2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Zhejiang NHU Company Ltd.2023 Semi-Annual Report
August 2023
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section I Important Notes, Contents, and DefinitionsThe Board of Directors and its members, Board of Supervisors and its members,and senior executives of the Company hereby guarantee that the informationpresented in this semi-annual report is authentic, accurate, complete and free offalse records, misleading statements or material omissions, and they will bearindividual and joint liabilities for such information.胡柏藩 (Hu Baifan), the Company’s legal representative, 石观群 (Shi Guanqun),the officer in charge of accounting, and 张莉瑾 (Zhang Lijin), the head ofaccounting department hereby declare that they guarantee the financialstatements in this semi-annual report are authentic, accurate and complete.All members of the Board of Directors have attended the meeting of the Board ofDirectors for deliberation of this semi-annual report.The future plan and other forward-looking information disclosed in this semi-annual report shall not be regarded as a commitment to investors. We kindlyremind investors of all possible risks in investments. The company provides adetailed description of the potential risks and countermeasures that may exist inthe company's operations in X. Risks and countermeasures under Section IIIManagement Discussion and Analysis section of this report. We kindly remindinvestors of all possible risks in investments.The Company will not distribute cash dividend, distribute bonus shares, ordistribute shares from capital reserve during the current reporting period.
This Semi-Annual Report is an English translation of the Chinese Semi-Annual Report. In case the English version does notconform to the Chinese version, the Chinese version prevails.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Contents
Section I Important Notes, Contents, and Definitions ...... 1
Section II Company Profile and Key Financial Indicators ...... 5
Section III Management Discussion and Analysis ...... 8
Section IV Corporate Governance ...... 22
Section V Environmental and Social Responsibilities ...... 25
Section VI Significant Events ...... 30
Section VII Movements in Shares and Information about Shareholders ...... 38
Section VIII Preferred Shares ...... 42
Section IX Bonds ...... 43
Section X Financial Report ...... 44
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Documents Available for Reference
I. Financial statements signed and sealed by the Company’s legal representative, officer in charge of accounting,and head of accounting department;II. Original copy of all the Company's documents and announcements published on the newspapers designated byCSRC within the reporting periodIII. Other documents for reference.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Definitions
| Abbreviations | Refers to | Contents of definitions |
| The Company, NHU | Refers to | ZHEJIANG NHU CO., LTD. |
| CSRC | Refers to | China Securities Regulatory Commission |
| PPS | Refers to | Polyphenylene sulfide |
| PPA | Refers to | Poly phthalamide |
| HSE | Refers to | Health, Safety and Environment |
| RTO | Refers to | Regenerative Thermal Oxidizer |
| VOC | Refers to | Volatile organic compound |
| NH-acid | Refers to | Taurine |
| F5 | Refers to | Vitamin B5 |
| NBC | Refers to | Azabicycles |
| CLA | Refers to | Karon anhydride |
| LDAR | Refers to | Leak Detection and Repair |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section II Company Profile and Key Financial Indicators
I. Company profile
| Stock abbreviation | NHU | Stock code | 002001 |
| Stock Exchange | Shenzhen Stock Exchange | ||
| Company Name in Chinese | 浙江新和成股份有限公司 | ||
| Company Abbreviation in Chinese | 新和成 | ||
| Company name in foreign language (if any) | ZHEJIANG NHU CO., LTD. | ||
| Company Abbreviation in foreign language (if any) | NHU | ||
| Legal representative | Hu Baifan | ||
II. Contact information
| Items | Board secretary | Securities affairs representative |
| Name | Shi Guanqun | 曾淑颖 (Zeng Shuying) |
| Contact address | No.418 Xinchang Dadao West Road, Xinchang, Zhejiang, P.R.China | No.418 Xinchang Dadao West Road, Xinchang, Zhejiang, P.R.China |
| Tel. | +86 575 86017157 | +86 575 86017157 |
| Fax | +86 575 86125377 | +86 575 86125377 |
| E-mail address | sgq@cnhu.com | 002001@cnhu.com |
III. Other Information
1. Company’s Contact Information
Whether the Company’s registered address, office address, zip code, website and e-mail address has changed during the reportingperiod
□ Applicable √ Not applicable
The Company’s registered address, office address, zip code, website and e-mail address have not changed during the reportingperiod, which can be found in the 2022 Annual Report.
2. Information Disclosure and Location
Whether information disclosure and location has changed during the reporting period
□ Applicable √ Not applicable
The name of the Company’s selected information disclosure newspaper, the URL of the website designated by the CSRC where thesemi-annual report is posted, and the place where the Company’s semi-annual report is available have not changed during thereporting period, which can be found in the 2022 Annual Report.
3. Other relevant Information
Whether other relecant information has changed during the reporting period
□ Applicable √ Not applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
IV. Key accounting data and financial indicators
Whether the Company needs to perform retroactive adjustment or restatement on financial data of prior years
√ Yes □ No
Reason for retroactive adjustment or restatementAccounting policy changes and other reasons
| Items | The Current Reporting Period | The Same Period of the Previous Year | Increase/ Decrease at the end of the current reporting period compared with the same period of the previous year | |
| Before adjustment | After adjustment[Note] | After adjustment | ||
| Operating revenue (yuan) | 7,418,514,576.09 | 8,215,039,277.03 | 8,215,039,277.03 | -9.70% |
| Net profit attributable to shareholders of listed company (yuan) | 1,483,229,236.96 | 2,213,877,419.25 | 2,213,882,215.02 | -33.00% |
| Net profit attributable to shareholders of listed company after deducting non-recurring profit or loss (yuan) | 1,375,218,885.82 | 2,094,055,949.62 | 2,094,060,745.39 | -34.33% |
| Net cash flows from operating activities (yuan) | 1,235,562,621.93 | 1,242,456,738.20 | 1,242,456,738.20 | -0.55% |
| Basic EPS (yuan/share) | 0.48 | 0.72 | 0.72 | -33.33% |
| Diluted EPS (yuan/share) | 0.48 | 0.72 | 0.72 | -33.33% |
| Weighted average ROE | 6.09% | 9.55% | 9.55% | Decreased by 3.46 percentage points |
| Items | Jun. 30, 2023 | Dec. 31, 2022 | Increase/Decrease at the end of the current reporting period compared with the end of the previous year | |
| Before adjustment | After adjustment[Note] | After adjustment | ||
| Total assets (yuan) | 37,975,841,342.92 | 38,267,625,155.83 | 38,268,063,792.50 | -0.76% |
| Net assets attributable to shareholders of listed company (yuan) | 23,568,679,385.68 | 23,574,859,468.61 | 23,574,879,326.24 | -0.03% |
Reasons for changes in accounting policies and correction of accounting errors[Note] On November 30, 2022, the Ministry of Finance ("MOF") issued and implemented ASBE Interpretation No. 16, "Accountingfor Deferred Taxes on Assets and Liabilities Arising from Individual Transactions that are not Subject to the Initial RecognitionExemption," which became effective on January 1, 2023. If taxable temporary differences and deductible temporary differences arisefrom lease liabilities and right-of-use assets recognized as a result of a single transaction to which this provision applies, as well asprojected liabilities related to abandonment obligations and related assets recognized at the beginning of the earliest period in whichthe financial statements of the first-time implementation of this provision are presented, the Company will recognize taxable temporarydifferences and deductible temporary differences in accordance with the provisions of this provision and Accounting Standard No. 18- "Income Taxes". -Income Taxes, the Company adjusts the cumulative effect to opening retained earnings and other related financialstatement items in the earliest period for which the financial statements are presente.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
V. Differences in accounting data under Chinese accounting standards and overseas accountingstandards
1. Difference in net profit and net assets in financial statements disclosed respectively under IFRS Standards and Chineseaccounting standards
□ Applicable √ Not Applicable
The Company has no difference in net profit or net assets in financial statements disclosed respectively under IFRS Standards andChinese accounting standards.
2. Difference in net profit and net assets in financial statements disclosed respectively under overseas accounting standards andChinese accounting standards
□ Applicable √ Not Applicable
The Company has no difference in net profit or net assets in financial statements disclosed respectively under overseas accountingstandards and Chinese accounting standards.VI. Non-recurring profit or loss
√ Applicable □ Not Applicable
Unit: RMB Yuan
| Items | Amount |
| Gains or losses on disposal of non-current assets, including write-off of provision for impairment | 13,545,778.16 |
| Government grants included in profit or loss (excluding those closely related to operating activities of the Company, satisfying government policies and regulations, and continuously enjoyed with certain quantity or quota based on certain standards) | 101,321,678.10 |
| Gains or losses on assets consigned to the third party for investment or management | 8,894,052.73 |
| Gains or losses on changes in fair value of held-for-trading financial assets and held-for-trading financial liabilities, and investment income from disposal of held-for-trading financial assets and held-for-trading financial liabilities, excluding those arising from hedging business related to operating activities | -11,268,469.70 |
| Other non-operating revenue or expenditures | 3,483,386.54 |
| Less: Enterprise income tax affected | 7,791,955.64 |
| Non-controlling interest affected (after tax) | 174,119.05 |
| Total | 108,010,351.14 |
Remarks on other profit or loss satisfying the definition of non-recurring profit or loss:
□ Applicable √ Not Applicable
The Company has no other profit or loss satisfying the definition of non-recurring profit or loss.Remarks on defining non-recurring profit or loss listed in the “Interpretation Pronouncement on Information Disclosure Criteria forPublic Companies No. 1 – Non-Recurring Profit or Loss” as recurring profit or loss.
□ Applicable √ Not Applicable
The Company has no situation of defining non-recurring profit or loss listed in the “Interpretation Pronouncement on InformationDisclosure Criteria for Public Companies No. 1 – Non-Recurring Profit or Loss” as recurring profit or loss.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section III Management Discussion and AnalysisI. The main business of the Company during the reporting period
The Company is a national high-tech company mainly engaged in the production and sales of nutrition, flavor andfragrance, new polymer materials, and APIs. It focuses on fine chemicals, adheres to the concept of innovation-leddevelopment and competition-driven growth, and continuously develops various functional chemicals based on the twocore platforms of chemical and biology, providing value-added services and solutions to customers in more than 100countries and regions around the world. It continuously improves the quality of human life with high-quality, healthy andgreen products, and creates sustainable value for stakeholders. With leading technology, scientific management andsincere service, the Company has become one of the four major world vitamin manufacturers, one of the top 100 nationalfine chemical companies, one of the top 10 companies in China’s light of industry fragrance and a well-known specialengineering plastics manufacturer.
1. Main products and applications
Nutrition: The current products mainly cover vitamins, amino acids and pigments, etc. Specific products include vitaminE, vitamin A, vitamin C, methionine, vitamin D3, biotin, coenzyme Q10, carotenoids, vitamin B5, vitamin B6, vitaminB12, etc. They are mainly used in feed additives and nutrition supplements of food, beverages, health food, etc. TheCompany actively implements the serialized and differentiated development of nutrition, and continuously improves thecompetitiveness of its products by optimizing the processing line and tackling key issues. In addition, through internalintegration and external cooperation, it embraces the ideology of open cooperation. It actively deploys cutting-edgebiotechnology, and builds the Company’s “Bio+” platform.Flavor and fragrance: At present, our main fragrance products include linalool, citral, and cis-3-hexenol series, andmethyl dihydrojasmonate, raspberry ketone and ligustral, which are widely used in personal care, cosmetic and food fields.From the perspective of competitiveness and market share, NHU becomes an important supplier in the global flavor andfragrance industry. The company continuously enriches the varieties of fragrance products to meet the changing marketdemands.New polymer materials: The Company focuses on the development of high molecular polymers and key intermediates,and appropriately develops downstream applications of materials according to the principles of integration andserialization. The entire industry chain of PPS from raw materials to high molecular polymers, then through modifyingprocessing to special fibers has enabled the Company as the only company in China that can stably produce fiber grade,injection molding grade, extrusion grade and coating grade PPS. The main products include PPS and PPA. They aremainly used in electronic and electrical, automotive, environmental protection, etc.APIs: The main products are concentrated in the series of vitamins and antibiotics. The main products includemoxifloxacin hydrochloride, vitamin A, vitamin D3, caronic anhydride, azabicyclic, etc., which are mainly used as activepharmaceutical ingredients for processing and producing pharmaceutical preparations.
2. Main business models
(1) Procurement model
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
The Company has always been adhering to the procurement principle of “fairness, transparency and optimal cost”, andadopts a combination of long-term strategic cooperation and open competitive procurement, and makes best use of markettrend analysis, to ensure the stable supply of the Company’s strategic materials. The Company pays attention to sourceprocurement, and continuously promotes the removal of intermediate links in the supply chain to reduce procurementcosts; the Company implements transparent procurement, and launches information systems such as procurementplatform, supplier and bidding management system, and industrial supplies supermarket, etc. to make the procurementprocess more transparent, standardized and efficient, which promotes the healthy development of the supply chain andreduces costs and increases efficiency for the Company’s operations.
(2) Production model
The Company has always been adhering to the production strategy based on the principle of “production and salescoordination, efficient operation, excellent quality, and cost leadership”. The Company arranges production plansproperly based on changes in market demand to achieve a balance between production and sales. In addition, the Companykeeps innovating the production model, digging out internal potentials, and optimizing the production process, reducingenergy consumption, in order to promote safe, green, standardized and efficient production, and continuously improvethe competitiveness of its products.
(3) Sales model
The Company has always been adhering to the “customer-centric, market-oriented” sales strategy. It divides businesslines by product application fields, and establishes a sales model that suits market needs according to marketcharacteristics and industry practices. Most of the Company’s sales are achieved through direct sales. By doing so, itestablishes long-term and stable strategic cooperative relationships with end customers to create greater value for them.Meanwhile, it also selects excellent agents or distributors for distribution. By doing so, it services customers indirectlybased on market and customer features. At the same time, through measures such as holding customer service months,strengthening customer strategic cooperation, establishing customer evaluation models, and optimizing customerclassification management, we will continue to expand market areas, increase new large-scale customers, and enhancebrand influence.
3. Key performance drivers
The Company has built four modern industrial bases across the country. It adheres to the development strategy ofintegration, serialization and synergy, and insists on innovation-driven. Relying on the solid foundation of fine chemicalindustry, it focuses on “chemical+” and “biology+” to form NHU featured R&D models with industrial clusters, andtechnology and industry platforms interdependent. Not only can its products connect basic chemical raw materials in theupstream, but also extend to special intermediates, nutrition, flavor and fragrance, new polymer materials, and APIs inthe downstream. It has formed a product network structure to resist risks and respond to market emergencies.During the reporting period, the company's original products were refined and the construction of new projects, the R&Dof new products were carried out in an orderly manner. In the nutrition sector, the Company’s second phase of methionine250,000 ton/year project, of which 100,000-ton equipment was operating smoothly, with comprehensive competitioncontinuously improved. And of which 150,000-ton equipment was constructed in June 2023 for test preparation. Thecompany and China Petroleum & Chemical Corporation planned to jointly build a 180,000-ton/year liquid methionine(purified) project, the production plant was under construction. 30,000 tons/year NH-acid project was under test run by
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
schedule. 2,500 ton/year vitamin B5 project was in production and sales. In the Flavor and fragrance sector, the projectwith an annual output of 5,000 tons of menthol was in production and sales. In the new polymer materials sector, thecommissioning of the phase III PPS project with an annual output of 7,000 tons was in production and sales; Theadiponitrile project was in the pilot test stage, and the project approval process was advancing in an orderly manner. Inthe API sector, the company will upgrade product structures according to market demand, gradually developing intomanufacturers of antipyretic and analgesic medicine, nutritional medicine, and characteristic API intermediates.During the reporting period, with of market changes in major vitamin products, the company actively tookcountermeasures, innovated marketing strategies and management to improve product sales. The company overcomedvarious adverse factors, promoted the sales of newly launched projects, gave full play to the advantages of sector linkage,and achieved steady growth in revenue of flavor and fragrance sector and new polymer materials sector.During the reporting period, the Company’s main business and its business model remained unchanged.
II. Core competitiveness analysisSince its establishment, the Company has focused on fine chemicals, and adhered to innovation-driven development. Through decadesof development, it has gradually formed an industrial system with nutrition, flavor and fragrance, new polymer materials and APIs asits main business. The market share of its main products is among the top tier in the world market. The Company’s core competitivenesslies in its cooperate culture, R&D, production management, process and equipment, talent and brand.
1. Corporate culture
Adhering to the enterprise objective of “creating wealth, employee success, and benefit the society”, core values of “new, harmony,union”, business philosophy of “create wealth, balanced and sustainable”, and enterprise spirit of “realism, innovation, high-qualityand efficiency”, the Company innovates its operation, and continuously improves management, to ensure the steady development.Under the guidance of the “teacher culture”, the Company pursues high-quality and sustainable development, creates spiritual wealthand material wealth, provides a platform and opportunity for employees to develop and realize life value, and contributes to socialinnovation development, green development and shared development. During the reporting period, the Company deepened culturalpublicity and implementation, organized corporate culture lectures, strengthened the integration of corporate culture and management,carried out reflection activities on execution and talent training, and promoted the improvement of management capabilities.
2. R&D
Adhering to the R&D philosophy of “demand-orientated, internal integration and external cooperation”, the Company invested greatlyin R&D activities. The R&D investments accounted for more than 5% of the operating revenue for many years in a row. It has builtthe innovative R&D system spanning from basic research, engineering development, process optimization to product applicationdevelopment. With its focus on the development of common, critical and forward-looking technologies in the chemicals industry, theCompany has developed and mastered a number of key technologies that have a strategic impact on economic development and haspromoted the transformation and upgrading of the industry. The Company cooperates closely with famous research institutes anduniversities at home and abroad, such as Zhejiang University, Chinese Academy of Sciences, Jiangnan University, China AgriculturalUniversity, Zhejiang University of Technology, CysBio biotechnology company of Denmark, and organizes and utilizes global basicscientific research resources to jointly develop forward-looking studies and application field researches on chemicals. As the core ofthe Company’s technology innovation, the Company’s researchinstitute has biomedical laboratories, supercritical reaction laboratories,engineering equipment research centers and other laboratories, equipped with 600M NMR with cryoprobes and other world-leadingscientific research instruments and equipment. Its achievements of domestic leading technologies such as supercritical reaction, highvacuum distillation, and continuous reaction have made it a nationally recognized enterprise technology center, national post-doctoral
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
scientific research workstation, and national model academician and expert workstation.
3. Production management
The Company has always been adhering to the production strategy based on the principle of “production and sales coordination,efficient operation, excellent quality, and cost leadership” and the HSE guideline of “safety first, green development, full participation,and continuous improvement”. The Company takes planning as the goal, cost management as the main line, and maximizing companybenefits as the principle for the allocation of resources. Through oriented management and the cyclic operation of planning,organization, implementation and control of the operation process, the Company continuously strengthens the level of cost control.Meanwhile, it also improves the level of digitalization and intelligence. Through process reform, efficient management and intelligentoperation, it promotes the continuous improvement of management efficiency. In addition, the Company is committed to thedevelopment of green chemicals, vigorously promotes clean production, recyclable economy and 7S on-site management, and adoptsan environmental governance model that focuses on source control and final disposal. It is determined to take the road of sustainabledevelopment.
4. Process and equipment
The Company values highly the effective combination of process and equipment. It has a process and equipment research institute, andcooperates with famous engineering companies and scientific research institutes at home and abroad. Through the introduction,digestion, absorption and re-innovation of advanced technologies, the Company improves the overall level of its process and equipment.The Company is dedicated to the R&D of process and equipment towards larger scale, better airtightness, greater continuity, and higherlevel of automation, aiming to save energy and reduce emissions, to improve productivity and product quality, to increase the intrinsicsafety of production process, to lower production costs, and to improve the level of automation. Currently, the Company has developedvarious efficient reaction and separation platforms including continuous reaction, high vacuum distillation, continuous extraction,continuous crystallization, efficient filtration, simulated moving bed separation, microchannel and micro-interface reaction with respectto specific processes, and remarkable results have been achieved in continuous transformation of reaction, vapor-liquid-solidheterogeneous reaction, and separation of air sensitive and heat sensitive materials through continuous improvement of large-sizeequipment.
5. Talent
The Company has always been adhering to the management concept of “standardization and efficiency” and the employment conceptof “valuing both integrity and talent, and matching people with right positions”, and has created a pioneering, innovative, pragmaticand efficient talent team and a long-term, stable and excellent management team with a high sense of responsibility, which promotesthe Company’s sustained, healthy and rapid development. The Company continues to strengthen the construction of the talent supplychain. It continuously improves the talent training system, strengthens the training of “management talents, skilled talents, internationaltalents, core technical talents, and leadership talents”, systematically cultivates and reserves university graduates, introduces variousprofessionals, and continues to promote the training and reserve of senior talents. It also promotes the rotation training in zigzag andcross-sequence pattern, in order to promote the integration of management and profession, and to build a team with a balanced talentstructure. During the reporting period, the company was awarded the Xinchang "High quality development demonstration award,valuing talents and loving talents award".
6. Brand
The Company follows the “integrity first” guideline, and has always regarded serving customers and creating industry value withcustomers as the goal of the Company. Through technological innovation, the Company continuously provides customers with safeand high-quality products, as well as efficient and satisfactory services. After years of development and accumulation, the companyhas won many honors in the global fine chemical industry, such as one of the top ten feed additive brands in China and one of the la
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
rge vitamin feed additive enterprises in China, and has been ranked among the top 500 petroleum and chemical enterprises(comprehensive category) and the top 100 enterprises in China's basic chemical raw material manufacturing industry. In addition, thecompany has won many awards such as "Top 30 Best Internal Control in Zhejiang Province", "Best Investor Relations Award" and"Best Board of Directors Award" of listed companies in mainstream media, which are widely favored by the market and investors.During the reporting period, the company was rated as one of the "Excellent Member Unit of China Brand Construction PromotionAssociation", and "Capital Brand High Value Enterprise in Zhejiang Province of 2022", "Top 100 Private Enterprises in Shaoxing Cityof 2023".
III. Main Business AnalysisOverviewRefer to “I. The Main Business of the Company during the Reporting Period”Year-on-year changes in key financial data
Unit: RMB Yuan
| Item | The Current Reporting Period | The Same Period of the Previous Year | YoY growth rate | Reasons for Changes |
| Operating revenue | 7,418,514,576.09 | 8,215,039,277.03 | -9.70% | This was mainly due to the impact of market fluctuations in the nutritional products segment on selling prices during the reporting period. |
| Operating Cost | 4,989,533,832.95 | 4,945,122,803.39 | 0.90% | This was mainly due to the increase in sales of major products during the reporting period. |
| Sales Expenses | 66,941,370.80 | 57,277,897.48 | 16.87% | This was mainly due to the increase in salaries and expenses of sales staff during the reporting period. |
| Administration Expenses | 244,646,451.17 | 212,284,822.41 | 15.24% | This was mainly due to the increase in personnel remuneration during the reporting period. |
| Financial Expenses | -37,162,425.39 | 22,231,053.96 | -267.16% | This was mainly due to exchange gains arising from exchange rate fluctuations during the reporting period. |
| R&D Expense | 416,575,391.59 | 440,357,252.64 | -5.40% | This was mainly due to the decrease in R&D related commissioning costs and other expenses during the reporting period. |
| Income Tax Expense | 251,283,197.83 | 400,095,127.85 | -37.19% | This was mainly due to the decrease in total profit as a result of the decrease in revenue during the reporting period. |
| Net Cash Flows from Operating Activities | 1,235,562,621.93 | 1,242,456,738.20 | -0.55% | This was mainly due to the decrease in purchases of raw materials during the reporting period. |
| Net Cash Flows from Investing Activities | -2,089,507,038.68 | -1,073,929,985.26 | -94.57% | This was mainly due to the increase in investment in projects under construction during the reporting period. |
| Net Cash Flows from Financing Activities | -865,319,516.45 | 574,156,254.26 | -250.71% | This was mainly due to the repayment of borrowings during the |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Item | The Current Reporting Period | The Same Period of the Previous Year | YoY growth rate | Reasons for Changes |
| reporting period. | ||||
| Net Increase in Cash and Cash Equivalents | -1,643,950,329.76 | 737,171,030.93 | -323.01% | This was mainly due to the increase in investment and repayment of borrowings during the reporting period. |
Significant changes in the composition of the Company’s profit or sources of profit during the reporting period
□ Applicable √ Not applicable
No significant changes in the composition of the Company’s profit or sources of profit during the reporting period.Operating Income Structure
Unit: RMB Yuan
| Items | The Current Reporting Period | The Same Period of the Previous Year | YoY growth rate | ||
| Amount | % to total | Amount | % to total | ||
| Total | 7,418,514,576.09 | 100% | 8,215,039,277.03 | 100% | -9.70% |
| By industry | |||||
| Pharmaceutical chemicals | 6,771,211,341.41 | 91.27% | 7,585,238,197.37 | 92.33% | -10.73% |
| Others | 647,303,234.68 | 8.73% | 629,801,079.66 | 7.67% | 2.78% |
| By product | |||||
| Nutrition | 4,830,212,886.75 | 65.10% | 5,768,862,111.12 | 70.22% | -16.27% |
| Flavor and fragrance | 1,631,864,728.45 | 22.00% | 1,522,994,415.83 | 18.54% | 7.15% |
| New polymer materials | 578,308,624.04 | 7.80% | 552,514,423.91 | 6.73% | 4.67% |
| Others | 378,128,336.85 | 5.10% | 370,668,326.17 | 4.51% | 2.01% |
| By region | |||||
| Domestic sales | 3,557,426,385.63 | 47.95% | 4,064,052,343.93 | 49.47% | -12.47% |
| Overseas sales | 3,861,088,190.46 | 52.05% | 4,150,986,933.10 | 50.53% | -6.98% |
| By sales model | |||||
| Direct sales | 5,896,114,550.44 | 79.48% | 6,536,368,733.62 | 79.57% | -9.80% |
| Agent sales | 1,522,400,025.65 | 20.52% | 1,678,670,543.41 | 20.43% | -9.31% |
Industry, product, or regions accounting for more than 10% of the Company’s operating revenue or profit
√ Applicable □ Not applicable
Unit: RMB Yuan
| Items | Operating revenue | Operating cost | Gross rate | Growth rate of operating revenue | Growth rate of operating cost | Growth rate of gross rate |
| By industry | ||||||
| Pharmaceutical chemicals | 6,771,211,341.41 | 4,533,447,871.52 | 33.05% | -10.73% | 2.20% | Decreased by 8.47 percentage points |
| By product | ||||||
| Nutrition | 4,830,212,886.75 | 3,435,180,782.01 | 28.88% | -16.27% | 0.14% | Decreased by 11.65 percentage points |
| Flavor and fragrance | 1,631,864,728.45 | 791,798,134.03 | 51.48% | 7.15% | 3.62% | Increased by 1.65 percentage |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | Operating revenue | Operating cost | Gross rate | Growth rate of operating revenue | Growth rate of operating cost | Growth rate of gross rate |
| points | ||||||
| By region | ||||||
| Domestic sales | 3,557,426,385.63 | 2,603,164,077.10 | 26.82% | -12.47% | -4.97% | Decreased by 5.78percentage points |
| Overseas sales | 3,861,088,190.46 | 2,386,369,755.85 | 38.19% | -6.98% | 8.18% | Decreased by 8.67 percentage points |
When the statistical caliber of the Company’s main business data is adjusted in the reporting period, the Company’s main businessdata in the most recent period should be subject to the one after the statistical caliber adjusted at the end of the reporting period.
□ Applicable √ Not applicable
IV. Non-main business analysis
√ Applicable □ Not Applicable
Unit: RMB Yuan
| Items | Amount | % to total profit before tax | Reason for balance | Whether has continuity |
| Investment income | 43,899,900.63 | 2.51% | This was mainly attributable to gains from financial products and profits realized by associates during the reporting period. | No |
| Gains on changes in fair value | -11,268,469.70 | -0.64% | Mainly as a result of changes in the fair value of forward settlements during the reporting period. | No |
| Credit impairment loss (Losses are shown with a "-" sign) | 6,389,579.21 | 0.37% | This is mainly due to the loss arising from the provision for credit impairment of accounts receivables. | No |
| Impairment losses on assets (Losses are shown with a "-" sign) | -81,296,758.10 | -4.65% | This is mainly due to losses arising from the provision for impairment of various assets. | No |
| Gains on asset disposal | 13,545,778.16 | 0.78% | This was mainly attributable to the increase in revenue from the recovery of land by the government during the reporting period. | No |
| Non-operating revenue | 3,576,842.57 | 0.20% | This is mainly due to income from claims. | No |
| Non-operating expenditures | 1,619,001.38 | 0.09% | This was mainly due to losses on assets scrapped during the reporting period. | No |
| Other income | 102,847,223.45 | 5.88% | This was mainly due to government grants received during the reporting period. | No |
V. Assets and liabilities analysis
1. Significant changes in asset composition
Unit: RMB Yuan
| Items | Jun. 30, 2023 | Dec. 31, 2022 | Percentage of | Remarks |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| % to total | Amount | % to total | % to total | change | on significant changes | |
| Cash and bank balances | 3,654,734,123.88 | 9.62% | 5,343,851,967.72 | 13.96% | Decreased by 4.34 percentage points | |
| Accounts receivable | 2,428,700,767.98 | 6.40% | 2,476,269,041.23 | 6.47% | Decreased by 0.07 percentage points | |
| Inventories | 4,578,585,468.62 | 12.06% | 4,144,557,702.39 | 10.83% | Increased by 1.23 percentage points | |
| Long-term equity investments | 703,117,491.00 | 1.85% | 432,503,568.48 | 1.13% | Increased by 0.72 percentage points | |
| Fixed assets | 17,819,362,500.06 | 46.92% | 16,523,867,858.53 | 43.18% | Increased by 3.74 percentage points | |
| Construction in progress | 4,927,272,645.25 | 12.97% | 5,089,233,908.22 | 13.30% | Decreased by 0.33 percentage points | |
| Right-of-use assets | 7,781,963.62 | 0.02% | 2,830,136.37 | 0.01% | Increased by 0.01 percentage points | |
| Short-term borrowings | 1,609,254,229.16 | 4.24% | 1,846,373,441.01 | 4.82% | Decreased by 0.58 percentage points | |
| Contract liabilities | 63,559,211.75 | 0.17% | 60,660,929.75 | 0.16% | Increased by 0.01 percentage points | |
| Long-term borrowings | 6,512,116,382.12 | 17.15% | 5,273,637,508.87 | 13.78% | Increased by 3.37 percentage points | |
| Lease liabilities | 7,865,412.13 | 0.02% | 2,822,404.07 | 0.01% | Increased by 0.01 percentage points |
2. Major overseas assets
□ Applicable √ Not applicable
3. Assets and liabilities at fair value
√ Applicable □ Not Applicable
Unit: RMB Yuan
| Items | Opening balance | Gains on changes in fair value | Accumulated changes in fair value included in equity | Provision for impairment made in the current period | Amount purchased during the reporting period | Amount sold during the reporting period | Other changes | Closing balance |
| Financial assets | ||||||||
| 1. Held-for-trading financial assets (derivative financial assets excluded) | 720,000,000.00 | 250,000,000.00 | 720,000,000.00 | 250,000,000.00 | ||||
| 2. Derivative financial assets | 314,576.43 | -314,576.43 | ||||||
| Subtotal of financial assets | 720,314,576.43 | -314,576.43 | 250,000,000.00 | 720,000,000.00 | 250,000,000.00 | |||
| Total | 720,314,576.43 | -314,576.43 | 250,000,000.00 | 720,000,000.00 | 250,000,000.00 | |||
| Financial liabilities | 0.00 | 12,909,447.29 | 12,909,447.29 | |||||
Whether the Company has significant changes in measurement attributes of main assets during the reporting period
□ Yes √ No
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
4. Restrictions on assets as of the end of the reporting period
(1) Closing of cash and bank balances included deposits of 146,842,521.78 yuan pledged and not on demand for payments, whichwas with use restrictions.
(2) Closing balance of receivables financing included 84,532,028.12 yuan pledged for bank acceptance and not on demand forpayments, which was with use restrictions.
(3) Closing balance of notes receivable included 155,053,622.64 yuan pledged for bank acceptance and not on demand for payment,which was with use restrictions.
(4) Closing carrying amount of fixed assets included 97,437,448.95 yuan mortgaged to the bank for borrowings, which was with userestrictions.
(5) Closing carrying amount of intangible assets included 18,579,010.61 yuan mortgaged to the bank for borrowings, which was withuse restrictions.VI. Investment status analysis
1. Overall information
√ Applicable □ Not Applicable
| Investments during the reporting period (yuan) | Investments of the preceding period (yuan) | Percentage of change |
| 2,011,618,396.22 | 1,832,296,131.71 | 9.79% |
2. Significant equity investments made during the reporting period
□ Applicable √ Not Applicable
3. Significant non-equity investments in progress during the reporting period
□ Applicable √ Not Applicable
4. Investments in financial assets
(1) investments in securities
□ Applicable √ Not Applicable
There is no investment in securities during the reporting period.
(2) Investments in derivatives
√ Applicable □ Not Applicable
1） Derivative investments for hedging purposes during the reporting period
√ Applicable □ Not Applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Unit: RMB 0,000Yuan
| Types of Derivatives Investments | Initial Investment Amount | Gains or losses on changes in fair value for the period | Accumulated fair value changes recorded in equity | Amount purchased during the reporting period | Amount sold during the reporting period | End of period amount | Investment amount at the end of the period as a percentage of the company's net assets at the end of the reporting period |
| Forward contracts | 35,506.29 | -1,126.85 | 0 | 116,359.98 | 83,911.32 | 67,954.95 | 2.88% |
| Total | 35,506.29 | -1,126.85 | 0 | 116,359.98 | 83,911.32 | 67,954.95 | 2.88% |
| Description of theaccounting policiesand specific principles of accounting for hedging operations during the reporting period, and whether there have been any significant changes compared to the previous reporting period | The Company accounts for the hedging business conducted in accordance with the relevant provisions of the Ministry of Finance's Accounting Standard for Business Enterprises (ASBE) No. 22 - Recognition and Measurement of Financial Instruments, ASBE No. 24 - Accounting for Hedges, ASBE No. 23 - Transfer of Financial Assets, ASBE No. 37 - Presentation of Financial Instruments and its guidelines. There were no significant changes in accounting policies and specific principles of accounting from the previous reporting period. | ||||||
| Description of actual profit or loss for the reporting period | In order to reduce the impact of exchange rate fluctuations on the Company's operating results, the Company carried out foreign exchange hedging business in accordance with a certain percentage of its export business, with business varieties mainly including forward exchange settlement and other foreign exchange derivative products, all of which were within the expected scale of sales business, and the actual gain on derivatives at the end of the reporting period was 1.93 million yuan. | ||||||
| Description of the hedging effect | The Company carries out foreign exchange hedging business based on the principle of exchange rate risk neutrality. By carrying out foreign exchange hedging business, the Company reduces the impact of exchange rate fluctuation on the Company's operation and effectively controls the operation risk. | ||||||
| Derivatives Investment Funding | Self-funded. | ||||||
| Risk analysis and description of control measures for derivative positions during the reporting period (including but not limited to market risk, liquidity risk, credit risk, operational risk, legal risk, etc.) | In order to prevent exchange rate risk, the Company and its subsidiaries have carried out derivative business and the Company and its subsidiaries have strictly implemented the "Foreign Exchange Hedging Business Management Regulations". | ||||||
| Changes in market prices or product fair values of invested derivatives during the reporting period, and the analysis of the fair value of derivatives should disclose the specific methods used and the setting of relevant assumptions and parameters | The fair value fluctuation loss on invested derivatives at the beginning of the reporting period was 66.32 million Yuan, and the fair value fluctuation loss on derivatives at the end of the reporting period was 11.27 million Yuan. Changes in fair value are determined at the end of each month based on quoted market prices from external financial institutions. | ||||||
| Litigation involved (if applicable) | None | ||||||
| Date of disclosure of board announcement for approval of erivative investments (if any) | April 21, 2023 | ||||||
| Derivatives Investment Approval Shareholders' Meeting Announcement Disclosure Date (if any) | Not Applicable | ||||||
| Special opinion of independent directors on the company's derivatives investment and risk control | The Company has formulated the "Management Measures for Foreign Exchange Hedging Business", which sets out specific operational procedures for the conduct of foreign exchange hedging business by strengthening internal control, implementing risk prevention measures and improving the level of operation and management. The Company has analyzed the feasibility of its foreign exchange hedging business, and in general, it is practicable for it to carry out foreign exchange hedging, which can | ||||||
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
effectively reduce the risk of exchange rate fluctuation and is conducive tostabilizing the profit level. The content and deliberation procedures of thematter are in compliance with relevant laws, regulations, standardizeddocuments and the Articles of Association of the Company, and do notconstitute any damage to the interests of the Company and othershareholders. We unanimously agree that the Company carries out foreignexchange hedging business this time.
2） Investments in derivatives for speculative purposes during the reporting period
□ Applicable √ Not Applicable
The Company had no derivative investments for speculative purposes during the reporting period.
5. Use of raised funds
√ Applicable □ Not Applicable
(1) Overall use of raised funds
√ Applicable □ Not Applicable
Unit: RMB 0,000Yuan
| Year of fund-raising | Way of fund-raising | Total amount raised | Amount used in the current period | Accumulated amount of raised funds used | Total raised funds with changes in uses during the reporting period | Accumul-ated amount of raised funds with changes in uses during the reporting period | Proportion of raised funds with changes in uses to total raised funds | Total raised funds not yet used | Purposes of raised funds not yet used and the whereabouts | Raised funds being idle for over two years |
| Year 2017 | Private placement of shares | 486,707.55 | 104,143.81 | 481,963.60 | 0 | 0 | 0.00% | 4,743.95 | Deposited in special accounts for raised funds, used to purchase bank financial products, deposited as structured deposits | 0 |
| Total | -- | 486,707.55 | 104,143.81 | 481,963.60 | 0 | 0 | 0.00% | 4,743.95 | -- | 0 |
| Remarks on overall use of raised funds | ||||||||||
| The Company’s raised funds used in previous years amounted to 3,778.20 million yuan, the net amount of interest on cash in bank received in previous years less handling charges amounted to 88.12 million yuan, gains on financial products and structured deposits received in previous years amounted to 630.82 million yuan, and the net expenditure on financial products and structured deposits purchased in previous years amounted to 720.00 million yuan; the raised funds actually used in the first half of 2023 amounted to 1,041.44 million yuan, the net amount of interest on cash in bank received in the first half of 2023 less handling charges amounted to 12.77 million yuan, gains on financial products and structured deposits received in the first half of 2023 amounted to 9.43 million yuan, and the net recovery from financial products and structured deposits purchased in the first half of 2023 amounted to 470.00 million yuan; the accumulated amount of the raised funds used amounted to 4,819.64 million yuan, the accumulated net amount of interest on cash in bank received less handling charges amounted to 100.89 million yuan, the accumulated amount of gains on financial products and structured deposits received amounted to 640.25 million yuan, and net expenditure on financial products and structured deposits purchased amounted to 250.00 million yuan. As of June 30, 2023, the balance of the raised funds amounted to 788.58 million yuan (including bank financial products and structured deposits, the net amount of interest on cash in bank less handling charges and s and bank bank financial products income). | ||||||||||
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
(2) Committed projects with raised funds
√ Applicable □ Not Applicable
Unit: RMB 0,000Yuan
| Committed investment projects and over-raised funds whereabouts | Whether changed (including partial changed) | Total committed investment in raised funds | Total amount after adjustment (1) | Input during the reporting period | Accumulated input as of the period end (2) | Investment progress as of the period end (3)=(2)/(1) | Date of reaching designed usable conditions | Benefit realized in the reporting period | Whether the expected benefit is reached | Whether there was significant changes in feasibility of the project |
| Committed investment projects | ||||||||||
| Methionine project with annual output of 0.25 million tons | No | 486,707.55 | 486,707.55 | 104,143.81 | 481,963.60 | 99.03% | Partially reached the designed usable conditions | 30,014.97 | Yes | No |
| Subtotal | -- | 486,707.55 | 486,707.55 | 104,143.81 | 481,963.60 | -- | -- | 30,014.97 | -- | -- |
| Over-raised funds whereabouts | ||||||||||
| No | 0 | 0 | 0 | 0 | 0.00% | 0 | ||||
| Total | -- | 486,707.55 | 486,707.55 | 104,143.81 | 481,963.60 | -- | -- | 30,014.97 | -- | -- |
| Conditions of and reasons for not meeting the planned schedule or estimated revenue (by specific project) | Pursuant to the results deliberated and approved by the eighth meeting of the eighth session of Board of Directors and the seventh meeting of the eighth session of the Board of Supervisors dated October 27, 2021, the Company intended to adjust the date when the methionine project with annual output of 0.25 million tons reaches the designed usable conditions from the originally planned December 2021 to June 2023, with other contents remaining unchanged. Main reasons: Due to the impact of the macro economy, the construction progress of the project’s infrastructure has been delayed, the procurement and delivery time of some equipment and materials has been extended, the installation and commissioning of equipment has been delayed, and the overall progress of the investment projects with raised funds has slowed down, which jointly resulted in the postponement of delivery of the projects. Currently, the 100,000-ton production line of the project has been completed and is in normal operation, and the 150,000-ton production line has been mostly completed . | |||||||||
| Remarks on significant changes in feasibility of projects | None. | |||||||||
| Amount, purposes and progress of use of over-raised funds | Not Applicable | |||||||||
| Changes in implementation locations of investment projects with raised funds | Not Applicable | |||||||||
| Adjustment on the implementation method of investment projects with raised funds | Not Applicable | |||||||||
| Preliminary investment and replacement of investment projects with raised funds | Applicable | |||||||||
| Preliminary investment amounted to 36.06 million yuan, and the replacement of raised funds is completed. | ||||||||||
| Temporary replenishment of working capital with idle raised funds | Not Applicable | |||||||||
| Amount of and reasons for the balance of raised funds in the implementation of projects | Not Applicable | |||||||||
| Uses and whereabouts of unused raised funds | Deposited in special accounts for raised funds, used to purchase bank financial products, deposited as structured deposits | |||||||||
| Problems or other situations in the use and disclosure of raised funds | None. | |||||||||
(3) Change of projects with raised funds
□ Applicable √ Not Applicable
There is no change of projects with raised funds during the reporting period.
