Hikvision 2023 Q3 ReportStock Exchange Code：002415 Abbreviation of Securities：HikvisionNo：2023-036
Hangzhou Hikvision Digital Technology Co., Ltd.
2023 3
rd
Quarter ReportThe Company and all members of the Board of Directors guarantee that the informationdisclosed is true, accurate and complete without false records, misleading statementsor material omissions.Important Content Notes:
1. The Board of Directors, Board of Supervisors, directors, supervisors and seniormanagement of Hangzhou Hikvision Digital Technology Co., Ltd. (hereinafterreferred to as the "Company") hereby guarantee that the information presented inthis report shall be together be wholly liable for the truthfulness, accuracy andcompleteness of its contents and free of any false records, misleading statements ormaterial omissions, and will undertake individual and joint legal liabilities.
2. Chen Zongnian, the Company's legal representative, Jin Yan, the person in chargeof the accounting work, and Zhan Junhua, the person in charge of accountinginstitution (accounting supervisor) hereby declare and warrant that the financialinformation in this report is authentic, accurate, and complete.
3. Whether the 3
rd
quarter report has been audited
□Yes√ No
Hikvision 2023 Q3 ReportI. Key Financial Data
1. Key Accounting Data and Financial Indicators
Whether the Company performed a retroactive adjustment or restatement of the previous accounting data
√ Yes □ No
Reasons for retroactive adjustment or restatement of the previous accounting data
√ Changes in accounting policies
Unit：RMB
| 2023 Q3 | 2022 Q3 | YoY Change(%) between 2023 Q3 and 2022 Q3 | 2023 Q1~Q3 | 2022 Q1~Q3 | YoY Change(%) between 2023 Q1~Q3 and 2022 Q1~Q3 | |||
| Before the adjustment | After the adjustment | After the adjustment | Before the adjustment | After the adjustment | After the adjustment | |||
| Revenue (RMB) | 23,704,377,795.74 | 22,464,020,301.15 | 22,464,020,301.15 | 5.52% | 61,275,164,193.63 | 59,721,536,891.77 | 59,721,536,891.77 | 2.60% |
| Net profit attributable to shareholders of the Company (RMB) | 3,513,299,100.33 | 3,081,001,112.19 | 3,081,936,227.11 | 14.00% | 8,851,167,117.21 | 8,840,255,887.45 | 8,840,604,273.67 | 0.12% |
| Net profit attributable to shareholders of the Company excluding non-recurring gains and losses (RMB) | 3,425,870,315.02 | 2,879,656,597.51 | 2,880,591,712.43 | 18.93% | 8,461,998,947.98 | 8,525,515,615.02 | 8,525,864,001.24 | -0.75% |
| Net cash flows from operating activities (RMB) | — | — | — | — | 5,913,853,480.95 | 160,117,141.04 | 160,117,141.04 | 3593.45% |
| Basic earnings per share (RMB/share) | 0.381 | 0.331 | 0.331 | 15.11% | 0.949 | 0.938 | 0.938 | 1.17% |
| Diluted earnings per share | 0.380 | 0.331 | 0.331 | 14.80% | 0.949 | 0.938 | 0.938 | 1.17% |
Reasons for changes in accounting policies and situations of correction of accounting errorsNote:
The Ministry of Finance issued the Interpretation No. 16 of Accounting Standards for Business Enterprises (the "Interpretation No. 16") on November 30, 2022. Thescope of the initial recognition exemption for deferred income tax in the Accounting Standards for Business Enterprises No. 18-Income Tax was revised. Making itclear that the provisions on exemption of initial recognition of deferred income tax liabilities and deferred income tax assets in Accounting Standards for BusinessEnterprises No. 18-Income Taxes do not apply to single transactions that are not business combinations and do not affect either accounting profit or taxable income (ordeductible losses) at the time of the transactions, nor do such provisions apply to single transactions whose assets and liabilities initially recognized result in equaltaxable temporary differences and deductible temporary differences. This provision is effective as of January 1, 2023 and earlier application is permitted. The Groupimplemented this requirement from January 1, 2023, and accounted for individual transactions between the beginning of the earliest period in which the financialstatements are presented and December 31, 2022 using the retrospective adjustment method, and restated the financial statements for the comparative period.
