2019) Yue 03 Min Chu No. 2943 (2021) Zui Gao Fa Zhi Min Zhong No. 1582	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; Defendant 2: Delta Video Display System (Wujiang) Limited; Defendant 3: Shenzhen Super Network Technology Co., Ltd.	200810065225.X	RMB 8.00 million	(1) Compensation amount decided in the trial of the first instance: RMB 271,399.40; (2) Under trial of the second instance

(2019) Yue 03 Min Chu No. 2944 (2021) Zui Gao Fa Zhi Min Zhong No. 1718	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; Defendant 2: Delta Video Display System (Wujiang) Limited; Defendant 3: Shenzhen Super Network Technology Co., Ltd.	200810065225.X	RMB 8.00 million	(1) Compensation amount decided in the trial of the first instance: RMB 501,399.40; (2) Under trial of the second instance
(2019) Yue 03 Min Chu No. 2946 (2022) Zui Gao Fa Zhi Min Zhong No. 161	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; Defendant 2: Delta Video Display System (Wujiang) Limited; Defendant 3: Shenzhen Super Network Technology Co., Ltd.	200810065225.X	RMB 4.00 million	(1) Compensation amount decided in the trial of the first instance: RMB 151,399.40; (2) Under trial of the second instance
(2019) Yue 03 Min Chu No. 2948 (2021) Zui Gao Fa Zhi Min Zhong No. 1548	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; Defendant 2: Delta Video Display System (Wujiang) Limited; Defendant 3: Shenzhen Super Network Technology Co., Ltd.	200810065225.X	RMB 4.00 million	(1) Compensation amount decided in the trial of the first instance: RMB 146,399.40; (2) Under trial of the second instance
(2019) Yue 03 Min Chu No. 2951 (2021) Zui Gao Fa Zhi Min Zhong No. 1550	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Electronics (Shanghai) Co., Ltd.; Defendant 2: Delta Video Display System (Wujiang) Limited; Defendant 3: Shenzhen Super Network Technology Co., Ltd.	200810065225.X	RMB 4.00 million	(1) Compensation amount decided in the trial of the first instance: RMB 581,399.40; (2) Under trial of the second instance
(2020) Yue 73 Min Chu No. 1335	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd.	ZL200880107739.5	RMB 3.00 million and right protection expenses of RMB 0.50 million	Under trial of the first instance

			Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.
(2020) Yue 73 Min Chu No. 1336	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200880107739.5	RMB 6.50 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1337	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Digital Protection (Beijing) Electronics Technology Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200880107739.5	RMB 2.50 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1338	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200880107739.5	RMB 2.00 million and right protection expenses of RMB 0.50 million	Under trial of the first instance

(2020) Yue 73 Min Chu No. 1340	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Digital Protection (Beijing) Electronics Technology Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200880107739.5	RMB 6.00 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1341	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200880107739.5	RMB 14.00 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1361	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 5: Guangzhou Jianye Network Technology Co., Ltd.	ZL200880107739.5	RMB 0.75 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1339	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Guangdong Jianye Display Information	ZL200810065225.X	RMB 0.75 million and right protection expenses of RMB 0.50 million	Under trial of the first instance

			Technology Co., Ltd. Defendant 5: Guangzhou Jianye Network Technology Co., Ltd.
(2020) Yue 73 Min Chu No. 1353	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200810065225.X	RMB 14.00 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1355	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Digital Protection (Beijing) Electronics Technology Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200810065225.X	RMB 6.00 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1356	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200810065225.X	RMB 6.50 million and right protection expenses of RMB 0.50 million	Under trial of the first instance

(2020) Yue 73 Min Chu No. 1357	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Digital Protection (Beijing) Electronics Technology Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200810065225.X	RMB 2.50 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1358	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200810065225.X	RMB 2.00 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1359	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd. Defendant 4: Delta Electronics Business Management (Shanghai) Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.	ZL200810065225.X	RMB 3.00 million and right protection expenses of RMB 0.50 million	Under trial of the first instance
(2020) Yue 73 Min Chu No. 1360	Infringement on patent for invention	Appotronics Corporation Limited	Defendant 1: Delta Video Display System (Wujiang) Limited Defendant 2: WANG Yuhai Defendant 3: Hunan Dehao Cultural and Creative Co., Ltd.	ZL200810065225.X	RMB 3.00 million and right protection expenses of RMB	Under trial of the first instance