VII. Sale of major assets and equities
1. Sale of major assets
□ Applicable √ Not Applicable
There is no sale of major assets during the reporting period.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
2. Significant sale of equities
□ Applicable √ Not Applicable
VIII. Major entities controlled or invested by the Company
√ Applicable □ Not Applicable
Major subsidiaries and investees with influence on net profit of the Company over 10% (inclusive)
Unit: RMB Yuan
| Entities | Categories | Major businesses | Registered capital | Total assets | Net assets | Operating revenue | Operating profit | Net profit |
| 山东新和成维生素有限公司(Shandong NHU Vitamins Co., Ltd.*) | Subsidiary | Production and sales of feed additives | 500 million yuan | 3,335,588,346.89 | 2,791,077,435.54 | 1,089,356,966.73 | 478,445,768.23 | 413,858,745.54 |
| 山东新和成药业有限公司(Shandong NHU Pharmaceutical Co., Ltd.*) | Subsidiary | Production and sales of fragrances | 590 million yuan | 3,538,287,980.85 | 2,652,260,779.71 | 1,917,145,242.32 | 697,181,837.47 | 595,187,075.67 |
| 山东新和成氨基酸有限公司(Shandong NHU Amino-acids Co., Ltd.*) | Subsidiary | Production and sales of methionine | 1,100 million yuan | 9,305,318,564.14 | 8,295,853,645.28 | 1,758,421,533.32 | 514,388,570.12 | 452,688,771.27 |
Details of acquisition and disposal of subsidiaries during the reporting period
□Applicable √ Not Applicable
IX. Structured entities controlled by the Company
□ Applicable √ Not Applicable
X. Risks and countermeasures
1. Macroeconomic risks
The global economy is facing numerous uncertainties due to international trade frictions and possible intensification ofgeopolitical conflicts. In order to promote the Company's sound development, the Company will strengthen international cooperation,expand market development and establish a diversified innovation chain, supply chain and customer base to actively cope with theimpact.
2. Industry and market competition risks
The Company is facing peer competition in both domestic and international markets. The development of new technologies byits competitors will not only impact the market, but also challenge the Company’s market position in the industry. In the future, theCompany will continuously enhance its R&D and innovation capabilities, improve its technology, strengthen cost control, and improvethe competitiveness in the industry.
*The English names are for identification purpose only.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
3. Risks of raw material price fluctuation
As cost of raw materials accounts for a relatively high proportion of the total cost, the price fluctuations caused by the supply-demand imbalance of raw material will have an impact on the Company’s profit. In the future, the Company will reduce the adverseimpact of raw material price fluctuations through market research and judgment, establishing strategic partnership with suppliers, andimprovin g theutilization rateofrawmaterials.
4. Exchange rate and trade risks
The Company’s sales revenue and profitability will be affected by trade barriers and exchange rate fluctuations caused by thetrade friction between China and US and the international political and economic instability. In the future, the Company will taketargeted measures to tackle changes in the international market, cement its position in the international market and explore neweconomic growth points, so as to achieve steady growth in business performance.
5. Risks of changes in environmental protection policies
With the increased social awareness of environmental protection, the promotion of the ecological civilization construction of theCPC Central Committee, and the strategic goal of “carbon emission peak and carbon neutrality”, the requirements for energyconservation, emission reduction, safety and environmental protection in the chemical and pharmaceutical manufacturing industry inwhich the Company operates are stricter than before. The Company will operate with higher standards and explore moreenvironmentally friendly ways of production to achieve sustainable development.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section IV Corporate GovernanceI. Annual general meeting and extraordinary general meetings held during the reporting period
1. General meeting of shareholders
| Session | Type of meetings | Proportion of participating investors | Meeting date | Disclosure date | Resolutions |
| General meeting of shareholders of 2022 | Annual general meeting of shareholders | 53.46% | May 19, 2023 | May 20, 2023 | 9 proposals including the Annual Work Report of the Board of Directors of 2022 were deliberated and approved. Please refer to Announcement No. 2023-025 disclosed on http://www.cninfo.com.cn for details. |
| The first extraordinary meeting of shareholders of 2023 | Extraordinary general meeting of shareholders | 55.77% | June 26, 2023 | June 27, 2023 | 2 proposals including forth phase of employee stock ownership plan (draft) and its abstract were deliberated and approved. Please refer to Announcement No. 2023-032 disclosed on http://www.cninfo.com.cn for details. |
2. Preference shareholders with restored voting rights request to convene an extraordinary general meeting
□ Applicable √ Not applicable
II. Changes of directors, supervisors and senior executives
□ Applicable √ Not applicable
The Company’s directors, supervisors and senior executives remains unchanged during the current reporting period,please refer to the 2022 Annual Report for details.III. Profit distribution and conversion of capital reserve into share capital
□ Applicable √ Not applicable
The Company will not distribute cash dividend, distribute bonus shares, or distribute shares from capital reserve duringthe current reporting period.
IV. Implementation of equity incentive plans, employee stock ownership plans or otheremployee incentive programs
√ Applicable □ Not applicable
1. Equity incentive
Not applicable.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
2. Implementation of employee stock ownership plans
√ Applicable □ Not applicable
All active employee stock ownership plans during the reporting period
| Scope of employees | Number of employees | Total shares held | Changes | Proportion to total share capital of the Company | Sources of fund to implement the plan |
| The third phase of employee stock ownership plan: directors, supervisors, senior executives of the Company, and regular employees of the Company and its holding subsidiaries or wholly-owned subsidiaries who meet the criteria | 681 | 12,157,826 | N/A | 0.39% | Legal remuneration of the employees, self-raised funds and other methods permitted by laws and administrative regulations |
| The forth phase of employee stock ownership plan: directors, supervisors, senior executives of the Company, and regular employees of the Company and its holding subsidiaries or wholly-owned subsidiaries who meet the criteria | 627 | 0 | N/A | 0.00% | Legal remuneration of the employees, self-raised funds and other methods permitted by laws and administrative regulations |
Shareholdings of directors, supervisors and senior executives in the employee stock ownership plan during the reportingperiod
| Name | Position | Number of shares held at the beginning of the reporting period | Number of shares held at the end of the reporting period | Proportion to total share capital of the Company |
| The third phase of employee stock ownership plan: Hu Baishan, Shi Guanqun, Wang Xuewen, Wang Zhengjiang, Zhou Guiyang, Yu Baijin, Shi Fangbin, Lyu Guofeng, Yu Hongwei, Yan Hongyue, Chen Zhaofeng, Zheng Gentu | Directors, supervisors and senior executives | 1,601,317 | 1,601,317 | 0.05% |
| The forth phase of employee stock ownership plan: Hu Baifan, Hu Baishan, Shi Guanqun, Wang Xuewen, Wang Zhengjiang, Zhou Guiyang, Shi Fangbin, Lyu Guofeng, Yu Hongwei, Yan Hongyue, Chen Zhaofeng | Directors, supervisors and senior executives | 0 | 0 | 0.00% |
Changes in asset management agency during the reporting period
□ Applicable √ Not applicable
Changes in equity during the reporting period due to disposal of shares by holders
□ Applicable √ Not applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Exercise of shareholders’ rights during the reporting periodPursuant to the Third Phase of Employee Stock Ownership Plan (Draft) and the Forth Phase of Employee StockOwnership Plan (Draft), such plan voluntarily waives the voting rights of holding shares in the general meeting of theCompany, while shares acquired through the employee stock ownership plan carry no voting rights in the general meeting.During the reporting period, the employee stock ownership plan did not exercise the voting rights of holding shares in thegeneral meeting, but still enjoyed the right to profit distribution.Other relevant situations and remarks of the employee stock ownership plan during the reporting period
□ Applicable √ Not applicable
Change in membership of the management committee of employee stock ownership plan
√ Applicable □ Not applicable
(1) The management committee of the the third phase of employee stock ownership plan remains unchanged.
(2) The management committee of the the forth phase of employee stock ownership plan: pursuant to the first meeting ofholders of the forth phase of employee stock ownership plan in manner of voting by correspondence dated June 20, 2023,the proposal on Election of Members of the Management Committee for the Forth Phase of Employee Stock OwnershipPlan was deliberated and approved. Miss. Xi Chun, Mr. Yu Weiguo, Mr. Chen Mengqiao, Mr. Li Huafeng and Ms. WangXiaobi were elected as the member of the management committee, with the duration of such plan as the term of office.Financial impact of employee stock ownership plan on the Company in the reporting period and related accountingtreatments
□ Applicable √ Not applicable
Termination of employee stock ownership plan during the reporting period
□ Applicable √ Not applicable
Other remarks
(1) Pursuant to proposals related to employee stock ownership plan including the Forth Phase of Employee StockOwnership Plan (Draft) of Zhejiang NHU Co., Ltd. and its Abstract were deliberated and approved by the sixteenthmeeting of the eighth session of Board of Directors and the thirteenth meeting of the eighth session of the Board ofSupervisors dated June 7, 2023 and the first extraordinary general meeting of 2023 dated June 26, 2023, the Companywas agreed to implement the forth phase of employee stock ownership plan. As of June 30, 2023, the fourth phase ofemployee stock ownership plan has not yet purchased any company’s stocks.
(2) The number of shares held by directors, supervisors and senior executives in the employee stock ownership plan ismeasured based on the proportion of shares of holders to the total shares of the employee stock ownership plan.
3. Other employee incentive programs
□ Applicable √ Not applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section V Environmental and Social Responsibilities
I. Major environmental issuesWhether the Company and its subsidiaries belong to the key pollutant discharging units announced by departments of environmentalprotection administration
√ Yes □ No
Environmental protection related policies and industry standardsAction Plan for Prevention and Control of Noise Pollution in the 14th Five-Year Plan Environmental Atmosphere [2023] No. 1Announcement on Issuing Procedures for Identifying the Properties of Solid Wastes in Imported Goods Ministry of Ecology andEnvironment General Administration of Customs Announcement No. 2 of 2023Pollution Control Standards for Storage of Hazardous Wastes GB 18597-2023Announcement on the Revision List of the Graphic Symbol of Environmental Protection-Solid Waste Storage (Disposal) Yard (GB15562.2-1995) Environmental Standards Announcement No. 5 of 2023Notice on Doing a Good Job in Allocating National Carbon Emission Trading Allowances for the Years 2021 and 2022 StateEnvironmental Regulation and Climate [2023] No. 1 Overall Implementation Program for the Construction of Major Hazardous WasteProjects (2023-2025) State Environmental Regulation and Climate [2023] No. 1Measures for Ecological and Environmental Administrative Punishment Decree of the Ministry of Ecology and Environment No. 30Technical Specification for Two-dimensional Code Labeling of Pollutant Discharge Outlets of Sewage Discharging Units Standard No.HJ 1297-2023Notice on Further Strengthening the Work Related to the Standardized Environmental Management of Hazardous Wastes (Draft forOpinion) Huanban Binhan [2023] No. 174Administrative licenses for environmental protectionHeilongjiang Xinhecheng Biotechnology Co., Ltd. has completed the renewal of the expiration of the sewage discharge permit,validity: May 18, 2023 - May 17, 2028Industry emission standards and specifics of pollutant emissions involved in production and businessactivities
| Name | Types of major and characteristic pollutants | Name of major pollutants and characteristic pollutants1 | Discharge method | Number of discharge outlets | Distribution of discharge outlets | Discharge concentration | Executive pollutant discharge standard | Total amount of discharge | Total verified amount of discharge | Excessive discharge or not |
| The Company | Water pollutants | COD | Sewer connection | 1 | Plant area | 50mg/L | 500mg/L | 8.63t | ≤189.5t/a | No |
| The Company | Water pollutants | NH3-N | Sewer connection | 1 | Plant area | 7.0mg/L | 35mg/L | 0.45t | ≤13.28t/a | No |
| The Company | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area | 22mg/m? | 50mg/ m? | 0.52t | ≤8.612t/a | No |
| The Company | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area | 23mg/ m? | 50mg/m? | 0.29t | ≤28t/a | No |
| Shangyu NHU Bio-Chem Co., Ltd. | Water pollutants | COD | Sewer connection | 1 | Plant area | 199.103mg/L | 500mg/L | 91.368t | ≤440.9t/a | No |
| Shangyu NHU Bio-Chem Co., Ltd. | Water pollutants | NH3-N | Sewer connection | 1 | Plant area | 5.02mg/L | 35mg/L | 2.29t | ≤30.863t/a | No |
| Shangyu NHU Bio-Chem Co., Ltd. | Water pollutants | TN | Sewer connection | 1 | Plant area | 24.245mg/L | 70mg/L | 11.159t | ≤61.726t/a | No |
| Shangyu NHU Bio-Chem Co., Ltd. | Atmospheric pollutants | VOC | Filtered discharge | 1 | Plant area | 5.974mg/m? | 100mg/m? | 1.015t | ≤207.6t/a | No |
| Shangyu NHU Bio-Chem Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area | 3.333mg/m? | 200mg/m? | 0.56t | ≤12.96t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Water pollutants | COD | Sewer connection | 1 | Plant area | 199.103mg/L | 500mg/L | 79.09t | ≤382.37t/a | No |
COD, NH3-N, SO?, NOx, TN, VOC, PM and TP stand for chemical oxygen demand, ammonia nitrogen, sulfur dioxide, nitrogenoxides, total nitrogen, volatile organic compound, particulate matter and total phosphorus, respectively.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Name | Types of major and characteristic pollutants | Name of major pollutants and characteristic pollutants1 | Discharge method | Number of discharge outlets | Distribution of discharge outlets | Discharge concentration | Executive pollutant discharge standard | Total amount of discharge | Total verified amount of discharge | Excessive discharge or not |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Water pollutants | NH3-N | Sewer connection | 1 | Plant area | 5.02mg/L | 35mg/L | 1.983t | ≤26.766t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Water pollutants | TN | Sewer connection | 1 | Plant area | 24.245mg/L | 70mg/L | 10.467t | ≤53.532t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | VOC | Filtered discharge | 1 | Plant area | 5.68mg/m? | 100mg/m? | 0.182t | ≤121.833t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | VOC | Filtered discharge | 1 | Plant area | 0.97mg/m? | 100mg/m? | 0.16t | ≤1.069t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | VOC | Filtered discharge | 1 | Plant area | 0.7mg/m? | 100mg/m? | 0.003t | ≤0.01t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | VOC | Filtered discharge | 1 | Plant area | 0.7mg/m? | 100mg/m? | 0.003t | ≤0.288t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area | 3mg/m? | 200mg/m? | 0.1t | ≤19.8t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area | 124.43mg/m? | 300mg/m? | 18.189t | ≤28.08t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area | 12.778mg/m? | 150mg/m? | 2.06t | ≤8.44t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area | 3mg/m? | 100mg/m? | 0.1t | ≤9.295t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area | 2.67mg/m? | 100mg/m? | 0.405t | ≤37.94t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area | 3mg/m? | 50mg/m? | 0.191t | ≤10.905t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 1 | Plant area | 3.961mg/m? | 20mg/m? | 0.093t | ≤5.174t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 1 | Plant area | 4.172mg/m? | 30mg/m? | 0.591t | ≤8.42t/a | No |
| Zhejiang NHU Pharmaceutical Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 1 | Plant area | 0.065mg/m? | 20mg/m? | 0.393t | ≤5.626t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 1 | Plant area | 1.3mg/m? | 5 mg/m? | 0.0505t | ≤17.73t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 1 | Plant area | 2.4mg/m? | 20 mg/m? | 0.2745t | ≤17.73t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 1 | Plant area | 6.8mg/m? | 20 mg/m? | 0.0239t | ≤17.73t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area | 2.8mg/m? | 35mg/m? | 0.1151t | ≤67.92t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area | 2.8mg/ m? | 50mg/ m? | 0.3059t | ≤67.92t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area | 18.3mg/m? | 50mg/ m? | 0.0650t | ≤67.92t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area | 13.3mg/m? | 50 mg/m? | 0.4922t | ≤83.28t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area | 18.0mg/m? | 100mg/m? | 1.8905t | ≤83.28t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area | 30.8mg/m? | 150 mg/m? | 0.1133t | ≤83.28t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Atmospheric pollutants | VOC | Filtered discharge | 2 | Plant area | 1.92mg/m? | 60 mg/m? | 0.3351t | ≤69.72t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Water pollutants | COD | Sewer connection | 1 | Plant area | 204.37mg/L | 500 mg/L | 38.405t | ≤182.1t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Water pollutants | NH3-N | Sewer connection | 1 | Plant area | 5.01mg/L | 35 mg/L | 0.941t | ≤12.747t/a | No |
| Zhejiang NHU Special Materials Co., Ltd. | Water pollutants | TN | Sewer connection | 1 | Plant area | 25.08mg/L | 70 mg/L | 4.714t | ≤25.494t/a | No |
| Shandong NHU Pharmaceutical Co., Ltd | Atmospheric pollutants | PM | Filtered discharge | 5 | Plant area | 1.82mg/m? | 10 mg/m? | 0.188t | ≤5.761t/a | No |
| Shandong NHU Pharmaceutical Co., Ltd | Atmospheric pollutants | SO? | Filtered discharge | 4 | Plant area | 3.86mg/m? | 50 mg/m? | 0.375t | ≤4.006t/a | No |
| Shandong NHU Pharmaceutical Co., Ltd | Atmospheric pollutants | NOx | Filtered discharge | 5 | Plant area | 40.2mg/m? | 100 mg/m? | 4.13t | ≤75.513t/a | No |
| Shandong NHU Pharmaceutical Co., Ltd | Atmospheric pollutants | VOC | Filtered discharge | 3 | Plant area | 7.48mg/m? | 60 mg/m? | 1.15t | ≤28.481t/a | No |
| Shandong NHU Pharmaceutical Co., Ltd | Water pollutants | COD | Sewer connection | 1 | Plant area | 309mg/L | 1000mg/L | 40.4t | ≤598.22t/a | No |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Name | Types of major and characteristic pollutants | Name of major pollutants and characteristic pollutants1 | Discharge method | Number of discharge outlets | Distribution of discharge outlets | Discharge concentration | Executive pollutant discharge standard | Total amount of discharge | Total verified amount of discharge | Excessive discharge or not |
| Shandong NHU Pharmaceutical Co., Ltd | Water pollutants | NH3-N | Sewer connection | 1 | Plant area | 16.2mg/L | 100mg/L | 2.31t | ≤59.82t/a | No |
| Shandong NHU Pharmaceutical Co., Ltd | Water pollutants | TN | Sewer connection | 1 | Plant area | 27.5mg/L | 120mg/L | 3.75t | ≤65.64t/a | No |
| Shandong NHU Amino-acids Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 4 | Plant area | 10.8mg/m? | 50 mg/m? | 3.313t | ≤92.59t/a | No |
| Shandong NHU Amino-acids Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 4 | Plant area | 90.1mg/m? | 100 mg/m? | 52.191t | ≤230.77t/a | No |
| Shandong NHU Amino-acids Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 5 | Plant area | 2.98mg/m? | 10 mg/m? | 1.368t | ≤21.19t/a | No |
| Shandong NHU Amino-acids Co., Ltd. | Atmospheric pollutants | VOC | Filtered discharge | 4 | Plant area | 43.7mg/m? | 60 mg/m? | 19.414t | ≤176.585t/a | No |
| Shandong NHU Amino-acids Co., Ltd. | Water pollutants | COD | Sewer connection | 1 | Plant area | 507mg/L | 1000 mg/L | 109.7t | ≤592.22t/a | No |
| Shandong NHU Amino-acids Co., Ltd. | Water pollutants | NH3-N | Sewer connection | 1 | Plant area | 38.9mg/L | 100 mg/L | 4.71t | ≤59.222t/a | No |
| Shandong NHU Amino-acids Co., Ltd. | Water pollutants | TN | Sewer connection | 1 | Plant area | 72.3mg/L | 120 mg/L | 14.68t | ≤70.38t/a | No |
| Shandong NHU Vitamins Co., Ltd. | Atmospheric pollutants | VOC | organized discharge | 4 | Plant area | 0.9mg/m? | 60mg/m? | 5.71t | ≤112.31t/a | No |
| Shandong NHU Vitamins Co., Ltd. | Atmospheric pollutants | SO? | organized discharge | 3 | Plant area | 4mg/m? | 50 mg/m? | 0.67t | ≤21.14t/a | No |
| Shandong NHU Vitamins Co., Ltd. | Atmospheric pollutants | NOx | organized discharge | 4 | Plant area | 55mg/m? | 100mg/m? | 16.012t | ≤65.27t/a | No |
| Shandong NHU Vitamins Co., Ltd. | Atmospheric pollutants | PM | organized discharge | 5 | Plant area | 3mg/m? | 10 mg/m? | 0.83t | ≤4.8t/a | No |
| Shandong NHU Vitamins Co., Ltd. | water contamination | COD | Sewer connection | 1 | Plant area | 241mg/L | 2000 mg/L | 21t | ≤1189.64t/a | No |
| Shandong NHU Vitamins Co., Ltd. | water contamination | NH3-N | Sewer connection | 1 | Plant area | 8.46 mg/L | 100 mg/L | 0.536t | ≤59.49t/a | No |
| Shandong NHU Technology Co., Ltd | Atmospheric pollutants | VOC | organized discharge | 2 | Plant area | 12mg/m? | 60 mg/m? | 0.6t | ≤4.109t/a | No |
| Shandong NHU Technology Co., Ltd | Atmospheric pollutants | NOx | organized discharge | 2 | Plant area | 30mg/m? | 100 mg/m? | 0.668t | ≤20.33t/a | No |
| Shandong NHU Technology Co., Ltd | Atmospheric pollutants | PM | organized discharge | 2 | Plant area | 1.3mg/m? | 10 mg/m? | 0.1t | ≤3.384t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 1 | Plant area（RTO） | 13.87mg/m? | 30mg/m? | 3.04t | ≤19.5684t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area（RTO） | 46.33mg/m? | 200mg/m? | 10.89t | ≤19.5684t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area（RTO） | 108.28mg/m? | 200mg/m? | 24.72t | ≤129.0211t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | Atmospheric pollutants | VOC | Filtered discharge | 1 | Plant area（RTO） | 1.32mg/m? | 150mg/m? | 0.23t | ≤96.12t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | Atmospheric pollutants | PM | Filtered discharge | 1 | Plant area（Heat transfer oil furnace） | 6.76mg/m? | 20mg/m? | 0.03t | ≤19.5684t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | Atmospheric pollutants | NOx | Filtered discharge | 1 | Plant area（Heat transfer oil furnace） | 69.5mg/m? | 200mg/m? | 0.35t | ≤131.604t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | Atmospheric pollutants | SO? | Filtered discharge | 1 | Plant area（Heat transfer oil furnace） | 2.91mg/m? | 50mg/m? | 0.006t | ≤129.0211t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | water contamination | COD | Sewer connection | 1 | Plant area（Wastewater outlet） | 156.88mg/m? | 350 mg/L | 519.1t | ≤2310t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | water contamination | NH3-N | Sewer connection | 1 | Plant area（Wastewater outlet） | 5.35mg/m? | 35 mg/m? | 15.71t | ≤231t/a | No |
| Heilongjiang NHU Biotechnology Co., Ltd. | water contamination | otal-P | Sewer connection | 1 | Plant area（Wastewater outlet） | 1.28mg/m? | 6 mg/L | 3.64t | / | No |
Treatment of contaminants
The company has established the environmental protection concept of green development: 1. Introduce the concept of green chemistryto develop and produce more environmentally friendly products. 2. We should change from a support type to a responsibility type, anddo a good job in source reduction, process control, and end treatment. 3. Pursue reduction, resources and harmlessness, build anecological factory, and realize the harmonious development of human and nature.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Wastewater treatment: The company has a perfect sewage treatment system; there are production sewage, domestic sewage, initialrainwater, accident water and other wastewater collection system, so as to achieve the clean sewage diversion, rain and sewagediversion. The waste water pool is sealed with a cover, and all the waste gases are effectively collected and finally incinerated, whicheffectively reduces the emission of waste gases.Exhaust gas treatment: The company adopts self-developed nitrogen sealing system to effectively reduce the exhaust gas emission;according to different exhaust gas composition and nature, different pre-treatment technologies are adopted; meanwhile, the companyintroduces foreign advanced exhaust gas treatment devices to strengthen the capacity of exhaust gas treatment. Exhaust gas leakagedetection and repair (LDAR) is carried out regularly every year.Solid Waste Disposal: The company has a standardized hazardous waste storage warehouse and hazardous waste incineration device,and the company basically disposes of hazardous waste by itself. The outsourced solid waste is transferred in strict accordance withthe requirements of the "Management Measures for the Transfer of Hazardous Wastes", and entrusted to qualified units to deal with.Noise prevention and control: the selection of low-noise equipment, while no fixed equipment using foundation damping noisereduction measures for air compressors, blowers and various pumps in addition to taking the foundation damping, but also in the noisesource around the addition of noise enclosures for sound insulation.Emergency management: installing exhaust gas online monitor around the plant boundary, real-time monitoring of the environment ofthe plant boundary; introducing VOC online monitor, real-time monitoring of the emission of exhaust gas data, test data uploaded tothe monitoring platform; wastewater one enterprise, one pipe online monitoring of wastewater emission indexes, real-time monitoring,normal uploading to the Environmental Protection Bureau; the introduction of domestic first-class pressure leakage pluggingtechnology, pipelines, valves, flanges, tanks, the emergence of abnormal leakage is reduced to the minimum amount, thereby reducingthe impact of the large number of leaks caused by the environment.Environmental emergency response planThe company has developed regulatory documents for emergency response to sudden environmental events, clarifying emergencyresponse responsibilities, standardizing emergency response procedures, establishing an emergency response plan system, regularlyorganizing training, drills, and reviews of relevant emergency plans, ensuring the effectiveness of emergency plans, and enhancing theemergency response capabilities of our company and its subsidiaries.Investment in environmental treatment and protection and payment of environmental protection taxThe Company's environmental protection management and investment in the first half of 2023 amounted to RMB 236.51 million yuan,and paid RMB 990,000 yuan in environmental protection tax.
Environmental self-monitoring programThe company has a good management capacity for pollutant discharge monitoring and is able to inform the environmental protectionadministrative authorities and the public of the monitoring information in a timely manner. The company has formulated relevant self-testing program, and the monitoring program covers all indicators of the company's organized exhaust gas, unorganized exhaust gasand groundwater. Meanwhile, it commissions a third-party testing company to carry out regular monitoring. The company implementsenvironmental information disclosure in strict accordance with national, provincial, municipal and county requirements onenvironmental information disclosure of enterprises. The subsidiaries have carried out enterprise environmental information disclosureon platforms such as provincial and municipal environmental information management systems for key sewage disposal units andsewage discharge licenses.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Administrative penalties for environmental problems during the reporting period
| Name | Reasons for punishment | Violations | Results of punishment | Impact on the production and operation of the Company | Rectification measures of the Company |
| N/A | N/A | N/A | N/A | N/A | N/A |
Other environmental information that should be disclosedNone.
Measures taken to reduce its carbon emissions during the reporting period and their effects
√ Applicable □ Not Applicable
In the research and development of new products, carbon emission of 10,000 yuan output value is taken as an important indicator ofthe process route and environmental feasibility assessment of new products, and the research and development of new products appliesgreen development technology, improves the utilization rate of atoms, and reduces carbon emission generated from raw materialconsumption from the source.Other information related to environmental protectionNone.II. Social responsibilitiesThe company integrates the concept of green and low-carbon development into the entire production process, attaches great importanceto collaborative development and intensive utilization of resources. In the product layout stage, it adheres to the development principleof "integration, serialization, and collaboration", continuously extends the industrial chain, reduces production costs, which isconducive to achieving sustainable clean production, leading the industry's green and low-carbon transformation.The company continues to improve its carbon emission control system, making efforts in energy reduction, comprehensive utilizationof materials, and strengthening basic energy management. The company continuously put research and development efforts on energy-saving and consumption reduction topics; Starting from optimizing process control and improving conversion efficiency, exploresustainable innovation in processes and equipment, and further consolidate the foundation of "green development".The company utilizes digital technology to empower green manufacturing. Each production base introduces advanced productionmanagement and energy management systems to detect energy consumption and three waste emissions data in time, and provides earlywarning for abnormal situations. LDAR is comprehensively carried out, and dedicated exhaust gas detectors and flow meters areintroduced to achieve refined management of production and operation, injecting new momentum into continuously improving theecological environment and promoting high-quality development.During the reporting period, the company fulfilled its corporate purpose, took on corporate responsibility, organized a series of activitiessuch as caring blood donation and volunteer services, donated to village enterprise construction and charitable fund projects, heldpublic open days, and actively established a communication platform between enterprises and various sectors of society. The companyassists in organizing the National Green Chemistry Academic Conference, providing a multi-dimensional, valuable, and sustainable"think tank" for the development of green economy in the chemical industry. The company has been awarded the title of "ExcellentUnit" by the National Political Research Association. Heilongjiang NHU Biotechnology Co., Ltd. has been awarded the national "GreenFactory", marking the company's green production has reached a new level and achieved new breakthroughs.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section VI Significant Events
I. Commitment performance fulfilled during the reporting period and not fulfilled as of the endof the reporting period by parties related to commitments including the actual controller of theCompany, shareholders, related parties, acquirers and the Company
√ Applicable □ Not Applicable
| Commitments | Parties making commitments | Types of commitments | Content of commitments | Time of commitment | Term of commitment | Performance |
| Commitments to shares reform | None | None | None | None | None | |
| Commitments made in reports on acquisition and changes in equity | None | None | None | None | None | |
| Commitments made in asset restructuring | None | None | None | None | None | |
| Commitments made in IPO or refinancing | NHU Holding Group Co., Ltd. and 张平一 (Zhang Pingyi), 石程 (Shi Cheng), 袁益中 (Yuan Yizhong), Hu Baishan, Shi Guanqun, Wang Xuewen, 崔欣荣 (Cui Xinrong), 王旭林 (Wang Xulin) | Commitments on horizontal competition, related party transactions and occupation of funds | The signing of Commitment on No Engagement in Horizontal Competition and commitments on no engagement in business activities result in horizontal competition with operations of the Company after listing. | June 25, 2004 | Long-term | Strictly performed |
| Hu Baifan; Hu Baishan;Shi Guanqun; Wang Xuewen; Cui Xinrong; Wang Zhengjiang; Zhou Guiyang | The Company’s directors, senior executives committed to perform their duties faithfully and diligently to safeguard the legitimate rights and interests of the Company and shareholders, and make the following commitments in accordance with the relevant provisions of the CSRC for the full performance of measures on filling immediate returns: 1. not to transfer benefits to other entities | January 12, 2017 | Long-term | Strictly performed |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| or individuals without compensation or on unfair terms, and not to use other means to harm benefits of the Company; 2. to impose restrictions on duty consumption of member of the Board of Directors and senior executives; 3. not to use assets of the Company to engage in investment or consumption activities not related to duty performance; 4. to link remuneration system formulated by the Board of Directors or remuneration committee to the implementation of measures on filling immediate returns; 5. to link vesting conditions of equity incentive to be published in the future to the implementation of measures on filling immediate returns. | ||||||
| Hu Baifan; NHU Holding Group Co., Ltd. | Not to interfere in the Company’s business and management activities in excess of authority; not to encroach on benefits of the Company; to perform measures on filling immediate returns in a practical way. | January 12, 2017 | Long-term | Strictly performed | ||
| Commitments to equity incentive | None | None | None | None | None | |
| Other commitments to minority shareholders of the Company | None | None | None | None | None | |
| Other commitments | None | None | None | None | None | |
| Whether commitments are performed on time | Yes | |||||
| If commitment performance is not fulfilled on time, please explain detailed reasons for it and the next work plans. | Not applicable | |||||
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
II. Non-operating occupation of funds over listed companies by controlling shareholders andother related parties
□ Applicable √ Not Applicable
There is no non-operating occupation of funds over listed companies by controlling shareholders and other related partiesduring the reporting period.
III. Illegal external guarantees
□ Applicable √ Not Applicable
There is no illegal external guarantee during the reporting period.IV、Engagement and dismissal of accounting firmsWhether the semi-annual report has been audited or not
□ Yes √ No
The semi-annual report has not been audited.V. Statements by the Board of Directors, the Board of Supervisors on the “Modified Auditor’sReport” issued by the accounting firm during the reporting period
□ Applicable √ Not Applicable
VI. Explanations by the Board of Directors on the “Modified Auditor’s Report” issued by theaccounting firm last year
□ Applicable √ Not Applicable
VII. Matters related to bankruptcy and restructuring
□ Applicable √ Not Applicable
There are no matters related to bankruptcy and restructuring during the reporting period.
VIII. Lawsuits
Significant lawsuits and arbitration
□ Applicable √ Not Applicable
There is no significant lawsuit and arbitration during the reporting period.
Other lawsuits
□ Applicable √ Not Applicable
IX. Penalties and rectification
□ Applicable √ Not Applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
X. Integrity of the Company, its controlling shareholders and the actual controller
□ Applicable √ Not Applicable
XI. Significant related party transactions
1. Related party transactions relevant to daily operations
□ Applicable √ Not Applicable
There is no related party transaction relevant to daily operations during the reporting period.
2. Related party transactions in purchase or sale of assets or equities
□ Applicable √ Not Applicable
There is no related party transaction in purchase or sale of assets or equities during the reporting period.
3. Related party transactions in joint external investments
□ Applicable √ Not Applicable
There is no related party transaction in joint external investments during the reporting period.
4. Related party creditor’s rights and debts
□ Applicable √ Not Applicable
There is no related creditor’s rights or debts during the reporting period.
5. Transactions with related financial companies
□ Applicable √ Not Applicable
There is no business of deposits, loans, credit granting or other financial businesses between the Company and itsrelated financial companies.
6. Transactions between financial companies controlled by the Company and the Company’s related parties
□ Applicable √ Not Applicable
There is no business of deposits, loans, credit granting or other financial businesses between financial companiescontrolled by the Company and the Company’s related parties.
7. Other significant related party transactions
□ Applicable √ Not Applicable
There is no other significant related party transaction during the reporting period.XII. Significant contracts and performance
1. Matters of trusteeship, contracting and leases
(1) Trusteeship
□ Applicable √ Not Applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
There is no trusteeship during the reporting period.
(2) Contracting
□ Applicable √ Not Applicable
There is no contracting during the reporting period.
(3) Leases
□ Applicable √ Not Applicable
There is no lease during the reporting period.