The total share capital of the Company as of the previous trading day of the financial report disclosure:
| The total share capital of the Company as of the previous trading day of the financial report disclosure (share) | 9,330,600,931 |
Fully diluted earnings per share calculated using the latest share capital:
| Fully diluted earnings per share (RMB/share) calculated with the latest share capital | 0.949 |
| (RMB/share) | |||||||||
| Weighted average ROE | 5.05% | 4.84% | 4.84% | 0.21% | 12.59% | 13.64% | 13.64% | -1.05% | |
| On September 30, 2023 | On December 31, 2022 | Change(%) between December 31, 2022 and September 30, 2023 | |||||||
| Before the adjustment | After the adjustment | After the adjustment | |||||||
| Total assets (RMB) | 127,457,393,562.08 | 119,233,282,761.47 | 119,234,602,968.11 | 6.90% | |||||
| Net assets attributable to shareholders of the Company (RMB) | 71,512,727,362.29 | 68,389,154,548.76 | 68,388,671,139.78 | 4.57% | |||||
2. Items and Amounts of Non-recurring Gains and Losses
√ Applicable □ Inapplicable
Unit：RMB
| Item | Amount occurred in the current reporting period (2023 Q3) | January 1, 2023– September 30, 2023 |
| Profit or loss from disposal of non-current assets (including the write-off for the impairment provision of assets) | -9,430,072.63 | -12,656,820.35 |
| Government subsidies included in the current profit and loss (except for government subsidies that are closely related to the Company's regular business operations, comply with national policies, and those that are continuously enjoyed in accordance with a certain standard fixed or quantitative basis) | 136,101,654.70 | 381,206,012.59 |
| Profits and losses attributed to change in fair value for held-for-trading financial assets and held-for-trading financial liabilities; and investment income from disposal of held for-trading financial assets, held-for-trading financial liabilities, and available-for-sale financial assets, excluding the effective hedging business related to the regular business operation of the Company. | 542,193.75 | -16,295,272.07 |
| The profit and loss of business combination under different control realized in stages by multiple transactions | - | 116,433,610.45 |
| Other non-operating income and expenditures except the items mentioned above | 14,083,115.40 | 64,577,632.01 |
| Less: Impact of income tax | 27,232,345.35 | 56,910,041.17 |
| Impact of the minority interests (after tax) | 26,635,760.56 | 87,186,952.23 |
| Total | 87,428,785.31 | 389,168,169.23 |
Details of other profit and loss items that meet the definition of non-recurring profit and loss:
□ Applicable √ Inapplicable
The Company does not have other specific conditions of profit and loss items that meet the definition of non-recurring profit and loss.
Explanations on classifying any non-recurring gain/loss item mentioned in the <Explanatory Announcement No. 1on Information Disclosure for Companies Offering Their Securities to the Public—Non-recurring Gains and Losses>as recurring gain/loss item.
□ Applicable √ Inapplicable
The Company does not classify any non-recurring gain/loss item mentioned in the <Explanatory Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public—Non-recurring Gains andLosses> as recurring gain/loss item.
3. Information and Explanation about Variations in Key Accounting Data and Financial Indicators
√Applicable □Inapplicable
3.1 Explanation for variations in balance sheet items
| Item | Balance on September 30, 2023 (RMB) | Balance on December 31, 2022 (RMB) | Change (%) | Note of Changes |
| Held-for-trading financial assets | 23,469,021.18 | 12,807,438.36 | 83.25% | Due to fluctuation in foreign exchange rate and decrease in the scale of foreign exchange hedging business |
| Held-for-trading financial liabilities | 4,181,387.92 | 68,299,685.57 | -93.88% | |
| Prepayments | 1,176,737,421.25 | 534,780,120.52 | 120.04% | Due to increase in prepayment for lock in part of raw material |
| Other receivables | 807,450,237.15 | 516,503,485.58 | 56.33% | Increase in tax refunds receivable and etc. |
| Contract assets | 1,154,739,956.62 | 2,118,223,370.98 | -45.49% | Part of the construction works that meet the conditions for collection are transferred to accounts receivable |