			Defendant 4: Digital Protection (Beijing) Electronics Technology Co., Ltd. Defendant 5: Guangdong Jianye Display Information Technology Co., Ltd. Defendant 6: Guangzhou Jianye Network Technology Co., Ltd.		0.50 million
(2021) Yue 73 Min Chu No. 1860	Maliciously initiate an intellectual property litigation	Appotronics Corporation Limited	Defendant: Delta Electronics, Inc.	/	RMB 10.00 million	Under trial of the first instance
(2022) Yue 0305 Min Chu No. 10069	Dispute over the sales contract	Appotronics Corporation Limited	Defendant: Shenzhen Creality 3D Technology Co., Ltd.	/	RMB 219,900 and the costs for litigation and preservation.	Under trial of the first instance
XA20220598	Dispute over the sales contract	Qingda Appotronics (Xiamen) Technology Co., Ltd.	Defendant: Yunzhi Feiyang (Beijing) Network Technology Co., Ltd.	/	RMB 214,800 and other expenses including arbitration costs	Under trial of arbitration
01-22-0001-2735	Arbitration of dispute over the implementation of the Settlement Agreement and arbitration counterclaims	Counter-claimants: Appotronics Hong Kong Limited and Appotronics Corporation Limited	Counter-respondents: GDC Technology Limited (Cayman Islands), GDC Technology Limited (British Virgin Islands), actual controller ZHANG Wanneng and his management team	/	USD 40 million	Pending trial

2. Civil litigation and arbitration where the Company acted as the defendant

As of June 30, 2022, there are 8 civil litigations where the Company was a defendant, specificallyincluding:

Case No.	Cause of action	Plaintiff	Defendant	Patents involved	Amount involved	Progress
(2019) Yue 73 Zhi Min Chu No. 662	Infringement on patent for invention	Delta Electronics, Inc.	Appotronics Corporation Limited; Futian SPN Projector & Video System Firm of Shenzhen	ZL201610387831.8	Loss compensation of RMB 16.00 million + right protection expenses of RMB 14,500.00	Under trial of the first instance

Case No.	Cause of action	Plaintiff	Defendant	Patents involved	Amount involved	Progress
(2019) Jing 73 Min Chu No.1275			Fengmi (Beijing) Technology Co., Ltd.; Appotronics Corporation Limited	ZL201410249663.7	Loss compensation of RMB 15.00 million + right protection expenses of RMB 1.01 million	The judgment of the first instance in January 2022 held that no infringement is constituted, under trial of the second trial
(2019) Jing 73 Min Chu No. 1276			Fengmi (Beijing) Technology Co., Ltd.; Appotronics Corporation Limited	ZL201610387831.8	Loss compensation of RMB 15.00 million + right protection expenses of RMB 1.01 million	The judgment of the first instance in January 2022 held that no infringement is constituted, under trial of the second trial
(2021) Hu 73 Zhi Min Chu No. 1070			Appotronics Corporation Limited and Shanghai Haichi Digital Technology Co., Ltd.	ZL201110041436.1	Loss compensation of RMB 15.00 million + right protection expenses of RMB 1.01 million	Under trial of the first instance
(2021) Chuan 01 Zhi Min Chu No. 685			Appotronics Corporation Limited; Chengdu Jinxi Guangxian Information Technology Co., Ltd.	ZL201610387831.8	Loss compensation of RMB 15.00 million + right protection expenses of RMB 1.01 million	Under trial of the first instance
(2021) Chuan 01 Zhi Min Chu No. 686				ZL201110041436.1	Loss compensation of RMB 15.00 million + right protection expenses of RMB 1.01 million	Under trial of the first instance