2. Significant guarantees
√ Applicable □ Not Applicable
Unit: RMB 0,000 yuan
| External guarantees by the Company and its subsidiaries to third parties (guarantees to subsidiaries are excluded) | ||||||||||
| Guaranteed parties | Announcement date of disclosure of amount guaranteed | Amount guaranteed | Actual commence-ment date | Actual amount guaranteed | Types of guarantees | Collaterals (if any) | Counter guarantees (if any) | Period of guarantee | Whether the guarantee is mature | Whether guarantee for related parties |
| None | ||||||||||
| Total amount of external guarantees approved during the reporting period (A1) | Total actual amount of external guarantees incurred during the reporting period (A2) | |||||||||
| Total amount of external guarantees approved balance at the end of the reporting period (A3) | Total actual amount of external guarantees balance at the end of the reporting period (A4) | |||||||||
| The Company’s guarantees to subsidiaries | ||||||||||
| Guaranteed parties | Announcement date of disclosure of amount guaranteed | Amount guaranteed | Actual commence-ment date | Actual amount guaranteed | Types of guarantees | Collaterals (if any) | Counter guarantees (if any) | Period of guarantee | Whether the guarantee is mature | Whether guarantee for related parties |
| Heilongjiang NHU Biotechnology Co., Ltd. | 12/28/2018 | 200,000 | 6/24/2019 | 200,000 | Joint and several liability guarantee | 6/24/2019-12/31/2023 | No | No | ||
| Shandong NHU VITAMIN CO.,LTD | 12/28/2018 | 90,000 | 11/29/2019 | 50,000 | Joint and several liability guarantee | 11/29/2019-04/26/2023 | Yes | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/22/2020 | 120,000 | 9/7/2020 | 57,806.40 | Joint and several liability guarantee | 9/7/2020-9/7/2023 | No | No | ||
| Shandong NHU Fine Chemical Science and Technology Co., Ltd. | 5/22/2020 | 50,000 | 3/24/2021 | 50,000 | Joint and several liability guarantee | 3/24/2021-12/25/2025 | No | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/11/2022 | 130,000 | 7/14/2022 | 7,877.13 | Joint and several liability guarantee | 7/14/2022-5/15/2023 | Yes | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/11/2022 | 130,000 | 6/17/2022 | 7,877.13 | Joint and several liability guarantee | 6/17/2022-6/18/2023 | Yes | No | ||
| Heilongjiang NHU Biotechnology Co., Ltd. | 4/22/2021 | 40,000 | 8/26/2021 | 37,000 | Joint and several liability guarantee | 8/26/2021-12/21/2025 | No | No | ||
| ZhejiangNHU IMPORT & EXPORT COMPANY LTD. | 5/11/2022 | 15,000 | 5/31/2022 | 5,000 | Joint and several liability guarantee | 5/31/2022-10/23/2023 | No | No | ||
| ZhejiangNHU IMPORT & EXPORT COMPANY LTD. | 5/20/2023 | 10,000 | 6/16/2023 | 10,000 | Joint and several liability guarantee | 6/16/2023-6/15/2024 | No | No | ||
| Xinchang NHU VITAMINS CO.,LTD. | 4/22/2021 | 40,000 | 12/16/2021 | 29,000 | Joint and several liability guarantee | 12/16/2021-12/25/2026 | No | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/11/2022 | 130,000 | 9/2/2022 | 105.96 | Joint and several liability guarantee | 9/02/2022-5/01/2023 | Yes | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/11/2022 | 130,000 | 11/3/2022 | 8.53 | Joint and several liability | 11/3/2022-6/01/2023 | Yes | No | ||
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| guarantee | ||||||||||
| NHU (Hong Kong) Trading Co., Ltd. | 5/11/2022 | 130,000 | 12/15/2022 | 25.06 | Joint and several liability guarantee | 12/15/2022-8/1/2023 | No | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/11/2022 | 130,000 | 3/15/2023 | 14.73 | Joint and several liability guarantee | 3/15/2023-11/1/2023 | No | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/11/2022 | 130,000 | 5/12/2023 | 46.76 | Joint and several liability guarantee | 5/12/2023-12/1/2023 | No | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/20/2023 | 100,000 | 6/12/2023 | 16.19 | Joint and several liability guarantee | 6/12/2023-3/1/2024 | No | No | ||
| Zhejiang NHU Pharmaceutical Co., Ltd. | 5/11/2022 | 60,000 | 6/24/2022 | 55,000 | Joint and several liability guarantee | 6/24/2022-6/23/2027 | No | No | ||
| Xinchang NHU Vitamins Co., Ltd. | 5/11/2022 | 20,000 | 10/14/2022 | 18,000 | Joint and several liability guarantee | 10/14/2022-10/14/2027 | No | No | ||
| NHU (Hong Kong) Trading Co., Ltd. | 5/20/2023 | 100,000 | 6/12/2023 | 7,948.38 | Joint and several liability guarantee | 6/12/2023-6/12/2024 | No | No | ||
| Shandong NHU Fine Chemical Science and Technology Co., Ltd. | 5/20/2023 | 58,600 | 3/30/2023 | 58,600 | Joint and several liability guarantee | 6/6/2023-3/29/2028 | No | No | ||
| Total amount of guarantees approved for subsidiaries during the reporting period (B1) | 215,000 | Total amount actually guaranteed for subsidiaries during the reporting period (B2) | 76,626.06 | |||||||
| Total amount of guarantees approved for subsidiaries at the end of the reporting period (B3) | 666,892.95 | Total amount actually guaranteed for subsidiaries at the end of the reporting period (B4) | 528,457.52 | |||||||
| Guarantees by subsidiaries to subsidiaries | ||||||||||
| Guaranteed parties | Announcement date of disclosure of amount guaranteed | Amount guaranteed | Actual commencement date | Amount actually guaranteed | Types of guarantees | Collaterals (if any) | Counter guarantee (if any) | Period of guarantee | Whether the guarantee is mature | Whether guarantee for related parties |
| None | ||||||||||
| Total amount of guarantees approved for subsidiaries during the reporting period (C1) | Total amount actually guaranteed for subsidiaries during the reporting period (C2) | |||||||||
| Total amount of guarantees approved for subsidiaries at the end of the reporting period (C 3) | Total amount actually guaranteed for subsidiaries at the end of the reporting period (C4) | |||||||||
| Total amount guaranteed by the Company (namely sum of the above three items) | ||||||||||
| Total amount of guarantees approved during the reporting period (A1+B1+C1) | 215,000 | Total amount actually guaranteed during the reporting period (A2+B2+C2) | 76,626.06 | |||||||
| Total amount of guarantees approved at the end of the reporting period (A3+B3+C3) | 666,892.95 | Total amount actually guaranteed at the end of the reporting period (A4+B4+C4) | 528,457.52 | |||||||
| Proportion of the amount actually guaranteed (A4+B4+C4) to net assets of the Company | 22.42% | |||||||||
| Including: | ||||||||||
| Balance of guarantees for shareholders, the actual controller and its related parties (D) | 407,600 | |||||||||
| Balance of debt guarantee directly or indirectly for guaranteed parties with debt to asset ratio exceeding 70% (E) | 407,600 | |||||||||
| The amount of the total amount guaranteed exceeding 50% of net assets (F) | None | |||||||||
| Total amount guaranteed of three items above (D+E+F) | None | |||||||||
Specification of the use of composite guarantees
None
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
3. Entrusted financing
√ Applicable □ Not Applicable
Unit: RMB 0,000 yuan
| Types | Source of entrusted funds | Entrusted amount | Unexpired balance | Overdue and not recovered amount | Impairment amount accrued for financial products overdue and not recovered |
| Bank financial products | Raised funds | 80,000.00 | 25,000.00 | 0.00 | 0.00 |
| Total | 80,000.00 | 25,000.00 | 0.00 | 0.00 | |
High-risk entrusted financial products with individual significant amount or low security and poor liquidity
□ Applicable √ Not Applicable
When the principal of entrusted financial products is expected to be irrevocable or there are other conditions result in impairment ofentrusted financial products
□ Applicable √ Not Applicable
4. Other significant contracts
□ Applicable √ Not Applicable
There is no other significant contract during the reporting period.
XIII. Other significant events
√ Applicable □ Not Applicable
Ⅰ Progress of the Third Employee Stock Ownership Plan
The third employee stock ownership plan of the Company was deliberated and adopted by the second extraordinary shareholders’meeting of 2020 held on November 11, 2020, the current employee stock ownership plan is managed by the Company itself, and theCompany’s shares are acquired and held by stock purchase through secondary market, the duration shall not exceed 24 months. OnFebruary 26, 2021, the number of shares held by the third employee stock ownership plan of the Company was 12,157,826*,accountingfor RMB 303,710,918.74 Yuan and 0.39% of the company's total share capital. The company held the 14th meeting of the eighth boardof directors on October 31, 2022, reviewed and approved the "Proposal on the Extension of the Duration of the Third Employee StockOwnership Plan", and agreed that the duration of the company's employee stock ownership plan will be extended. The former durationNovember 11,2020 to November 10, 2022 will be adjusted to November 11, 2020 to November 10, 2023, and other contents will notbe changed. For more details, please refer to Announcement on the extension of the duration of the third employee stock ownershipplan (2022-045) published on the company's designated information disclosure media and cninfo (http://www.cninfo.com.cn). As ofthe end of the reporting period, the balance of shares held by the Third Employee Stock Ownership Plan was 12,157,826 shares,accounting for 0.39% of the company's total share capital.* On May 25, 2022, after the implementation of the company's 2021 annual equity distribution, the number of shares held by thecompany's third-phase employee stock ownership plan increased to 12,157,826 shares, accounting for 0.39% of the company's existingtotal share capital.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
II Progress of the Forth Employee Stock Ownership Plan
The forth employee stock ownership plan of the Company was deliberated and adopted by the first extraordinary shareholders’ meetingof 2023 held on June 26, 2023, the current employee stock ownership plan is managed by the Company itself, and the Company’sshares are acquired and held by stock purchase through secondary market, the duration shall not exceed 24 months. As of the end ofthe reporting period, the balance of shares held by the Forth Employee Stock Ownership Plan was 0 shares, the current employee stockownership plan has not yet started purchasing the company’s stocks.III Foreign Investment and Establishment of a Joint Venture Company
At the Ninth Meeting of the Eighth Session of the Board of Directors of the Company held on December 24, 2021, the Company considered and passedthe ''Proposal on Foreign Investment and Signing of a Letter of Intent on Joint Venture Cooperation'', agreeing that the Company would sign the ''Letterof Intent on Joint Venture Cooperation'' with China Petroleum & Chemical Corporation Zhenhai Refining Branch, and that the two parties wouldcooperate in investing in a set of methionine production facilities, with an estimated total investment of approximately RMB3 billion for the project,which would be constructed in Ningbo City, Ningbo Zhenhai District, Ningbo. The parties will establish a joint venture company as the implementationbody of the project, which will be responsible for the production and sales of methionine products. The proposed registered capital of the joint venturecompany is RMB778.36 million, which will be contributed in cash, and the shareholding ratio between the two parties is tentatively set at 50%:50%.The joint venture company shall have a board of directors consisting of four directors, with each party having the right to appoint two directors, and themanagement of the joint venture company shall be composed of both parties.On 9 March 2023, the joint venture company, Ningbo Zhenhai Refining Xinhecheng Biotechnology Co., Ltd. completed the industrial and commercialregistration procedures and obtained the Business License issued by the Market Supervision Administration of Zhenhai District, Ningbo City; as at 30June 2023, the Company had contributed RMB233,508,000.00 to the joint venture company.IV Progress of Investment Project with Raised Funds
With the approval of [2017] No. 1684 document of China Securities Regulatory Commission, the company's lead underwriter, CSCSecurities Co., Ltd., privately issued 175 million common shares (A shares) to specific objects at an issue price of RMB 28.00/share,raising a total of RMB 4,900 million. After deducting the underwriting and recommendation fees of RMB 30 million yuan (includingtax), the raised funds amounted to RMB 4,870 million, which was remitted to the raised funds supervision account of the company bythe lead underwriter, CSC Securities Co., Ltd. on December 7, 2017. In addition, after deducting lawyer fees, audit fees, capitalverification fees and other issuance expenses of RMB 4.62 million (excluding tax), and considering the deductible VAT input tax ofRMB 1.70 million of underwriting fees and recommendation fees deducted by the lead underwriter, the net amount of funds raised wasRMB 4,867.08 million. The availability of the above raised funds has been verified by Tianjian Certified Public Accountants (specialgeneral partnership), who issued the capital verification report ([2017] No. 503).From January 1 to June 30, 2023, the actual use of the raised funds was RMB 1,041.44 mn, and the accumulated investment of theraised funds project was RMB 4,819.64 mn. By June 30, 2023, the balance of raised funds was RMB 788.58 mn (including bankfinancial products and structured deposits, the net amount of interest on cash in bank less handling charges and s and bank bankfinancial products income) .XIV. Significant events of subsidiaries of the Company
□ Applicable √ Not Applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section VII Movements in Shares and Information about
ShareholdersI. Movements in shares
1. Details
Unit: Share
| Items | Before | Movements（+/-） | After | ||||||
| Quantity | % to total | Issue of new shares | Bonus shares | Reserve transferred to shares | Others | Subtotal | Quantity | % to total | |
| I. Restricted shares | 36,374,202 | 1.18% | 36,374,202 | 1.18% | |||||
| 1. Held by other domestic parties | 36,374,202 | 1.18% | 36,374,202 | 1.18% | |||||
| Including: Held by domestic natural persons | 36,374,202 | 1.18% | 36,374,202 | 1.18% | |||||
| II. Unrestricted shares | 3,054,533,154 | 98.82% | 3,054,533,154 | 98.82% | |||||
| 1. RMB ordinary shares | 3,054,533,154 | 98.82% | 3,054,533,154 | 98.82% | |||||
| III. Total | 3,090,907,356 | 100.00% | 3,090,907,356 | 100.00% | |||||
Reason for movements
□ Applicable √ Not Applicable
Approval on movements in shares
□ Applicable √ Not Applicable
Transfer of shares
□ Applicable √ Not Applicable
Progress of the Share Repurchase Plan
□ Applicable √ Not Applicable
Implementation progress of shareholding reduction for shares repurchased through centralized bidding
□ Applicable √ Not applicable
Effect of movements in shares on financial indicators of preceding year and preceding eriod such as basic EPS and dilutedEPS, net assets per share attributable to shareholders of ordinary shares
□ Applicable √ Not applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Other contents the Company considered as necessary or securities regulatory institutions required disclosure
□ Applicable √ Not applicable
2. Movement in restricted shares
□ Applicable √ Not applicable
II. Issuance and listing of securities
□ Applicable √ Not Applicable
III.Number of shareholders of the Company and their shareholding conditions
Unit: Share
| Total shareholders of ordinary shares at the end of the reporting period | 119,419 | Total shareholders of preferred shares with voting rights restored at the end of the reporting period | 0 | |||||
| Shareholders with holding proportion over 5% or the top 10 shareholders with largest holding proportions | ||||||||
| Shareholders | Nature of shareholders | Holding proportion | Quantity of ordinary shares at the end of the reporting period | Movements during the reporting period | Quantity of restricted shares | Quantity of unrestricted shares | Shares pledged, marked or frozen | |
| Condition | Quantity | |||||||
| NHU Holding Group Co., Ltd. | Domestic non-state-owned legal person | 49.22% | 1,521,362,525 | 0 | 0 | 1,521,362,525 | ||
| Hong Kong Securities Clearing Company Limited | Overseas legal person | 2.17% | 67,107,711 | -29,081 | 0 | 67,107,711 | ||
| Shanghai Chongyang Strategic Investment Co., Ltd. － Chongyang Strategic Huizhi Fund | Others | 1.75% | 54,072,200 | 0 | 0 | 54,072,200 | ||
| National Social Security Fund No.503Portfolio | Others | 1.20% | 37,000,000 | -2,000,060 | 0 | 37,000,000 | ||
| China Construction BankCorporation -E Fund Shanghai and Shenzhen 300 Medical and Health Trading Open-end Index Fund | Others | 0.85% | 26,374,133 | 10,254,000 | 0 | 26,374,133 | ||
| Shanghai Chongyang Strategic Investment Co., Ltd. － Chongyang Strategic Yingzhi Fund | Others | 0.53% | 16,248,559 | 0 | 0 | 16,248,559 | ||
| Hu Baishan | Domestic natural person | 0.47% | 14,595,929 | 0 | 10,946,947 | 3,648,982 | ||
| Chongyang Group Co., Ltd. | Domestic non-state-owned legal person | 0.45% | 13,962,191 | 0 | 0 | 13,962,191 | ||
| Hu Baifan | Domestic natural person | 0.45% | 13,922,998 | 0 | 10,442,248 | 3,480,750 | ||
| Sanhua Holdings Group Co., Ltd. | Domestic non-state-owned legal person | 0.45% | 13,772,970 | 0 | 0 | 13,772,970 | ||
| Strategic investors or ordinary legal persons that became one of the top 10 shareholders due to the allotment of new shares | Shanghai Chongyang Strategic Investment Co., Ltd. － Chongyang Strategic Huizhi Fund became one of the top 10 shareholders with largest holding proportions due to its participation in private placement of shares in 2017. | |||||||
| Remarks on relationships or concerted action between the top 10 shareholders with largest holding proportions | Among the above shareholders, Hu Baifan is the chairman of the board, general manager and actural controller of NHU Holding Group Co., Ltd.; Hu Baishan is the director of NHU Holding Group Co., | |||||||
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Ltd., and Hu Baifan and Hu Baishan are brothers. The Company does not know whether other shareholders have relationships and whether they are persons acting in concert as defined in Administration of the Takeover of Listed Companies Procedures. | |||
| Remarks on proxy voting and waiver of voting right of the above shareholders | None | ||
| Special remarks on top 10 shareholders with special repurchase accounts | The Company’s special securities account for repurchase is attributable to the top 10 shareholders, who however did not participate in the presentation of such balances. | ||
| Top 10 shareholders with unrestricted shares | |||
| Shareholders | Quantity of unrestricted shares at the end of the reporting period | Category of shares | |
| Category | Quantity | ||
| NHU Holding Group Co., Ltd. | 1,521,362,525 | RMB ordinary shares | 1,521,362,525 |
| Hong Kong Securities Clearing Company Limited | 67,107,711 | RMB ordinary shares | 67,107,711 |
| Shanghai Chongyang Strategic Investment Co., Ltd. － Chongyang Strategic Huizhi Fund | 54,072,200 | RMB ordinary shares | 54,072,200 |
| National Social Security Fund No.503 Portfolio | 37,000,000 | RMB ordinary shares | 37,000,000 |
| China Construction BankCorporation -E Fund Shanghai and Shenzhen 300 Medical and Health Trading Open-end Index Fund | 26,374,133 | RMB ordinary shares | 26,374,133 |
| Shanghai Chongyang Strategic Investment Co., Ltd. － Chongyang Strategic Yingzhi Fund | 16,248,559 | RMB ordinary shares | 16,248,559 |
| Chongyang Group Co., Ltd. | 13,962,191 | RMB ordinary shares | 13,962,191 |
| Sanhua Holdings Group Co., Ltd. | 13,772,970 | RMB ordinary shares | 13,772,970 |
| The Company－Employee stock ownership plan phase III | 12,157,826 | RMB ordinary shares | 12,157,826 |
| National Social Security Fund No.112 Portfolio | 11,658,657 | RMB ordinary shares | 11,658,657 |
| Remarks on relationships or concerted action between the top 10 shareholders with unrestricted shares, and between the top 10 shareholders with unrestricted shares and top 10 shareholders with largest holding proportions. | Among the above shareholders, Hu Baifan is the chairman of the board, general manager and actural controller of NHU Holding Group Co., Ltd.; Hu Baishan is the director of NHU Holding Group Co., Ltd., and Hu Baifan and Hu Baishan are brothers. The Company does not know whether other shareholders have relationships and whether they are persons acting in concert as defined in Administration of the Takeover of Listed Companies Procedures. | ||
| Remarks on top 10 shareholders of ordinary shares participating in securities margin trading | Shanghai Chongyang Strategic Investment Co., Ltd. － Chongyang Strategic Huizhi Fund holds 54,072,127 shares through client account of collateral securities for margin trading of Guotai Junan Securities Co., Ltd.; Shanghai Chongyang Strategic Investment Co., Ltd. － Chongyang Strategic Yingzhi Fund holds 16,248,461 shares through client account of collateral securities for margin trading of Citic Securities Co., Ltd.; Chongyang Group Co., Ltd. holds 13,961,946 shares through client account of collateral securities for margin trading of China Merchants Securities Co., Ltd.. | ||
Note: The Company’s special securities account for repurchase is attributable to the top 10 shareholders with unrestrictedshares, who however did not participate in the presentation of such balances.Did the top 10 shareholders of ordinary shares and the top 10 shareholders of unrestricted ordinary shares perform agreedrepurchase transaction during the reporting period?
□ Yes √ No
The top 10 shareholders of ordinary shares and the top 10 shareholders of unrestricted ordinary shares did not performagreed repurchase transaction during the reporting period.IV. Movement in shares of directors, supervisors and senior executives
□ Applicable √ Not applicable
The shares of the company’s directors, supervisors and senior executives remains unchanged during the currentreporting period, please refer to the 2022 Annual Report for details.V. Changes of holding shareholders or controlling shareholders
Changes of holding shareholders during the reporting period
□ Applicable √ Not applicable
The Company has no changes of holding shareholders during the reporting period.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Changes of actual controller within the reporting period
□ Applicable √ Not applicable
The Company has no changes in actual controller within the reporting period.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section VIII Preferred Shares
□ Applicable √ Not applicable
The Company has no preferred shares during the reporting period.
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section IX Bonds
□ Applicable √ Not applicable
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
Section X Financial Report
I. Audit Reports
Has the semi-annual report been audited
□ Yes √ No
The Company’s semi-annual report has not been audited.
II. Financial StatementsThe monetary unit of the financial statements is Renminbi (RMB) Yuan.
1. Consolidated balance sheet
Prepared by Zhejiang NHU Co., Ltd.
June 30, 2023
Unit: RMB Yuan
| Items | June 30, 2023 | January 1, 2023 |
| Current assets: | ||
| Cash and bank balances | 3,654,734,123.88 | 5,343,851,967.72 |
| Settlement funds | ||
| Loans to other banks | ||
| Held-for-trading financial assets | 250,000,000.00 | 720,314,576.43 |
| Derivative financial assets | ||
| Notes receivable | 214,389,084.86 | 372,641,835.79 |
| Accounts receivable | 2,428,700,767.98 | 2,476,269,041.23 |
| Receivables financing | 506,430,216.64 | 379,217,582.25 |
| Advances paid | 120,026,047.84 | 222,336,776.26 |
| Premiums receivable | ||
| Reinsurance accounts receivable | ||
| Reinsurance reserve receivable | ||
| Other receivables | 224,942,479.71 | 269,567,592.73 |
| Including: Interest receivable | ||
| Dividend receivable | 20,735,987.73 | |
| Financial assets under reverse repo | ||
| Inventories | 4,578,585,468.62 | 4,144,557,702.39 |
| Contract assets | ||
| Assets held for sale | ||
| Non-current assets due within one year | ||
| Other current assets | 46,357,304.14 | 182,442,976.79 |
| Total current assets | 12,024,165,493.67 | 14,111,200,051.59 |
| Non-current assets: | ||
| Loans and advances |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | June 30, 2023 | January 1, 2023 |
| Debt investments | ||
| Other debt investments | ||
| Long-term receivables | ||
| Long-term equity investments | 703,117,491.00 | 432,503,568.48 |
| Other equity instrument investments | 22,998,147.55 | 22,998,147.55 |
| Other non-current financial assets | ||
| Investment property | ||
| Fixed assets | 17,819,362,500.06 | 16,523,867,858.53 |
| Construction in progress | 4,927,272,645.25 | 5,089,233,908.22 |
| Productive biological assets | ||
| Oil & gas assets | ||
| Right-of-use assets | 7,781,963.62 | 2,830,136.37 |
| Intangible assets | 2,163,238,985.57 | 1,738,506,246.32 |
| Development expenditures | ||
| Goodwill | 3,622,704.97 | 3,622,704.97 |
| Long-term prepayments | 14,202,219.63 | 13,179,878.45 |
| Deferred tax assets | 58,100,373.59 | 50,250,809.38 |
| Other non-current assets | 231,978,818.01 | 279,870,482.64 |
| Total non-current assets | 25,951,675,849.25 | 24,156,863,740.91 |
| Total assets | 37,975,841,342.92 | 38,268,063,792.50 |
| Current liabilities: | ||
| Short-term borrowings | 1,609,254,229.16 | 1,846,373,441.01 |
| Central bank loans | ||
| Loans from other banks | ||
| Held-for-trading financial liabilities | 12,909,447.29 | |
| Derivative financial liabilities | ||
| Notes payable | 456,643,824.63 | 627,438,689.79 |
| Accounts payable | 1,803,368,804.84 | 2,175,458,436.49 |
| Advances received | ||
| Contract liabilities | 63,559,211.75 | 60,660,929.75 |
| Financial liabilities under repo | ||
| Absorbing deposit and interbank deposit | ||
| Deposit for agency security transaction | ||
| Deposit for agency security underwriting | ||
| Employee benefits payable | 249,028,076.00 | 386,391,911.86 |
| Taxes and rates payable | 225,884,100.98 | 208,198,951.94 |
| Other payables | 59,568,912.95 | 67,351,740.34 |
| Including: Interest payable | ||
| Dividend payable | ||
| Handling fee and commission payable | ||
| Reinsurance accounts payable |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | June 30, 2023 | January 1, 2023 |
| Liabilities held for sale | ||
| Non-current liabilities due within one year | 1,919,195,692.86 | 2,591,687,706.22 |
| Other current liabilities | 6,877,330.18 | 4,978,299.99 |
| Total current liabilities | 6,406,289,630.64 | 7,968,540,107.39 |
| Non-current liabilities: | ||
| Insurance policy reserve | ||
| Long-term borrowings | 6,512,116,382.12 | 5,273,637,508.87 |
| Bonds payable | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Lease liabilities | 7,865,412.13 | 2,822,404.07 |
| Long-term payables | ||
| Long-term employee benefits payable | ||
| Provisions | ||
| Deferred income | 1,109,884,644.23 | 1,083,159,222.41 |
| Deferred tax liabilities | 263,498,923.13 | 277,735,456.67 |
| Other non-current liabilities | ||
| Total non-current liabilities | 7,893,365,361.61 | 6,637,354,592.02 |
| Total liabilities | 14,299,654,992.25 | 14,605,894,699.41 |
| Equity: | ||
| Share capital | 3,090,907,356.00 | 3,090,907,356.00 |
| Other equity instruments | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Capital reserve | 3,613,097,510.81 | 3,613,097,510.81 |
| Less: Treasury shares | 500,059,711.25 | 500,059,711.25 |
| Other comprehensive income | 106,229,698.18 | 76,577,564.17 |
| Special reserve | 43,826,423.02 | 26,196,894.55 |
| Surplus reserve | 1,444,413,940.89 | 1,444,413,940.89 |
| General risk reserve | ||
| Undistributed profit | 15,770,264,168.03 | 15,823,745,771.07 |
| Total equity attributable to the parent company | 23,568,679,385.68 | 23,574,879,326.24 |
| Non-controlling interest | 107,506,964.99 | 87,289,766.85 |
| Total equity | 23,676,186,350.67 | 23,662,169,093.09 |
| Total liabilities & equity | 37,975,841,342.92 | 38,268,063,792.50 |
Legal representative: Hu Baifan Officer in charge of accounting: Shi Guanqun Head of accounting department: Zhang Lijin
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
2. Parent company balance sheet
Unit: RMB Yuan
| Items | June 30, 2023 | January 1, 2023 |
| Current assets: | ||
| Cash and bank balances | 1,879,002,770.67 | 4,202,458,431.01 |
| Held-for-trading financial assets | 200,000,000.00 | |
| Derivative financial assets | ||
| Notes receivable | 211,520,726.11 | 333,989,841.29 |
| Accounts receivable | 602,227,072.04 | 500,589,449.94 |
| Receivables financing | ||
| Advances paid | 6,665,421.84 | 3,906,244.57 |
| Other receivables | 3,823,227,738.70 | 2,496,112,121.85 |
| Including: Interest receivable | ||
| Dividend receivable | 20,735,987.73 | |
| Inventories | 414,707,404.84 | 383,861,555.41 |
| Contract assets | ||
| Assets held for sale | ||
| Non-current assets due within one year | ||
| Other current assets | 4,221,982.33 | 3,980,654.70 |
| Total current assets | 6,941,573,116.53 | 8,124,898,298.77 |
| Non-current assets: | ||
| Debt investments | ||
| Other debt investments | ||
| Long-term receivables | ||
| Long-term equity investments | 10,590,743,358.41 | 9,386,046,175.45 |
| Other equity instrument investments | 72,998,147.55 | 72,998,147.55 |
| Other non-current financial assets | ||
| Investment property | ||
| Fixed assets | 615,179,622.70 | 625,625,323.34 |
| Construction in progress | 6,947,851.98 | 2,701,423.73 |
| Productive biological assets | ||
| Oil & gas assets | ||
| Right-of-use assets | 2,711,325.88 | 2,791,860.28 |
| Intangible assets | 143,819,303.01 | 144,448,440.79 |
| Development expenditures | ||
| Goodwill | ||
| Long-term prepayments | 1,805,015.91 | 2,614,317.07 |
| Deferred tax assets | 37,331,940.26 | 26,576,591.36 |
| Other non-current assets | 27,230,752.00 | 21,018,962.32 |
| Total non-current assets | 11,498,767,317.70 | 10,284,821,241.89 |
| Total assets | 18,440,340,434.23 | 18,409,719,540.66 |
| Current liabilities: | ||
| Short-term borrowings | 601,427,055.54 | 501,525,361.11 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | June 30, 2023 | January 1, 2023 |
| Held-for-trading financial liabilities | ||
| Derivative financial liabilities | ||
| Notes payable | 225,609,468.45 | 226,011,556.24 |
| Accounts payable | 89,480,977.40 | 107,476,196.13 |
| Advances received | ||
| Contract liabilities | 4,115,887.55 | 4,296,388.78 |
| Employee benefits payable | 43,553,731.57 | 75,342,683.87 |
| Taxes and rates payable | 2,084,719.30 | 7,632,017.61 |
| Other payables | 21,747,335.43 | 28,936,115.08 |
| Including: Interest payable | ||
| Dividend payable | ||
| Liabilities held for sale | ||
| Non-current liabilities due within one year | 684,759,005.38 | 1,208,306,034.83 |
| Other current liabilities | 535,065.41 | 558,530.54 |
| Total current liabilities | 1,673,313,246.03 | 2,160,084,884.19 |
| Non-current liabilities: | ||
| Long-term borrowings | 4,006,414,333.32 | 3,336,304,155.58 |
| Bonds payable | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Lease liabilities | 2,890,103.02 | 2,822,404.07 |
| Long-term payables | ||
| Long-term employee benefits payable | ||
| Provisions | ||
| Deferred income | 11,428,646.54 | 11,887,665.38 |
| Deferred tax liabilities | 21,871,583.64 | 19,499,233.40 |
| Other non-current liabilities | ||
| Total non-current liabilities | 4,042,604,666.52 | 3,370,513,458.43 |
| Total liabilities | 5,715,917,912.55 | 5,530,598,342.62 |
| Equity: | ||
| Share capital | 3,090,907,356.00 | 3,090,907,356.00 |
| Other equity instruments | ||
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Capital reserve | 3,353,427,829.42 | 3,353,427,829.42 |
| Less: Treasury shares | 500,059,711.25 | 500,059,711.25 |
| Other comprehensive income | 506,954.43 | 506,954.43 |
| Special reserve | ||
| Surplus reserve | 1,444,413,940.89 | 1,444,413,940.89 |
| Undistributed profit | 5,335,226,152.19 | 5,489,924,828.55 |
| Total equity | 12,724,422,521.68 | 12,879,121,198.04 |
| Total liabilities & equity | 18,440,340,434.23 | 18,409,719,540.66 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
3. Consolidated income statement
Unit: RMB Yuan
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| I. Total operating revenue | 7,418,514,576.09 | 8,215,039,277.03 |
| Including: Operating revenue | 7,418,514,576.09 | 8,215,039,277.03 |
| Interest income | ||
| Premiums earned | ||
| Revenue from handling charges and commission | ||
| II. Total operating cost | 5,746,931,719.68 | 5,728,884,500.93 |
| Including: Operating cost | 4,989,533,832.95 | 4,945,122,803.39 |
| Interest expenses | ||
| Handling charges and commission expenditures | ||
| Surrender value | ||
| Net payment of insurance claims | ||
| Net provision of insurance policy reserve | ||
| Premium bonus expenditures | ||
| Reinsurance expenses | ||
| Taxes and surcharges | 66,397,098.56 | 51,610,671.05 |
| Selling expenses | 66,941,370.80 | 57,277,897.48 |
| Administrative expenses | 244,646,451.17 | 212,284,822.41 |
| R&D expenses | 416,575,391.59 | 440,357,252.64 |
| Financial expenses | -37,162,425.39 | 22,231,053.96 |
| Including: Interest expenses | 163,988,612.81 | 152,357,156.76 |
| Interest income | 78,203,398.06 | 76,211,850.51 |
| Add: Other income | 102,847,223.45 | 86,626,226.90 |
| Investment income (or less: losses) | 43,899,900.63 | 51,479,744.19 |
| Including: Investment income from associates and joint ventures | 34,855,314.27 | 25,402,893.70 |
| Gains from derecognition of financial assets at amortized cost | ||
| Gains on foreign exchange (or less: losses) | ||
| Gains on net exposure to hedging risk (or less: losses) | ||
| Gains on changes in fair value (or less: losses) | -11,268,469.70 | 11,836,700.04 |
| Credit impairment loss | 6,389,579.21 | -10,613,626.22 |
| Assets impairment loss | -81,296,758.10 | -7,890,179.58 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| Gains on asset disposal (or less: losses) | 13,545,778.16 | 6,674,850.81 |
| III. Operating profit (or less: losses) | 1,745,700,110.06 | 2,624,268,492.24 |
| Add: Non-operating revenue | 3,576,842.57 | 2,024,074.84 |
| Less: Non-operating expenditures | 1,619,001.38 | 2,330,316.96 |
| IV. Profit before tax (or less: total loss) | 1,747,657,951.25 | 2,623,962,250.12 |
| Less: Income tax | 251,283,197.83 | 400,095,127.85 |
| V. Net profit (or less: net loss) | 1,496,374,753.42 | 2,223,867,122.27 |
| (I) Categorized by the continuity of operations | ||
| 1. Net profit from continuing operations (or less: net loss) | 1,496,374,753.42 | 2,223,867,122.27 |
| 2. Net profit from discontinued operations (or less: net loss) | ||
| (II) Categorized by the portion of equity ownership | ||
| 1. Net profit attributable to owners of parent company | 1,483,229,236.96 | 2,213,882,215.02 |
| 2. Net profit attributable to non-controlling shareholders | 13,145,516.46 | 9,984,907.25 |
| VI. Other comprehensive income after tax | 36,723,815.69 | 32,372,570.30 |
| Items attributable to the owners of the parent company | 29,652,134.01 | 32,251,478.10 |
| (I) Not to be reclassified subsequently to profit or loss | ||
| 1. Changes in remeasurement on the net defined benefit plan | ||
| 2. Items under equity method that will not be reclassified to profit or loss | ||
| 3. Changes in fair value of other equity instrument investments | ||
| 4. Changes in fair value of own credit risk | ||
| 5. Others | ||
| (II) To be reclassified subsequently to profit or loss | 29,652,134.01 | 32,251,478.10 |
| 1. Items under equity method that may be reclassified to profit or loss | ||
| 2. Changes in fair value of other debt investments | ||
| 3. Profit or loss from reclassification of financial assets into other comprehensive income | ||
| 4. Provision for credit impairment of other debt investments | ||
| 5. Cash flow hedging reserve | ||
| 6. Translation reserve | 29,652,134.01 | 32,251,478.10 |
| 7. Others |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| Items attributable to non-controlling shareholders | 7,071,681.68 | 121,092.20 |
| VII. Total comprehensive income | 1,533,098,569.11 | 2,256,239,692.57 |
| Items attributable to the owners of the parent company | 1,512,881,370.97 | 2,246,133,693.12 |
| Items attributable to non-controlling shareholders | 20,217,198.14 | 10,105,999.45 |
| VIII. Earnings per share (EPS): | ||
| (I) Basic EPS (yuan per share) | 0.48 | 0.72 |
| (II) Diluted EPS (yuan per share) | 0.48 | 0.72 |
Net profit realized by the combined party in business combination under common control before the business combination in the currentperiod was 0.00 yuan, and net profit realized by the combined party in the previous period was 0.00 yuan.Legal representative: Hu Baifan Officer in charge of accounting: Shi Guanqun Head of accounting department: Zang Lijin
4. Parent company income statement
Unit: RMB Yuan
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| I. Operating revenue | 1,467,649,891.79 | 1,881,789,420.59 |
| Less: Operating cost | 1,286,663,766.90 | 1,484,626,689.83 |
| Taxes and surcharges | 5,272,107.65 | 9,419,467.60 |
| Selling expenses | 14,547,584.98 | 13,475,826.45 |
| Administrative expenses | 71,695,788.38 | 70,457,378.58 |
| R&D expenses | 105,896,011.00 | 117,265,377.61 |
| Financial expenses | 26,721,645.73 | 19,040,825.17 |
| Including: Interest expenses | 82,410,752.78 | 86,733,082.30 |
| Interest income | 55,944,010.36 | 67,574,365.85 |
| Add: Other income | 20,950,696.09 | 22,525,397.54 |
| Investment income (or less: losses) | 1,460,083,688.60 | 90,072,788.02 |
| Including: Investment income from associates and joint ventures | 17,189,195.23 | 19,977,116.53 |
| Gains from derecognition of financial assets at amortized cost | ||
| Gains on net exposure to hedging risk (or less: losses) | ||
| Gains on changes in fair value (or less: losses) | ||
| Credit impairment loss | -76,822,623.15 | 16,015,667.16 |
| Assets impairment loss | -1,816,889.00 | -6,715,175.00 |
| Gains on asset disposal (or less: losses) | 12,144,624.20 | -79,510.57 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| II. Operating profit (or less: losses) | 1,371,392,483.89 | 289,323,022.50 |
| Add: Non-operating revenue | 1,629,246.59 | 56,720.00 |
| Less: Non-operating expenditures | 70,000.00 | 972,209.42 |
| III. Profit before tax (or less: total loss) | 1,372,951,730.48 | 288,407,533.08 |
| Less: Income tax | -9,060,433.16 | 30,379,713.92 |
| IV. Net profit (or less: net loss) | 1,382,012,163.64 | 258,027,819.16 |
| (I) Net profit from continuing operations (or less: net loss) | 1,382,012,163.64 | 258,027,819.16 |
| (II) Net profit from discontinued operations (or less: net loss) | ||
| V. Other comprehensive income after tax | ||
| (I) Not to be reclassified subsequently to profit or loss | ||
| 1. Changes in remeasurement on the net defined benefit plan | ||
| 2. Items under equity method that will not be reclassified to profit or loss | ||
| 3. Changes in fair value of other equity instrument investments | ||
| 4. Changes in fair value of own credit risk | ||
| 5. Others | ||
| (II) To be reclassified subsequently to profit or loss | ||
| 1. Items under equity method that may be reclassified to profit or loss | ||
| 2. Changes in fair value of other debt investments | ||
| 3. Profit or loss from reclassification of financial assets into other comprehensive income | ||
| 4. Provision for credit impairment of other debt investments | ||
| 5. Cash flow hedging reserve | ||
| 6. Translation reserve | ||
| 7. Others | ||
| VI. Total comprehensive income | 1,382,012,163.64 | 258,027,819.16 |
| VII. Earnings per share (EPS): | ||
| (I) Basic EPS (yuan per share) | ||
| (II) Diluted EPS (yuan per share) |
5. Consolidated cash flow statement
Unit: RMB Yuan
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| I. Cash flows from operating activities: | ||
| Cash receipts from sale of goods or rendering of services | 7,691,504,205.43 | 7,785,627,208.41 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| Net increase of client deposit and interbank deposit | ||
| Net increase of central bank loans | ||
| Net increase of loans from other financial institutions | ||
| Cash receipts from original insurance contract premium | ||
| Net cash receipts from reinsurance | ||
| Net increase of policy-holder deposit and investment | ||
| Cash receipts from interest, handling charges and commission | ||
| Net increase of loans from others | ||
| Net increase of repurchase | ||
| Net cash receipts from agency security transaction | ||
| Receipts of tax refund | 623,052,104.04 | 696,115,463.88 |
| Other cash receipts related to operating activities | 211,777,249.15 | 181,679,924.51 |
| Subtotal of cash inflows from operating activities | 8,526,333,558.62 | 8,663,422,596.80 |
| Cash payments for goods purchased and services received | 5,567,275,176.60 | 5,623,412,196.31 |
| Net increase of loans and advances to clients | ||
| Net increase of central bank deposit and interbank deposit | ||
| Cash payments for insurance indemnities of original insurance contracts | ||
| Net increase of loans to others | ||
| Cash payments for interest, handling charges and commission | ||
| Cash payments for policy bonus | ||
| Cash paid to and on behalf of employees | 1,092,533,915.84 | 1,032,523,887.01 |
| Cash payments for taxes and rates | 447,327,818.25 | 618,388,114.66 |
| Other cash payments related to operating activities | 183,634,026.00 | 146,641,660.62 |
| Subtotal of cash outflows from operating activities | 7,290,770,936.69 | 7,420,965,858.60 |
| Net cash flows from operating activities | 1,235,562,621.93 | 1,242,456,738.20 |
| II. Cash flows from investing activities: | ||
| Cash receipts from withdrawal of investments | ||
| Cash receipts from investment income | 30,163,695.90 | 37,221,964.90 |
| Net cash receipts from the disposal of fixed assets, intangible assets and other long-term assets | 140,680.08 | 4,153,451.64 |
| Net cash receipts from the disposal of subsidiaries & other business units | ||
| Other cash receipts related to investing activities | 740,938,810.13 | 1,827,718,300.54 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| Subtotal of cash inflows from investing activities | 771,243,186.11 | 1,869,093,717.08 |
| Cash payments for the acquisition of fixed assets, intangible assets and other long-term assets | 2,373,242,224.79 | 1,801,063,585.84 |
| Cash payments for investments | 237,508,000.00 | |
| Net increase of pledged borrowings | ||
| Net cash payments for the acquisition of subsidiaries & other business units | 5,485,385.14 | |
| Other cash payments related to investing activities | 250,000,000.00 | 1,136,474,731.36 |
| Subtotal of cash outflows from investing activities | 2,860,750,224.79 | 2,943,023,702.34 |
| Net cash flows from investing activities | -2,089,507,038.68 | -1,073,929,985.26 |
| III. Cash flows from financing activities: | ||
| Cash receipts from absorbing investments | ||
| Including: Cash received by subsidiaries from non-controlling shareholders as investments | ||
| Cash receipts from borrowings | 3,618,534,438.57 | 3,790,379,237.43 |
| Other cash receipts related to financing activities | ||
| Subtotal of cash inflows from financing activities | 3,618,534,438.57 | 3,790,379,237.43 |
| Cash payments for the repayment of borrowings | 2,772,078,719.75 | 1,249,162,336.86 |
| Cash payments for distribution of dividends or profits and for interest expenses | 1,710,367,614.94 | 1,963,178,314.75 |
| Including: Cash paid by subsidiaries to non-controlling shareholders as dividend or profit | ||
| Other cash payments related to financing activities | 1,407,620.33 | 3,882,331.56 |
| Subtotal of cash outflows from financing activities | 4,483,853,955.02 | 3,216,222,983.17 |
| Net cash flows from financing activities | -865,319,516.45 | 574,156,254.26 |
| IV. Effect of foreign exchange rate changes on cash & cash equivalents | 75,313,603.44 | -5,511,976.27 |
| V. Net increase in cash and cash equivalents | -1,643,950,329.76 | 737,171,030.93 |
| Add: Opening balance of cash and cash equivalents | 5,151,841,931.86 | 5,714,537,538.23 |
| VI. Closing balance of cash and cash equivalents | 3,507,891,602.10 | 6,451,708,569.16 |
6. Parent company cash flow statement
Unit: RMB Yuan
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| I. Cash flows from operating activities: | ||
| Cash receipts from sale of goods and rendering of services | 1,621,333,193.57 | 2,052,435,852.98 |
| Receipts of tax refund | 52,307,259.26 | 45,449,735.20 |
| Other cash receipts related to operating activities | 82,446,555.85 | 87,918,046.65 |
| Subtotal of cash inflows from operating activities | 1,756,087,008.68 | 2,185,803,634.83 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| Cash payments for goods purchased and services received | 1,423,009,942.09 | 1,208,399,552.39 |
| Cash paid to and on behalf of employees | 199,303,567.32 | 195,470,414.48 |
| Cash payments for taxes and rates | 10,958,178.21 | 93,367,767.02 |
| Other cash payments related to operating activities | 62,126,529.37 | 55,099,073.01 |
| Subtotal of cash outflows from operating activities | 1,695,398,216.99 | 1,552,336,806.90 |
| Net cash flows from operating activities | 60,688,791.69 | 633,466,827.93 |
| II. Cash flows from investing activities: | ||
| Cash receipts from withdrawal of investments | ||
| Cash receipts from investment income | 1,438,665,904.66 | 52,285,594.53 |
| Net cash receipts from the disposal of fixed assets, intangible assets and other long-term assets | ||
| Net cash receipts from the disposal of subsidiaries & other business units | ||
| Other cash receipts related to investing activities | 2,152,600,000.00 | 3,520,172,480.03 |