| Goodwill | 397,053,077.36 | 217,386,531.28 | 82.65% | Goodwill arising from the acquisition of Wuhu Sensortech Intelligent Technology Ltd. |
| Notes payable | 635,917,745.45 | 1,207,756,963.94 | -47.35% | Decrease in notes settlement |
| Taxes payable | 1,844,339,050.35 | 1,234,032,138.37 | 49.46% | Increase in quarterly corporate income tax payable |
| Non-current liabilities due within one year | 5,033,280,741.55 | 868,197,272.46 | 479.74% | Increase in demands for long-term working capital |
| Long-term borrowings | 9,251,855,308.30 | 7,522,315,341.60 | 22.99% | |
| Other current liabilities | 1,451,039,846.11 | 923,721,593.78 | 57.09% | The repurchase of public outstanding shares and the completion of cancellation of the third batch of 2018 Restricted Stock Plan |
| Other non-current liabilities | 1,669,822,285.01 | 2,831,108,087.59 | -41.02% | |
| Capital reserves | 8,312,925,536.12 | 10,141,153,435.32 | -18.03% | |
| Treasury shares | 2,737,987,226.55 | 5,316,033,650.24 | -48.50% | |
| Other comprehensive income | 12,228,192.69 | -42,587,158.81 | 128.71% | Increase in differences of foreign currency statement translation due to fluctuations of exchange rate |
3.2 Explanation for variations in income statement items
| Items | 2023 Q1 ~ 2023 Q3 (RMB) | 2022 Q1 ~ 2022 Q3 (RMB) | YoY Change (%) | Note of changes |
| Business taxes and surcharges | 526,331,975.20 | 404,250,604.06 | 30.20% | Increase in additional taxes caused by increase in the VAT credit |
| Financial expenses | -438,125,633.70 | -937,194,664.41 | 53.25% | Decrease in foreign exchange gains |
| Investment income | 39,763,080.90 | 166,250,594.06 | -76.08% | Decrease in investment income in joint ventures and associates and decrease in trading gains from foreign exchange hedging business |
| Gains from changes in fair value | 83,987,239.15 | -69,558,120.87 | 220.74% | Increase in gains from changes in fair value in foreign exchange hedging business |
3.3 Explanation for variations in cash flow statement items
| Item | 2023 Q1 ~ 2023 Q3 (RMB) | 2022 Q1 ~ 2022 Q3 (RMB) | YoY Change (%) | Note of changes |
| Net cash flows from operating activities | 5,913,853,480.95 | 160,117,141.04 | 3593.45% | Increase in inventory purchases |
| Net cash flows from investing activities | -3,439,635,132.46 | -2,623,081,074.94 | -31.13% | Increased in investment on the construction of industrial parks |
II. Shareholder Information
1. Number of Common Shareholders and Preferred Shareholders with Resumed Voting Rights andInformation about Top 10 Shareholders
Unit: Share
| Total number of common shareholders at the end of the reporting period | 354,629 | Total number of preferred shareholders (if any) whose voting rights have been recovered at the end of the reporting period (if any) | 0 | ||||
| Particulars about top 10 shareholders | |||||||
| Name of shareholder | Nature of shareholder | Share-holding percentage (%) | Total shares held at the period-end | The number of common shares held with trading restrictions | Pledged, marked or frozen | ||
| Status | Amount | ||||||
| China Electronics Technology HIK Group Co., Ltd. | Domestic State-owned corporation | 36.48% | 3,403,879,509 | - | Pledged | 50,000,000 | |
| Gong Hongjia | Overseas individual | 10.32% | 962,504,814 | - | Pledged | 153,026,700 | |
| Hangzhou Weixun Equity Investment Partnership (Limited Partnership) | Domestic non-state-owned corporation | 4.83% | 450,795,176 | - | Pledged | 18,900,000 | |
| Shanghai Perseverance Asset Management Partnership (Limited Partnership) - Perseverance Adjacent Mountain 1 Yuanwang Fund | Other | 4.66% | 435,000,000 | - | - | - | |
| CETC Investment Holdings Co., Ltd. | Domestic State-owned corporation | 2.49% | 232,307,903 | - | - | - | |
| Hangzhou Pukang Equity Investment Partnership (Limited Partnership) | Domestic non-state-owned corporation | 1.96% | 182,510,174 | - | Pledged | 48,300,000 | |
| The 52nd Research Institute at China Electronics Technology Group Co. Ltd. | Domestic State-owned corporation | 1.94% | 180,775,044 | - | - | - | |
| Hu Yangzhong | Domestic Individual | 1.67% | 155,636,477 | 116,727,358 | - | - | |
| Central Huijin Investment Co., Ltd. | Domestic State-owned corporation | 0.69% | 64,700,691 | - | - | - | |
| Hong Kong Securities Clearing Company Ltd.(HKSCC) | Overseas corporation | 0.50% | 47,002,201 | - | - | - | |