Case No.	Cause of action	Plaintiff	Defendant	Patents involved	Amount involved	Progress
(2022) Zhe 01 Min Chu No. 157	Dispute over infringement on patent for design	Wanbo Technology Co., Ltd.	Defendant 1: Shenzhen Appotronics Xiaoming Technology Co., Ltd. Defendant 2: Fengmi (Beijing) Technology Co., Ltd. Defendant 3: Zhejiang Tmall Network Co., Ltd.	ZL201930556138.3	Requesting compensation in the amount of: RMB 3.00 million	Under trial of the first instance
01-22-0001-2735	Arbitration of dispute over the implementation of the Settlement Agreement and arbitration counterclaims	Claimants: GDC Technology Limited (Cayman Islands) and GDC Technology Limited (British Virgin Islands)	Respondents: Appotronics Hong Kong Limited and Appotronics Corporation Limited	/	USD 38 million	Pending trial

(2). Description shall also be provided even if the Company has no significant contingencies to bedisclosed:

□ Applicable √ N/A

3. Others

□ Applicable √ N/A

XV. Events after the balance sheet date

1. Material non-adjusting event

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Content	Effects on the financial position and operating results	Reasons for not being able to estimate such effects
Issuance of stocks and bonds	A total of 2,881,497 shares in the first vesting period meets the vesting criteria for the initial grant under the 2021 Restricted Share Incentive Plan, and the formalities for	The paid-in share capital increases by RMB 2,881,497.00 and the capital reserve (share premium) increases by RMB 48,352,137.36

such shares completedon July 13, 2022.

2. Profit distribution

□ Applicable √ N/A

3. Sales return

□ Applicable √ N/A

4. Description of other events after the balance sheet date

□ Applicable √ N/A

XVI. Other significant events

1. Corrections of prior period errors

(1). Retrospective application

□ Applicable √ N/A

(2). Prospective application

□ Applicable √ N/A

2. Debt restructuring

□ Applicable √ N/A

3. Asset swap

(1). Exchange of non-monetary assets

□ Applicable √ N/A

(2). Other asset swap

□ Applicable √ N/A

4. Annuity plan

□ Applicable √ N/A

5. Discontinued operations

□ Applicable √ N/A

6. Segment reporting

(1). Determination basis and accounting policies of reporting segments

□ Applicable √ N/A

(2). Financial information of reporting segments

□ Applicable √ N/A

(3). If the Company has no reporting segments, or cannot disclose the total assets and liabilities of

reporting segments, specify the reasons

√ Applicable□ N/A

The Company has no reporting segments due to absence of diversified operations. A breakdown ofthe Company’s principal operating incomes and costs categorized by businesses, products and regions isdisclosed as below:

Categorized by businesses and products:

Unit: RMB0’000

Item	Amount of the current period		Amount of the prior period
	Principal operating income	Principal operating cost	Principal operating income	Principal operating cost
Sales	113,156.62	81,850.58	91,163.98	65,553.48

Item	Amount of the current period		Amount of the prior period
	Principal operating income	Principal operating cost	Principal operating income	Principal operating cost
Projection services	13,521.49	6,474.67	18,565.59	6,437.12
Other business	254.11	130.82	739.35	370.63
Sub-total	126,932.22	88,456.06	110,468.92	72,361.23

Categorized by regions:

Unit: RMB0’000

Item	Amount of the current period		Amount of the prior period
	Principal operating income	Principal operating cost	Principal operating income	Principal operating cost
Domestic	111,764.66	79,898.99	105,208.67	69,458.21
Overseas	15,167.56	8,557.07	5,260.25	2,903.02
Sub-total	126,932.22	88,456.06	110,468.92	72,361.23

(4). Other description

□ Applicable √ N/A

7. Other significant transactions and matters having an impact on the decisions of investors

□ Applicable √ N/A

8. Others

□ Applicable √ N/A

XVII. Notes to key items in the parent company’s financial statements

1. Accounts receivable

(1). Disclosure by aging

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Aging	Closing balance of carrying amount
Within 1 year
Including: Subitems within 1 year
Sub-total of items within 1 year	649,298,212.29
1 to 2 years	23,341,733.24
2 to 3 years	3,148,153.35
Total	675,788,098.88