| Subtotal of cash inflows from investing activities | 3,591,265,904.66 | 3,572,458,074.56 |
| Cash payments for the acquisition of fixed assets, intangible assets and other long-term assets | 12,931,959.73 | 2,828,025.55 |
| Cash payments for investments | 1,187,508,000.00 | 50,000,000.00 |
| Net cash payments for the acquisition of subsidiaries & other business units | ||
| Other cash payments related to investing activities | 3,352,754,775.00 | 3,014,522,667.74 |
| Subtotal of cash outflows from investing activities | 4,553,194,734.73 | 3,067,350,693.29 |
| Net cash flows from investing activities | -961,928,830.07 | 505,107,381.27 |
| III. Cash flows from financing activities: | ||
| Cash receipts from absorbing investments | ||
| Cash receipts from borrowings | 1,850,000,000.00 | 2,040,000,000.00 |
| Other cash receipts related to financing activities | ||
| Subtotal of cash inflows from financing activities | 1,850,000,000.00 | 2,040,000,000.00 |
| Cash payments for the repayment of borrowings | 1,603,000,000.00 | 689,759,400.00 |
| Cash payments for distribution of dividends or profits and for interest expenses | 1,619,589,051.11 | 1,878,276,172.00 |
| Other cash payments related to financing activities | 1,126,850.43 | 1,266,518.81 |
| Subtotal of cash outflows from financing activities | 3,223,715,901.54 | 2,569,302,090.81 |
| Net cash flows from financing activities | -1,373,715,901.54 | -529,302,090.81 |
| IV. Effect of foreign exchange rate changes on cash and cash equivalents | 969,709.78 | 806,094.12 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | 2023 Semi-Annual | 2022 Semi-Annual |
| V. Net increase in cash and cash equivalents | -2,273,986,230.14 | 610,078,212.51 |
| Add: Opening balance of cash and cash equivalents | 4,054,348,356.27 | 4,191,863,033.83 |
| VI. Closing balance of cash and cash equivalents | 1,780,362,126.13 | 4,801,941,246.34 |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
7. Consolidated statement of changes in equity
Current period cumulative
Unit: RMB Yuan
| Items | 2023 Semi-Annual | ||||||||||||||
| Equity attributable to parent company | Non-controlling interest | Total equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Others | Subtotal | |||||
| Preferred shares | Perpetual bonds | Others | |||||||||||||
| I. Balance at the end of prior year | 3,090,907,356.00 | 3,613,097,510.81 | 500,059,711.25 | 76,577,564.17 | 26,196,894.55 | 1,444,413,940.89 | 15,823,725,913.44 | 23,574,859,468.61 | 87,289,766.85 | 23,662,149,235.46 | |||||
| Add: Cumulative changes of accounting policies | 19,857.63 | 19,857.63 | 19,857.63 | ||||||||||||
Error correction of prior period
| Error correction of prior period | |||||||||||||||
| Business combination under common control |
Others
| Others | |||||||||||||||
| II. Balance at the beginning of current year | 3,090,907,356.00 | 3,613,097,510.81 | 500,059,711.25 | 76,577,564.17 | 26,196,894.55 | 1,444,413,940.89 | 15,823,745,771.07 | 23,574,879,326.24 | 87,289,766.85 | 23,662,169,093.09 | |||||
| III. Current period increase (or less: decrease) | 29,652,134.01 | 17,629,528.47 | -53,481,603.04 | -6,199,940.56 | 20,217,198.14 | 14,017,257.58 | |||||||||
| (I) Total comprehensive income | 29,652,134.01 | 1,483,229,236.96 | 1,512,881,370.97 | 20,217,198.14 | 1,533,098,569.11 | ||||||||||
| (II) Capital contributed or withdrawn by owners | |||||||||||||||
| 1. Ordinary shares contributed by owners | |||||||||||||||
| 2. Capital contributed by holders of other equity instruments | |||||||||||||||
| 3. Amount of share-based payment included in equity | |||||||||||||||
| 4. Others | |||||||||||||||
| (III) Profit distribution | -1,536,710,840.00 | -1,536,710,840.00 | -1,536,710,840.00 | ||||||||||||
| 1. Appropriation of surplus reserve | |||||||||||||||
| 2. Appropriation of general risk reserve | |||||||||||||||
| 3. Appropriation of profit to owners | -1,536,710,840.00 | -1,536,710,840.00 | -1,536,710,840.00 | ||||||||||||
| 4. Others | |||||||||||||||
| (IV) Internal carry-over within equity | |||||||||||||||
| 1. Transfer of capital reserve to capital | |||||||||||||||
| 2. Transfer of surplus reserve to capital | |||||||||||||||
| 3. Surplus reserve to cover losses | |||||||||||||||
| 4. Changes in defined benefit plan carried over to retained earnings |
5. Other comprehensive income carried over to
retained earnings
| 5. Other comprehensive income carried over to retained earnings |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | 2023 Semi-Annual | ||||||||||||||
| Equity attributable to parent company | Non-controlling interest | Total equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Others | Subtotal | |||||
| Preferred shares | Perpetual bonds | Others | |||||||||||||
| 6. Others | |||||||||||||||
| (V) Special reserve | 17,629,528.47 | 17,629,528.47 | 17,629,528.47 | ||||||||||||
| 1. Appropriation of current period | 26,153,211.92 | 26,153,211.92 | 26,153,211.92 | ||||||||||||
| 2. Application of current period | -8,523,683.45 | -8,523,683.45 | -8,523,683.45 | ||||||||||||
| (VI) Others | |||||||||||||||
| IV. Balance at the end of current period | 3,090,907,356.00 | 3,613,097,510.81 | 500,059,711.25 | 106,229,698.18 | 43,826,423.02 | 1,444,413,940.89 | 15,770,264,168.03 | 23,568,679,385.68 | 107,506,964.99 | 23,676,186,350.67 | |||||
Preceding period comparative
Unit: RMB Yuan
| Items | Year 2022 | ||||||||||||||
| Non-controlling interest | Total equity | ||||||||||||||
| Equity attributable to parent company | |||||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Others | Subtotal | |||||
| Preferred shares | Perpetual bonds | Others | |||||||||||||
| I. Balance at the end of prior year | 2,578,394,760.00 | 4,121,063,080.96 | 320,360,784.48 | -1,614,172.31 | 12,692,218.51 | 1,289,197,380.00 | 14,152,465,528.17 | 21,831,838,010.85 | 63,730,851.41 | 21,895,568,862.26 | |||||
| Add: Cumulative changes of accounting policies | 4,795.77 | 4,795.77 | 4,795.77 | ||||||||||||
| Error correction of prior period | |||||||||||||||
| Business combination under common control | |||||||||||||||
| Others | |||||||||||||||
| II. Balance at the beginning of current year | 2,578,394,760.00 | 4,121,063,080.96 | 320,360,784.48 | -1,614,172.31 | 12,692,218.51 | 1,289,197,380.00 | 14,152,470,323.94 | 21,831,842,806.62 | 63,730,851.41 | 21,895,573,658.03 | |||||
| III. Current period increase (or less: decrease) | 512,512,596.00 | -507,468,870.48 | 179,698,926.77 | 32,251,478.10 | 4,449,092.88 | 420,083,330.45 | 282,128,700.18 | 10,105,999.45 | 292,234,699.63 | ||||||
| (I) Total comprehensive income | 32,251,478.10 | 2,213,877,419.25 | 2,246,128,897.35 | 10,105,999.45 | 2,256,234,896.80 | ||||||||||
| (II) Capital contributed or withdrawn by owners | 179,698,926.77 | -179,698,926.77 | -179,698,926.77 | ||||||||||||
| 1. Ordinary shares contributed by owners | |||||||||||||||
2. Capital contributed by holders of other equity
instruments
| 2. Capital contributed by holders of other equity instruments | |||||||||||||||
| 3. Amount of share-based payment included in equity | |||||||||||||||
| 4. Others | 179,698,926.77 | -179,698,926.77 | -179,698,926.77 |
(III) Profit distribution
| (III) Profit distribution | -1,793,794,088.80 | -1,793,794,088.80 | -1,793,794,088.80 | ||||||||||||
| 1. Appropriation of surplus reserve | |||||||||||||||
| 2. Appropriation of general risk reserve |
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | Year 2022 | ||||||||||||||
| Equity attributable to parent company | Non-controlling interest | Total equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Others | Subtotal | |||||
| Preferred shares | Perpetual bonds | Others | |||||||||||||
| 3. Appropriation of profit to owners | -1,793,794,088.80 | -1,793,794,088.80 | -1,793,794,088.80 | ||||||||||||
| 4. Others | |||||||||||||||
| (IV) Internal carry-over within equity | 512,512,596.00 | -512,512,596.00 | |||||||||||||
| 1. Transfer of capital reserve to capital | 512,512,596.00 | -512,512,596.00 | |||||||||||||
| 2. Transfer of surplus reserve to capital | |||||||||||||||
| 3. Surplus reserve to cover losses | |||||||||||||||
| 4. Changes in defined benefit plan carried over to retained earnings | |||||||||||||||
| 5. Other comprehensive income carried over to retained earnings | |||||||||||||||
| 6. Others | |||||||||||||||
| (V) Special reserve | 4,449,092.88 | 4,449,092.88 | 4,449,092.88 | ||||||||||||
| 1. Appropriation of current period | 13,360,150.22 | 13,360,150.22 | 13,360,150.22 | ||||||||||||
| 2. Application of current period | -8,911,057.34 | -8,911,057.34 | -8,911,057.34 | ||||||||||||
| (VI) Others | 5,043,725.52 | 5,043,725.52 | 5,043,725.52 | ||||||||||||
| IV. Balance at the end of current period | 3,090,907,356.00 | 3,613,594,210.48 | 500,059,711.25 | 30,637,305.79 | 17,141,311.39 | 1,289,197,380.00 | 14,572,553,654.39 | 22,113,971,506.80 | 73,836,850.86 | 22,187,808,357.66 | |||||
8. Parent company statements of changes in equity
Current period cumulative
Unit: RMB Yuan
| Items | Year 2023 | |||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profit | Others | Total equity | |||
| Preferred shares | Perpetual bonds | Others | ||||||||||
| I. Balance at the end of prior year | 3,090,907,356.00 | 3,353,427,829.42 | 500,059,711.25 | 506,954.43 | 1,444,413,940.89 | 5,489,904,970.92 | 12,879,101,340.41 | |||||
| Add: Cumulative changes of accounting policies | 19,857.63 | 19,857.63 | ||||||||||
| Error correction of prior period | ||||||||||||
| Others | ||||||||||||
| II. Balance at the beginning of current year | 3,090,907,356.00 | 3,353,427,829.42 | 500,059,711.25 | 506,954.43 | 1,444,413,940.89 | 5,489,924,828.55 | 12,879,121,198.04 | |||||
| III. Current period increase (or less: decrease) | -154,698,676.36 | -154,698,676.36 | ||||||||||
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | Year 2023 | |||||||||||
| Share capital | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profit | Others | Total equity | ||||
| Other equity instruments | ||||||||||||
| Preferred shares | Perpetual bonds | Others | ||||||||||
| (I) Total comprehensive income | 1,382,012,163.64 | 1,382,012,163.64 | ||||||||||
| (II) Capital contributed or withdrawn by owners | ||||||||||||
| 1. Ordinary shares contributed by owners | ||||||||||||
| 2. Capital contributed by holders of other equity instruments | ||||||||||||
| 3. Amount of share-based payment included in equity | ||||||||||||
| 4. Others | ||||||||||||
| (III) Profit distribution | -1,536,710,840.00 | -1,536,710,840.00 | ||||||||||
| 1. Appropriation of surplus reserve | ||||||||||||
| 2. Appropriation of profit to owners | -1,536,710,840.00 | -1,536,710,840.00 | ||||||||||
| 3. Others | ||||||||||||
| (IV) Internal carry-over within equity | ||||||||||||
| 1. Transfer of capital reserve to capital | ||||||||||||
| 2. Transfer of surplus reserve to capital | ||||||||||||
| 3. Surplus reserve to cover losses | ||||||||||||
| 4. Changes in defined benefit plan carried over to retained earnings | ||||||||||||
| 5. Other comprehensive income carried over to retained earnings | ||||||||||||
| 6. Others | ||||||||||||
| (V) Special reserve | ||||||||||||
| 1. Appropriation of current period | ||||||||||||
| 2. Application of current period | ||||||||||||
| (VI) Others | ||||||||||||
| IV. Balance at the end of current period | 3,090,907,356.00 | 3,353,427,829.42 | 500,059,711.25 | 506,954.43 | 1,444,413,940.89 | 5,335,226,152.19 | 12,724,422,521.68 | |||||
Preceding period comparative
Unit: RMB Yuan
2023 Semi-Annual Report of Zhejiang NHU Co., Ltd.
| Items | Year 2022 | |||||||||||
| Share capital | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profit | Others | Total equity | ||||
| Other equity instruments | ||||||||||||
| Preferred shares | Perpetual bonds | Others | ||||||||||
| I. Balance at the end of prior year | 2,578,394,760.00 | 3,861,393,399.57 | 320,360,784.48 | 506,954.43 | 1,289,197,380.00 | 5,886,750,011.71 | 13,295,881,721.23 | |||||
| Add: Cumulative changes of accounting policies | 4,795.77 | 4,795.77 | ||||||||||
| Error correction of prior period | ||||||||||||
| Others | ||||||||||||
| II. Balance at the beginning of current year | 2,578,394,760.00 | 3,861,393,399.57 | 320,360,784.48 | 506,954.43 | 1,289,197,380.00 | 5,886,754,807.48 | 13,295,886,517.00 | |||||
| III. Current period increase (or less: decrease) | 512,512,596.00 | -507,468,870.48 | 179,698,926.77 | -1,535,766,219.19 | -1,710,421,420.44 | |||||||
| (I) Total comprehensive income | 258,027,869.61 | 258,027,869.61 | ||||||||||
| (II) Capital contributed or withdrawn by owners | 179,698,926.77 | -179,698,926.77 | ||||||||||
| 1. Ordinary shares contributed by owners | ||||||||||||
| 2. Capital contributed by holders of other equity instruments | ||||||||||||
| 3. Amount of share-based payment included in equity | ||||||||||||
| 4. Others | 179,698,926.77 | -179,698,926.77 | ||||||||||
| (III) Profit distribution | -1,793,794,088.80 | -1,793,794,088.80 | ||||||||||
| 1. Appropriation of surplus reserve | ||||||||||||
| 2. Appropriation of profit to owners | -1,793,794,088.80 | -1,793,794,088.80 | ||||||||||
| 3. Others | ||||||||||||
| (IV) Internal carry-over within equity | 512,512,596.00 | -512,512,596.00 | ||||||||||
| 1. Transfer of capital reserve to capital | 512,512,596.00 | -512,512,596.00 | ||||||||||
| 2. Transfer of surplus reserve to capital | ||||||||||||
| 3. Surplus reserve to cover losses | ||||||||||||
| 4. Changes in defined benefit plan carried over to retained earnings | ||||||||||||
| 5. Other comprehensive income carried over to retained earnings | ||||||||||||
| 6. Others | ||||||||||||
| (V) Special reserve | ||||||||||||
| 1. Appropriation of current period | ||||||||||||
| 2. Application of current period | ||||||||||||
| (VI) Others | 5,043,725.52 | 5,043,725.52 | ||||||||||
| IV. Balance at the end of current period | 3,090,907,356.00 | 3,353,924,529.09 | 500,059,711.25 | 506,954.43 | 1,289,197,380.00 | 4,350,988,588.29 | 11,585,465,096.56 | |||||
III. Company profile
Zhejiang NHU Co., Ltd. (the “Company”) was jointly established by 新昌县合成化工厂 (Xinchang County Synthetic ChemicalPlant?, renamed as NHU Holding Group Co., Ltd. on November 17, 2009) and 9 natural persons including Zhang Pingyi, Yuan Yizhong,Shi Cheng, Hu Baishan, Shi Guanqun, Wang Xuewen, 石三夫 (Shi Sanfu), Cui Xinrong, and Wang Xulin under the document ofapproval numbered Zhe Zheng Wei [1999] 9 issued by the former Securities Commission of the People’s Government of ZhejiangProvince. Headquartered in Shaoxing City, Zhejiang Province, the Company was registered at Zhejiang Administration for Industryand Commerce on April 5, 1999. Currently, the Company holds a business license with unified social credit code of91330000712560575G, with registered capital of 3,090,907,356.00 yuan, total share of 3,090,907,356 shares (each with par value ofone yuan), of which, 36,374,202 shares are restricted outstanding shares, and 3,054,533,154 shares are unrestricted outstanding shares.The Company’s shares were listed on Shenzhen Stock Exchange on June 25, 2004.The Company belongs to pharmaceutical manufacturing industry and is mainly engaged in manufacturing and sales of nutrition, flavorand fragrance, and new polymer materials. The Company’s main products are nutrition, flavor and fragrance, new polymer materialsand API.The financial statements were approved and authorized for issue by the Seventeenth Meeting of the Eighth session of the Board ofDirectorsdated August 28, 2023.The Company has brought 28 subsidiaries including Xinchang NHU Vitamins Co., Ltd., Zhejiang NHU Import & Export Co., Ltd., 浙江维尔新动物营养保健品有限公司 (Zhejiang Vityesun Animal Nutrition and Health Co., Ltd.*), etc. into the consolidation scope.Please refer to item VIII and IX of this section for details.IV. Preparation basis of the financial statements
1. Preparation basis
The financial statements have been prepared on the basis of going concern.
2. The ability to continue as a going concern
The Company has no events or conditions that may cast significant doubts upon the Company’s ability to continue as a going concernwithin the 12 months after the balance sheet date.V. Significant accounting policies and estimates
Note to specific accounting policies and estimates: The Company has set up accounting policies and estimates on transactions or eventssuch as impairment of financial instruments, depreciation of fixed assets, depreciation of right-of-use assets, amortization of intangibleassets, and revenue recognition, etc. based on the Company’s actual production and operation features.
1. Statement of compliance
The financial statements have been prepared in accordance with the requirements of China Accounting Standards for BusinessEnterprises (CASBEs), and present truly and completely the financial position, results of operations and cash flows of the Company.
2. Accounting period
The accounting year of the Company runs from January 1 to December 31 under the Gregorian calendar.
?The English names are for identification purpose only.
3. Operating cycle
Except for the real estate industry, the Company has a relatively short operating cycle for its business, an asset or a liability isclassified as current if it is expected to be realized or due within 12 months. The operating cycle for real estate industry starts fromthe development of property and ends at sales, which normally extends over 12 months and is subject to specific projects, therefore,an asset or a liability is classified as current if it is expected to be realized or due within such operating cycle.
4. Functional currency
The functional currency of the Company and its domestic subsidiaries is Renminbi (RMB) Yuan, while the functional currency ofsubsidiaries engaged in overseas operations including NHU (Hong Kong) Trading Co., Ltd., NHU Europe GmbH and NHUSingapore PTE. LTD. , NHU/CHR. OLESEN LATIN AMERICA A/S is the currency of the primary economic environment in whichthey operate.
5. Accounting treatments of business combination under and not under common control
1. Accounting treatment of business combination under common control
Assets and liabilities arising from business combination are measured at carrying amount of the combined party included in theconsolidated financial statements of the ultimate controlling party at the combination date. Difference between carrying amount ofthe equity of the combined party included in the consolidated financial statements of the ultimate controlling party and that of thecombination consideration or total par value of shares issued is adjusted to capital reserve, if the balance of capital reserve isinsufficient to offset, any excess is adjusted to retained earnings.
2. Accounting treatment of business combination not under common control
When combination cost is in excess of the fair value of identifiable net assets obtained from the acquiree at the acquisition date, theexcess is recognized as goodwill; otherwise, the fair value of identifiable assets, liabilities and contingent liabilities, and themeasurement of the combination cost are reviewed, then the difference is recognized in profit or loss.
6. Compilation method of consolidated financial statements
The parent company brings all its controlled subsidiaries into the consolidation scope. The consolidated financial statements arecompiled by the parent company according to “CASBE 33 – Consolidated Financial Statements”, based on relevant information andthe financial statements of the parent company and its subsidiaries.
7. Recognition criteria of cash and cash equivalents
Cash as presented in cash flow statement refers to cash on hand and deposit on demand for payment. Cash equivalents refer to short-term, highly liquid investments that can be readily converted to cash and that are subject to an insignificant risk of changes in value.
8. Foreign currency translation
1. Translation of transactions denominated in foreign currency
Transactions denominated in foreign currency are translated into RMB yuan at the approximate exchange rate similar to the spotexchange rate at the transaction date at initial recognition. At the balance sheet date, monetary items denominated in foreign currencyare translated at the spot exchange rate at the balance sheet date with difference, except for those arising from the principal and interestof exclusive borrowings eligible for capitalization, included in profit or loss; non-cash items carried at historical costs are translated atthe approximate exchange rate similar to the spot exchange rate at the transaction date, with the RMB amounts unchanged; non-cashitems carried at fair value in foreign currency are translated at the spot exchange rate at the date when the fair value was determined,with difference included in profit or loss or other comprehensive income.
2. Translation of financial statements measured in foreign currency
The assets and liabilities in the balance sheet are translated into RMB at the spot rate at the balance sheet date; the equity items, otherthan undistributed profit, are translated at the spot rate at the transaction date; the revenues and expenses in the income statement aretranslated into RMB at the approximate exchange rate similar to the spot exchange rate at the transaction date. The difference arisingfrom the aforementioned foreign currency translation is included in other comprehensive income.
9. Financial instruments
1. Classification of financial assets and financial liabilities
Financial assets are classified into the following three categories when initially recognized: (1) financial assets at amortized cost; (2)financial assets at fair value through other comprehensive income; (3) financial assets at fair value through profit or loss.Financial liabilities are classified into the following four categories when initially recognized: (1) financial liabilities at fair valuethrough profit or loss; (2) financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or whenthe continuing involvement approach applies; (3) financial guarantee contracts not fall within the above categories (1) and (2), andcommitments to provide a loan at a below-market interest rate, which do not fall within the above category (1); (4) financial liabilitiesat amortized cost.
2. Recognition criteria, measurement method and derecognition condition of financial assets and financial liabilities
(1) Recognition criteria and measurement method of financial assets and financial liabilities
When the Company becomes a party to a financial instrument, it is recognized as a financial asset or financial liability. The financialassets and financial liabilities initially recognized by the Company are measured at fair value; for the financial assets and liabilities atfair value through profit or loss, the transaction expenses thereof are directly included in profit or loss; for other categories of financialassets and financial liabilities, the transaction expenses thereof are included into the initially recognized amount. However, at initialrecognition, for accounts receivable that do not contain a significant financing component or in circumstances where the Companydoes not consider the financing components in contracts within one year, the Company measures the transaction price in accordancewith “CASBE 14 – Revenues”.
(2) Subsequent measurement of financial assets
1) Financial assets measured at amortized cost
The Company measures its financial assets at the amortized costs using effective interest method. Gains or losses on financial assetsthat are measured at amortized cost and are not part of hedging relationships shall be included into profit or loss when the financialassets are derecognized, reclassified, amortized using effective interest method or recognized with impairment loss.
2) Debt instrument investments at fair value through other comprehensive income
The Company measures its debt instrument investments at fair value. Interests, impairment gains or losses, and gains and losses onforeign exchange that calculated using effective interest method shall be included into profit or loss, while other gains or losses areincluded into other comprehensive income. Accumulated gains or losses that initially recognized as other comprehensive income shouldbe transferred out into profit or loss when the financial assets are derecognized.
3) Equity instrument investments at fair value through other comprehensive income
The Company measures its equity instrument investments at fair value. Dividends obtained (other than those as part of investment costrecovery) shall be included into profit or loss, while other gains or losses are included into other comprehensive income. Accumulatedgains or losses that initially recognized as other comprehensive income should be transferred out into retained earnings when thefinancial assets are derecognized.
4) Financial assets at fair value through profit or loss
The Company measures its financial assets at fair value. Gains or losses arising from changes in fair value (including interests anddividends) shall be included into profit or loss, except for financial assets that are part of hedging relationships.
(3) Subsequent measurement of financial liabilities
1) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include held-for-trading financial liabilities (including derivatives that areliabilities) and financial liabilities designated as at fair value through profit or loss. The Company measures such kind of liabilities atfair value. The amount of changes in the fair value of the financial liabilities that are attributable to changes in the Company’s owncredit risk shall be included into other comprehensive income, unless such treatment would create or enlarge accounting mismatchesin profit or loss. Other gains or losses on those financial liabilities (including interests, changes in fair value that are attributable toreasons other than changes in the Company’s own credit risk) shall be included into profit or loss, except for financial liabilities thatare part of hedging relationships. Accumulated gains or losses that originally recognized as other comprehensive income should betransferred out into retained earnings when the financial liabilities are derecognized.
2) Financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuinginvolvement approach appliesThe Company measures its financial liabilities in accordance with “CASBE 23 – Transfer of Financial Assets”.
3) Financial guarantee contracts not fall within the above categories 1) and 2), and commitments to provide a loan at a below-marketinterest rate, which do not fall within the above category 1)The Company measures its financial liabilities at the higher of: a. the amount of loss allowances in accordance with impairmentrequirements of financial instruments; b. the amount initially recognized less the amount of accumulated amortization recognized inaccordance with “CASBE 14 – Revenues”.
4) Financial liabilities at amortized cost
The Company measures its financial liabilities at amortized cost using effective interest method. Gains or losses on financial liabilitiesthat are measured at amortized cost and are not part of hedging relationships shall be included into profit or loss when the financialliabilities are derecognized and amortized using effective interest method.
(4) Derecognition of financial assets and financial liabilities
1) Financial assets are derecognized when:
a. the contractual rights to the cash flows from the financial assets expire; orb. the financial assets have been transferred and the transfer qualifies for derecognition in accordance with “CASBE 23 – Transfer ofFinancial Assets”.
2) Only when the underlying present obligations of a financial liability are relieved totally or partly may the financial liability bederecognized accordingly.
3. Recognition criteria and measurement method of financial assets transfer
Where the Company has transferred substantially all of the risks and rewards related to the ownership of the financial asset, itderecognizes the financial asset, and any right or liability arising from such transfer is recognized independently as an asset or a liability.If it retained substantially all of the risks and rewards related to the ownership of the financial asset, it continues recognizing the
financial asset. Where the Company does not transfer or retain substantially all of the risks and rewards related to the ownership of afinancial asset, it is dealt with according to the circumstances as follows respectively: (1) if the Company does not retain its controlover the financial asset, it derecognizes the financial asset, and any right or liability arising from such transfer is recognizedindependently as an asset or a liability; (2) if the Company retains its control over the financial asset, according to the extent of itscontinuing involvement in the transferred financial asset, it recognizes the related financial asset and recognizes the relevant liabilityaccordingly.If the transfer of an entire financial asset satisfies the conditions for derecognition, the difference between the amounts of the followingtwo items is included in profit or loss: (1) the carrying amount of the transferred financial asset as of the date of derecognition; (2) thesum of consideration received from the transfer of the financial asset, and the accumulative amount of the changes of the fair valueoriginally included in other comprehensive income proportionate to the transferred financial asset (financial assets transferred refer todebt instrument investments at fair value through other comprehensive income). If the transfer of financial asset partially satisfies theconditions to derecognition, the entire carrying amount of the transferred financial asset is, between the portion which is derecognizedand the portion which is not, apportioned according to their respective relative fair value, and the difference between the amounts ofthe following two items is included into profit or loss: (1) the carrying amount of the portion which is derecognized; (2) the sum ofconsideration of the portion which is derecognized, and the portion of the accumulative amount of the changes in the fair valueoriginally included in other comprehensive income which is corresponding to the portion which is derecognized (financial assetstransferred refer to debt instrument investments at fair value through other comprehensive income).
4. Fair value determination method of financial assets and liabilities
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data and information areavailable to measure fair value. The inputs to valuation techniques used to measure fair value are arranged in the following hierarchyand used accordingly:
(1) Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company can access at themeasurement date.
(2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directlyor indirectly. Level 2 inputs include: quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similarassets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability, for example,interest rates and yield curves observable at commonly quoted intervals; market-corroborated inputs;
(3) Level 3 inputs are unobservable inputs for the asset or liability. Level 3 inputs include interest rate that is not observable and cannotbe corroborated by observable market data at commonly quoted intervals, historical volatility, future cash flows to be paid to fulfill thedisposal obligation assumed in business combination, financial forecast developed using the Company’s own data, etc.
5. Impairment of financial instruments
(1) Measurement and accounting treatment
The Company, on the basis of expected credit loss, recognizes loss allowances of financial assets at amortized cost, debt instrumentinvestments at fair value through other comprehensive income, contract assets, leases receivable, loan commitments other than financialliabilities at fair value through profit or loss, financial guarantee contracts not belong to financial liabilities at fair value through profitor loss or financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuinginvolvement approach applies.Expected credit losses refer to the weighted average of credit losses with the respective risks of a default occurring as the weights.Credit loss refers to the difference between all contractual cash flows that are due to the Company in accordance with the contract andall the cash flows that the Company expects to receive (i.e. all cash shortfalls), discounted at the original effective interest rate. Among
which, purchased or originated credit-impaired financial assets are discounted at the credit-adjusted effective interest rate.At the balance sheet date, the Company shall only recognize the cumulative changes in the lifetime expected credit losses since initialrecognition as a loss allowance for purchased or originated credit-impaired financial assets.For leases receivable, and accounts receivable and contract assets resulting from transactions regulated in “CASBE 14 – Revenues”,the Company chooses simplified approach to measure the loss allowance at an amount equal to lifetime expected credit losses.For financial assets other than the above, on each balance sheet date, the Company shall assess whether the credit risk on the financialinstrument has increased significantly since initial recognition. The Company shall measure the loss allowance for the financialinstrument at an amount equal to the lifetime expected credit losses if the credit risk on that financial instrument has increasedsignificantly since initial recognition; otherwise, the Company shall measure the loss allowance for that financial instrument at anamount equal to 12-month expected credit loss.Considering reasonable and supportable forward-looking information, the Company compares the risk of a default occurring on thefinancial instrument as at the balance sheet date with the risk of a default occurring on the financial instrument as at the date of initialrecognition, so as to assess whether the credit risk on the financial instrument has increased significantly since initial recognition.The Company may assume that the credit risk on a financial instrument has not increased significantly since initial recognition if thefinancial instrument is determined to have relatively low credit risk at the balance sheet date.The Company shall estimate expected credit risk and measure expected credit losses on an individual or a collective basis. When theCompany adopts the collective basis, financial instruments are grouped with similar credit risk features.The Company shall remeasure expected credit loss on each balance sheet date, and increased or reversed amounts of loss allowancearising therefrom shall be included into profit or loss as impairment losses or gains. For a financial asset measured at amortized cost,the loss allowance reduces the carrying amount of such financial asset presented in the balance sheet; for a debt investment measuredat fair value through other comprehensive income, the loss allowance shall be recognized in other comprehensive income and shall notreduce the carrying amount of such financial asset.
(2) Financial instruments with expected credit risk assessed and expected credit losses measured on a collective basis
| Items | Basis for determination of portfolio | Method for measuring expected credit loss |
| Other receivables – Portfolio grouped with export tax refund receivable | Nature of receivables | Based on historical credit loss experience, the current situation and the forecast of future economic conditions, the Company calculates expected credit loss through exposure at default and 12-month or lifetime expected credit loss rate. |
| Other receivables – Portfolio grouped with VAT refund receivable | ||
| Other receivables – Portfolio grouped with land bond receivable | ||
| Other receivables – Portfolio grouped with deposits receivable from customs and tax authorities | ||
| Other receivables – Portfolio grouped with ages | Ages |
(3) Accounts receivable and contract assets with expected credit losses measured on a collective basis
1) Specific portfolios and method for measuring expected credit loss
| Items | Basis for determination of portfolio | Method for measuring expected credit loss |
| Bank acceptance receivable | Type of notes | Based on historical credit loss experience, the current situation and the forecast of future economic conditions, the Company calculates expected credit loss through exposure at default and lifetime expected credit loss rate. |
| Trade acceptance receivable | ||
| Accounts receivable – Portfolio grouped with ages | Ages | Based on historical credit loss experience, the current situation and the forecast of future economic conditions, the Company prepares the comparison table of ages and lifetime expected credit loss rate of accounts receivable, so as to calculate expected credit loss. |
2) Accounts receivable – comparison table of ages and lifetime expected credit loss rate of portfolio grouped with ages
| Ages | Expected credit loss rate (%) |
| Within 1 year (inclusive, the same hereinafter) | 5 |
| 1-2 years | 20 |
| 2-3 years | 80 |
| Over 3 years | 100 |
6. Offsetting financial assets and financial liabilities
Financial assets and financial liabilities are presented separately in the balance sheet and are not offset. However, the Company offsetsa financial asset and a financial liability and presents the net amount in the balance sheet when, and only when, the Company: (1)currently has a legally enforceable right to set off the recognized amounts; and (2) intends either to settle on a net basis, or to realizethe asset and settle the liability simultaneously.For a transfer of a financial asset that does not qualify for derecognition, the Company does not offset the transferred asset and theassociated liability.
10. Inventories
1. Classification of inventories
Inventories include finished goods or goods held for sale in the ordinary course of business, work in process in the process of production,materials or supplies, etc. to be consumed in the production process or in the rendering of services.
2. Accounting method for dispatching inventories:
Inventories dispatched from storage are accounted for with weighted average method at the end of each month.
3. Basis for determining net realizable value
At the balance sheet date, inventories are measured at the lower of cost and net realizable value; provisions for inventory write-downare made on the excess of its cost over the net realizable value. The net realizable value of inventories held for sale is determined based
on the amount of the estimated selling price less the estimated selling expenses and relevant taxes and surcharges in the ordinary courseof business; the net realizable value of materials to be processed is determined based on the amount of the estimated selling price lessthe estimated costs of completion, selling expenses and relevant taxes and surcharges in the ordinary course of business; at the balancesheet date, when only part of the same item of inventories have agreed price, their net realizable value are determined separately andare compared with their costs to set the provision for inventory write-down to be made or reversed.
4. Inventory system
Perpetual inventory method is adopted.
5. Amortization method of low-value consumables and packages
(1) Low-value consumables
Low-value consumables are amortized with one-off method.
(2) Packages
Packages are amortized with one-off method.
11. Long-term equity investments
1. Judgment of joint control and significant influence
Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevantactivities require the unanimous consent of the parties sharing control. Significant influence is the power to participate in the financialand operating policy decisions of the investee but is not control or joint control of these policies.
2. Determination of investment cost
(1) For business combination under common control, if the consideration of the combining party is that it makes payment in cash,transfers non-cash assets, assumes its liabilities or issues equity securities, on the date of combination, it regards the share of thecarrying amount of the equity of the combined party included in the consolidated financial statements of the ultimate controlling partyas the initial cost of the investment. The difference between the initial cost of the long-term equity investments and the carrying amountof the combination consideration paid or the par value of shares issued offsets capital reserve; if the balance of capital reserve isinsufficient to offset, any excess is adjusted to retained earnings.When long-term equity investments are obtained through business combination under common control achieved in stages, the Companydetermines whether it is a “bundled transaction”. If it is a “bundled transaction”, stages as a whole are considered as one transaction inaccounting treatment. If it is not a “bundled transaction”, on the date of combination, investment cost is initially recognized at the shareof the carrying amount of net assets of the combined party included the consolidated financial statements of the ultimate controllingparty. The difference between the initial investment cost of long-term equity investments at the acquisition date and the carrying amountof the previously held long-term equity investments plus the carrying amount of the consideration paid for the newly acquired equityis adjusted to capital reserve; if the balance of capital reserve is insufficient to offset, any excess is adjusted to retained earnings.
(2) For business combination not under common control, investment cost is initially recognized at the acquisition-date fair value ofconsiderations paid.When long-term equity investments are obtained through business combination not under common control achieved in stages, theCompany determined whether they are stand-alone financial statements or consolidated financial statements in accounting treatment:
1) In the case of stand-alone financial statements, investment cost is initially recognized at the carrying amount of the previously heldlong-term equity investments plus the carrying amount of the consideration paid for the newly acquired equity.
2) In the case of consolidated financial statements, the Company determines whether it is a “bundled transaction”. If it is a “bundledtransaction”, stages as a whole are considered as one transaction in accounting treatment. If it is not a “bundled transaction”, thecarrying amount of the acquirer’s previously held equity interest in the acquiree is remeasured at the acquisition-date fair value, andthe difference between the fair value and the carrying amount is recognized in investment income; when the acquirer’s previously heldequity interest in the acquiree involves other comprehensive income under equity method, the related other comprehensive income is
reclassified as income for the acquisition period, excluding other comprehensive income arising from changes in net liabilities or assetsfrom remeasurement of defined benefit plan of the acquiree.
(3) Long-term equity investments obtained through ways other than business combination: the initial cost of a long-term equityinvestment obtained by making payment in cash is the purchase cost which is actually paid; that obtained on the basis of issuing equitysecurities is the fair value of the equity securities issued; that obtained through debt restructuring is determined according to “CASBE12 – Debt Restructuring”; and that obtained through non-cash assets exchange is determined according to “CASBE 7 – Non-cashAssets Exchange”.
3. Subsequent measurement and recognition method of profit or loss
For long-term equity investments with control relationship, it is accounted for with cost method; for long-term equity investments withjoint control or significant influence relationship, it is accounted for with equity method.
4. Disposal of a subsidiary in stages resulting in the Company’s loss of control
(1) Stand-alone financial statements
The difference between the carrying amount of the disposed equity and the consideration obtained thereof is recognized in profit orloss. If the disposal does not result in the Company’s loss of significant influence or joint control, the remained equity is accounted forwith equity method; however, if the disposal results in the Company’s loss of control, joint control, or significant influence, theremained equity is accounted for according to “CASBE 22 – Financial Instruments: Recognition and Measurement”.
(2) Consolidated financial statements
1) Disposal of a subsidiary in stages not qualified as “bundled transaction” resulting in the Company’s loss of controlBefore the Company’s loss of control, the difference between the disposal consideration and the proportionate share of net assets in thedisposed subsidiary from acquisition date or combination date to the disposal date is adjusted to capital reserve (capital premium), ifthe balance of capital reserve is insufficient to offset, any excess is adjusted to retained earnings.When the Company loses control, the remained equity is remeasured at the loss-of-control-date fair value. The aggregated value ofdisposal consideration and the fair value of the remained equity, less the share of net assets in the disposed subsidiary held before thedisposal from the acquisition date or combination date to the disposal date is recognized in investment income in the period when theCompany loses control over such subsidiary, and meanwhile goodwill is offset correspondingly. Other comprehensive income relatedto equity investments in former subsidiary is reclassified as investment income upon the Company’s loss of control.