| Particulars about shares held by the Top 10 common shareholders holding shares that are not subject to trading restriction(s) | |||||||
| Name of shareholder | Number of common shares without trading restrictions held at the period-end | Type of shares | |||||
| Type | Number | ||||||
| China Electronics Technology HIK Group Co., Ltd. | 3,403,879,509 | RMB common shares | 3,403,879,509 | ||||
| Gong Hongjia | 962,504,814 | RMB common shares | 962,504,814 | ||||
| Hangzhou Weixun Equity Investment Partnership (Limited Partnership) | 450,795,176 | RMB common shares | 450,795,176 |
| Shanghai Perseverance Asset Management Partnership (Limited Partnership) - Perseverance Adjacent Mountain 1 Yuanwang Fund | 435,000,000 | RMB common shares | 435,000,000 |
| CETC Investment Holdings Co., Ltd | 232,307,903 | RMB common shares | 232,307,903 |
| Hangzhou Pukang Equity Investment Partnership (Limited Partnership) | 182,510,174 | RMB common shares | 182,510,174 |
| The 52nd Research Institute at China Electronics Technology Group Co. Ltd | 180,775,044 | RMB common shares | 180,775,044 |
| Central Huijin Investment Co., Ltd. | 64,700,691 | RMB common shares | 64,700,691 |
| Hong Kong Securities Clearing Company Ltd.(HKSCC) | 47,002,201 | RMB common shares | 47,002,201 |
| Hu Yangzhong | 38,909,119 | RMB common shares | 38,909,119 |
| Explanation on associated relationship and concerted actions among above shareholders | China Electronics Technology HIK Group Co., Ltd., CETC Investment Holdings Co., Ltd. and The 52nd Research Institute at China Electronics Technology Group Co., Ltd. are all subject to control of China Electronics Technology Group Co. Ltd. Ms. Chen Chunmei, limited partner of Hangzhou Pukang Equity Investment Partnership (Limited Partnership), is the spouse of Mr. Gong Hongjia, overseas individual shareholder of the Company. Hu Yangzhong, domestic individual, is holding shares in both Hangzhou Weixun Equity Investment Partnership (Limited Partnership) and Hangzhou Pukang Equity Investment Partnership (Limited Partnership). Except for these, the Company does not know whether the other shareholders are related parties or whether they are acting-in-concert parties in accordance with the Administration of the Takeover of Listed Companies Procedures. | ||
2. Total Number of Preferred Shareholders and Information about Top 10 Preferred Shareholders
□ Applicable √ Inapplicable
Hikvision 2023 Q3 ReportIII. Significant Events
√Applicable □Inapplicable
1. During the reporting period, the Company completed the third repurchase and cancellation of the 2018 RestrictedStock Plan.
On April 13, 2023 and May 9, 2023, the 17
th meeting of the 5
th session of the Board of Directors, the 15
th
meetingof the 5
thsession of the Board of Supervisors and 2022 Annual General Meeting reviewed and approved theProposal of Unlocking Conditions for the Third Unlocking Period of the 2018 Restricted Plan were not Meet andthe Proposal of the Repurchase of Restricted Shares that have been Granted but not yet Unlocked. As the Companyperformance did not meet the unlocking conditions for the third unlocking period of the 2018 Restricted Stock Plan(Revised Draft), 33,331,858 restricted shares granted but not unlocked in the current period for all grantees of the2018 Restricted Stock Plan were repurchased and cancelled. And the Company had completed the cancellationprocedures for the above shares at the Shenzhen branch of China Securities Depository and Clearing Ltd. on July 5,2023.
For details, please refer to The Proposal of Unlocking Conditions for the Third Unlocking Period of the 2018Restricted Plan were not Meet and The Proposal of the Repurchase of Restricted Shares that have been Granted butnot yet Unlocked (2023-021) published by the Company on www.cninfo.com.cn on April 15, 2023 and The Proposalof the Completed Cancellation of the Restricted Shares that have been Granted but not yet Unlocked for the ThirdUncloking Period of the 2018 Restricted Plan (2023-028) published by the Company on www.cninfo.com.cn onJuly 7, 2023.
As of the end of the current reporting period, the Company has a total of 97,402,605 granted but unvested shares,accounting for 1.04% of the Company's total share capital at the end of the reporting period.