(2). Disclosure by categories of provision for bad debts

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Category	Closing balance					Opening balance
	Gross carrying amount		Provision for bad debts		Carrying amount	Gross carrying amount		Provision for bad debts		Carrying amount
	Amount	Percentage (%)	Amount	Percentage of provision (%)		Amount	Percentage (%)	Amount	Percentage of provision (%)
Provision for bad debts made individually
Including:
Provision for bad debts made by group	675,788,098.88	100.00	6,371,273.75	0.94	669,416,825.13	621,699,280.41	100.00	5,483,110.45	0.88	616,216,169.96
Including:
Group of aging	122,652,853.97	18.15	6,371,273.75	5.19	116,281,580.22	109,178,209.03	17.56	5,483,110.45	5.02	103,695,098.58
Group of receivables from related parties in the scope of consolidation	553,135,244.91	81.85			553,135,244.91	512,521,071.38	82.44			512,521,071.38
Total	675,788,098.88	100.00	6,371,273.75	0.94	669,416,825.13	621,699,280.41	100.00	5,483,110.45	0.88	616,216,169.96

Provision for bad debts made individually:

□ Applicable √ N/A

Provision for bad debts made by group:

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Name	Closing balance
	Accounts receivable	Provision for bad debts	Percentage of provision (%)
Group of aging	122,652,853.97	6,371,273.75	5.19
Group of receivables from related parties in the scope of consolidation	553,135,244.91		0.00
Total	675,788,098.88	6,371,273.75	0.94

Recognition criterion to make the provision for bad debts by group and explanation:

□ Applicable √ N/A

If a provision for bad debts of accounts receivable is made in accordance with the general model ofECL, please disclose relevant information subject to the disclosure of the provision for bad debts forother receivables:

□ Applicable √ N/A

(3). Provision for bad debts

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Category	Opening balance	Changes for the current period				Closing balance
		Provision	Recovery or reversal	Write off or cancellation	Other changes
Provision for bad debts made by group	5,483,110.45	888,163.30				6,371,273.75
Total	5,483,110.45	888,163.30				6,371,273.75

Including significant amounts recovered or reversed from the current provision for bad debts:

□ Applicable √ N/A

(4). Accounts receivable actually canceled in the current period

□ Applicable √ N/A

(5). Top five closing balances of accounts receivable categorized by debtors

√ Applicable □ N/A

Entity	Closing balance	Proportion to the total closing balance of accounts receivable (%)	Closing balance of provision for bad debts
Top 1	217,442,090.82	32.18
Top 2	119,295,011.51	17.65
Top 3	111,493,328.28	16.50
Top 4	70,204,911.89	10.39
Top 5	33,135,753.04	4.90	1,711,165.15
Total	551,571,095.54	81.62	1,711,165.15

(6). Accounts receivable derecognized due to transfer of financial assets

□ Applicable √ N/A

(7). Assets and liabilities arising from transfer of accounts receivable and continued involvement

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

2. Other receivables

Presented by items

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Closing balance	Opening balance
Interest receivable
Dividends receivable
Other receivables	11,109,739.71	6,645,181.15
Total	11,109,739.71	6,645,181.15

Other description:

□ Applicable √ N/A

Interest receivable

(1). Categories of interest receivable

□ Applicable √ N/A

(2). Significant interests overdue

□ Applicable √ N/A

(3). Provision for bad debts

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

(4). Dividends receivable

□ Applicable √ N/A

(5). Dividends receivable with significant amounts aged more than 1 year

□ Applicable √ N/A

(6). Provision for bad debts

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

Other receivables

(7). Disclosure by aging

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Aging	Closing balance of carrying amount
Within 1 year
Including: Subitems within 1 year
Sub-total of items within 1 year	7,723,237.58
1 to 2 years
2 to 3 years	3,687,618.00
Total	11,410,855.58

(8). Categories by the nature of other receivables

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Nature of receivables	Closing balance of carrying amount	Opening balance of carrying amount
Deposits/margins/petty cash	5,909,756.01	5,855,101.09
Receivables from related parties in the scope of consolidation	5,388,538.01	912,569.02
Temporary receivables	112,561.56	207,998.50