2) Disposal of a subsidiary in stages qualified as “bundled transaction” resulting in the Company’s loss of controlIn case of “bundled transaction”, stages as a whole are considered as one transaction resulting in loss of control in accounting treatment.However, before the Company loses control, the difference between the disposal consideration at each stage and the proportionateshare of net assets in the disposed subsidiary is recognized as other comprehensive income at the consolidated financial statements andreclassified as profit or loss in the period when the Company loses control over such subsidiary.
12. Fixed assets
(1) Recognition principles
Fixed assets are tangible assets held for use in the production of goods or rendering of services, for rental to others, or for administrativepurposes, and expected to be used during more than one accounting year. Fixed assets are recognized if, and only if, it is probable thatfuture economic benefits associated with the assets will flow to the Company and the cost of the assets can be measured reliably.
(2) Depreciation method
| Categories | Depreciation method | Useful life (years) | Residual value proportion (%) | Annual depreciation rate (%) |
| Buildings and structures | Straight-line method | 7-70 | 5 | 13.57-1.36 |
| General equipment | Straight-line method | 5-10 | 5 | 19.00-9.50 |
| Special equipment | Straight-line method | 5-15 | 5 | 19.00-6.33 |
| Transport facilities | Straight-line method | 5-7 | 5 | 19.00-13.57 |
13. Construction in progress
1. Construction in progress is recognized if, and only if, it is probable that future economic benefits associated with the item will flowto the Company, and the cost of the item can be measured reliably. Construction in progress is measured at the actual cost incurred toreach its designed usable conditions.
2. Construction in progress is transferred into fixed assets at its actual cost when it reaches the designed usable conditions. When theauditing of the construction in progress was not finished while reaching the designed usable conditions, it is transferred to fixed assetsusing estimated value first, and then adjusted accordingly when the actual cost is settled, but the accumulated depreciation is not to beadjusted retrospectively.
14. Borrowing costs
1. Recognition principle of borrowing costs capitalization
Where the borrowing costs incurred to the Company can be directly attributable to the acquisition and construction or production ofassets eligible for capitalization, it is capitalized and included in the costs of relevant assets; other borrowing costs are recognized asexpenses on the basis of the actual amount incurred, and are included in profit or loss.
2. Borrowing costs capitalization period
(1) The borrowing costs are not capitalized unless the following requirements are all met: 1) the asset disbursements have alreadyincurred; 2) the borrowing costs have already incurred; and 3) the acquisition and construction or production activities which arenecessary to prepare the asset for its intended use or sale have already started.
(2) Suspension of capitalization: where the 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 is suspended; the borrowing costsincurred during such period are recognized as expenses, and are included in profit or loss, till the acquisition and construction orproduction of the asset restarts.
(3) Ceasing of capitalization: when the qualified asset under acquisition and construction or production is ready for the intended use orsale, the capitalization of the borrowing costs is ceased.
3. Capitalization rate and capitalized amount of borrowing costs
For borrowings exclusively for the acquisition and construction or production of assets eligible for capitalization, the to-be-capitalizedamount of interests is determined in light of the actual interest expenses incurred (including amortization of premium or discount basedon effective interest method) of the special borrowings in the current period less the interest income on the unused borrowings as adeposit in the bank or as a temporary investment; where a general borrowing is used for the acquisition and construction or productionof assets eligible for capitalization, the Company calculates and determines the to-be-capitalized amount of interests on the generalborrowing by multiplying the weighted average asset disbursement of the part of the accumulative asset disbursements less the generalborrowing by the capitalization rate of the general borrowing used.
15. Intangible assets
(1) Measurement method, useful lives and impairment test
1. Intangible assets include land use right, patent right, non-patented technology, etc. The initial measurement of intangible assets isbased on its cost.
2. For intangible assets with finite useful lives, their amortization amounts are amortized within their useful lives systematically andreasonably, if it is unable to determine the expected realization pattern reliably, intangible assets are amortized by the straight-linemethod with details as follows:
| Items | Amortization period (years) |
| Land use right | 50, 70 |
| Software | 10 |
| Patent right | 10 |
| Non-patented technology | 15 |
(2) Accounting policies on internal R&D expenditures
Expenditures on the research phase of an internal project are recognized as profit or loss when they are incurred. An intangible assetarising from the development phase of an internal project is recognized if the Company can demonstrate all of the followings: (1) thetechnical feasibility of completing the intangible asset so that it will be available for use or sale; (2) its intention to complete the intangibleasset and use or sell it; (3) how the intangible asset will generate probable future economic benefits, among other things, the Companycan demonstrate the existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally,the usefulness of the intangible asset; (4) the availability of adequate technical, financial and other resources to complete the developmentand to use or sell the intangible asset; and (5) its ability to measure reliably the expenditure attributable to the intangible asset during itsdevelopment.
16. Impairment of part of long-term assets
For long-term assets such as long-term equity investments, fixed assets, construction in progress, right-of-use assets, intangible assetswith finite useful lives, etc., if at the balance sheet date there is indication of impairment, the recoverable amount is to be estimated. Forgoodwill recognized in business combination and intangible assets with indefinite useful lives, no matter whether there is indication ofimpairment, impairment test is performed annually. Impairment test on goodwill is performed on related asset group or asset groupportfolio.When the recoverable amount of such long-term assets is lower than their carrying amount, the difference is recognized as provision forassets impairment through profit or loss.
17. Long-term prepayments
Long-term prepayments are expenses that have been recognized but with amortization period over one year (excluding one year). Theyare recorded with actual cost, and evenly amortized within the beneficiary period or stipulated period. If items of long-term prepaymentsfail to be beneficial to the following accounting periods, residual values of such items are included in profit or loss.
18. Employee benefits
(1) Short-term employee benefits
The Company recognizes, in the accounting period in which an employee provides service, short-term employee benefits actuallyincurred as liabilities, with a corresponding charge to profit or loss or the cost of a relevant asset.
(2) Post-employment benefits
The Company classifies post-employment benefit plans as either defined contribution plans or defined benefit plans.
(1) The Company recognizes in the accounting period in which an employee provides service the contribution payable to a definedcontribution plan as a liability, with a corresponding charge to profit or loss or the cost of a relevant asset.
(2) Accounting treatment by the Company for defined benefit plan usually involves the following steps:
1) In accordance with the projected unit credit method, using unbiased and mutually compatible actuarial assumptions to estimaterelated demographic variables and financial variables, measure the obligations under the defined benefit plan, and determine the periodsto which the obligations are attributed. Meanwhile, the Company discounts obligations under the defined benefit plan to determine thepresent value of the defined benefit plan obligations and the current service cost;
2) When a defined benefit plan has assets, the Company recognizes the deficit or surplus by deducting the fair value of defined benefitplan assets from the present value of the defined benefit plan obligation as a net defined benefit plan liability or net defined benefitplan asset. When a defined benefit plan has a surplus, the Company measures the net defined benefit plan asset at the lower of thesurplus in the defined benefit plan and the asset ceiling;
3) At the end of the period, the Company recognizes the following components of employee benefits cost arising from defined benefitplan: a. service cost; b. net interest on the net defined benefit plan liability (asset); and c. changes as a result of remeasurement of thenet defined benefit liability (asset). Item a and item b are recognized in profit or loss or the cost of a relevant asset. Item c is recognizedin other comprehensive income and is not to be reclassified subsequently to profit or loss. However, the Company may transfer thoseamounts recognized in other comprehensive income within equity.
(3) Termination benefits
Termination benefits provided to employees are recognized as an employee benefit liability for termination benefits, with acorresponding charge to profit or loss at the earlier of the following dates: a. when the Company cannot unilaterally withdraw the offerof termination benefits because of an employment termination plan or a curtailment proposal; or b. when the Company recognizes costor expenses related to a restructuring that involves the payment of termination benefits.
(4) Other long-term employee benefits
When other long-term employee benefits provided to the employees satisfied the conditions for classifying as a defined contributionplan, those benefits are accounted for in accordance with the requirements relating to defined contribution plan, while other benefitsare accounted for in accordance with the requirements relating to defined benefit plan. The Company recognizes the cost of employeebenefits arising from other long-term employee benefits as the followings: a. service cost; b. net interest on the net liability or net assetsof other long-term employee benefits; and c. changes as a result of remeasurement of the net liability or net assets of other long-termemployee benefits. As a practical expedient, the net total of the aforesaid amounts is recognized in profit or loss or included in the costof a relevant asset.
19. Revenue
Accounting policies on revenue recognition and measurement
1. Revenue recognition principles
At contract inception, the Company shall assess the contracts and shall identify each performance obligation in the contracts, anddetermine whether the performance obligation should be satisfied over time or at a point in time.The Company satisfies a performance obligation over time if one of the following criteria is met, otherwise, the performance obligationis satisfied at a point in time: (1) the customer simultaneously receives and consumes the economic benefits provided by the Company’sperformance as the Company performs; (2) the customer can control goods as they are created by the Company’s performance; (3)goods created during the Company’s performance have irreplaceable uses and the Company has an enforceable right to the paymentsfor performance completed to date during the whole contract period.For each performance obligation satisfied over time, the Company shall recognize revenue over time by measuring the progress towardscomplete satisfaction of that performance obligation. In the circumstance that the progress cannot be measured reasonably, but thecosts incurred in satisfying the performance obligation are expected to be recovered, the Company shall recognize revenue only to theextent of the costs incurred until it can reasonably measure the progress. For each performance obligation satisfied at a point in time,the Company shall recognize revenue at the time point that the customer obtains control of relevant goods or services. To determinewhether the customer has obtained control of goods, the Company shall consider the following indications: (1) the Company has apresent right to payment for the goods, i.e., the customer is presently obliged to pay for the goods; (2) the Company has transferred thelegal title of the goods to the customer, i.e., the customer has legal title to the goods; (3) the Company has transferred physicalpossession of the goods to the customer, i.e., the customer has physically possessed the goods; (4) the Company has transferredsignificant risks and rewards of ownership of the goods to the customer, i.e., the customer has obtained significant risks and rewards
of ownership of the goods; (5) the customer has accepted the goods; (6) other evidence indicating the customer has obtained controlover the goods.
2. Revenue measurement principle
(1) Revenue is measured at the amount of the transaction price that is allocated to each performance obligation. The transaction priceis the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer,excluding amounts collected on behalf of third parties and those expected to be refunded to the customer.
(2) If the consideration promised in a contract includes a variable amount, the Company shall confirm the best estimate of variableconsideration at expected value or the most likely amount. However, the transaction price that includes the amount of variableconsideration only to the extent that it is high probable that a significant reversal in the amount of cumulative revenue recognized willnot occur when the uncertainty associated with the variable consideration is subsequently resolved.
(3) In the circumstance that the contract contains a significant financing component, the Company shall determine the transaction pricebased on the price that a customer would have paid for if the customer had paid cash for obtaining control over those goods or services.The difference between the transaction price and the amount of promised consideration is amortized under effective interest methodover contractual period. The effects of a significant financing component shall not be considered if the Company expects, at the contractinception, that the period between when the customer obtains control over goods or services and when the customer pays considerationwill be one year or less.
(4) For contracts containing two or more performance obligations, the Company shall determine the stand-alone selling price at contractinception of the distinct good underlying each performance obligation and allocate the transaction price to each performance obligationon a relative stand-alone selling price basis.
3. Revenue recognition method
(1) Revenue from sales of products
The Company’s main products are nutrition, flavor and fragrance, new polymer materials, etc. Sales of products are performanceobligations satisfied at a point in time. Revenue from domestic sales is recognized when the Company has delivered goods to thecustomer as agreed by contract and has obtained delivery note signed by the customer, and the Company has collected the paymentsor has obtained the right to the payments, and related economic benefits are highly probable to flow to the Company. Revenue fromoverseas sales is recognized when the Company has declared goods to the customs based on contractual agreements and has obtaineda bill of lading, and the Company has collected the payments or has obtained the right to the payments, and related economic benefitsare highly probable to flow to the Company.
(2) Revenue from real estate sales
Real estate sales are performance obligations satisfied at a point in time. Revenue from real estate sales is recognized when theCompany has delivered properties to the customer as agreed by contract and has obtained the client acceptance receipts signed by thecustomer, and the Company has collected the payments or has obtained the right to the payments, and related economic benefits arehighly probable to flow to the Company.
20. Government grants
1. Government grants shall be recognized if, and only if, the following conditions are all met: (1) the Company will comply with theconditions attaching to the grants; (2) the grants will be received. Monetary government grants are measured at the amount received orreceivable. Non-monetary government grants are measured at fair value, and can be measured at nominal amount in the circumstancethat fair value cannot be assessed.
2. Government grants related to assets
Government grants related to assets are government grants with which the Company constructs or otherwise acquires long-term assetsunder requirements of government. In the circumstances that there is no specific government requirement, the Company shall determinebased on the primary condition to acquire the grants, and government grants related to assets are government grants whose primarycondition is to construct or otherwise acquire long-term assets. They offset carrying amount of relevant assets, or they are recognized
as deferred income. If recognized as deferred income, they are included in profit or loss on a systematic basis over the useful lives ofthe relevant assets. Those measured at notional amount are directly included into profit or loss. For assets sold, transferred, disposedor damaged within the useful lives, balance of unamortized deferred income is transferred into profit or loss of the period in which thedisposal occurred.
3. Government grants related to income
Government grants related to income are government grants other than those related to assets. For government grants that contain bothparts related to assets and parts related to income, in which those two parts are blurred, they are thus collectively classified asgovernment grants related to income. For government grants related to income used for compensating the related future cost, expensesor losses, they are recognized as deferred income and included in profit or loss or used to offset relevant cost during the period in whichthe relevant cost, expenses or losses are recognized; for government grants related to income used for compensating the related cost,expenses or losses incurred to the Company, they are directly included in profit or loss or used to offset relevant cost.
4. Government grants related to the ordinary course of business shall be included into other income or used to offset relevant cost basedon business nature, while those not related to the ordinary course of business shall be included into non-operating revenue orexpenditures.
5. Policy interest subvention
(1) In the circumstance that government appropriates interest subvention to lending bank, who provides loans for the Company with apolicy subsidised interest rate, borrowings are carried at the amount received, with relevant borrowings cost computed based on theprincipal and the policy subsidised interest rate.
(2) In the circumstance that government directly appropriates interest subvention to the Company, the subsidised interest shall offsetrelevant borrowing cost.
21. Contract assets, contract liabilities
The Company presents contract assets or contract liabilities in the balance sheet based on the relationship between its performanceobligations and customers’ payments. Contract assets and contract liabilities under the same contract shall offset each other and bepresented on a net basis.The Company presents an unconditional right to consideration (i.e., only the passage of time is required before the consideration is due)as a receivable, and presents a right to consideration in exchange for goods that it has transferred to a customer (which is conditionalon something other than the passage of time) as a contract asset.The Company presents an obligation to transfer goods to a customer for which the Company has received consideration (or the amountis due) from the customer as a contract liability.
22. Deferred tax assets/Deferred tax liabilities
1. Deferred tax assets or deferred tax liabilities are calculated and recognized based on the difference between the carrying amount andtax base of assets and liabilities (and the difference of the carrying amount and tax base of items not recognized as assets and liabilitiesbut with their tax base being able to be determined according to tax laws) and in accordance with the tax rate applicable to the periodduring which the assets are expected to be recovered or the liabilities are expected to be settled.
2. A deferred tax asset is recognized to the extent of the amount of the taxable income, which is most likely to obtain and which canbe deducted from the deductible temporary difference. At the balance sheet date, if there is any exact evidence that it is probable thatfuture taxable income will be available against which deductible temporary differences can be utilized, the deferred tax assetsunrecognized in prior periods are recognized.
3. At the balance sheet date, the carrying amount of deferred tax assets is reviewed. The carrying amount of a deferred tax asset isreduced to the extent that it is no longer probable that sufficient taxable income will be available to allow the benefit of the deferredtax asset to be utilized. Such reduction is subsequently reversed to the extent that it becomes probable that sufficient taxable incomewill be available.
4. The income tax and deferred tax for the period are treated as income tax expenses or income through profit or loss, excluding thosearising from the following circumstances: (1) business combination; and (2) the transactions or items directly recognized in equity.
23. Leases
(1) Operating lease
1. The Company as lessee
At the commencement date, the Company recognizes a lease that has a lease term of 12 months or less as a short-term lease, whichshall not contain a purchase option; the Company recognizes a lease as a lease of a low-value asset if the underlying asset is of lowvalue when it is new. If the Company subleases an asset, or expects to sublease an asset, the head lease does not qualify as a lease of alow-value asset.For all short-term leases and leases of low-value assets, lease payments are recognized as cost or profit or loss with straight-linemethod/unit-of-production method over the lease term.Apart from the above-mentioned short-term leases and leases of low-value assets with simplified approach, the Company recognizesright-of-use assets and lease liabilities at the commencement date.
(1) Right-of-use assets
The right-of-use asset is measured at cost and the cost shall comprise: 1) the amount of the initial measurement of the lease liability; 2)any lease payments made at or before the commencement date, less any lease incentives received; 3) any initial direct costs incurredby the lessee; and 4) an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring thesite on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease.The Company depreciates the right-of-use asset using the straight-line method/unit-of-production method. If it is reasonable to becertain that the ownership of the underlying asset can be acquired by the end of the lease term, the Company depreciates the right-of-use asset from the commencement date to the end of the useful life of the underlying asset. Otherwise, the Company depreciates theright-of-use asset from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the leaseterm.
(2) Lease liability
At the commencement date, the Company measures the lease liability at the present value of the lease payments that are not paid atthat date, discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, the Company’s incrementalborrowing rate shall be used. Unrecognized financing expenses, calculated at the difference between the lease payment and its presentvalue, are recognized as interest expenses over the lease term using the discount rate which has been used to determine the presentvalue of lease payment and included in profit or loss. Variable lease payments not included in the measurement of lease liabilities areincluded in profit or loss in the periods in which they are incurred.After the commencement date, if there is a change in the following items: a. actual fixed payments; b. amounts expected to be payableunder residual value guarantees; c. an index or a rate used to determine lease payments; d. assessment result or exercise of purchaseoption, extension option or termination option., the Company remeasures the lease liability based on the present value of lease paymentsafter changes, and adjusts the carrying amount of the right-of-use asset accordingly. If the carrying amount of the right-of-use asset isreduced to zero but there shall be a further reduction in the lease liability, the remaining amount shall be recognized into profit or loss.
2. The Company as lessor
At the commencement date, the Company classifies a lease as a finance lease if it transfers substantially all the risks and rewardsincidental to ownership of an underlying asset. Otherwise, it is classified as an operating lease.Operating leaseLease receipts are recognized as lease income with straight-line method/unit-of-production method over the lease term. Initial directcosts incurred shall be capitalized, amortized on the same basis as the recognition of lease income, and included into profit or loss byinstallments. Variable lease payments related to operating lease which are not included in the lease payment are charged as profit orloss in the periods in which they are incurred.
（2） Accounting for finance leases
None
24. Work safety fund
The Company accrues work safety fund in accordance with the “Circular on Management Measures on the Accrual and Use of WorkSafety Fund” numbered Cai Qi [2022] 136 by Ministry of Finance and State Administration of Work Safety. Standard work safety fundis included in the cost or current profit or loss, meanwhile accounted for under “special reserve”. When work safety fund is used as anexpense, it is to offset special reserve directly. When work safety fund is qualified to be included in the cost of fixed assets, it isaccounted for under “construction in progress” and transferred to fixed assets when related safety projects reach the designed usefulconditions; meanwhile, the cost included in fixed assets is to offset “special reserve”, and accumulated depreciation shall be recognizedat the same amount. Such fixed assets shall not be depreciated in future periods.
25. Segment reporting
Operating segments are determined based on the structure of the Company’s internal organization, management requirements andinternal reporting system. An operating segment is a component of the Company:
1. that engages in business activities from which it may earn revenues and incur expenses;
2. whose financial performance is regularly reviewed by the Management to make decisions about resource to be allocated to thesegment and to assess its performance; and
3. for which accounting information regarding financial position, financial performance and cash flows is available through analysis.
26.Accounting treatment related to share repurchase
When the Company repurchases its shares for the purpose of reducing its registered capital or rewarding its employees, if the purchasedshares are to be kept as treasury shares, the treasury shares are recorded at the cash distributed to existing shareholders for repurchase;if the purchased shares are to be retired, the difference between the total par value of shares retired and the cash distributed to existingshareholders for repurchase is to reduce capital reserve, or retained earnings when the capital reserve is not enough to reduce. If theCompany repurchases vested equity instruments in equity-settled share-based payment transactions with employees, cost of treasuryshares granted to employees and capital reserve (other capital reserve) accumulated within the vesting perio.
27. Significant changes in accounting policies and estimates
(1) Significant changes in accounting policies
√ Applicable □ Not Applicable
| Contents and reasons | Approval process | Remarks |
| Ministry of Finance, "Interpretation of Enterprise | N/A | Please refer to Announcement No.2023- |
| Contents and reasons | Approval process | Remarks |
| Accounting Standards No. 16" (Caijing [2022] No. 31) "Accounting for Deferred Income Taxes Associated with Assets and Liabilities Arising from a Single Transaction to Which the Initial Recognition Exemption Does Not Apply" | 021 disclosed on www.cninfo.com.cn on April 21, 2023 for details. |
The impact of the implementation of the standards on the relevant items of the company's balance sheet in 2022, profit statement andcash flow statement in the same period of last year is retroactively adjusted as follows:
Unit: RMB Yuan
| Items | (Jan 1,2023/ Preceding period comparative) | Effect due to revised lease standard | (Jan 1,2023/ Preceding period comparative) |
| Consolidated balance sheet | |||
| Deferred tax assets | 49,812,172.71 | 438,636.67 | 50,250,809.38 |
| Deferred tax liabilities | 277,316,677.63 | 418,779.04 | 277,735,456.67 |
| Undistributed profit | 15,823,725,913.44 | 19,857.63 | 15,823,745,771.07 |
| Consolidated income statement | |||
| Income tax | 400,099,923.62 | -4,795.77 | 400,095,127.85 |
| Net profit | 2,223,862,326.50 | 4,795.77 | 2,223,867,122.27 |
VI. Taxes
1. Main taxes and tax rates
| Taxes | Tax bases | Tax rates |
| Value-added tax (VAT) | The output tax calculated based on the revenue from sales of goods or rendering of services in accordance with the tax law, net of the input tax that is allowed to be deducted in the current period | 13%, 9%, 6%, 5% and 19%; export goods enjoy the “exemption, credit and refund” policy and the refund rate ranges from 0% to 13%; the subsidiary Zhejiang NHU Import & Export Co., Ltd. enjoys the “refund upon collection” policy and the refund rate ranges from 0% to 13%. |
| Urban maintenance and construction tax | Turnover tax actually paid | 5%、7% |
| Enterprise income tax | Taxable income | 15%、17%、20%、22%、25%、25.5%、34%、16.5% |
| Land appreciation tax | The incremental amount arising from the transfer of state-owned land use right and the buildings and structures that are constructed on the land | A four-grade progressive tax system is adopted. The rates are: 30% for appreciated value not over 50% of total deductible amount; 40% for appreciated value over 50% but not over 100% of total deductible amount; 50% for appreciated value over 100% but not over 200% of total deductible amount; and 60% for appreciated value over 200% of total deductible amount. |
| Housing property tax | For housing property levied on the basis of price, housing property tax is levied at the rate of 1.2% of the balance after deducting 30% of the cost; for housing property levied on the basis of rent, housing property tax is levied at the rate of 12% of rent revenue. | 1.2%、12% |
| Education surcharge | Turnover tax actually paid | 3% |
| Local education | Turnover tax actually paid | 2% |
| Taxes | Tax bases | Tax rates |
| surcharge | ||
| Solidarity surcharge [Note] | Income tax payable | 5.50% |
| Trade tax [Note] | Taxable income | 13.30% |
Note: The subsidiaries NHU EUROPE GmbH, NHU PERFORMANCE MATERIALS GMBH and Bardoterminal GmbH are subjectto these rates.Different enterprise income tax rates applicable to different taxpayers:
| Taxpayers | Income tax rate |
| The Company | 15% |
| Shangyu NHU Bio-Chem Co., Ltd. | 15% |
| Shandong NHU Pharmaceutical Co., Ltd. | 15% |
| Shandong NHU Vitamins Co., Ltd. | 15% |
| Shandong NHU Amino-acids Co., Ltd. | 15% |
| Zhejiang NHU Special Materials Co., Ltd. | 15% |
| Heilongjiang NHU Biotechnology Co., Ltd. | 15% |
| Zhejiang NHU Pharmaceutical Co., Ltd | 15% |
| Shandong NHU Jinghua Technology Co., Ltd | 15% |
| NHU (Hong Kong) Trading Co., Ltd. | 16.5% |
| NHU EUROPE GmbH | 15% |
| NHU PERFORMANCE MATERIALS GMBH | 15% |
| Bardoterminal GmbH | 15% |
| NHU Singapore PTE. LTD. | 17% |
| Zhejiang NHU Nylon Material Co., Ltd | 20% |
| NHU/CHR.OLESEN LATIN AMERICA A/S | 22% |
| NHU CHR. OLESEN MEXICO S.A.P.I. DE C.V. | 25.5% |
| NHU/CHR. OLESEN BRASIL LTDA | 34% |
| Taxpayers other than the above-mentioned | 25% |
2. Tax preferential policies
According to the Hi-Tech Enterprise Certificate (GR202033003531) issued by Zhejiang Provincial Department of Science andTechnology, Zhejiang Provincial Department of Finance and Zhejiang Provincial Tax Service, State Taxation Administration (STA),the Company is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from 2020 to 2022. In 2023, corporateincome tax will be temporarily calculated and paid at a tax rate of 15%.According to the Hi-Tech Enterprise Certificate (GR202233002530) issued by Zhejiang Provincial Department of Science andTechnology, Zhejiang Provincial Department of Finance and Zhejiang Provincial Tax Service, STA, the subsidiary Shangyu NHU Bio-Chem Co., Ltd. is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from 2022 to 2024. It is subject tothe rate of 15% for enterprise income tax in 2023.According to the Hi-Tech Enterprise Certificate (GR202037001084) issued by Department of Science and Technology of ShandongProvince, Shandong Provincial Department of Finance and Shandong Provincial Tax Service, STA, the subsidiary Shandong NHUPharmaceutical Co., Ltd. is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from 2020 to 2022. In2023, corporate income tax will be temporarily calculated and paid at a tax rate of 15%.According to the Hi-Tech Enterprise Certificate (GR202037000197) issued by Department of Science and Technology of Shandong
Province, Shandong Provincial Department of Finance and Shandong Provincial Tax Service, STA, the subsidiary Shandong NHUVitamins Co., Ltd. is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from 2020 to 2022. In 2023,corporate income tax will be temporarily calculated and paid at a tax rate of 15%.According to the Hi-Tech Enterprise Certificate (GR202137000086) issued by Department of Science and Technology of ShandongProvince, Shandong Provincial Department of Finance and Shandong Provincial Tax Service, STA, the subsidiary Shandong NHUAmino Acid Co., Ltd. is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from 2021 to 2023. It issubject to the rate of 15% for enterprise income tax in 2023.According to the Hi-Tech Enterprise Certificate (GR202133008939) issued by Zhejiang Provincial Department of Science andTechnology, Zhejiang Provincial Department of Finance and Zhejiang Provincial Tax Service, STA, the subsidiary Zhejiang NHUSpecial Materials Co., Ltd. is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from 2021 to 2023. It issubject to the rate of 15% for enterprise income tax in 2023.According to the Hi-Tech Enterprise Certificate (GR202123000560) issued by Heilongjiang Provincial Department of Science andTechnology, Heilongjiang Provincial Department of Finance and Heilongjiang Provincial Tax Service, STA, the subsidiaryHeilongjiang NHU Biotechnology Co., Ltd. is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from2021 to 2023. It is subject to the rate of 15% for enterprise income tax in 2023.According to the Hi-Tech Enterprise Certificate (GR202233004365) issued by Zhejiang Provincial Department of Science andTechnology, Zhejiang Provincial Department of Finance and Zhejiang Provincial Tax Service, STA, the subsidiary Zhejiang NHUPharmaceutical Co., Ltd. is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from 2022 to 2024. It issubject to the rate of 15% for enterprise income tax in 2023.According to the Hi-Tech Enterprise Certificate (GR202237005690) issued by Department of Science and Technology of ShandongProvince, Shandong Provincial Department of Finance and Shandong Provincial Tax Service, STA, the subsidiary Shandong NHUJinghua Technology Co., Ltd is accredited as a hi-tech enterprise and entitled to enjoy the tax preferential policy from 2022 to 2024. Itis subject to the rate of 15% for enterprise income tax in 2023.According to the Announcement of the Ministry of Finance and the State Administration of Taxation on Preferential Policies on IncomeTax for Small and Micro Enterprises and Individual Entrepreneurs issued by the Ministry of Finance and the State Administration ofTaxation (Announcement of the Ministry of Finance and the State Administration of Taxation No. 6 of 2023), from January 1, 2023 toDecember 31, 2024, the portion of the annual taxable income of a small and micro enterprise that does not exceed 1 million yuan willbe reduced by 25% of the annual taxable income, and will pay corporate income tax at a rate of 20%. The tax rate of 20% will beapplied to the enterprise income tax. Subsidiary Zhejiang NHU Nylon Material Co., Ltd. is subject to enterprise income tax at thecorresponding preferential tax rate..
3、Other
None
VII. Notes to items of consolidated financial statements
1. Cash and bank balances
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Cash on hand | 21,036.01 | 16,584.59 |
| Cash in bank | 3,507,862,165.02 | 5,151,816,943.29 |
| Items | Closing balance | Opening balance |
| Other cash and bank balances | 146,850,922.85 | 192,018,439.84 |
| Total | 3,654,734,123.88 | 5,343,851,967.72 |
| Including: Deposited overseas | 84,689,947.39 | 62,426,363.92 |
Other remarks
(1) Other cash and bank balances
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
Deposit for bank acceptance
| Deposit for bank acceptance | 110,959,093.51 | 147,608,293.24 |
| Deposit for letters of credit | 33,486,505.20 | 42,310,180.59 |
Deposit for engineering labor costs
| Deposit for engineering labor costs | 852,349.44 | 851,288.54 |
| Deposit for construction safety | 867,529.53 | 863,937.05 |
| Deposit for water fees | 660,544.10 | 359,836.44 |
| Deposit for ETC | 16,500.00 | 16,500.00 |
| Alipay balance | 8401.07 | 8,401.07 |
| Deposited investment fund | 2.91 | |
| Subtotal | 146,850,922.85 | 192,018,439.84 |
2. Held-for-trading financial assets
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Financial assets at fair value through profit or loss | 250,000,000.00 | 720,314,576.43 |
| Including: Financial products with guaranteed principal and floating income | 250,000,000.00 | 720,000,000.00 |
| Derivative financial assets | 314,576.43 | |
| Total | 250,000,000.00 | 720,314,576.43 |
3. Notes receivable
(1) Details on categories
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Bank acceptance | 207,107,417.99 | 321,261,741.29 |
| Commercial Acceptance | 7,281,666.87 | 51,380,094.50 |
| Total | 214,389,084.86 | 372,641,835.79 |
Unit: RMB Yuan
| Categories | Closing balance | ||||
| Book balance | Provision for bad debts | Carrying amount | |||
| Amount | % to total | Amount | Provision proportion | ||
| Notes receivable with provision for bad debts made on a collective basis | 214,772,330.49 | 100.00% | 383,245.63 | 0.18% | 214,389,084.86 |
| Bank acceptance | 207,107,417.99 | 96.43% | 207,107,417.99 | ||
| Commercial Acceptance | 7,664,912.50 | 3.57% | 383,245.63 | 5.00% | 7,281,666.87 |
| Total | 214,772,330.49 | 100.00% | 383,245.63 | 0.18% | 214,389,084.86 |
(Continued)
| Categories | Opening balance | ||||
| Book balance | Provision for bad debts | Carrying amount | |||
| Amount | % to total | Amount | Provision proportion | ||
| Notes receivable with provision for bad debts made on a collective basis | 375,346,051.29 | 100.00% | 2,704,215.50 | 0.72% | 372,641,835.79 |
| Bank acceptance | 321,261,741.29 | 85.59% | 321,261,741.29 | ||
| Commercial Acceptance | 54,084,310.00 | 14.41% | 2,704,215.50 | 5.00% | 51,380,094.50 |
| Total | 375,346,051.29 | 100.00% | 2,704,215.50 | 0.72% | 372,641,835.79 |
provision for bad debts made on a collective basis：383,245.63
Unit: RMB Yuan
| Categories | Closing balance | ||
| Book balance | Provision for bad debts | Provision proportion | |
| Commercial Acceptance | 7,664,912.50 | 383,245.63 | 5.00% |
| Total | 7,664,912.50 | 383,245.63 | |
A description of the basis for determining the portfolio:
If the bad debt provision for notes receivable is based on the general model of expected credit losses, please disclose informationabout the bad debt provision by referring to the disclosure for other receivables:
□Applicable ?Not applicable
(2) Provisions made, collected or reversed in the current period
Provisions made in the current period:
Unit: RMB Yuan
| Categories | Opening balance | Increase/Decrease | Closing balance | |||
| Accrual | Recovery/ Reversal | Write-off | Others | |||
| Provision made on a collective basis | 2,704,215.50 | -2,320,969.87 | 383,245.63 | |||
| Total | 2,704,215.50 | -2,320,969.87 | 383,245.63 | |||
which the amount of bad debt provision recovered or reversed during the period is significant:
□Applicable ?Not applicable
(3) Pledged notes at the balance sheet date
Unit: RMB Yuan
| Items | Closing balance of pledged notes |
| Bank acceptance | 155,053,622.64 |
| Total | 155,053,622.64 |
(4) Endorsed or discounted but undue notes at the balance sheet date
Unit: RMB Yuan
| Items | Closing balance derecognized | Closing balance not yet derecognized |
| Bank acceptance | 40,752,118.29 | |
| Total | 40,752,118.29 |
4. Accounts receivable
(1) Details on categories
Unit: RMB Yuan
| Categories | Closing balance | ||||
| Book balance | Provision for bad debts | Carrying amount | |||
| Amount | % to total | Amount | Provision proportion | ||
| Accounts receivable with provision for bad debts made on a collective basis | 2,572,631,687.58 | 100.00% | 143,930,919.60 | 5.59% | 2,428,700,767.98 |
| Total | 2,572,631,687.58 | 100.00% | 143,930,919.60 | 5.59% | 2,428,700,767.98 |
(Continued)
| Categories | Opening balance | ||||
| Book balance | Provision for bad debts | Carrying amount | |||
| Amount | % to total | Amount | Provision proportion | ||
| Accounts receivable with provision for bad debts made on a collective basis | 2,615,042,281.60 | 100.00% | 138,773,240.37 | 5.31% | 2,476,269,041.23 |
| Total | 2,615,042,281.60 | 100.00% | 138,773,240.37 | 5.31% | 2,476,269,041.23 |
provision for bad debts made on a collective basis：143,930,919.60
Unit: RMB Yuan
| Categories | Closing balance | ||
| Book balance | Provision for bad debts | Provision proportion | |
| Commercial Acceptance | 2,572,631,687.58 | 143,930,919.60 | 5.59% |
| Total | 2,572,631,687.58 | 143,930,919.60 | |
A description of the basis for determining the portfolio:
If the bad debt provision for notes receivable is based on the general model of expected credit losses, please disclose information aboutthe bad debt provision by referring to the disclosure for other receivables:
□Applicable ?Not applicable
Ages analysis:
Unit: RMB Yuan
| Ages | Book balance |
| Within 1 year (inclusive) | 2,482,677,830.83 |
| 1-2 years | 87,681,785.95 |
| 2-3 years | 57,000.00 |
| Over 3 years | 2,215,070.80 |
| 3-4 years | |
| 4-5 years | 489,750.00 |
| Over 5 years | 1,725,320.80 |
| Total | 2,572,631,687.58 |
(2) Provisions made, collected or reversed in the current period
Provisions made in the current period:
Unit: RMB Yuan
| Categories | Opening balance | Increase/Decrease | Closing balance | |||
| Accrual | Recovery/ Reversal | Write-off | Others | |||
| Provision made on a collective basis | 138,773,240.37 | 5,397,679.23 | 240,000.00 | 143,930,919.60 | ||
| Total | 138,773,240.37 | 5,397,679.23 | 240,000.00 | 143,930,919.60 | ||
(3) Accounts receivable actually written off in the current period
Unit: RMB Yuan
| Items | Write-off amount |
| Payment for goods | 240,000.00 |
(4) Details of the top 5 debtors with largest balances
Unit: RMB Yuan
| Debtors | Closing balance | Proportion to the total balance of receivables (%) | Closing balance of provision for bad debts |
| Client A | 316,559,132.16 | 12.30% | 15,827,956.61 |
| Client B | 184,341,286.74 | 7.17% | 9,217,064.34 |
| Client C | 87,285,592.08 | 3.39% | 4,364,279.60 |
| Client D | 36,987,720.20 | 1.44% | 1,849,386.01 |
| Client E | 35,320,657.51 | 1.37% | 1,766,032.88 |
| Total | 660,494,388.69 | 25.67% |
5. Receivables financing
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Bank acceptance | 506,430,216.64 | 379,217,582.25 |
| Total | 506,430,216.64 | 379,217,582.25 |
Changes in receivables financing during the period and changes in fair value
□Applicable ?Not applicable
If the provision for impairment of receivables financing is based on the general model of expected credit losses, disclose informationabout the provision for impairment by referring to the disclosure for other receivables:
□Applicable ?Not applicable
(1) Pledged notes at the balance sheet date
Unit: RMB Yuan
| Items | Closing balance of pledged notes |
| Bank acceptance | 84,532,028.12 |
| Subtotal | 84,532,028.12 |
(2) Endorsed or discounted but undue notes at the balance sheet date
Unit: RMB Yuan
| Items | Closing balance derecognized |
| Bank acceptance | 579,996,213.46 |
| Subtotal | 579,996,213.46 |
Due to the fact that the acceptor of bank acceptance is commercial bank, which is of high credit level, there is very little possibility offailure in recoverability when it is due. Based on this fact, the Company derecognized the endorsed or discounted bank acceptance.However, if any bank acceptance is not recoverable when it is due, the Company still holds joint liability on such acceptance, accordingto the China Commercial Instrument Law.
6. Advances paid
(1) Age analysis
Unit: RMB Yuan
| Ages | Closing balance | Opening balance | ||
| Amount | % to total | Amount | % to total | |
| Within 1 year | 113,021,820.29 | 94.16% | 215,300,317.59 | 96.84% |
| 1-2 years | 6,640,398.88 | 5.54% | 7,013,257.67 | 3.14% |
| 2-3 years | 340,628.67 | 0.28% | 16,001.00 | 0.01% |
| Over 3 years | 23,200.00 | 0.02% | 7,200.00 | 0.01% |
| Total | 120,026,047.84 | -- | 222,336,776.26 | -- |
(2) Details of the top 5 debtors with largest balances
Unit: RMB Yuan
| Debtors | Book balance | Proportion to the total balance of advances paid (%) |
| Supplier A | 17,186,516.30 | 14.32% |
| Supplier B | 10,380,247.17 | 8.65% |
| Supplier C | 8,431,174.24 | 7.02% |
| Supplier D | 8,429,722.01 | 7.02% |
| Supplier E | 5,745,000.00 | 4.79% |
| Subtotal | 50,172,659.72 | 41.80% |
7. Other receivables
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Dividend receivable | 20,735,987.73 | |
| Other receivables | 224,942,479.71 | 248,831,605.00 |
| Total | 224,942,479.71 | 269,567,592.73 |
(1) Dividend receivable
Unit: RMB Yuan
| Items/Investees | Closing balance | Opening balance |
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | 20,735,987.73 | |
| Total | 20,735,987.73 |
(2) Other receivables
1) Categorized by nature
Unit: RMB Yuan
| Nature of receivables | Closing book balance | Opening book balance |
| Security deposits | 116,100,494.45 | 120,123,425.59 |
| Nature of receivables | Closing book balance | Opening book balance |
| Export tax refund | 72,167,345.62 | 62,763,834.97 |
| Unborrowed funds | 21,098,506.24 | |
| Receivables of returned equipment | 95,312.91 | 1,041,600.00 |
| Refundable VAT | 21,109,926.49 | 41,890,037.74 |
| Employee petty cash | 12,558,327.06 | 8,050,322.00 |
| Temporary advance payment receivable | 4,228,609.89 | 3,839,206.82 |
| Others | 8,117,227.78 | 3,035,775.60 |
| Total | 234,377,244.20 | 261,842,708.96 |
2) Provision for bad debts
Unit: RMB Yuan
| Provision for bad debts | Phase I | Phase II | Phase III | Total |
| 12?month expected credit losses | Lifetime expected credit losses (credit not impaired) | Lifetime expected credit losses (credit impaired) | ||
| Opening balance | 1,760,180.53 | 1,062,902.90 | 10,188,020.53 | 13,011,103.96 |
| Opening balance in the current period | ||||
| --Transferred to phase II | -252,531.71 | 252,531.71 | ||
| --Transferred to phase III | -182,677.07 | 182,677.07 | ||
| Provision made in the current period | -430,122.97 | -122,630.70 | -3,023,585.80 | -3,576,339.47 |
| Closing balance | 1,077,525.85 | 1,010,126.84 | 7,347,111.80 | 9,434,764.49 |
Significant changes in book balance of other receivables with changes in provision for bad debts:
□ Applicable √ Not applicable
Ages analysis
Unit: RMB Yuan
| Ages | Book balance |
| Within 1 year (inclusive) | 118,060,890.14 |
| 1-2 years | 9,886,365.19 |
| 2-3 years | 913,385.36 |
| Over 3 years | 105,516,603.51 |
| 3-4 years | 5,406,045.90 |
| 4-5 years | 300,000.00 |
| Over 5 years | 99,810,557.61 |
| Total | 234,377,244.20 |
3) Details of the top 5 debtors with largest balances
Unit: RMB Yuan
| Debtors | Nature of receivables | Book balance | Ages | Proportion to the total balance of other receivables (%) | Provision for bad debts |
| Weifang Municipal Bureau of Land and Resource, Binhai District Branch | Security deposits | 97,900,000.00 | Over 3 years | 41.77% | |
| State Taxation | Export tax refund | 72,167,345.61 | Within 1 year | 30.79% |
| Debtors | Nature of receivables | Book balance | Ages | Proportion to the total balance of other receivables (%) | Provision for bad debts |
| Administration (Export tax refund receivable) | |||||
| State Revenue Service (VAT refundable) | AT refundable | 21,109,926.50 | Within 1 year | 9.01% | |
| Weifang Binhai Economic and Technological Development Zone Finance Treasury Centralized Payment Center | Security deposits | 4,835,731.00 | 1-2 years | 2.06% | |
| Suihua Labor Security Supervision Detachment | Security deposits | 2,950,490.53 | 3-4 years | 1.26% | 2,950,490.53 |
| Total | -- | 198,963,493.64 | -- | 84.89% | 2,950,490.53 |
8. Inventories
Does the company need to comply with disclosure requirements in the real estate industryNO
(1) Details on categories
Unit: RMB Yuan
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for inventory write-down/ Provision for impairment of cost to fulfill a contract | Carrying amount | Book balance | Provision for inventory write-down/ Provision for impairment of cost to fulfill a contract | Carrying amount | |
| Raw materials | 404,321,979.01 | 1,371,035.91 | 402,950,943.10 | 512,088,438.92 | 1,371,035.91 | 510,717,403.01 |
| Work in process | 1,244,177,291.69 | 1,244,177,291.69 | 1,259,897,028.55 | 1,259,897,028.55 | ||
| Goods on hand | 2,693,983,880.45 | 151,230,060.62 | 2,542,753,819.83 | 2,122,998,309.26 | 151,579,577.92 | 1,971,418,731.34 |
| Goods dispatched | 59,383,998.25 | 59,383,998.25 | 96,141,207.37 | 96,141,207.37 | ||
| Development cost | 97,530,835.60 | 97,530,835.60 | 97,530,835.60 | 97,530,835.60 | ||
| Developed products | 122,087,269.95 | 122,087,269.95 | 121,902,734.56 | 121,902,734.56 | ||
| Materials on consignment for further processing | 6,468,031.91 | 6,468,031.91 | 8,335,609.99 | 8,335,609.99 | ||
| Packages | 15,187,420.88 | 15,187,420.88 | 16,061,832.47 | 16,061,832.47 | ||
| Low-value consumables | 88,045,857.41 | 88,045,857.41 | 62,552,319.50 | 62,552,319.50 | ||
| Total | 4,731,186,565.15 | 152,601,096.53 | 4,578,585,468.62 | 4,297,508,316.22 | 152,950,613.83 | 4,144,557,702.39 |
(2) Provision for inventory write-down and provision for impairment of cost to fulfill a contract
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance | ||
| Accrual | Others | Recovery/ Reversal | Others | |||
| Raw materials | 1,371,035.91 | 1,371,035.91 | ||||
| Items | Opening balance | Increase | Decrease | Closing balance | ||
| Accrual | Others | Reversal | Others | |||
| Goods on hand | 151,579,577.92 | 81,296,758.10 | 81,646,275.40 | 151,230,060.62 | ||
| Total | 152,950,613.83 | 81,296,758.10 | 81,646,275.40 | 152,601,096.53 | ||
Determination basis of net realizable value and reasons for the reversal or write-off of provision for inventory write-down
| Items | Determination basis of net realizable value | Reasons for write-off of provision for inventory write-down |
| Raw materials | Estimated selling price of relevant finished goods less cost to be incurred upon completion, estimated selling expenses, and relevant taxes and surcharges. | Inventories with provision for inventory write-down made at the beginning of period were used or sold in the current period. |
| Goods on hand | Estimated selling price of relevant finished goods less estimated selling expenses, and relevant taxes and surcharges. | Inventories with provision for inventory write-down made at the beginning of period were sold in the current period. |
(3) Inventories – Development cost
Unit: RMB Yuan
| Items | Estimated total investment | Opening balance | Closing balance |
Boao NHU Resort
| Boao NHU Resort | 550 million | 42,570,355.38 | 42,570,355.38 |
| Weifang NHU Town Phase II | 398.53 million | 54,960,480.22 | 54,960,480.22 |
Subtotal
| Subtotal | 97,530,835.60 | 97,530,835.60 |
(4) Inventories – Developed products
Unit: RMB Yuan
| Items | Date of completion | Opening balance | Increase | Decrease | Closing balance |
Boao NHU Resort Center
| Boao NHU Resort Center | Dec. 2014 | 121,902,734.56 | 737,327.12 | 552,791.73 | 122,087,269.95 |
| Subtotal | 121,902,734.56 | 737,327.12 | 552,791.73 | 122,087,269.95 |
9. Other current assets
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Prepaid VAT or input VAT to be credited | 20,686,257.91 | 123,811,281.53 |
| Prepaid enterprise income tax | 19,249,934.46 | 54,251,454.46 |
| Prepaid insurance premiums | 5,502,799.65 | 4,330,488.27 |
| Prepaid housing rents | 891,922.42 | 23,362.83 |
| Prepaid urban maintenance and construction tax | 13,194.85 | 13,194.85 |
| Prepaid education surcharge | 7,916.74 | 7,916.74 |
| Prepaid local education surcharge | 5,278.11 | 5,278.11 |
| Total | 46,357,304.14 | 182,442,976.79 |
10. Long-term equity investments
Unit: RMB Yuan
| Investees | Opening carrying amount | Increase/Decrease | Closing carrying amount | Closing balance of provision for impairment | |||||||
| Investments increased | Investments decreased | Investment income/losses recognized under equity method | Adjustment in other comprehensive income | Changes in other equity | Cash dividend/ Profit declared for distribution | Provision for impairment | Others | ||||
| I. Joint ventures | |||||||||||
| II. Associates | |||||||||||
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | 239,967,333.33 | 20,358,467.14 | 260,325,800.47 | ||||||||
| Shandong Bin’an Vocational Training School Co., Ltd. [Note] | 5,842,851.42 | -785,163.90 | 5,057,687.52 | ||||||||
| Zhejiang Saiya Chemical Materials Co., Ltd | 125,450,987.77 | 16,212,276.85 | -960,219.61 | 140,703,045.01 | |||||||
| DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | 24,457,448.36 | 3,423,314.91 | -2,120,785.74 | 25,759,977.53 | |||||||
| CysBio ApS | 36,784,947.60 | -1,184,308.82 | 1,331,625.87 | 36,932,264.65 | |||||||
| Anhui Yingna Weixun Technology Co., Ltd | 4,000,000.00 | 4,000,000.00 | |||||||||
| Ningbo Zhenhai Refining and Chemical Xinhecheng Biotechnology Co., Ltd | 233,508,000.00 | -3,169,284.18 | 230,338,715.82 | ||||||||
| Subtotal | 432,503,568.48 | 237,508,000.00 | 34,855,302.00 | 1,331,625.87 | -3,081,005.35 | 703,117,491.00 | |||||
| Total | 432,503,568.48 | 237,508,000.00 | 34,855,302.00 | 1,331,625.87 | -3,081,005.35 | 703,117,491.00 | |||||
11. Other equity instrument investments
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Zhejiang Second Pharma Co., Ltd. | 7,790,147.55 | 7,790,147.55 |
| Shanghai NewMargin Yongjin Eqiuty Enterprise (LP) | 15,208,000.00 | 15,208,000.00 |
| Total | 22,998,147.55 | 22,998,147.55 |
12. Fixed assets
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Fixed assets | 17,819,362,500.06 | 16,523,867,858.53 |
| Total | 17,819,362,500.06 | 16,523,867,858.53 |
(1) Details
Unit: RMB Yuan
| Items | Buildings and structures | Generali equipment | Special equipment | Transport facilities | Total |
| I. Cost: | |||||
| 1. Opening balance | 7,126,286,829.35 | 217,277,952.88 | 15,524,771,612.37 | 27,261,458.12 | 22,895,597,852.72 |
| 2. Increase | 237,812,172.57 | 27,583,195.13 | 2,181,485,766.14 | 2,992,677.90 | 2,449,873,811.74 |
| (1) Acquisition | 98,370,675.72 | 7,642,898.98 | 404,802,224.29 | 2,986,353.56 | 513,802,152.55 |
| (2) Transferred in from construction in progress | 139,441,496.85 | 19,940,296.15 | 1,776,683,541.85 | 6,324.34 | 1,936,071,659.19 |
| 3. Decrease | 24,302.75 | 1,115,100.03 | 373,539,569.72 | 3,770,245.45 | 378,449,217.95 |
| (1) Disposal/ Scrapping | 24,302.75 | 1,115,100.03 | 373,539,569.72 | 3,770,245.45 | 378,449,217.95 |
| 4. Closing balance | 7,364,074,699.17 | 243,746,047.98 | 17,332,717,808.79 | 26,483,890.57 | 24,967,022,446.51 |
| II. Accumulated depreciation | |||||
| 1. Opening balance | 861,276,258.73 | 123,348,225.80 | 5,340,663,239.78 | 17,564,262.94 | 6,342,851,987.25 |
| Items | Buildings and structures | Generali equipment | Special equipment | Transport facilities | Total |
| 2. Increase | 101,963,792.73 | 15,617,968.92 | 684,348,352.06 | 2,040,364.15 | 803,970,477.86 |
| (1) Accrual | 101,963,792.73 | 15,617,968.92 | 684,348,352.06 | 2,040,364.15 | 803,970,477.86 |
| 3. Decrease | 1,801,604.05 | 22,555,055.47 | 3,665,804.54 | 28,022,464.06 | |
| (1) Disposal/ Scrapping | 1,801,604.05 | 22,555,055.47 | 3,665,804.54 | 28,022,464.06 | |
| 4. Closing balance | 963,240,051.46 | 137,164,590.67 | 6,002,456,536.37 | 15,938,822.55 | 7,118,800,001.05 |
| III. Provision for impairment | |||||
| 1. Opening balance | 20,980,481.81 | 7,425.45 | 7,873,804.67 | 16,295.01 | 28,878,006.94 |
| 2. Increase | |||||
| (1) Accrual | |||||
| 3. Decrease | 1,766.53 | 16,295.01 | 18,061.54 | ||
| (1) Disposal/ Scrapping | 1,766.53 | 16,295.01 | 18,061.54 | ||
| 4. Closing balance | 20,980,481.81 | 7,425.45 | 7,872,038.14 | 28,859,945.40 | |
| IV. Carrying amount | |||||
| 1. Closing balance | 6,379,854,165.90 | 106,574,031.86 | 11,322,389,234.28 | 10,545,068.02 | 17,819,362,500.06 |
| 2. Opening balance | 6,244,030,088.81 | 93,922,301.63 | 10,176,234,567.92 | 9,680,900.17 | 16,523,867,858.53 |
(2) Fixed assets temporarily idle
Unit: RMB Yuan
| Items | Cost | Accumulated depreciation | Provision for impairment | Carrying amount | Remarks |
| Buildings and structures | 90,962,662.12 | 36,264,898.95 | 32,689,772.80 | 22,007,990.37 | |
| General equipment | 204,504.71 | 140,250.58 | 3,546.30 | 60,707.83 | |
| Special equipment | 369,743,848.13 | 295,253,821.79 | 10,863,291.68 | 63,626,734.66 | |
| Subtotal | 460,911,014.96 | 331,658,971.32 | 43,556,610.78 | 85,695,432.86 |
(3) Fixed assets leased out under operating leases
Unit: RMB Yuan
| Items | Closing carrying amount |
| Buildings and structures | 26,767,138.93 |
| Subtotal | 26,767,138.93 |
(4) Fixed assets with certificate of titles being unsettled
Unit: RMB Yuan
| Items | Carrying amount | Reasons for unsettlement |
| Buildings and structures | 534,675,849.87 | Relevant procedures have not yet been completed. |
| Subtotal | 534,675,849.87 |
13. Construction in progress
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Construction in progress | 4,927,272,645.25 | 5,089,233,908.22 |
| Total | 4,927,272,645.25 | 5,089,233,908.22 |
(1) Details
Unit: RMB Yuan
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Methionine project with annual output of 0.25 million tons | 3,219,069,329.67 | 3,219,069,329.67 | 2,389,822,701.74 | 2,389,822,701.74 | ||
| 616 Joint Production Project | 426,984,891.23 | 426,984,891.23 | ||||
| Shandong Industrial Park 603 Project | 58,473,733.80 | 58,473,733.80 | 67,408,245.22 | 67,408,245.22 | ||
| Shandong Industrial Park HA Project | 424,267,448.48 | 424,267,448.48 | 94,672,989.28 | 94,672,989.28 | ||
| Shangyu Industrial Park PPS Project | 559,554,821.51 | 559,554,821.51 | ||||
| Daming Life and Health Industry Project | 113,110,548.03 | 113,110,548.03 | 26,065,403.64 | 26,065,403.64 | ||
| NH acid project | 411,013,534.11 | 411,013,534.11 | 514,155,642.52 | 514,155,642.52 | ||
| Cogeneration Expansion Project | 172,840,859.23 | 172,840,859.23 | 113,869,534.14 | 113,869,534.14 | ||
| F5 project | 91,979,706.11 | 91,979,706.11 | ||||
| NBC and CLA projects of Zhejiang Pharmaceutical | 120,581,503.32 | 120,581,503.32 | ||||
| Other piecemeal projects | 528,497,191.93 | 528,497,191.93 | 684,138,469.51 | 684,138,469.51 | ||
| Total | 4,927,272,645.25 | 4,927,272,645.25 | 5,089,233,908.22 | 5,089,233,908.22 | ||
(2) Changes in significant projects
Unit: RMB Yuan
| Projects | Budgets RMB 0000 Yuan | Opening balance | Increase | Transferred to fixed assets | Other decrease | Closing balance | Accumulated input to budget（%） | Completion percentage（%） | Accumulated amount of borrowing cost capitalization | Including: Amount of borrowing cost capitalization in current period | Annual capitalization rate | Fund source |
| Methionine project with annual output of 0.25 million tons | 536,984.22 | 2,389,822,701.74 | 829,246,627.93 | 3,219,069,329.67 | 97.12% | 99.00% | Raised funds | |||||
| 616 Joint Production Project | 77,213.69 | 426,984,891.23 | 3,455,987.89 | 430,440,879.12 | 98.38% | 100.00% | Raised funds | |||||
| Shandong Industrial Park 603 Project | 8,983.60 | 67,408,245.22 | 8,934,511.42 | 58,473,733.80 | 75.03% | 95.00% | Others | |||||
| Shandong Industrial Park HA Project | 97,991.14 | 94,672,989.28 | 330,483,701.66 | 889,242.46 | 424,267,448.48 | 43.71% | 60.00% | 811,777.78 | 811,777.78 | 2.60% | Others | |
| Shangyu Industrial Park PPS Project | 70,900.00 | 559,554,821.51 | 60,878,207.54 | 620,433,029.05 | 87.08% | 100.00% | Others | |||||
| Daming Life and Health Industry Project | 69,314.56 | 26,065,403.64 | 87,045,144.39 | 113,110,548.03 | 77.34% | 80.00% | 5,560,699.99 | 1,256,944.44 | 3.79% | Others | ||
| NH acid project | 73,899.28 | 514,155,642.52 | 37,804,682.32 | 140,946,790.73 | 411,013,534.11 | 74.56% | 85.00% | Others | ||||
| Cogeneration Expansion Project | 33,890.43 | 113,869,534.14 | 58,971,325.09 | 172,840,859.23 | 51.00% | 90.00% | Others | |||||
| F5 project | 13,563.50 | 91,979,706.11 | 46,677,427.57 | 138,657,133.68 | 102.23% | 100.00% | Others | |||||
| NBC and CLA projects of Zhejiang Pharmaceutical | 13,555.00 | 120,581,503.32 | 38,141,206.81 | 158,722,710.13 | 117.10% | 100.00% | Others | |||||
| Total | 996,295.42 | 4,405,095,438.71 | 1,492,704,311.20 | 1,490,089,785.17 | 8,934,511.42 | 4,398,775,453 .32 | -- | -- | 6,372,477.77 | 2,068,722.22 | -- |
14. Right-of-use assets
Unit: RMB Yuan
| Items | Buildings and structures | Total |
| I. Cost | ||
| 1. Opening balance | 3,573,327.02 | 3,573,327.02 |
| 2. Increase | 5,312,700.96 | 5,312,700.96 |
| (1) Leased in | 5,312,700.96 | 5,312,700.96 |
| 3. Decrease | ||
| 4. Closing balance | 8,886,027.98 | 8,886,027.98 |
| II. Accumulated depreciation | ||
| 1. Opening balance | 743,190.65 | 743,190.65 |
| 2. Increase | 360,873.71 | 360,873.71 |
| (1) Accrual | 360,873.71 | 360,873.71 |
| 3. Decrease | ||
| (1) Disposal | ||
| 4. Closing balance | 1,104,064.36 | 1,104,064.36 |
| III. Carrying amount | ||
| 1. Closing balance | 7,781,963.62 | 7,781,963.62 |
| 2. Opening balance | 2,830,136.37 | 2,830,136.37 |
15. Intangible assets
(1) Details
Unit: RMB Yuan
| Items | Land use right | Patent right | Non-patented technology | Software | Total |
| I. Cost | |||||
| 1. Opening balance | 1,854,376,892.96 | 31,662,062.75 | 38,788,324.30 | 62,516,135.99 | 1,987,343,416.00 |
| 2. Increase | 423,872,121.50 | 3,853,885.79 | 19,032,964.34 | 1,749,989.09 | 448,508,960.72 |
| (1) Acquisition | 423,872,121.50 | 3,853,885.79 | 19,032,964.34 | 1,749,989.09 | 448,508,960.72 |
| (2) Internal R&D | |||||
| 3. Closing balance | 2,278,249,014.46 | 35,515,948.54 | 57,821,288.64 | 64,266,125.08 | 2,435,852,376.72 |
| II. Accumulated amortization | |||||
| 1. Opening balance | 223,213,559.07 | 5,344,520.66 | 1,628,315.26 | 18,650,774.69 | 248,837,169.68 |
| 2. Increase | 20,057,624.00 | 2,969,177.07 | 368,326.76 | 2,975,925.67 | 26,371,053.50 |
| (1) Accrual | 20,057,624.00 | 2,969,177.07 | 368,326.76 | 2,975,925.67 | 26,371,053.50 |
| 3. Decrease | 2,594,832.03 | 0.00 | 0.00 | 2,594,832.03 | |
| (1) Disposal0 | 2,594,832.03 | 0.00 | 0.00 | 2,594,832.03 | |
| 4. Closing balance | 240,676,351.04 | 8,313,697.73 | 1,996,642.02 | 21,626,700.36 | 272,613,391.15 |
| III. Carrying amount | - | ||||
| 1. Closing balance | 2,037,572,663.42 | 27,202,250.81 | 55,824,646.62 | 42,639,424.72 | 2,163,238,985.57 |
| 2. Opening balance | 1,631,163,333.89 | 26,317,542.09 | 37,160,009.04 | 43,865,361.30 | 1,738,506,246.32 |
(2) Land use right with certificate of titles being unsettled
Unit: RMB Yuan
| Items | Carrying amount | Reasons for unsettlement |
| Land use right | 31,583,200.00 | Relevant procedures have not yet been completed. |
| Subtotal | 31,583,200.00 |
16. Goodwill
(1) Cost
Unit: RMB Yuan
| Investees or events resulting in goodwill | Opening balance | Increase | Decrease | Closing balance | ||
| Business combination | Translation reserve | Disposal | Translation reserve | |||
| Bardoterminal GmbH | 2,134,185.59 | 2,134,185.59 | ||||
| NHU/CHR.OLESEN LATIN AMERICA A/S | 3,622,704.97 | 3,622,704.97 | ||||
| Total | 5,756,890.56 | 5,756,890.56 | ||||
(2) Provision for impairment
Unit: RMB Yuan
| Investees or events resulting in goodwill | Opening balance | Increase | Decrease | Closing balance | ||
| Accrual | Translation reserve | Disposal | Translation reserve | |||
| Bardoterminal GmbH | 2,134,185.59 | 2,134,185.59 | ||||
| Total | 2,134,185.59 | 2,134,185.59 | ||||
17. Long-term prepayments
Unit: RMB Yuan
| Items | Opening balance | Increase | Amortization | Other decrease | Closing balance |
| Decoration fees | 8,149,891.98 | 1,703,262.70 | 6,446,629.28 | ||
| Site leveling fees | 16,221.60 | 8,110.80 | 8,110.80 | ||
| Catalysts | 5,013,764.87 | 4,856,634.96 | 2,122,920.28 | 7,747,479.55 | |
| Total | 13,179,878.45 | 4,856,634.96 | 3,834,293.78 | 14,202,219.63 |
18. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets before offset
Unit: RMB Yuan
| Items | Closing balance | Opening balance | ||
| Deductible temporary difference | Deferred tax assets | Deductible temporary difference | Deferred tax assets | |
| Provision for impairment of assets | 56,657,315.88 | 9,051,392.83 | 67,822,769.65 | 11,068,181.53 |
| Unrealized profit from internal transactions | 111,305,657.67 | 17,111,574.21 | 50,194,235.37 | 7,529,135.31 |
| Items | Closing balance | Opening balance | ||
| Deductible temporary difference | Deferred tax assets | Deductible temporary difference | Deferred tax assets | |
| Deferred income | 198,964,860.87 | 29,844,729.13 | 185,235,337.49 | 27,785,300.63 |
| Difference in depreciation of fixed assets | 10,956,796.59 | 1,643,519.49 | 22,863,701.57 | 3,429,555.24 |
| Lease liabilities | 2,994,386.17 | 449,157.93 | 2,924,244.47 | 438,636.67 |
| Total | 380,879,017.18 | 58,100,373.59 | 329,040,288.55 | 50,250,809.38 |
(2) Deferred tax liabilities before offset
Unit: RMB Yuan
| Items | Closing balance | Opening balance | ||
| Taxable temporary difference | Deferred tax liabilities | Taxable temporary difference | Deferred tax liabilities | |
| Difference due to one-off pre-tax deduction of fixed assets | 1,439,749,541.81 | 232,926,127.42 | 1,468,559,836.57 | 232,654,485.84 |
| Profit before tax of NHU (Hong Kong) Trading Co., Ltd. | 201,107,312.20 | 30,166,096.83 | 297,747,945.27 | 44,662,191.79 |
| Right-of-use assets | 2,711,325.88 | 406,698.88 | 2,791,860.27 | 418,779.04 |
| Total | 1,643,568,179.89 | 263,498,923.13 | 1,769,099,642.11 | 277,735,456.67 |
(3) Deferred tax assets or liabilities after offset
Unit: RMB Yuan
| Items | Closing balance of deferred tax assets offset by deferred tax liabilities | Closing balance of deferred tax assets/ liabilities after offset | Opening balance of deferred tax assets offset by deferred tax liabilities | Opening balance of deferred tax assets/ liabilities after offset |
| Deferred tax assets | 58,100,373.59 | 50,250,809.38 | ||
| Deferred tax liabilities | 263,498,923.13 | 277,735,456.67 |
(4) Details of unrecognized deferred tax assets
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Deductible temporary difference | 449,494,781.50 | 511,910,785.90 |
| Deductible losses | 1,730,583,954.80 | 2,002,071,871.11 |
| Total | 2,180,078,736.30 | 2,513,982,657.01 |
(5) Maturity years of deductible losses of unrecognized deferred tax assets
Unit: RMB Yuan
| Maturity years | Closing balance | Opening balance | Remarks |
| Year 2027 | 8,512,140.12 | ||
| Year 2028 | 7,395,372.22 | 35,469,296.06 | |
| Year 2029 | 38,901,398.74 | 79,322,307.29 | |
| Year 2030 | 79,426,136.78 | 255,397,416.94 | |
| Year 2031 | 254,533,024.55 | 287,143,749.91 | |
| Year 2032 | 281,165,481.82 | 1,336,226,960.79 | |
| Year 2033 | 1,069,162,540.69 | ||
| Total | 1,730,583,954.80 | 2,002,071,871.11 | -- |
19. Other non-current assets
Unit: RMB Yuan
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Pollution emission trading fees | 16,399,343.44 | 16,399,343.44 | 16,250,239.11 | 16,250,239.11 | ||
| Payments for coal quota | 62,296,000.00 | 62,296,000.00 | 63,496,000.00 | 63,496,000.00 | ||
| Prepayments for long-term assets | 153,283,474.57 | 153,283,474.57 | 200,124,243.53 | 200,124,243.53 | ||
| Total | 231,978,818.01 | 231,978,818.01 | 279,870,482.64 | 279,870,482.64 | ||
20. Short-term borrowings
(1) Details on categories
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Guaranteed borrowings | 11,404,061.84 | 22,643,974.95 |
| Credit borrowings | 1,597,850,167.32 | 1,673,729,466.06 |
| Credit and guaranteed borrowings | 150,000,000.00 | |
| Total | 1,609,254,229.16 | 1,846,373,441.01 |
21. Held-for-trading financial liabilities
Unit: RMB Yuan
| Categories | Closing balance | Opening balance |
| Financial liabilities designated at fair value through profit or loss | 12,909,447.29 | |
| Total | 12,909,447.29 |
22. Notes payable
Unit: RMB Yuan
| Categories | Closing balance | Opening balance |
| Bank acceptance | 456,643,824.63 | 627,438,689.79 |
| Total | 456,643,824.63 | 627,438,689.79 |
23. Accounts payable
(1) Details
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Materials and labor costs | 856,281,933.83 | 735,579,156.33 |
| Payments for engineering and equipment | 947,086,871.01 | 1,439,879,280.16 |
| Total | 1,803,368,804.84 | 2,175,458,436.49 |
24. Contract liabilities
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Payments for goods received in advance | 63,559,211.75 | 60,660,929.75 |
| Total | 63,559,211.75 | 60,660,929.75 |
25. Employee benefits payable
(1) Details
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance |
| I. Short-term employee benefits | 386,391,911.86 | 1,009,716,693.28 | 1,147,080,529.14 | 249,028,076.00 |
| II. Post-employment benefits – defined contribution plan | 56,940,894.94 | 56,940,894.94 | ||
| Total | 386,391,911.86 | 1,066,657,588.22 | 1,204,021,424.08 | 249,028,076.00 |
(2) Details of short-term employee benefits
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance |
| 1. Wage, bonus, allowance and subsidy | 352,176,336.45 | 867,947,427.24 | 1,000,786,485.82 | 219,337,277.87 |
| 2. Employee welfare fund | 59,636,166.90 | 59,636,166.90 | ||
| 3. Social insurance premium | 30,258,035.99 | 30,258,035.99 | ||
| Including: Medicare premium | 26,687,732.53 | 26,687,732.53 | ||
| Occupational injuries premium | 2,983,466.98 | 2,983,466.98 | ||
| Maternity premium | 586,836.48 | 586,836.48 | ||
| 4. Housing provident fund | 46,183,287.53 | 46,183,287.53 | ||
| 5. Trade union fund and employee education fund | 34,215,575.41 | 5,691,775.62 | 10,216,552.90 | 29,690,798.13 |
| Total | 386,391,911.86 | 1,009,716,693.28 | 1,147,080,529.14 | 249,028,076.00 |
(3) Details of defined contribution plan
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance |
| 1. Basic endowment insurance premium | 54,906,640.57 | 54,906,640.57 | ||
| 2. Unemployment insurance premium | 2,034,254.37 | 2,034,254.37 | ||
| Total | 56,940,894.94 | 56,940,894.94 |
26. Taxes and rates payable
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| VAT | 10,491,330.77 | 14,398,822.86 |
| Enterprise income tax | 172,254,286.01 | 141,076,919.30 |
| Individual income tax withheld for tax authorities | 12,179,983.93 | 6,871,930.23 |
| Urban maintenance and construction tax | 2,858,413.99 | 3,127,594.55 |
| Items | Closing balance | Opening balance |
| Land appreciation tax | 15,477,549.51 | 15,427,321.94 |
| Housing property tax | 4,530,579.03 | 16,764,793.31 |
| Land use tax | 6,118,100.19 | 7,963,404.79 |
| Education surcharge (local education surcharge) | 1,973,857.55 | 2,568,164.96 |
| Total | 225,884,100.98 | 208,198,951.94 |
27. Other payables
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Other payables | 59,568,912.95 | 67,351,740.34 |
| Total | 59,568,912.95 | 67,351,740.34 |
1) Categorized by nature
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Security deposits | 19,362,450.86 | 26,917,823.16 |
| Temporary receipts payable | 10,630,190.09 | 15,463,590.29 |
| Earnest money for housing purchase (Boao NHU Resort Center) | 100,000.00 | 100,000.00 |
| Call loans | 13,760,448.64 | |
| Others | 29,476,272.00 | 11,109,878.25 |
| Total | 59,568,912.95 | 67,351,740.34 |
28. Non-current liabilities due within one year
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Long-term borrowings due within one year | 1,919,091,409.71 | 2,591,558,912.13 |
| Lease liabilities due within one year | 104,283.15 | 128,794.09 |
| Total | 1,919,195,692.86 | 2,591,687,706.22 |
29. Other current liabilities
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Output VAT to be recognized | 6,877,330.18 | 4,978,299.99 |
| Total | 6,877,330.18 | 4,978,299.99 |
30. Long-term borrowings
(1) Categories
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Mortgaged borrowings | 29,736,351.83 | 31,590,890.00 |
| Items | Closing balance | Opening balance |
| Guaranteed borrowings | 853,870,166.65 | 934,059,850.02 |
| Credit borrowings | 5,628,509,863.64 | 4,307,986,768.85 |
| Total | 6,512,116,382.12 | 5,273,637,508.87 |
31. Lease liabilities
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Unpaid lease payments | 9,426,413.21 | 4,080,857.16 |
| Less: Unrealized financing expenses | 1,561,001.08 | 1,258,453.09 |
| Total | 7,865,412.13 | 2,822,404.07 |
32. Deferred income
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance | Reasons for balance |
| Government grants | 1,083,159,222.41 | 90,417,310.00 | 63,691,888.18 | 1,109,884,644.23 | The Company received government grants related to assets, which were amortized based on the depreciation progress of corresponding assets. |
| Total | 1,083,159,222.41 | 90,417,310.00 | 63,691,888.18 | 1,109,884,644.23 | -- |
Details of government grants
Unit: RMB Yuan
| Items | Opening balance | Increase | Grants included into non-operating revenue | Grants included into other income | Grants offsetting relevant cost | Other changes | Closing balance | Related to assets/income |
| Special funds for Biological Fermentation Industrial Park Project | 378,242,820.00 | 24,668,010.00 | 353,574,810.00 | Related to assets | ||||
| Special funds for enterprise development (Shandong Vitamins) | 65,290,051.35 | 4,836,300.10 | 60,453,751.25 | Related to assets | ||||
| Special funds for joint production project of Xinhao Thermal Power | 27,997,916.77 | 1,887,499.98 | 26,110,416.79 | Related to assets | ||||
| Technical renovation for green deep processing of 2019 | 33,403,500.00 | 1,713,000.00 | 31,690,500.00 | Related to assets | ||||
| Special funds for enterprise development (Amino Acid) | 62,659,340.76 | 572,802.18 | 62,086,538.58 | Related to assets | ||||
| Subsidies for land leveling of Shandong | 27,590,534.40 | 359,094.72 | 27,231,439.68 | Related to assets | ||||
| Enterprise development funds of Shandong | 18,409,410.76 | 218,907.06 | 18,190,503.70 | Related to assets | ||||
| PPS construction project with annual output of 10,000 tons | 9,586,499.84 | 913,000.02 | 8,673,499.82 | Related to assets | ||||
| Subsidies for PPS resin with annual output of 5,000 tons and PPS composite materials with annual output of 6,000 tons | 5,700,000.00 | 1,425,000.00 | 4,275,000.00 | Related to assets | ||||
| Enterprise development funds of Advanced Manufacturing Industrial Park | 8,293,534.31 | 99,125.88 | 8,194,408.43 | Related to assets | ||||
| Effective industrial input expansion of 2016 | 5,107,200.00 | 478,800.00 | 4,628,400.00 | Related to assets | ||||
| Funds for key thematic projects of industrial revitalization and technical renovation of 2012 | 2,497,500.02 | 713,571.42 | 1,783,928.60 | Related to assets |
| Items | Opening balance | Increase | Grants included into non-operating revenue | Grants included into other income | Grants offsetting relevant cost | Other changes | Closing balance | Related to assets/income |
| Fiscal subsidies for low-rent housing | 5,857,702.92 | 120,428.58 | 5,737,274.34 | Related to assets | ||||
| Subsidies from land transfer fees of Shandong dormitory | 4,622,789.52 | 125,115.78 | 4,497,673.74 | Related to assets | ||||
| Subsidies for inputs in biochemical infrastructure of Shangyu | 4,263,191.96 | 158,885.94 | 4,104,306.02 | Related to assets | ||||
| Construction project of public testing service platform | 2,000,000.08 | 499,999.98 | 1,500,000.10 | Related to assets | ||||
| Subsidies for infrastructure supporting fees | 6,680,625.00 | 398,812.50 | 6,281,812.50 | Related to assets | ||||
| Compensation for resource conservation and environmental protection projects of 2017 | 2,880,000.00 | 240,000.00 | 2,640,000.00 | Related to assets | ||||
| Subsidies for new materials, land and infrastructure construction | 1,621,440.00 | 405,360.00 | 1,216,080.00 | Related to assets | ||||
| Special fiscal funds for revitalization of the substantial economy (transformation of traditional industries) of 2017 | 1,600,842.78 | 269,614.26 | 1,331,228.52 | Related to assets | ||||
| Subsidies for RTO Project | 866,666.94 | 199,999.98 | 666,666.96 | Related to assets | ||||
| Special subsidies for development of marine economy of 2017 | 1,199,999.98 | 100,000.06 | 1,099,999.92 | Related to assets | ||||
| Special subsidies for high-quality development of manufacturing industry | 1,499,372.60 | 152,478.60 | 1,346,894.00 | Related to assets | ||||
| Enterprise development fund (Shandong Fine Chemical) | 50,048,537.62 | 2,611,228.06 | 47,437,309.56 | Related to assets | ||||
| Special funds for Taishan industry leading talents | 7,400,000.00 | 4,000,000.00 | 133,333.34 | 11,266,666.66 | Related to assets | |||
| Food security control and emergency facilities project | 22,363,000.00 | 1,254,000.00 | 21,109,000.00 | Related to assets | ||||
| Policy incentives for industrial production projects of 2020 | 21,419,388.07 | 1,396,916.64 | 20,022,471.43 | Related to assets | ||||
| Special funds for Heilongjiang Biological Fermentation Industrial Park Project | 111,810,000.00 | 111,810,000.00 | Related to assets | |||||
| Incentives for enterprises settling in Industrial Collaborative Innovation Center by Hangzhou Bay Shangyu Economic and Technological Development Zone | 21,049,216.77 | 1,603,099.98 | 19,446,116.79 | Related to assets | ||||
| Subsidies for upgrading coal-fired boilers of 2017 | 185,714.24 | 18,571.44 | 167,142.80 | Related to assets | ||||
| Subsidies for low-nitrogen transformation of gas-fired boilers of Xinchang County | 394,821.43 | 35,357.16 | 359,464.27 | Related to assets | ||||
| Special funds for technical renovation | 30,693,643.47 | 689,427.70 | 30,004,215.77 | Related to assets | ||||
| Incentives for investment promotion | 23,012,614.08 | 304,037.69 | 22,708,576.39 | Related to assets | ||||
| Special fiscal supporting funds for high-quality development (investment projects) of manufacturing industry of Xinchang County of 2021 | 4,468,841.70 | 348,221.40 | 4,120,620.30 | Related to assets | ||||
| Support advanced manufacturing and modern service industry special 2021 central budget investment plan | 36,025,000.02 | 2,807,142.84 | 33,217,857.18 | Related to assets | ||||
| Economic and Information Bureau of technical transformation project subsidies | 7,541,559.54 | 541,869.04 | 6,999,690.50 | Related to assets | ||||
| 2021 Enterprise Digitalization Key Project Incentive Funds | 15,000,000.00 | 500,000.00 | 14,500,000.00 | Related to assets | ||||
| 2022 Special funds to support advanced manufacturing and service industries | 3,831,190.27 | 127,706.36 | 3,703,483.91 | Related to assets | ||||
| 2021 Digital (intelligent) demonstration workshop project incentive money | 1,803,921.60 | 117,647.04 | 1,686,274.56 | Related to assets | ||||
| 2020 industrial enterprise energy-saving technology transformation project incentive policy funds | 915,966.40 | 50,420.16 | 865,546.24 | Related to assets | ||||
| Chemical industry transformation and upgrading 2.0 intelligent transformation project incentives and service subsidies | 40,320,000.00 | 1,344,000.00 | 38,976,000.00 | Related to assets |
| Items | Opening balance | Increase | Grants included into non-operating revenue | Grants included into other income | Grants offsetting relevant cost | Other changes | Closing balance | Related to assets/income |
| Second Digital Economy Financial Assistance Awards | 1,000,000.00 | 59,523.80 | 940,476.20 | Related to assets | ||||
| Collaborative Innovation Center Grant | 30,626,900.00 | 7,911,949.18 | 22,714,950.82 | Related to assets | ||||
| NHU amino acid Project grants | 38,640,510.00 | 38,640,510.00 | Related to assets | |||||
| Shandong Province Core Technology Tackling Special Project (Major Technical Equipment Direction) | 11,360,000.00 | 11,360,000.00 | Related to assets | |||||
| 2023 Provincial Science and Technology Development Special Funding Grant | 1,800,000.00 | 42,857.14 | 1,757,142.86 | Related to assets | ||||
| Heilongjiang Bio 23-year Vitamin C Expansion to 42,000 Tons Technical Reform Project Government Subsidy | 2,989,900.00 | 74,747.49 | 2,915,152.51 | Related to assets | ||||
| Other piecemeal subsidies | 7,004,867.21 | 1,164,024.68 | 5,840,842.53 | Related to assets | ||||
| Total | 1,083,159,222.41 | 90,417,310.00 | 63,691,888.18 | 1,109,884,644.23 |
Note: Please refer to item VII 60 of this section for details on government grants included in profit or loss.