Total

11,410,855.58

6,975,668.61

(9). Provision for bad debts

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Provision for bad debts	Stage I	Stage II	Stage III	Total
	12-month ECL in the future	Lifetime ECL (without credit impairment)	Lifetime ECL (with credit impairment)
Balance as at January 1, 2022	296,321.86	34,165.60		330,487.46
Balance as at January 1, 2022 in the current period
--transferred to Stage II
--transferred to Stage III
--reversed to Stage II
--reversed to Stage I
Provision	4,794.01	-34,165.60		-29,371.59
Reversal
Write-off
Cancellation
Other changes
Balance as at June 30, 2022	301,115.87			301,115.87

Description of significant changes in the balance of other receivables with changed provisions for lossesin the current period:

□ Applicable √ N/A

Basis for recognizing the amount of provision for bad debts and evaluating whether the credit risk offinancial instruments has been increased significantly in the current period:

□ Applicable √ N/A

(10). Provision for bad debts

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Category	Opening balance	Changes for the current period				Closing balance
		Provision	Recovery or reversal	Write off or cancellation	Other changes
Provision for bad debts	330,487.46	-29,371.59				301,115.87

made by group
Total	330,487.46	-29,371.59				301,115.87

Including significant amounts recovered or reversed from the current provision for bad debts:

□ Applicable √ N/A

(11). Other receivables actually canceled in the current period

□ Applicable √ N/A

Description of other receivables cancellation:

□ Applicable √ N/A

(12). Top five closing balances of other receivables categorized by debtors

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Entity	Nature of other receivables	Closing balance	Aging	Proportion to the balance of other receivables (%)	Provision for bad debts Closing balance
Top 1	Receivables from related parties in the scope of consolidation	4,561,858.65	Within 1 year	39.98
Top 2	Deposits/margins/petty cash	3,574,618.00	Over 3 years	31.33	178,730.90
Top 3	Deposits/margins/petty cash	1,257,075.20	2-3 years, over 3 years	11.02	62,853.76
Top 4	Receivables from related parties in the scope of consolidation	691,051.81	Within 1 year	6.06
Top 5	Deposits/margins/petty cash	500,000.00	2-3 years	4.38	25,000.00
Total	/	10,584,603.66	/	92.77	266,584.66

(13). Accounts receivable involving government grants

□ Applicable √ N/A

(14). Other receivables derecognized due to transfer of financial assets

□ Applicable √ N/A

(15). Assets and liabilities arising from transfer of other receivables and continued involvement

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

3. Long-term equity investments

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Closing balance			Opening balance
	Gross carrying amount	Provision for impairment	Carrying amount	Gross carrying amount	Provision for impairment	Carrying amount
Investments in subsidiaries	460,313,745.55	12,827,792.79	447,485,952.76	453,386,804.91	12,827,792.79	440,559,012.12

Investments in associates and joint ventures
Total	460,313,745.55	12,827,792.79	447,485,952.76	453,386,804.91	12,827,792.79	440,559,012.12

(1) Investments in subsidiaries

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Investees	Opening balance	Increase	Decrease	Closing balance	Provision for impairment	Closing balance of provision for impairment
CINEAPPO Laser Cinema Technology (Beijing) Co., Ltd.	40,023,897.89	4,488,535.66		44,512,433.55
Shenzhen Appotronics Software Technology Co., Ltd.	1,763,700.01		272,764.93	1,490,935.08
Beijing Orient Appotronics Technology Co., Ltd.	5,900,000.00			5,900,000.00
Shenzhen Appotronics Xiaoming Technology Co., Ltd.	12,000,000.00			12,000,000.00		12,000,000.00
Fengmi (Beijing) Technology Co., Ltd.	3,285,537.50	242,168.82		3,527,706.32
Qingda Appotronics (Xiamen) Technology Co., Ltd.	5,100,000.00			5,100,000.00		827,792.79
Shenzhen Appotronics Laser Display Technology Co., Ltd.	18,966,857.26			18,966,857.26