33. Share capital
Unit: RMB Yuan
| Items | Opening balance | Movements | Closing balance | ||||
| Issue of new shares | Bonus shares | Reserve transferred to shares | Others | Subtotal | |||
| Total shares | 3,090,907,356.00 | 3,090,907,356.00 | |||||
34. Capital reserve
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance |
| Share/capital premium | 3,334,992,617.92 | 3,334,992,617.92 | ||
| Other capital reserve | 278,104,892.89 | 278,104,892.89 | ||
| Total | 3,613,097,510.81 | 3,613,097,510.81 |
35. Treasury shares
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance |
| Treasury shares | 500,059,711.25 | 500,059,711.25 | ||
| Total | 500,059,711.25 | 500,059,711.25 |
36. Other comprehensive income (OCI)
Unit: RMB Yuan
| Items | Opening balance | Current period cumulative | Closing balance | |||||
| Current period cumulative before income tax | Less: OCI previously recognized but transferred to profit or loss in current period | Less: OCI previously recognized but transferred to retained earnings in current period | Less: Income tax | Attributable to parent company | Attributable to non-controlling shareholders | |||
| Items not to be reclassified subsequently to profit or loss | 76,577,564.17 | 36,723,815.69 | 29,652,134.01 | 7,071,681.68 | 106,229,698.18 | |||
| Including: Other comprehensive income | 506,954.43 | 506,954.43 | ||||||
| Items | Opening balance | Current period cumulative | Closing balance | |||||
| Current period cumulative before income tax | Less: OCI previously recognized but transferred to profit or loss in current period | Less: OCI previously recognized but transferred to retained earnings in current period | Less: Income tax | Attributable to parent company | Attributable to non-controlling shareholders | |||
| to be transferred to profit or loss under equity method | ||||||||
| Translation reserves | 76,070,609.74 | 36,723,815.69 | 29,652,134.01 | 7,071,681.68 | 105,722,743.75 | |||
| Total | 76,577,564.17 | 36,723,815.69 | 29,652,134.01 | 7,071,681.68 | 106,229,698.18 | |||
37. Special reserve
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance |
| Work safety fund | 26,196,894.55 | 26,153,211.92 | 8,523,683.45 | 43,826,423.02 |
| Total | 26,196,894.55 | 26,153,211.92 | 8,523,683.45 | 43,826,423.02 |
Other remarks, including remarks on current movements and reasons for movements:
According to the "enterprise safety production costs and the use of management practices," the production and storage of dangerousgoods enterprises based on the actual business income of the previous year, the adoption of the regressive approach to the averagemonthly withdrawal in accordance with the following standards: 1) operating income of up to 10 million yuan, in accordance with
4.5%; 2) operating income of more than 10 million yuan to 100 million yuan, in accordance with 2.25% extraction; 3) 0.55% for thepart of business income exceeding 100 million to 1 billion; 4) 0.2% for the part of business income exceeding RMB 1 billion.
38. Surplus reserve
Unit: RMB Yuan
| Items | Opening balance | Increase | Decrease | Closing balance |
| Statutory surplus reserve | 1,444,413,940.89 | 1,444,413,940.89 | ||
| Total | 1,444,413,940.89 | 1,444,413,940.89 |
39. Undistributed profit
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Unallocated earnings at the end of the previous period before adjustment | 15,823,725,913.44 | 14,152,465,528.17 |
| Adjustments to total unappropriated earnings at the beginning of the period (increase +, decrease -) | 19,857.63 | 4,795.77 |
| Adjustment to unappropriated earnings at the beginning of the period | 15,823,745,771.07 | 14,152,470,323.94 |
| Add: Net profit attributable to owners of the parent company | 1,483,229,236.96 | 2,213,877,419.25 |
| Minus: Dividend payable on ordinary shares | 1,536,710,840.00 | 1,793,794,088.80 |
| Closing balance | 15,770,264,168.03 | 14,572,553,654.39 |
Details of undistributed profits at the beginning of adjustment period:
1）Due to the retroactive adjustment of the accounting standards for business enterprises and relevant new regulations, the undistributedprofit at the beginning of the period was RMB 19,857.63. Please refer to item V 18 of this section for details on Deferred tax assetsand deferred tax liabilities.
2）Pursuant to the 2022 profit distribution plan deliberated and approved by the general meeting of 2022, based on the total shares of3,073,421,680 shares excluding the repurchased shares of 17,485,676 shares from 3,090,907,356 shares, a cash dividend of RMB5.00per 10 shares (tax included) will be paid to all shareholders, totaling a cash dividend of RMB1,536,710,840.00 yuan.
40. Operating revenue/Operating cost
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative | ||
| Revenue | Cost | Revenue | Cost | |
| Main operations | 7,320,741,964.94 | 4,925,581,429.30 | 8,115,267,916.02 | 4,789,134,207.58 |
| Other operations | 97,772,611.15 | 63,952,403.65 | 99,771,361.01 | 155,988,595.81 |
| Total | 7,418,514,576.09 | 4,989,533,832.95 | 8,215,039,277.03 | 4,945,122,803.39 |
Details of revenue:
Unit: RMB Yuan
| Categories of contracts | Total |
| By product | |
| Including: Nutrition | 4,830,212,886.75 |
| Flavor and fragrance | 1,631,864,728.45 |
| New materials | 578,308,624.04 |
| Others | 378,128,336.85 |
| Subtotal | 7,418,514,576.09 |
| By operating region | |
| Including: Domestic | 3,557,426,385.63 |
| Overseas | 3,861,088,190.46 |
| Subtotal | 7,418,514,576.09 |
| By revenue recognition time | |
| Including: Goods (transferred at a point in time) | 7,418,514,576.09 |
| Subtotal | 7,418,514,576.09 |
| By sales channel | |
| Including: Direct sales | 5,896,114,550.44 |
| Agent sales | 1,522,400,025.65 |
| Subtotal | 7,418,514,576.09 |
Information related to performance obligations:
None.Information related to transaction price allocated to the remaining performance obligations:
At the end of this report period, revenue corresponding to performance obligations for which the Company has entered into contractsbut not yet performed or fulfilled amounted to 5,371.60 million yuan, of which, 5,371.60 million yuan is expected to be recognized asrevenue in 2023.
41. Taxes and surcharges
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Urban maintenance and construction tax | 16,139,986.76 | 12,713,819.69 |
| Education surcharge (local education surcharge) | 12,568,962.34 | 10,775,889.86 |
| Housing property tax | 16,543,479.78 | 15,431,428.20 |
| Land use tax | 13,595,984.53 | 5,892,341.09 |
| Vehicle and vessel use tax | 31,354.61 | 23,132.71 |
| Stamp duty | 6,523,091.10 | 5,558,733.12 |
| Environmental protection tax | 994,239.44 | 853,455.25 |
| Land appreciation tax | 361,871.13 | |
| Total | 66,397,098.56 | 51,610,671.05 |
42. Selling expenses
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Employee benefits | 30,266,930.02 | 27,765,835.78 |
| Sales commission and customs declaration charges | 16,644,358.83 | 12,731,579.13 |
| Office expenses, business traveling expenses | 9,598,115.80 | 7,801,633.19 |
| Advertising and promotion expenses, business entertainment expenses | 5,805,395.37 | 4,600,887.46 |
| Others | 4,626,570.78 | 4,377,961.92 |
| Total | 66,941,370.80 | 57,277,897.48 |
43. Administrative expenses
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Employee benefits | 134,360,487.91 | 115,390,102.23 |
| Depreciation, amortization of intangible assets | 55,032,882.01 | 46,129,788.87 |
| Office expenses, business traveling expenses | 18,001,839.38 | 13,377,152.20 |
| Business entertainment expenses | 10,453,876.07 | 12,437,740.12 |
| Consulting fees | 9,344,412.68 | 9,456,199.96 |
| Insurance premiums | 7,863,383.20 | 7,564,296.84 |
| Others | 9,589,569.92 | 7,929,542.19 |
| Total | 244,646,451.17 | 212,284,822.41 |
44. R&D expenses
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Employee benefits | 199,709,646.94 | 204,036,669.50 |
| Direct input | 150,730,396.75 | 146,667,952.04 |
| Depreciation, amortization of intangible assets | 38,536,030.81 | 32,048,604.87 |
| Items | Current period cumulative | Preceding period comparative |
| Outsourcing expenses | 3,267,672.12 | 5,698,974.07 |
| Office expenses, business traveling expenses | 4,840,225.31 | 21,270,730.68 |
| Others | 19,491,419.66 | 30,634,321.48 |
| Total | 416,575,391.59 | 440,357,252.64 |
45. Financial expenses
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Interest expenses | 163,988,612.81 | 152,357,156.76 |
| Less: Interest income | 78,203,398.06 | 76,211,850.51 |
| Losses on foreign exchange (or less: gains) | -132,095,878.10 | -61,972,039.28 |
| Others | 9,148,237.96 | 8,057,786.99 |
| Total | -37,162,425.39 | 22,231,053.96 |
46. Other income
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Government grants related to assets [Note] | 63,691,888.18 | 46,423,802.28 |
| Government grants related to income [Note] | 37,629,789.92 | 39,098,377.26 |
| Refund of handling fees for withholding individual income tax | 1,525,545.35 | 1,104,047.36 |
| Total | 102,847,223.45 | 86,626,226.90 |
Note: Please refer to item VII 60 of this section for details on government grants included in other income.
47. Investment income
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Investment income from long-term equity investments under equity method | 34,855,314.27 | 25,402,893.70 |
| Investment income from disposal of financial instruments | -30,080.26 | -2,764,801.12 |
| Including: Financial assets classified as at fair value through profit or loss | 996,763.92 | 7,739,778.29 |
| Financial liabilities classified as at fair value through profit or loss | -1,026,844.18 | -10,504,579.41 |
| Investment income from bank financial products and structured deposits | 8,894,052.73 | 28,841,651.61 |
| Interest income from split loans | 180,613.89 | |
| Total | 43,899,900.63 | 51,479,744.19 |
48. Gains on changes in fair value
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Held-for-trading financial assets | 1,735,988.41 | 29,128,440.56 |
| Including: Gains on changes in fair value arising from financial assets classified as at fair | 1,735,988.41 | 29,128,440.56 |
| Items | Current period cumulative | Preceding period comparative |
| value through profit or loss | ||
| Held-for-trading financial liabilities | -13,004,458.11 | -17,291,740.52 |
| Including: Gains on changes in fair value arising from financial liabilities classified as at fair value through profit or loss | -13,004,458.11 | -17,291,740.52 |
| Total | -11,268,469.70 | 11,836,700.04 |
49. Credit impairment loss
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Bad debts | 6,389,579.21 | -10,613,626.22 |
| Total | 6,389,579.21 | -10,613,626.22 |
50. Assets impairment loss
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Inventory write-down loss | -81,296,758.10 | -7,890,179.58 |
| Total | -81,296,758.10 | -7,890,179.58 |
51. Gains on asset disposal
Unit: RMB Yuan
| Sources | Current period cumulative | Preceding period comparative |
| Gains on disposal of non-current assets | 13,545,778.16 | 6,674,850.81 |
| Total | 13,545,778.16 | 6,674,850.81 |
52. Non-operating revenue
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative | Amount included in non-recurring profit or loss |
| Indemnity income | 3,394,701.03 | 949,584.99 | 3,394,701.03 |
| Others | 182,141.54 | 1,074,489.85 | 182,141.54 |
| Total | 3,576,842.57 | 2,024,074.84 | 3,576,842.57 |
53. Non-operating expenditures
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative | Amount included in non-recurring profit or loss |
| Donation expenditures | 591,259.90 | 1,416,764.60 | 591,259.90 |
| Others | 1,027,741.48 | 913,552.36 | 1,027,741.48 |
| Total | 1,619,001.38 | 2,330,316.96 | 1,619,001.38 |
54. Income tax expenses
(1) Details
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Current period income tax expenses | 273,369,295.58 | 346,750,734.36 |
| Deferred income tax expenses | -22,086,097.75 | 53,344,393.49 |
| Total | 251,283,197.83 | 400,095,127.85 |
(2) Reconciliation of accounting profit to income tax expenses
Unit: RMB Yuan
| Items | Current period cumulative |
| Profit before tax | 1,747,657,951.25 |
| Income tax expenses based on statutory/applicable tax rate | 262,148,692.69 |
| Effect of different tax rate applicable to subsidiaries | 56,214,218.40 |
| Effect of prior income tax reconciliation | -12,365,290.81 |
| Effect of non-taxable income | -451,921,887.75 |
| Effect of non-deductible costs, expenses and losses | 1,445,115.51 |
| Effect of extra deduction of R&D expenses | -63,686,107.78 |
| Effect of utilization of deductible losses not previously recognized as deferred tax assets | 459,448,457.57 |
| Income tax expenses | 251,283,197.83 |
55. Other comprehensive income
Please refer to item VII 36 of this section for details.
56. Notes to items of the cash flow statement
(1) Other cash receipts related to operating activities
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Interest income from cash in bank | 77,998,992.00 | 75,485,329.15 |
| Receipt of government grants | 127,517,191.82 | 95,852,424.62 |
| Recovery of temporary borrowings and security deposits | 1,665,000.00 | 5,016,089.54 |
| Other receipts and net current accounts | 4,596,065.33 | 5,326,081.20 |
| Total | 211,777,249.15 | 181,679,924.51 |
(2) Other cash payments related to operating activities
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| R&D expenditures in the form of cash | 28,971,437.79 | 2,053,649.86 |
| Office expenses and business traveling expenses | 24,331,184.10 | 13,788,936.02 |
| Advertising and promotion expenses, business entertainment expenses | 13,968,143.32 | 8,869,953.87 |
| Sales commission and customs declaration | 16,317,917.34 | 13,003,888.95 |
| Items | Current period cumulative | Preceding period comparative |
| charges | ||
| Insurance expenses | 2,686,385.45 | 2,327,776.16 |
| Other payments and net current accounts | 97,358,958.00 | 106,597,455.76 |
| Total | 183,634,026.00 | 146,641,660.62 |
(3) Other cash receipts related to investing activities
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Redemption of financial products | 720,000,000.00 | 1,800,000,000.00 |
| Receipt of demobilized loans and interest | 20,938,810.13 | 13,423,350.06 |
| Net recovery of other and transactions | 14,294,950.48 | |
| Total | 740,938,810.13 | 1,827,718,300.54 |
(4) Other cash payments related to investing activities
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Payments for purchase of financial products and structured deposits | 250,000,000.00 | 920,000,000.00 |
| Unbundled principal amount | 36,775,804.59 | |
| Payments for land bond | 179,698,926.77 | |
| Total | 250,000,000.00 | 1,136,474,731.36 |
(5) Other cash payments related to financing activities
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Payments for bank financing handling charges | 1,206,719.90 | 3,305,539.56 |
| Payments of handling charges for issuing letters of guarantee for borrowings | 200,900.43 | 576,792.00 |
| Total | 1,407,620.33 | 3,882,331.56 |
57. Supplement information to the cash flow statement
(1) Supplement information to the cash flow statement
Unit: RMB Yuan
| Supplement information | Current period cumulative | Preceding period comparative |
| 1. Reconciliation of net profit to cash flows from operating activities: | ||
| Net profit | 1,496,374,753.42 | 2,223,867,122.27 |
| Add: Provision for assets impairment loss | 74,907,178.89 | 18,503,805.80 |
| Depreciation of fixed assets, oil and gas assets, productive biological assets | 803,970,477.86 | 623,703,868.71 |
| Depreciation of right-of-use assets | 360,873.71 | 657,653.96 |
| Amortization of intangible assets | 26,371,053.50 | 19,125,769.24 |
| Amortization of long-term prepayments | 3,834,293.78 | 3,316,666.66 |
| Losses on disposal of fixed assets, intangible assets and other long-term | -13,545,778.16 | -6,674,850.81 |
| Supplement information | Current period cumulative | Preceding period comparative |
| assets (Less: gains) | ||
| Fixed assets retirement loss (Less: gains) | ||
| Losses on changes in fair value (Less: gains) | 11,268,469.70 | -11,836,700.04 |
| Financial expenses (Less: gains) | -36,396,626.05 | 163,843,989.92 |
| Investment losses (Less: gains) | -43,899,900.63 | -51,479,744.19 |
| Decrease of deferred tax assets (Less: increase) | -7,849,564.21 | -12,188,648.37 |
| Increase of deferred tax liabilities (Less: decrease) | -14,236,533.54 | 65,533,041.86 |
| Decrease of inventories (Less: increase) | -433,678,248.93 | -1,358,969,145.31 |
| Decrease of operating receivables (Less: increase) | 351,542,987.52 | 125,300,272.14 |
| Increase of operating payables (Less: decrease) | -983,460,814.93 | -560,246,363.64 |
| Others | ||
| Net cash flows from operating activities | 1,235,562,621.93 | 1,242,456,738.20 |
| 2. Significant investing and financing activities not related to cash receipts and payments: | -- | -- |
| Conversion of debt into capital | ||
| Convertible bonds due within one year | ||
| Fixed assets leased in under finance leases | ||
| 3. Net changes in cash and cash equivalents: | -- | -- |
| Cash at the end of the period | 3,507,891,602.10 | 6,451,708,569.16 |
| Less: Cash at the beginning of the period | 5,151,841,931.86 | 5,714,537,538.23 |
| Add: Cash equivalents at the end of the period | ||
| Less: Cash equivalents at the beginning of the period | ||
| Net increase of cash and cash equivalents | -1,643,950,329.76 | 737,171,030.93 |
(2) Composition of cash and cash equivalents
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| I. Cash | 3,507,891,602.10 | 5,151,841,931.86 |
| Including: Cash on hand | 21,036.01 | 16,584.59 |
| Cash in bank on demand for payment | 3,507,862,165.02 | 5,151,816,943.29 |
| Other cash and bank balances on demand for payment | 8,401.07 | 8,403.98 |
| II. Cash and cash equivalents at the end of the period | 3,507,891,602.10 | 5,151,841,931.86 |
Remarks:
Closing balance of cash and bank balances amounted to 3,654,734,123.88 yuan, including deposit for bank acceptance of110,959,093.51 yuan, deposit for letters of credit of 33,486,505.20yuan, deposit for engineering labor costs of 852,349.44 yuan, depositfor construction safety of 867,529.53 yuan, deposit for ETC of 16,500.00 yuan and deposit for water fees of 660,544.10 yuan, whichwas not cash and cash equivalents.
Closing balance of cash and bank balances amounted to 5,343,851,967.72 yuan, including deposit for bank acceptance of147,608,293.24 yuan, deposit for letters of credit of 42,310,180.59 yuan, deposit for engineering labor costs of 851,288.54yuan, depositfor construction safety of 863,937.05 yuan, deposit for ETC of 16,500.00 yuan and deposit for water fees of 359,836.44 yuan, whichwas not cash and cash equivalents.
58. Assets with title or use right restrictions
Unit: RMB Yuan
| Items | Closing carrying amount | Reasons for restrictions |
| Cash and bank balances | 146,842,521.78 | Please refer to supplement information to the cash flow statement of this section for details. |
| Notes receivable | 155,053,622.64 | Please refer to notes to notes receivable of this section for details. |
| Fixed assets | 97,437,448.95 | Mortgaged for bank borrowings. |
| Intangible assets | 18,579,010.61 | Mortgaged for bank borrowings. |
| Receivables financing | 84,532,028.12 | Please refer to notes to receivables financing of this section for details. |
| Total | 502,444,632.10 | -- |
59. Monetary items in foreign currencies
(1) Details
Unit: RMB Yuan
| Items | Closing balance in foreign currencies | Exchange rate | RMB equivalent at the end of the period |
| Cash and bank balances | -- | -- | 286,324,680.87 |
| Including: USD | 21,871,979.07 | 7.2258 | 158,042,546.36 |
| EUR | 15,249,133.92 | 7.8771 | 120,118,952.80 |
| HKD | 813,287.36 | 0.9220 | 749,850.95 |
| JPY | 80,552,975.00 | 0.0501 | 4,035,704.05 |
| BRL | 1,409,474.25 | 1.4922 | 2,103,217.48 |
| PHP | 1,880,313.16 | 0.4235 | 796,312.62 |
| SGD | 68,001.46 | 5.3442 | 363,413.40 |
| PLN | 64,752.53 | 1.7711 | 114,683.21 |
| Accounts receivable | - | - | 1,720,951,618.92 |
| Including: USD | 196,305,356.37 | 7.2258 | 1,418,463,244.16 |
| EUR | 29,742,103.99 | 7.8771 | 234,281,527.35 |
| GBD | 38,640.00 | 0.9220 | 35,626.08 |
| BRL | 45,685,043.11 | 1.4922 | 68,171,221.33 |
| Other receivables | - | - | 53,809,261.14 |
| Including: EUR | 1,772,947.54 | 7.8771 | 13,965,685.07 |
| HKD | 31,700.00 | 0.9220 | 29,227.40 |
| BRL | 7,751,932.61 | 1.4922 | 11,567,433.84 |
| PHP | 65,940,508.41 | 0.4235 | 27,925,805.31 |
| SGD | 60,085.61 | 5.3442 | 321,109.52 |
| Short-term borrowings | - | - | 134,477,770.95 |
| Including: USD | 411,070.24 | 7.2258 | 2,970,311.34 |
| Items | Closing balance in foreign currencies | Exchange rate | RMB equivalent at the end of the period |
| EUR | 15,884,344.60 | 7.8771 | 125,122,570.85 |
| DKK | 6,034,296.15 | 1.0581 | 6,384,888.76 |
| Accounts payable | - | - | 85,049,402.03 |
| Including: USD | 2,545,781.14 | 7.2258 | 18,395,305.35 |
| EUR | 6,269,284.37 | 7.8771 | 49,383,779.93 |
| BRL | 11,476,912.19 | 1.4922 | 17,125,848.37 |
| PHP | 341,129.58 | 0.4235 | 144,468.38 |
| Other payables | - | - | 8,796,122.02 |
| Including: USD | 914,096.30 | 7.2258 | 6,605,077.04 |
| EUR | 265,517.36 | 7.8771 | 2,091,506.80 |
| HKD | 57,878.84 | 0.9220 | 53,364.29 |
| SGD | 8,640.00 | 5.3442 | 46,173.89 |
| Long-term borrowings | - | - | 29,736,351.83 |
| Including: EUR | 3,775,038.00 | 7.8771 | 29,736,351.83 |
| Non-current liabilities due within one year | - | - | 7,575,107.74 |
| Including: EUR | 961,662.00 | 7.8771 | 7,575,107.74 |
(2) Remarks on overseas operations. For significant overseas operating entities, their main operating places,functional currencies and adoption basis shall be disclosed. Reasons for any changes in functional currencyshall also be disclosed.
√ Applicable □ Not applicable
NHU EUROPE GmbH is a holding subsidiary of the subsidiary NHU (Hong Kong) Trading Co., Ltd. with the holding proportion of51%; NHU Performance Materials GmbH is a wholly-owned subsidiary of the subsidiary NHU (Hong Kong) Trading Co., Ltd.;Bardoterminal GmbH is a wholly-owned subsidiary of NHU EUROPE GmbH. The above three entities are all located in Luneburg,Germany, with EUR as functional currency.NHU/Chr.Olesen Latin America A/S, with a shareholding ratio of 51%, located in gentovt, Denmark, and the functional currency iseuro; NHU/CHR. Olesen Brasil LTDA. Is nhu / Chr Olesen Latin America a / s, a wholly-owned subsidiary, is located in Sao Paulo,Brazil, and its functional currency is Brazilian real; CHR. Olesen Mexico SAPI de CV is nhu / Chr Olesen Latin America a / S is aholding subsidiary of Olesen Latin America a /s, with a shareholding ratio of 87%. It is located in cretaro, Mexico, and its functionalcurrency is Mexican peso.NHU Singapore PTE. LTD. is a wholly-owned subsidiary of the Company. It is located in Singapore, with SGD as functional currency.
60. Government grants
(1) Government grants related to assets
Unit: RMB Yuan
| Items | Closing balance | Related to assets/income | Grants included into other income |
| Special funds for Biological Fermentation Industrial Park Project | 353,574,810.00 | Related to assets | 24,668,010.00 |
| Special funds for enterprise development (Shandong Vitamins) | 60,453,751.25 | Related to assets | 4,836,300.10 |
| Special funds for joint production project of Xinhao Thermal Power | 26,110,416.79 | Related to assets | 1,887,499.98 |
| Technical renovation for green deep processing of 2019 | 31,690,500.00 | Related to assets | 1,713,000.00 |
| Items | Closing balance | Related to assets/income | Grants included into other income |
Special funds for enterprise development(Amino Acid)
| Special funds for enterprise development (Amino Acid) | 62,086,538.58 | Related to assets | 572,802.18 |
| Subsidies for land leveling of Shandong | 27,231,439.68 | Related to assets | 359,094.72 |
| Enterprise development funds of Shandong | 18,190,503.70 | Related to assets | 218,907.06 |
| PPS construction project with annual output of 10,000 tons | 8,673,499.82 | Related to assets | 913,000.02 |
| Subsidies for PPS resin with annual output of 5,000 tons and PPS composite materials with annual output of 6,000 tons | 4,275,000.00 | Related to assets | 1,425,000.00 |
| Enterprise development funds of Advanced Manufacturing Industrial Park | 8,194,408.43 | Related to assets | 99,125.88 |
| Effective industrial input expansion of 2016 | 4,628,400.00 | Related to assets | 478,800.00 |
Funds for key thematic projects of industrialrevitalization and technical renovation of 2012
| Funds for key thematic projects of industrial revitalization and technical renovation of 2012 | 1,783,928.60 | Related to assets | 713,571.42 |
| Fiscal subsidies for low-rent housing | 5,737,274.34 | Related to assets | 120,428.58 |
| Subsidies from land transfer fees of Shandong dormitory | 4,497,673.74 | Related to assets | 125,115.78 |
| Subsidies for inputs in biochemical infrastructure of Shangyu | 4,104,306.02 | Related to assets | 158,885.94 |
| Construction project of public testing service platform | 1,500,000.10 | Related to assets | 499,999.98 |
| Subsidies for infrastructure supporting fees | 6,281,812.50 | Related to assets | 398,812.50 |
| Compensation for resource conservation and environmental protection projects of 2017 | 2,640,000.00 | Related to assets | 240,000.00 |
| Subsidies for new materials, land and infrastructure construction | 1,216,080.00 | Related to assets | 405,360.00 |
| Special fiscal funds for revitalization of the substantial economy (transformation of traditional industries) of 2017 | 1,331,228.52 | Related to assets | 269,614.26 |
Subsidies for RTO Project
| Subsidies for RTO Project | 666,666.96 | Related to assets | 199,999.98 |
| Special subsidies for development of marine economy of 2017 | 1,099,999.92 | Related to assets | 100,000.06 |
| Special subsidies for high-quality development of manufacturing industry | 1,346,894.00 | Related to assets | 152,478.60 |
| Enterprise development fund (Shandong Fine Chemical) | 47,437,309.56 | Related to assets | 2,611,228.06 |
| Special funds for Taishan industry leading talents project | 11,266,666.66 | Related to assets | 133,333.34 |
| Food security control and emergency facilities project – investment plan within budget of the central government of 2020 | 21,109,000.00 | Related to assets | 1,254,000.00 |
| Policy incentives for industrial production projects of 2020 | 20,022,471.43 | Related to assets | 1,396,916.64 |
| Special funds for Heilongjiang Biological Fermentation Industrial Park Project | 111,810,000.00 | Related to assets |
Incentives for enterprises settling in IndustrialCollaborative Innovation Center by HangzhouBay Shangyu Economic and TechnologicalDevelopment Zone
| Incentives for enterprises settling in Industrial Collaborative Innovation Center by Hangzhou Bay Shangyu Economic and Technological Development Zone | 19,446,116.79 | Related to assets | 1,603,099.98 |
| Subsidies for upgrading coal-fired boilers of 2017 | 167,142.80 | Related to assets | 18,571.44 |
| Items | Closing balance | Related to assets/income | Grants included into other income |
Subsidies for low-nitrogen transformation ofgas-fired boilers of Xinchang County
| Subsidies for low-nitrogen transformation of gas-fired boilers of Xinchang County | 359,464.27 | Related to assets | 35,357.16 |
| Special funds for technical renovation | 30,004,215.77 | Related to assets | 689,427.70 |
| Incentives for investment promotion | 22,708,576.39 | Related to assets | 304,037.69 |
| Special fiscal supporting funds for high-quality development (investment projects) of manufacturing industry of Xinchang County of 2021 | 4,120,620.30 | Related to assets | 348,221.40 |
Special investment plan within budget of thecentral government for supporting advancedmanufacturing industry and modern service of2021
| Special investment plan within budget of the central government for supporting advanced manufacturing industry and modern service of 2021 | 33,217,857.18 | Related to assets | 2,807,142.84 |
| Economic and Information Bureau of technical transformation project subsidies | 6,999,690.50 | Related to assets | 541,869.04 |
| 2021 Enterprise Digitalization Key Project Incentive Funds | 14,500,000.00 | Related to assets | 500,000.00 |
| 2022 Special funds to support advanced manufacturing and service industries | 3,703,483.91 | Related to assets | 127,706.36 |
| 2021 Digital (intelligent) demonstration workshop project incentive money | 1,686,274.56 | Related to assets | 117,647.04 |
| 2020 industrial enterprise energy-saving technology transformation project incentive policy funds | 865,546.24 | Related to assets | 50,420.16 |
| Chemical industry transformation and upgrading 2.0 intelligent transformation project incentives and service subsidies | 38,976,000.00 | Related to assets | 1,344,000.00 |
| Second Digital Economy Financial Assistance Awards | 940,476.20 | Related to assets | 59,523.80 |
| Collaborative Innovation Center Grant | 22,714,950.82 | Related to assets | 7,911,949.18 |
| NHU amino acid Project grants | 38,640,510.00 | Related to assets | |
| Shandong Province Core Technology Tackling Special Project (Major Technical Equipment Direction) | 11,360,000.00 | Related to assets | |
| 2023 Provincial Science and Technology Development Special Funding Grant | 1,757,142.86 | Related to assets | 42,857.14 |
| Heilongjiang Bio 23-year Vitamin C Expansion to 42,000 Tons Technical Reform Project Government Subsidy | 2,915,152.51 | Related to assets | 74,747.49 |
| Other piecemeal subsidies - investment plan within budget of the central government of 2023 | 5,840,842.53 | Related to assets | 1,164,024.68 |
| Subtotal | 1,109,884,644.23 | 63,691,888.18 |
(2) Government grants related to income and used to compensate incurred relevant costs, expenses or losses
Unit: RMB Yuan
| Items | Amount | Presented under | Remarks |
| Government subsidies | 18,869,301.48 | Other income | Related to income |
| Other subsidies | 9,404,072.44 | Other income | Related to income |
| Special subsidies | 9,356,416.00 | Other income | Related to income |
| Items | Amount | Presented under | Remarks |
| Subtotal | 37,629,789.92 |
(3) In the current period, government grants included into profit or loss totaled 101,321,678.10 yuan.
VIII. Changes in the consolidation scope
None
IX. Interest in other entities
1. Interest in subsidiaries
(1) Composition of the group
1） Significant subsidiaries
| Subsidiaries | Main operating place | Place of registration | Business nature | Holding proportion (%) | Acquisition method | |
| Direct | Indirect | |||||
| Shangyu NHU Bio-Chem Co., Ltd. | Shangyu, Zhejiang | Shangyu, Zhejiang | Manufacturing | 100.00% | Establishment | |
| Shandong NHU Pharmaceutical Co., Ltd. | Weifang, Shandong | Weifang, Shandong | Manufacturing | 100.00% | Establishment | |
| NHU (Hong Kong) Trading Co., Ltd. | Hong Kong, China | Hong Kong, China | Commerce | 100.00% | Establishment | |
| Zhejiang NHU Special Materials Co., Ltd. | Shangyu, Zhejiang | Shangyu, Zhejiang | Manufacturing | 100.00% | Establishment | |
| Shandong NHU Amino-acids Co., Ltd. | Weifang, Shandong | Weifang, Shandong | Manufacturing | 100.00% | Establishment | |
| NHU EUROPE GmbH | Luneburg, Germany | Luneburg, Germany | Trade | 51% [Note 1] | Establishment | |
| Shandong NHU Holdings Co., Ltd. | Weifang, Shandong | Weifang, Shandong | Service | 100.00% | Establishment | |
| Shandong NHU Vitamins Co., Ltd. | Weifang, Shandong | Weifang, Shandong | Manufacturing | 100.00% [Note 2] | Establishment | |
| Heilongjiang NHU Biotechnology Co., Ltd. | Suihua, Heilongjiang | Suihua, Heilongjiang | Manufacturing | 100.00% | Establishment | |
Remarks on inconsistency between holding proportion and voting rights proportion in subsidiaries:
Note 1: The Company holds shares through NHU (Hong Kong) Trading Co., Ltd.Note 2: The Company holds shares through Shandong NHU Holdings Co., Ltd.
(2) Significant not wholly-owned subsidiaries
Unit: RMB Yuan
| Subsidiaries | Holding proportion of non-controlling shareholders | Non-controlling shareholders’ profit or loss | Dividend declared to non-controlling shareholders | Closing balance of non-controlling interest |
| NHU EUROPE GmbH | 49.00% | 8,666,085.23 | 93,309,805.67 |
(3) Main financial information of significant not wholly-owned subsidiaries
Unit: RMB Yuan
| Subsidiaries | Closing balance | |||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| NHU EUROPE GmbH | 768,261,922.73 | 109,151,554.14 | 877,413,476.87 | 657,248,950.21 | 29,736,351.83 | 686,985,302.04 |
(Continued)
| Subsidiaries | Opening balance | |||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| NHU EUROPE GmbH | 704,132,280.59 | 96,076,867.88 | 800,209,148.47 | 606,659,014.52 | 31,590,890.00 | 638,249,904.52 |
Unit: RMB Yuan
| Subsidiaries | Current period cumulative | Preceding period comparative | ||||||
| Operating revenue | Net profit | Total comprehensive income | Cash flows from operating activities | Operating revenue | Net profit | Total comprehensive income | Cash flows from operating activities | |
| NHU EUROPE GmbH | 856,013,524.97 | 17,685,888.23 | 28,468,930.88 | 45,632,953.79 | 810,123,339.42 | 17,831,246.48 | 13,823,928.20 | -2,752,415.97 |
2. Interest in joint venture or associates
(1) Significant joint ventures or associates
| Joint ventures or associates | Main operating place | Place of registration | Business nature | Holding proportion (%) | Accounting treatment on investments in joint ventures or associates | |
| Direct | Indirect | |||||
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | Shangyu, Zhejiang | Shangyu, Zhejiang | Manufacturing | 29.9307% | Equity method | |
| DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | Shangyu, Zhejiang | Shangyu, Zhejiang | Manufacturing | 40.00% | Equity method | |
| Zhejiang Saiya Chemical Materials Co., Ltd. | Shangyu, Zhejiang | Shangyu, Zhejiang | Manufacturing | 49.00% | Equity method | |
(2) Main financial information of significant joint ventures
Unit: RMB Yuan
| Items | Closing balance/Current period cumulative | Opening balance/Preceding period comparative | ||||
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | Zhejiang Saiya Chemical Materials Co., Ltd. | Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | Zhejiang Saiya Chemical Materials Co., Ltd. | |
| Current assets | 396,646,413.66 | 111,900,748.44 | 204,326,091.93 | 460,887,337.74 | 109,398,305.48 | 144,410,128.60 |
| Non-current assets | 688,393,234.17 | 14,859,373.63 | 129,082,880.51 | 676,165,054.18 | 19,755,796.05 | 138,230,668.22 |
| Total assets | 1,085,039,647.83 | 126,760,122.07 | 333,408,972.44 | 1,137,052,391.92 | 129,154,101.53 | 282,640,796.82 |
| Current liabilities | 168,151,910.46 | 57,072,921.64 | 41,303,737.81 | 290,955,340.38 | 62,895,473.39 | 24,117,241.66 |
| Non-current liabilities | 47,125,878.37 | 1,941,915.00 | 44,353,913.81 | 2,114,370.00 | ||
| Total liabilities | 215,277,788.83 | 57,072,921.64 | 43,245,652.81 | 335,309,254.19 | 62,895,473.39 | 26,231,611.66 |
| Equity attributable to shareholders of parent company | 869,761,859.00 | 69,687,200.43 | 290,163,319.63 | 801,743,137.73 | 66,258,628.14 | 256,409,185.16 |
| Proportionate share in net assets | 260,325,800.47 | 27,874,880.17 | 142,180,026.62 | 239,967,333.33 | 26,503,451.26 | 125,640,500.73 |
| Adjustments | ||||||
| - Goodwill | 762,611.33 | 762,611.33 | ||||
| - Unrealized profit | 2,120,785.74 | 740,043.41 | 2,046,002.90 | 952,124.29 | ||
| Items | Closing balance/Current period cumulative | Opening balance/Preceding period comparative | ||||
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | Zhejiang Saiya Chemical Materials Co., Ltd. | Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | Zhejiang Saiya Chemical Materials Co., Ltd. | |
| in internal trading | ||||||
| -other | ||||||
| Carrying amount of investments in associates | 260,325,800.47 | 25,759,977.53 | 140,703,045.01 | 239,967,333.33 | 24,457,448.36 | 125,450,987.77 |
| Operating revenue | 274,315,575.00 | 118,776,550.60 | 195,077,130.44 | 283,967,325.65 | 92,415,365.12 | 201,503,983.57 |
| Net profit | 95,546,122.92 | 10,291,286.16 | 33,133,116.13 | 70,472,241.95 | 7,058,005.64 | 13,640,166.75 |
| Total comprehensive income | 95,546,122.92 | 10,291,286.16 | 33,133,116.13 | 70,472,241.95 | 7,058,005.64 | 13,640,166.75 |
(3) Aggregated financial information of insignificant joint ventures and associates
Unit: RMB Yuan
| Items | Closing balance/ Current period cumulative | Opening balance/ Preceding period comparative |
| Joint ventures: | -- | -- |
| Total carrying amount of investments | 276,328,667.99 | 42,627,799.02 |
| Proportionate shares in the following items | -- | -- |
| -- Net profit | -2,918,914.57 | -911,994.44 |
| -- Other comprehensive income | ||
| -- Total comprehensive income | -2,918,914.57 | -911,994.44 |
X. Risks related to financial instrumentsIn risk management, the Company aims to seek the appropriate balance between the risks and benefits from its use of financialinstruments and to mitigate the adverse effects that the risks of financial instruments have on the Company’s financial performance, soas to maximize the profits of shareholders and other equity investors. Based on such risk management objectives, the Company’s riskmanagement policies are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls,and to monitor risks and adherence to limits on a timely and reliable basis.The Company has exposure to the following risks from its use of financial instruments, which mainly include: credit risk, liquidityrisk, and market risk. The Management has deliberated and approved policies concerning such risks, and details are:
(I) Credit riskCredit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge anobligation.
1. Credit risk management practice
(1) Evaluation method of credit risk
At each balance sheet date, the Company assesses whether the credit risk on a financial instrument has increased significantly sinceinitial recognition. When assessing whether the credit risk has increased significantly since initial recognition, the Company takes intoaccount reasonable and supportable information, which is available without undue cost or effort, including qualitative and quantitativeanalysis based on historical data, external credit risk rating, and forward-looking information. The Company determines the changesin default risk of financial instruments during the estimated lifetime through comparison of the default risk at the balance sheet dateand the initial recognition date, on an individual basis or a collective basis.
The Company considers the credit risk on a financial instrument has increased significantly when one or more of the followingqualitative and quantitative standards are met:
1) Quantitative standard mainly relates to the scenario in which, at the balance sheet date, the probability of default in the remaininglifetime has risen by more than a certain percentage compared with the initial recognition;
2) Qualitative standard mainly relates to significant adverse changes in the debtor’s operation or financial position, present or expectedchanges in technology, market, economy or legal environment that will have significant adverse impact on the debtor’s repaymentability.
(2) Definition of default and credit-impaired assets
A financial instrument is defined as defaulted when one or more following events have occurred, of which the standard is consistentwith that for credit-impairment:
1) significant financial difficulty of the debtor;
2) a breach of binding clause of contract;
3) it is very likely 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 financial difficulty, having granted to thedebtor a concession(s) that the creditor would not otherwise consider.