Appotronics HongKong Limited	303,045,217.02	1,676,517.72		304,721,734.74
JOVEAI Innovation	769,778.40		7,580.21	762,198.19
Appotronics Technology (Changzhou) Co., Ltd.	2,000,000.00			2,000,000.00
Shenzhen Appotronics Display Device Co., Ltd.	3,000,000.00			3,000,000.00
WEMAX LLC				-
APPOTRONICS USA,INC.	399,600.01		399,600.01
Tianjin Bonian Film Partnership (LP)	26,954,120.20			26,954,120.20
Formovie (Chongqing) Innovative Technology Co., Ltd.	30,178,096.62	1,199,663.59		31,377,760.21
Total	453,386,804.91	7,606,885.79	679,945.15	460,313,745.55		12,827,792.79

(2) Investments in associates and joint ventures

□ Applicable √ N/A

Other description:

□ Applicable √ N/A

4. Operating income and operating costs

(1). Description of operating income and operating costs

√ Applicable □ N/A

Unit: Yuan Currency ： RMB

Item	Amount for the current period		Amount for the prior period
	Income	Cost	Income	Cost
Main business	649,645,354.34	432,684,792.22	572,827,875.91	381,855,853.31
Total	649,645,354.34	432,684,792.22	572,827,875.91	381,855,853.31

(2). Description of incomes from contracts

□ Applicable √ N/A

(3). Description of performance obligations

□ Applicable √ N/A

(4). Description of allocation to remaining performance obligations

□ Applicable √ N/A

Other description:

None

5. Investment income

√ Applicable □ N/A

Unit: Yuan Currency ： RMB

Item	Amount for the current period	Amount for the prior period
Gains from long-term equity investment accounted for using the cost method		7,452,000.00
Long-term equity investment accounted for using the equity method		6,057,494.48
Investment income from held-for-trading financial assets during the holding period	200,000.00
Investment income from disposal of held-for-trading financial assets	5,684,922.38	2,145,923.39
Total	5,884,922.38	15,655,417.87

Other description:

None

6. Others

□ Applicable √ N/A

XVIII. Supplementary information

1. Breakdown of non-recurring profit or loss for the current period

√ Applicable □ N/A

Unit: Yuan Currency: RMB

Item	Amount	Description
Gain or loss on disposal of non-current assets	-4,939,437.34
Government grants recognized in profit or loss (other than grants which are closely related to the Company's business and are either in fixed amounts or determined under quantitative methods in accordance with the national standard)	16,026,819.55
Profit or loss on entrusted investments or assets management	5,795,366.82
Net profit or loss of subsidiaries from the beginning of the period up to the business combination date recognized as a result of business combination of enterprises involving enterprises under common control	13,594,336.06
Profit or loss on changes in the fair value of held-for-trading financial assets, derivative financial assets, held-for-trading financial liabilities and derivative financial liabilities and investment income on disposal of held-for-trading financial assets, derivative financial assets, held-for-trading financial liabilities, derivative financial liabilities and other debt investments, other than those used in the effective hedging activities relating to normal operating business	-1,434,000.00
Other non-operating income and expenses	-1,047,993.35

Other gains or losses meeting the definition of non-recurring profit or loss	364,144.36
Less: Effect of income taxes	2,770,765.40
Effects attributable to minority interests (net of tax)	1,627,376.52
Total	23,961,094.18

It is required to specify the reason for defining items as non-recurring profit or loss items according toInformation Disclosure and Presentation Rules for Companies Making Public Offering of Securities No.1－Non-recurring Profit or Loss, and reasons for defining non-recurring profit or loss items illustrated inInformation Disclosure and Presentation Rules for Companies Making Public Offering of Securities No.1－Non-recurring Profit or Loss as recurring profit or loss items.

□ Applicable √ N/A

2. Return on net assets and earnings per share

√ Applicable □ N/A

Profit for the reporting period	Weighted average return on net assets (%)	Earnings per share
		Basic earnings per share	Diluted earnings per share
Net profit attributable to ordinary shareholders of the Company	1.86	0.10	0.10
Net profit after deduction of non-recurring profits or losses attributable to ordinary shareholders of the Company	0.89	0.05	0.05

3. Differences in accounting data under Chinese accounting standards and overseas accountingstandards

□ Applicable √ N/A

4. Others

□ Applicable √ N/A

Chairman: LI Yi

Approval for submission by the Board of Directors: August 18, 2022

Revision information

□ Applicable √ N/A