2. Measurement of expected credit losses
The key factors in the measurement of expected credit loss include the probability of default, loss rate of default, and exposure todefault risk. The Company develops a model of the probability of default, loss rate of default, and exposure to default risk on the basisof quantitative analysis of historical data (e.g. counterparty rating, guarantee measures and collateral type, payment method, etc.) andforward-looking information.
3. Please refer to item VII 4 and 7 of this section for details on the reconciliation table of opening balance and closing balance ofprovision for losses of financial instrument.
4. Exposure to credit risk and concentration of credit risk
The Company’s credit risk is primarily attributable to cash and bank balances and receivables. In order to control such risks, theCompany has taken the following measures:
(1) Cash and bank balances
The Company deposits its bank balances and other cash and bank balances in financial institutions with relatively high credit levels,hence, its credit risk is relatively low.
(2) Receivables
The Company performs credit assessment on customers using credit settlement on a continuous basis. The Company selects credibleand well-reputed customers based on credit assessment result, and conducts ongoing monitoring on balance of receivables, to avoidsignificant risks in bad debts.As the Company only conducts business with credible and well-reputed third parties, collateral is not required from customers. TheCompany manages credit risk aggregated by customers. As of June 30, 2023, the Company has certain concentration of credit risk,and 25.67% (December 31, 2022: 29.31%) of the total accounts receivable was due from the five largest customers of the Company.The Company held no collateral or other credit enhancement on balance of receivables.The maximum amount of exposure to credit risk of the Company is the carrying amount of each financial asset at the balance sheet.(II) Liquidity risk
Liquidity risk is the risk that the Company may encounter deficiency of funds in meeting obligations associated with cash or otherfinancial assets settlement, which is possibly attributable to failure in selling financial assets at fair value on a timely basis, or failurein collecting liabilities from counterparties of contracts, or early redemption of debts, or failure in achieving estimated cash flows.In order to control such risk, the Company comprehensively utilized financing tools such as notes settlement, bank borrowings, etc.and adopts long-term and short-term financing methods to optimize financing structures, and finally maintains a balance betweenfinancing sustainability and flexibility. The Company has obtained credit limit from several commercial banks to meet working capitalrequirements and expenditures.Financial liabilities classified based on remaining time period till maturity
Unit: RMB Yuan
| Items | Closing balance | ||||
| Carrying amount | Contract amount not yet discounted | Within 1 year | 1-3 years | Over 3 years | |
| Bank borrowings | 10,040,462,020.99 | 10,613,649,462.49 | 3,800,376,575.50 | 5,943,854,166.30 | 869,418,720.69 |
| Notes payable | 456,643,824.63 | 456,643,824.63 | 456,643,824.63 | ||
| Accounts payable | 1,803,368,804.84 | 1,803,368,804.84 | 1,803,368,804.84 | ||
| Other payables | 59,568,912.95 | 59,568,912.95 | 59,568,912.95 | ||
| Lease liabilities | 7,969,695.28 | 9,291,079.41 | 2,842,604.78 | 3,119,558.99 | 3,328,915.64 |
| Subtotal | 12,368,013,258.69 | 12,942,522,084.32 | 6,122,800,722.70 | 5,946,973,725.29 | 872,747,636.33 |
(Continued)
Unit: RMB Yuan
| Items | December 31, 2022 | ||||
| Carrying amount | Contract amount not yet discounted | Within 1 year | 1-3 years | Over 3 years | |
Bank borrowings
| Bank borrowings | 9,711,569,862.01 | 10,221,836,453.80 | 4,703,403,806.64 | 5,017,998,789.29 | 500,433,857.87 |
| Notes payable | 627,438,689.79 | 627,438,689.79 | 627,438,689.79 |
Accounts payable
| Accounts payable | 2,175,458,436.49 | 2,175,458,436.49 | 2,175,458,436.49 | ||
| Other payables | 67,351,740.34 | 67,351,740.34 | 67,351,740.34 | ||
| Lease liabilities | 2,951,198.16 | 4,345,952.05 | 265,094.89 | 714,285.72 | 3,366,571.44 |
Subtotal
| Subtotal | 12,584,769,926.79 | 13,096,431,272.47 | 7,573,917,768.15 | 5,018,713,075.01 | 503,800,429.31 |
(III) Market riskMarket risk is the risk that the Company may encounter fluctuation in fair value or future cash flows of financial instruments due tochanges in market price. Market risk mainly includes interest risk and foreign currency risk.
1. Interest risk
Interest risk is the risk that an enterprise may encounter fluctuation in fair value or future cash flows of financial instruments due tochanges in market interest. The Company’s fair value interest risks arise from fixed-rate financial instruments, while the cash flowinterest risks arise from floating-rate financial instruments. The Company determines the proportion of fixed-rate financial instrumentsand floating-rate financial instruments based on the market environment, and maintains a proper financial instruments portfolio throughregular review and monitoring. The Company’s interest risk in cash flows relates mainly to bank borrowings with floating interest rate.As of June 30, 2023, balance of borrowings with interest accrued at floating interest rate totaled 10,040.46 million yuan (December 31,2022: 9,711.57 million yuan). If interest rates had been 50 basis points higher/lower and all other variables were held constant, theCompany’s profit before tax and equity will not be significantly affected.
2. Foreign currency risk
Foreign currency risk is the risk arising from changes in fair value or future cash flows of financial instrument resulted from changesin exchange rate. The Company’s foreign currency risk relates mainly to foreign currency monetary assets and liabilities. When short-term imbalance occurred to foreign currency assets and liabilities, the Company may trade foreign currency at market exchange ratewhen necessary, in order to maintain the net risk exposure within an acceptable level.Please refer to item VII 59 of the notes to the financial statements for details on foreign currency financial assets and liabilities at theend of the period.
XI. Fair value disclosure
1. Details of fair value of assets and liabilities at fair value at the balance sheet date
Unit: RMB Yuan
| Items | Fair value as at the balance sheet date | |||
| Level 1 fair value measurement | Level 2 fair value measurement | Level 3 fair value measurement | Total | |
| I. Recurring fair value measurement | -- | -- | -- | -- |
| 1. Held-for-trading financial assets and other non-current financial assets | 250,000,000.00 | 250,000,000.00 | ||
| Financial assets classified as at fair value through profit or loss | 250,000,000.00 | 250,000,000.00 | ||
| Financial products with guaranteed principal and floating income | 250,000,000.00 | 250,000,000.00 | ||
| 2. Receivables financing | 506,430,216.64 | 506,430,216.64 | ||
| 3. Other equity instrument investments | 22,998,147.55 | 22,998,147.55 | ||
| Total assets at recurring fair value measurement | 779,428,364.19 | 779,428,364.19 | ||
| 1. Held-for-trading financial liabilities and other non-current financial liabilities | 12,909,447.29 | 12,909,447.29 | ||
| Total liabilities at recurring fair value measurement | 12,909,447.29 | 12,909,447.29 | ||
2. Qualitative and quantitative information of valuation technique(s) and key input(s) for level 2 fair valueat recurring and non-recurring fair measurementFair value was determined at forward exchange rate published by Bank of China Limited at the balance sheet date.
3. Qualitative and quantitative information of valuation technique(s) and key input(s) for level 3 fair valueat recurring and non-recurring fair measurement
1. Fair value of short-term financial products with guaranteed principal and floating income and structured deposits was determinedbased on their par value.
2. Fair value of bank acceptance was determined based on its par value.
3. As there is no significant change in the operating environment, operating condition and financial position of the invested entitiesZhejiang Second Pharma Co., Ltd. and Shanghai NewMargin Yongjin Eqiuty Enterprise (LP), the Company took investment cost asthe reasonable estimation of fair value.
XII. Related parties and related party transactions
1. Parent company
| Parent company | Place of registration | Business nature | Registered capital | Holding proportion over the Company | Voting right proportion over the Company |
| NHU Holding Group Co., Ltd. | Xinchang, Zhejiang | Manufacturing | 120.00 million | 49.22% | 49.22% |
Remarks on the parent companyThe Company’s ultimate controlling party is the natural person Hu Baifan.
2. Subsidiaries of the Company
Please refer to item IX 1 of the notes to the financial statements for details on the Company’s subsidiaries.
3. Joint ventures and associates of the Company
Please refer to item IX 2 of the notes to the financial statements for details on the Company’s significant joint ventures andassociates.Other joint ventures or associates that had related-party transactions with the Company during the current period, or had balancesresulting from related-party transactions with the Company in prior periods, are described below:
| Related parties | Relationships with the Company |
| Beijing Winsunny Pharmaceutical Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Zhejiang Asen Pharmaceutical Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Xinchang County Hechun Greening Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Zhejiang Deli Equipment Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Front Pharmaceutical PLC. | Controlled by NHU Holding Group Co., Ltd. |
| Weifang Hecheng Real Estate Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Qionghai Heyue Property Services Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Qionghai Boao Holliyard Hotel Management Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Shaoxing Heyue Property Services Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Zhejiang Jingshi Real Estate Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Shaoxing Yuexiu Education Development Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Shaoxing Jinghe Hotel Management Co., Ltd. | Controlled by NHU Holding Group Co., Ltd. |
| Zhejiang Yuexiu University of Foreign Languages | Controlled by NHU Holding Group Co., Ltd. |
| Heilongjiang Haotian Corn Development Co., Ltd. | Minority Shareholders of Subsidiaries |
As Client B holds 25% equity of NHU Europe GmbH, the holding subsidiary of the Company’s subsidiary NHU (Hong Kong)Trading Co., Ltd., the Company discloses transactions between Client B and NHU Europe GmbH as well as balances in related partytransactions for the sake of prudence.
4. Related party transactions
(1) Purchase and sale of goods, rendering and receiving of services
Purchase of goods and receiving of services
Unit: RMB Yuan
| Related parties | Content of transaction | Current period cumulative | Transaction limit approved | Whether exceeds transaction limit | Preceding period comparative |
| Zhejiang Deli Equipment Co., Ltd. | Purchase of goods | 83,333,232.99 | 176,700,000.00 | No | 55,826,474.37 |
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | Purchase of steam | 60,694,568.26 | 60,245,778.74 | ||
| Waste disposal service fees | 147,459.89 | 984,963.43 | |||
| Zhejiang Saiya Chemical Materials Co., Ltd. | Purchase of goods | 138,488,066.99 | 240,000,000.00 | No | 153,465,976.22 |
| Heilongjiang Haotian Corn Development Co., Ltd. | Purchase of goods | 108,479.87 | 520,003.54 | ||
| Shandong Bin’an Vocational Training School Co., Ltd. | Receiving of services | 2,674.53 | 23,177.36 | ||
| Zhejiang Asen Pharmaceutical Co., Ltd. | Purchase of goods | 774,003.49 | 4,109,100.00 | No | 743,954.80 |
| Xinchang County Hechun Greening Co., Ltd. | Purchase of goods | 12,472.77 | |||
| Qionghai Boao Holliyard Hotel Management Co., Ltd. | Catering and accommodation services | 234,525.72 | 61,979.00 | ||
| Shaoxing Jinghe Hotel Management Co., Ltd | Catering and accommodation services | 831,053.37 | 326,991.94 | ||
| Qionghai Heyue Property Services Co., Ltd. | Property management | 219,042.13 | 470,190.62 | ||
| Shaoxing Heyue Property Services Co., Ltd. | Property management | 203,704.00 | 11,733.62 | ||
| Shaoxing Yuexiu Education Development Co., Ltd. | Receiving of services | 496.00 | |||
| Zhejiang Yuexiu University of Foreign Languages | Receiving of services | 4,388.00 | |||
| Subtotal | 285,041,695.24 | 420,809,100.00 | 272,693,696.41 |
Sale of goods and rendering of services
Unit: RMB Yuan
| Related parties | Content of transaction | Current period cumulative | Preceding period comparative |
| Zhejiang Deli Equipment Co., Ltd. | Scrapped materials | 92,969.09 | |
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | Waste and scrap materials | 53,097.35 | 17,256.64 |
| Zhejiang Asen Pharmaceutical Co., Ltd. | Pharmaceutical intermediates, test fees | 6,735.85 | 310,840.71 |
| Shandong Bin’an Vocational Training School Co., Ltd. | Management Service Fee | 23,372.54 | |
| Waste and scrap materials | 21,584.50 | ||
| Heilongjiang Haotian Corn Development Co., Ltd. | Steam charges | 82,192.66 | |
| Front Pharmaceutical PLC. | Pharmaceutical intermediates, testing fees | 575,409.92 | |
| DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | Scrapped materials | 71,867,299.71 | 81,288,692.23 |
| Labor costs, etc. | 413,070.59 | ||
| Utilities fees | 802,824.33 | 816,229.00 | |
| Beijing Winsunny Pharmaceutical Co., Ltd. | Pharmaceutical intermediates | 47,169.81 | 17,699.12 |
| Total | 73,881,949.19 | 82,554,494.86 |
(2) Related party leases
The Company as the lessor:
Unit: RMB Yuan
| Lessees | Types of assets leased | Lease income recognized in the current period | Lease income recognized in preceding period |
| DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | Land use right and buildings | 347,147.50 | 356,400.00 |
| Qionghai Boao Holliyard Hotel Management Co., Ltd. | Land use right and buildings | 240,000.00 | 258,177.14 |
| Zhejiang Jingshi Real Estate Co., Ltd. | Land use right and buildings | 266,666.67 | |
| Zhejiang Deli Equipment Co., Ltd. | Land use right and buildings | 20,183.49 | |
| Weifang Hecheng Real Estate Co., Ltd. | Land use right and buildings | 5,142.86 | 13,714.29 |
| NHU Holding Group Co., Ltd. | Land use right and buildings | 16,513.76 |
The Company as the lessee:
Unit: RMB Yuan
| Lessors | Types of assets leased | Lease expenses recognized in the current period | Lease expenses recognized in preceding period |
| NHU Holding Group Co., Ltd. | Land use right and buildings | 847,107.96 | 847,107.96 |
(3) Related party guarantees
The company and its subsidiaries as guaranteed parties
Unit: RMB Yuan
| Guarantors | Guarantee balance | Commencement date | Maturity date | Whether the guarantee is mature |
| NHU Holding Group Co., Ltd. | 72,000,000.00 | January 23, 2019 | December 21, 2023 | No |
| 470,000,000.00 | December 03, 2020 | September 21, 2025 | No | |
| 300,000,000.00 | September 19, 2022 | September 18, 2025 | No | |
| 200,000,000.00 | November 17, 2022 | November 14, 2025 | No | |
| Subtotal | 1,042,000,000.00 |
(4) Key management’s emoluments
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Key management’s emoluments | 5,533,632.28 | 5,698,512.85 |
(5) Other related party transactions
(1) Owners of Boao Resort Center Apartment entrusted serviced apartments to Qionghai Boao Holliyard Hotel Management Co., Ltd.for operation and management.
(2) In the current period, NHU EUROPE GmbH sold products amounting to 70,789,632.31 yuan to Client B the end of the period,balance of accounts receivable amounted to 14,533,367.11 yuan.
5. Balance due to or from related parties
(1) Balance due from related parties
Unit: RMB Yuan
| Items | Related parties | Closing balance | Opening balance | ||
| Book balance | Provision for bad debts | Book balance | Provision for bad debts | ||
| Accounts receivable | Zhejiang Asen Pharmaceutical Co., | 23,625.00 | 1,181.25 | ||
| Items | Related parties | Closing balance | Opening balance | ||
| Book balance | Provision for bad debts | Book balance | Provision for bad debts | ||
| Ltd. | |||||
| DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | 35,321,127.19 | 1,766,032.88 | 42,585,814.11 | 2,129,290.71 | |
| Zhejiang Deli Equipment Co., Ltd. | 74,255.06 | 3,712.75 | |||
| Zhejiang Deli Equipment Co., Ltd. | 26,410.98 | 1,320.55 | |||
| Subtotal | 35,421,793.23 | 1,771,066.18 | 42,609,439.11 | 2,130,471.96 | |
| Advance paid | Heilongjiang Haotian Corn Development Co., Ltd | 434,824.36 | 479,844.89 | ||
| Subtotal | 434,824.36 | 479,844.89 | |||
| Other receivables | Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | 20,000.00 | 4,000.00 | 20,000.00 | 4,000.00 |
| DSM NHU Engineering Materials (Zhejiang) Co., Ltd. | 1,253,616.96 | 62,680.85 | |||
| Subtotal | 1,273,616.96 | 66,680.85 | 20,000.00 | 4,000.00 | |
| Other non-current assets | Zhejiang Deli Equipment Co., Ltd. | 45,521,653.98 | 33,210,788.17 | ||
| Subtotal | 45,521,653.98 | 33,210,788.17 | |||
(2) Balance due to related parties
Unit: RMB Yuan
| Items | Related parties | Closing book balance | Opening book balance |
| Accounts payable | Zhejiang Deli Equipment Co., Ltd. | 14,877,785.50 | 13,581,584.31 |
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | 9,978,557.75 | 13,688,789.40 | |
| Zhejiang Saiya Chemical Materials Co., Ltd. | 77,621,235.15 | 1,905,191.13 | |
| Zhejiang Second Pharma Co., Ltd. | 6,408.00 | 6,408.00 | |
| Subtotal | 102,483,986.40 | 29,181,972.84 | |
| Contract liabilities | Zhejiang Deli Equipment Co., Ltd. | 14,700.89 | 13,009.64 |
| Subtotal | 14,700.89 | 13,009.64 | |
| Other payables | Zhejiang Deli Equipment Co., Ltd. | 3,500.00 | 3,500.00 |
| Xinchang County Hechun Greening Co., Ltd. | 13,102.77 | ||
| Zhejiang Jingshi Real Estate Co., Ltd. | 166,075.68 | ||
| Shaoxing Jinghe Hotel Management Co., Ltd. | 9,127.85 | ||
| Subtotal | 12,627.85 | 182,678.45 | |
| Other current liabilities | Zhejiang Deli Equipment Co., Ltd. | 1,691.25 | |
| Subtotal | 1,691.25 |
XIII. Commitments and contingencies
1. Significant commitments
Significant commitments as at the balance sheet date
(I) Significant commitments
1. Forward exchange settlement contracts
According to the ISDA 2002 MASTER AGREEMENT entered into between the Company and Bank of China (Hong Kong)Limited, the ISDA 2002 MASTER AGREEMENT entered into with DBS Bank (China) Limited, the GLOBAL CAPITAL MARKETSTRANSACTION and the related transaction application form entered into with HSBC Bank (China) Limited Hangzhou Branch, theNAFMII Master Agreement and Supplementary Agreement (No. Y161136) entered into with the Bank of China Limited, ZhejiangBranch, NAFMII Master Agreement and Supplemental Agreement (No. Y161136), the details of the Company's undelivered forwardsettlement contracts as of June 30, 2023 are as follows:
| Currency | Amount | Exchang Rate | Settlement Date |
| USD | 10,000,000.00 | 7.1440 | 2023/7/13 |
| 10,000,000.00 | 7.1400 | 2023/7/20 | |
| 5,000,000.00 | 7.1698 | 2023/7/13 | |
| 10,000,000.00 | 7.1615 | 2023/7/27 | |
| 10,000,000.00 | 7.1700 | 2023/8/15 | |
| Subtotal | 45,000,000.00 | ||
| EUR | 3,000,000.00 | 7.5341 | 2023/7/25 |
| 3,000,000.00 | 7.5266 | 2023/8/24 | |
| 2,000,000.00 | 7.5558 | 2023/7/25 | |
| 2,000,000.00 | 7.5482 | 2023/8/24 | |
| 3,000,000.00 | 7.8861 | 2023/7/31 | |
| 3,000,000.00 | 7.6113 | 2023/7/25 | |
| 3,000,000.00 | 7.6041 | 2023/8/24 | |
| 3,000,000.00 | 7.5870 | 2023/7/25 | |
| 3,000,000.00 | 7.5800 | 2023/8/24 | |
| 2,000,000.00 | 7.5685 | 2023/7/25 | |
| 2,000,000.00 | 7.5620 | 2023/8/24 | |
| 5,000,000.00 | 7.5805 | 2023/7/25 | |
| 5,000,000.00 | 7.5730 | 2023/8/24 | |
| 5,000,000.00 | 7.5655 | 2023/9/26 | |
| 3,000,000.00 | 7.8313 | 2023/9/26 | |
| Subtotal | 47,000,000.00 |
2. Letters of guarantee issued but undue
As of June 30, 2023, the undue letters of guarantee issued by the Company and its subsidiaries are as follows:
| Issuing banks | Applicants | Type of L/G | Amount | Conditions for issuing |
| Bank of China Limited | The Company | Performance guarantee | USD20,380.00 | Occupying credit line |
| Issuing banks | Applicants | Type of L/G | Amount | Conditions for issuing |
| Xinchang Sub-branch | Performance guarantee | USD64,706.00 | Occupying credit line | |
| Performance guarantee | USD22,409.00 | Occupying credit line | ||
| Performance guarantee | USD34,680.00 | Occupying credit line | ||
| China Merchants Bank Co., Ltd. Weifang Sub-branch | Shandong NHU Vitamin Co., Ltd. | Customs Duty Guarantee Bond | CNY2,120,000.00 | Occupying credit line |
| Bank of China Limited Weifang Binhai Sub-branch | Shandong NHU Pharmaceutical Co., Ltd. | Project Payment Guarantee | CNY588,000.00 | Occupying credit line |
| Project Payment Guarantee | CNY283,780.00 | Occupying credit line |
3. Letters of credit issued but undue
As of June 30, 2023, the undue letters of credit issued by the Company and its subsidiaries are as follows:
| Issuing banks | Applicants | Balance of L/C | Conditions |
| Bank of China Limited Xinchang Sub-branch | The Company | USD1,848,747.00 | Occupying credit line |
| USD11,436.80 | Occupying credit line | ||
| Bank of China Limited Xinchang Sub-branch | Zhejiang NHU Import & Export Company Ltd. | EUR2,597,000.00 | Deposit of EUR 2,597,000.00 |
| Shangyu New District Sub-branch of Construction Bank Co. | Shangyu NHU Biochemical Co., Ltd | USD142,500.00 | Deposit of EUR 142,500.00 |
| Bank of China Limited Weifang Binhai Sub-branch | Shandong Nhu Amino Acid Co., Ltd. | EUR107,225.00 | Deposit of 12,000,000.00 yuan |
China Merchants Bank Co., Ltd.Hangzhou Branch
| China Merchants Bank Co., Ltd. Hangzhou Branch | The Company | CNY 72,000,000.00 | Occupying credit line |
| CNY 50,000,000.00 | Occupying credit line | ||
| CNY 100,000,000.00 | Occupying credit line | ||
| CNY 235,000,000.00 | Occupying credit line | ||
| CNY 150,000,000.00 | Occupying credit line | ||
| China Merchants Bank Co., Ltd.Weifang Branch | Shandong NHU Pharmaceutical Co., Ltd. | CNY21,536,585.76 | Occupying credit line |
| CNY24,431,946.60 | Occupying credit line |
4. The “notes pool” business
Pursuant to the “Notes Pool Cooperation Agreement” entered into among the Company, its subsidiaries Shangyu NHU Bio-ChemCo., Ltd., Zhejiang NHU Pharmaceutical Co., Ltd., Zhejiang NHU Special Materials Co., Ltd., Shaoxing Yuchen New Materials Co.,Ltd., Shandong NHU Pharmaceutical Co., Ltd., Shandong NHU Vitamins Co., Ltd., Shandong NHU Amino-acids Co., Ltd.,Heilongjiang NHU Biotechnology Co., Ltd., Shandong NHU Fine Chemical Science and Technology Co., Ltd., Heilongjiang XinhaoThermal Power Co., Ltd., Xinchang NHU Vitamins Co., Ltd., Zhejiang Vityesun Animal Nutrition and Health Co., Ltd. , ZhejiangNHU Import & Export Company Ltd.,and China Zheshang Bank Co., Ltd., the Company pledged assets pool or notes pool for guarantee,and opened a notes deposit account to pay deposits at a certain percentage, with no specific agreement on the amount of deposits. Asof June 30, 2023, balance of pledged bank acceptance amounted to 239,585,650.76 yuan, deposits of notes pool in China ZheshangBank Co., Ltd. amounted to 110,859,093.35 yuan.
5. Besides the aforementioned events and assets with title or use right restrictions as stated in this section, theCompany has no other significant commitments to be disclosed as of the balance sheet date.
2、contingency
（1）There are no material contingencies that the company is required to disclose, which should also be stated
The Company has no material contingencies that require disclosure.XIV. Events after the balance sheet date
1. Profit distribution
As of the date of approval for issuing the financial statements, the Company has no other significant events after the balance sheetdate to be disclosed.
2. Description of other events after the balance sheet date
As of the date of approval for issuing the financial statements, the Company has no other significant events after the balance sheetdate to be disclosed.XV. Other significant events
1. Segment information
(1) Identification basis and accounting policies for reportable segments
Reportable segments are identified according to the structure of the Company’s internal organization, management requirements andinternal reporting system, and based on business segments. Assets and liabilities shared by different segments are allocated amongsegments proportionate to their respective sizes.
(2) Financial information of reportable segments
Unit: RMB Yuan
| Items | Pharmaceutical chemicals | Others | Inter-segment offsetting | Total |
| Operating revenue | 6,827,101,806.65 | 580,426,399.06 | 86,786,240.77 | 7,320,741,964.94 |
| Operating cost | 4,600,622,791.73 | 411,744,878.34 | 86,786,240.77 | 4,925,581,429.30 |
| Total assets | 36,071,193,496.27 | 2,753,884,437.14 | 849,236,590.49 | 37,975,841,342.92 |
| Total liabilities | 13,797,335,987.50 | 1,351,555,595.24 | 849,236,590.49 | 14,299,654,992.25 |
XVI. Notes to main items of parent company financial statements
1. Accounts receivable
(1) Details on categories
Unit: RMB Yuan
| Categories | Closing balance | Opening balance | ||||||||
| Book balance | Provision for bad debts | Carrying amount | Book balance | Provision for bad debts | Carrying amount | |||||
| Amount | % to total | Amount | Provision proportion | Amount | % to total | Amount | Provision proportion | |||
| Receivables with provision made on a collective basis | 633,923,233.73 | 100.00% | 31,696,161.69 | 5.00% | 602,227,072.04 | 526,936,263.09 | 100.00% | 26,346,813.15 | 5.00% | 500,589,449.94 |
| Total | 633,923,233.73 | 100.00% | 31,696,161.69 | 5.00% | 602,227,072.04 | 526,936,263.09 | 100.00% | 26,346,813.15 | 5.00% | 500,589,449.94 |
provision for bad debts made on a collective basis：
Unit: RMB Yuan
| Categories | Closing balance | ||
| Book balance | Provision for bad debts | Provision proportion | |
| Commercial Acceptance | 633,923,233.73 | 31,696,161.69 | 5.00% |
A description of the basis for determining the portfolio:
If the bad debt provision for notes receivable is based on the general model of expected credit losses, please disclose informationabout the bad debt provision by referring to the disclosure for other receivables:
□Applicable ?Not applicable
Age analysis
Unit: RMB Yuan
| Ages | Book balance |
| Within 1 year (inclusive) | 633,923,233.73 |
| Total | 633,923,233.73 |
(2) Provisions made, collected or reversed in the current period
Provisions made in the current period:
Unit: RMB Yuan
| Categories | Opening balance | Increase/Decrease | Closing balance | |||
| Accrual | Recovery/ Reversal | Write-off | Others | |||
| Provision made on a collective basis | 26,346,813.15 | 5,349,348.54 | 31,696,161.69 | |||
| Total | 26,346,813.15 | 5,349,348.54 | 31,696,161.69 | |||
(3) Details of the top 5 debtors with largest balances
Unit: RMB Yuan
| Debtors | Book balance | Proportion to the total balance of accounts receivable | Provision for bad debts |
| Client 1 | 319,039,010.16 | 50.33% | 15,951,950.51 |
| Client 2 | 59,148,876.90 | 9.33% | 2,957,443.85 |
| Client 3 | 32,800,000.00 | 5.17% | 1,640,000.00 |
| Client 4 | 27,485,943.84 | 4.34% | 1,374,297.19 |
| Client 5 | 24,734,066.71 | 3.90% | 1,236,703.34 |
| Total | 463,207,897.61 | 73.07% | -- |
2. Other receivables
Unit: RMB Yuan
| Items | Closing balance | Opening balance |
| Dividend receivable | 20,735,987.73 | |
| Other receivables | 3,823,227,738.70 | 2,475,376,134.12 |
| Total | 3,823,227,738.70 | 2,496,112,121.85 |
(1) Dividend receivable
1) Details on categories
Unit: RMB Yuan
| Items/Investees | Closing balance | Opening balance |
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | 20,735,987.73 | |
| Total | 20,735,987.73 |
(2) Other receivables
1) Categorized by nature
Unit: RMB Yuan
| Nature of receivables | Closing book balance | Opening book balance |
| loan splitting | 3,904,102,993.42 | 2,477,800,000.00 |
| Deposit Guarantee | 98,678,496.50 | 100,017,996.50 |
| Export Tax Refund | 7,249,071.14 | 8,678,171.26 |
| Employee reserve fund | 8,853,450.45 | 5,953,662.00 |
| Accounts receivable in suspense | 30,442.29 | 461,787.32 |
| Other | 2,227,395.62 | 8,467,732.53 |
| Total | 4,021,141,849.42 | 2,601,379,349.61 |
2) Provision for bad debts
Unit: RMB Yuan
| Provision for bad debts | Phase I | Phase II | Phase III | Total |
| 12?month expected credit losses | Lifetime expected credit losses (credit not impaired) | Lifetime expected credit losses (credit impaired) | ||
| Opening balance | 124,623,172.45 | 230,800.00 | 1,149,243.04 | 126,003,215.49 |
| Opening balance in the current period | —— | —— | —— | —— |
| --Transferred to phase II | -175,989.20 | 175,989.20 | ||
| --Transferred to phase III | -19,000.00 | 19,000.00 | ||
| Provision made in the current period | 71,091,966.24 | 316,167.59 | 502,761.40 | 71,910,895.23 |
| Closing balance | 195,539,149.49 | 703,956.79 | 1,671,004.44 | 197,914,110.72 |
Significant changes in book balance of other receivables with changes in provision for bad debts:
□ Applicable √ Not applicable
Age analysis
Unit: RMB Yuan
| Ages | Book balance |
| Within 1 year (inclusive) | 3,918,032,061.02 |
| 1-2 years | 3,519,783.96 |
| 2-3 years | 95,000.00 |
| Over 3 years | 99,495,004.44 |
| 3-4 years | 716,162.81 |
| 4-5 years | 100,000.00 |
| Over 5 years | 98,678,841.63 |
| Total | 4,021,141,849.42 |
3) Provisions made, collected or reversed in the current period
Provisions made in the current period:
Unit: RMB Yuan
| Categories | Opening balance | Increase/Decrease | Closing balance | |||
| Accrual | Recovery/Reversal | Write-off | Others | |||
| Portfolio grouped by ages | 126,003,215.49 | 71,910,895.23 | 197,914,110.72 | |||
| Total | 126,003,215.49 | 71,910,895.23 | 197,914,110.72 | |||
4) Details of the top 5 debtors with largest balances
Unit: RMB Yuan
| Debtors | Nature of receivables | Book balance | Ages | Proportion to the total balance of other receivables | Provision for bad debts |
| Heilongjiang NHU Biotechnology Co., Ltd. | Call loans | 2,088,739,518.04 | Within 1 year | 51.94% | 104,436,975.90 |
| Shandong NHU Fine Chemical Science and Technology Co., Ltd. | Call loans | 753,305,543.80 | Within 1 year | 18.73% | 37,665,277.19 |
| Heilongjiang Xinhao Thermal Power Co., Ltd | Call loans | 312,772,192.57 | Within 1 year | 7.78% | 15,638,609.63 |
| Zhejiang NHU Special Materials Co., Ltd. | Call loans | 245,326,773.01 | Within 1 year | 6.10% | 12,266,338.65 |
| Shandong NHU Pharmaceutical Co., Ltd. | Call loans | 222,707,491.68 | Within 1 year | 5.54% | 11,135,374.58 |
| Total | -- | 3,622,851,519.10 | -- | 90.09% | 181,142,575.95 |
3. Long-term equity investments
Unit: RMB Yuan
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Investments in subsidiaries | 10,096,078,842.12 | 10,096,078,842.12 | 9,146,078,842.12 | 9,146,078,842.12 | ||
| Investments in associates and joint ventures | 494,664,516.29 | 494,664,516.29 | 239,967,333.33 | 239,967,333.33 | ||
| Total | 10,590,743,358.41 | 10,590,743,358.41 | 9,386,046,175.45 | 9,386,046,175.45 | ||
(1) Investments in subsidiaries
Unit: RMB Yuan
| Investees | Opening carrying amount | Increase/Decrease | Closing carrying amount | Closing balance of provision for impairment | |||
| Investments increased | Investments decreased | Provision for impairment | Others | ||||
| Xinchang NHU Vitamins Co., Ltd. | 149,407,990.15 | 149,407,990.15 | |||||
| Zhejiang NHU Import & Export Co., Ltd. | 13,500,000.00 | 13,500,000.00 | |||||
| Qionghai Boao Lidu Real Estate Co., Ltd. | 54,020,492.00 | 54,020,492.00 | |||||
| Zhejiang Vityesun Animal Nutrition and Health Co., Ltd. | 5,000,000.00 | 5,000,000.00 | |||||
| Shangyu NHU Bio-Chem Co., Ltd. | 414,100,091.44 | 414,100,091.44 | |||||
| NHU (Hong Kong) Trading Co., Ltd. | 16,406,160.00 | 16,406,160.00 | |||||
| Zhejiang NHU Pharmaceutical Co., Ltd. | 480,000,000.00 | 480,000,000.00 | |||||
| Investees | Opening carrying amount | Increase/Decrease | Closing carrying amount | Closing balance of provision for impairment | |||
| Investments increased | Investments decreased | Provision for impairment | Others | ||||
| Zhejiang NHU Special Materials Co., Ltd. | 554,844,108.53 | 554,844,108.53 | |||||
| Shandong NHU Amino-acids Co., Ltd. | 4,900,000,000.00 | 900,000,000.00 | 5,800,000,000.00 | ||||
| Shandong NHU Holdings Co., Ltd. | 200,000,000.00 | 200,000,000.00 | |||||
| Heilongjiang NHU Biotechnology Co., Ltd. | 1,300,000,000.00 | 1,300,000,000.00 | |||||
| Shandong NHU Pharmaceutical Co., Ltd. | 586,000,000.00 | 586,000,000.00 | |||||
| Shandong NHU Fine Chemical Science and Technology Co., Ltd. | 460,000,000.00 | 50,000,000.00 | 510,000,000.00 | ||||
| NHU Singapore PTE. LTD. | 12,800,000.00 | 12,800,000.00 | |||||
| Total | 9,146,078,842.12 | 950,000,000.00 | 10,096,078,842.12 | ||||
(2) Investments in associates and joint ventures
Unit: RMB Yuan
| Investees | Opening carrying amount | Increase/Decrease | Closing carrying amount | Closing balance of provision for impairment | |||||||
| Investments increased | Investments decreased | Investment income recognized under equity method | Adjustment in other comprehensive income | Changes in other equity | Cash dividend/ Profit declared for distribution | Provision for impairment | Others | ||||
| I. Associates | |||||||||||
| Zhejiang Chunhui Environmental Protection Energy Co., Ltd. | 239,967,333.33 | 20,358,467.14 | 260,325,800.47 | ||||||||
| Anhui Yingna Weixun Technology Co., Ltd | 233,508,000.00 | -3,169,284.18 | 230,338,715.82 | ||||||||
| Ningbo Zhenhai Refining and Chemical Xinhecheng Biotechnology Co., Ltd | 4,000,000.00 | 4,000,000.00 | |||||||||
| Subtotal | 239,967,333.33 | 237,508,000.00 | 17,189,182.96 | 494,664,516.29 | |||||||
| Total | 239,967,333.33 | 237,508,000.00 | 17,189,182.96 | 494,664,516.29 | |||||||
4. Operating revenue/Operating cost
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative | ||
| Revenue | Cost | Revenue | Cost | |
| Main operations | 1,438,268,120.92 | 1,261,740,406.31 | 1,850,628,697.19 | 1,460,074,892.61 |
| Other operations | 29,381,770.87 | 24,923,360.59 | 31,160,723.40 | 24,551,797.22 |
| Total | 1,467,649,891.79 | 1,286,663,766.90 | 1,881,789,420.59 | 1,484,626,689.83 |
Details of revenue
Unit: RMB Yuan
| Categories of contracts | Total |
| By product | |
| Including: Nutrition | 1,384,907,822.00 |
| Others | 82,742,069.79 |
| Subtotal | 1,467,649,891.79 |
| By operating region | |
| Including: Domestic | 864,862,923.22 |
| Overseas | 602,786,968.57 |
| Subtotal | 1,467,649,891.79 |
| By revenue recognition time | |
| Including: Transferred at a point in time | 1,467,649,891.79 |
| Subtotal | 1,467,649,891.79 |
| By sales channel | |
| Direct Sales | 1,305,456,608.74 |
| Resellers | 162,193,283.05 |
| Subtotal | 1,467,649,891.79 |
Information related to performance obligations:
None.Information related to transaction price allocated to the remaining performance obligations:
As of June 30, 2023, revenue corresponding to performance obligations for which the Company has entered into contracts but not yetperformed or fulfilled amounted to 1,035.97 million yuan, of which, 1,035.97 million yuan is expected to be recognized as revenue in2023.
5. Investment income
Unit: RMB Yuan
| Items | Current period cumulative | Preceding period comparative |
| Investment income from long-term equity investments under equity method | 17,189,195.23 | 19,977,116.53 |
| Investment income from long-term equity investments under cost method | 1,390,000,000.00 | |
| Interest income from call loans | 50,158,644.31 | 54,876,777.72 |
| Investment income from bank financial products and structured deposits | 2,735,849.06 | 15,218,893.77 |
| Total | 1,460,083,688.60 | 90,072,788.02 |
XVII. Supplementary information
1. Schedule of non-recurring profit or loss
√ Applicable □ Not applicable
Unit: RMB Yuan
| Items | Amount |
| Gains on disposal of non-current assets | 13,545,778.16 |
| Government grants included in profit or loss (excluding those closely related to operating activities of the Company, satisfying government policies and regulations, and continuously enjoyed with certain quantity or quota based on certain standards) | 101,321,678.10 |
| Gains on assets consigned to the third party for investment or management | 8,894,052.73 |
| Gains or losses on changes in fair value of held-for-trading financial assets and held-for-trading financial liabilities, and investment income from disposal of held-for-trading financial assets and held-for-trading financial liabilities, excluding those arising from hedging business related to operating activities | -11,268,469.70 |
| Non-operating income and expenses other than those mentioned above | 3,483,386.54 |
| Less: Enterprise income tax affected | 7,791,955.64 |
| Non-controlling interest affected | 174,119.05 |
| Total | 108,010,351.14 |
Remarks on other profit or loss satisfying the definition of non-recurring profit or loss:
□ Applicable √ Not applicable
The Company has no other profit or loss satisfying the definition of non-recurring profit or loss.Remarks on defining non-recurring profit or loss listed in the “Interpretation Pronouncement on Information Disclosure Criteria forPublic Companies No. 1 – Non-Recurring Profit or Loss” as recurring profit or loss
□ Applicable √ Not applicable
2. ROE and EPS
| Profit of the reporting period | Weighted average ROE (%) | EPS (yuan/share) | |
| Basic EPS | Diluted EPS | ||
| Net profit attributable to shareholders of ordinary shares | 6.09% | 0.48 | 0.48 |
| Net profit attributable to shareholders of ordinary shares after deducting non-recurring profit or loss | 5.65% | 0.44 | 0.44 |
3. Differences in accounting data under Chinese accounting standards and overseas accounting standards
(1) Difference in net profit and net assets in financial statements disclosed respectively under IFRS Standardsand Chinese accounting standards
□ Applicable √ Not applicable
(2) Difference in net profit and net assets in financial statements disclosed respectively under overseasaccounting standards and Chinese accounting standards
□ Applicable √ Not applicable
（3）Explanation of the reasons for differences in accounting data under domestic and foreign accountingstandards, and, in the case of reconciliation of differences in data that have been audited by an offshoreauditing organization, the name of the offshore organization.
□ Applicable √ Not applicable