2. Matters relating to steady promotion of the spin-off of HikRobot to be listed on the SZSE ChiNext Market
On March 7, 2023, Hangzhou Hikrobot Co., Ltd. (hereinafter referred to as "HikRobot") received Notice onAccepting the Application Documents for the Initial Public Offering of Shares and Listing on the SZSE ChiNextMarket of Hangzhou Hikrobot Co., Ltd. (SZSE Listing Review [2023] No. 252) issued by Shenzhen Stock Exchange,
Hikvision 2023 Q3 Reportand SZSE considered that application documents were completed and decided to accept. For details, please refer tothe Announcement on the Application for the Initial Public Offering of Shares and Listing on the SZSE ChiNextMarket of Hangzhou Hikrobot Co., Ltd., a Subsidiary of the Company, is Accepted by the SZSE (AnnouncementNo.: 2023-008) published by the Company on cninfo website (www.cninfo.com.cn) on March 8,
2023. ShenzhenStock Exchange issed the Inquiry Letter on the Review of Application Documents for the Initial Public ShareOffering of Shares and Listing on the SZSE ChiNext Market of Hangzhou Hikrobot Co., Ltd. (Inquiry Letter (2023)No. 010121) on March 30, 2023, and HikRobot has submitted the Reply to the Inquiry Letter on the Review ofApplication Documents for the Initial Public Share Offering of Shares and Listing on the SZSE ChiNext Market ofHangzhou Hikrobot Co., Ltd. on May 17, 2023. Shenzhen Stock Exchange issed the Second Inquiry Letter on theReview of Application Documents for the Initial Public Share Offering of Shares and Listing on the SZSE ChiNextMarket of Hangzhou Hikrobot Co., Ltd. (Inquiry Letter (2023) No. 010218) on June 30, 2023, and HikRobot hassubmitted the Reply to the Second Inquiry Letter on the Review of Application Documents for the Initial PublicShare Offering of Shares and Listing on the SZSE ChiNext Market of Hangzhou Hikrobot Co., Ltd. on July 27, 2023.
3. The Company's controlling shareholder disclosed its plan to increase its shareholding in the Company
The Company received a notice from China Electronics Technology HIK Group Co., Ltd. (hereinafter referred toas "CETHIK"), the Company's controlling shareholder, on October 16, 2023 that CETHIK intends to increase itsshareholdings of the Company's shares through the trading system of the Shenzhen Stock Exchange throughcentralized bidding, block trading or other trading methods permitted by laws and regulations within 6 months fromOctober 17, 2023. The total amount of the increased shareholdings will not be less than RMB200 million and notmore than RMB300 million, and the proposed price of increased shareholdings shall not be higher than RMB40 pershare (inclusive). The plan of increase shareholding will be implemented at the opportunity with the considerationof the fluctuation of Hikvision's stock price and the overall trend of the capital market. The Company will continueto pay attention to the relevant situation of this plan of increase shareholding in accordance with the Rules for theListing of Stocks on the Shenzhen Stock Exchange and other relevant regulations, and fulfill its informationdisclosure obligations in a timely manner. For details, please refer to the Announcement on the Company'sControlling Shareholders' Plan to Increase the Company's Shareholding (2023-033) published by the Company onwww.cninfo.com.cn on October 17, 2023.
Hikvision 2023 Q3 ReportIV. Quarterly Financial Reports
1. Financial Statements
1.1 Consolidated balance sheet
Unit: RMB
| Item | September 30, 2023 | December 31, 2022 |
| Current Assets: | ||
| Cash and bank balances | 39,977,862,822.26 | 40,011,863,999.94 |
| Held-for-trading financial assets | 23,469,021.18 | 12,807,438.36 |
| Notes receivable | 2,121,463,259.43 | 2,519,988,159.23 |
| Accounts receivable | 35,040,102,719.68 | 29,906,294,410.40 |
| Receivables for financing | 1,336,187,223.27 | 1,484,218,258.74 |
| Prepayments | 1,176,737,421.25 | 534,780,120.52 |
| Other receivables | 807,450,237.15 | 516,503,485.58 |
| Inventories | 19,363,488,485.66 | 18,998,222,978.81 |
| Contract assets | 1,154,739,956.62 | 2,118,223,370.98 |
| Non-current assets due within one year | 1,230,559,088.32 | 996,902,343.27 |
| Other current assets | 931,026,501.20 | 806,832,941.58 |
| Total Current Assets | 103,163,086,736.02 | 97,906,637,507.41 |
| Non-current Assets: | ||
| Long-term receivables | 606,725,980.62 | 540,647,965.30 |
| Long-term equity investment | 1,126,759,863.53 | 1,252,033,513.41 |
| Other non-current financial assets | 476,162,910.62 | 423,893,239.94 |
| Fixed assets | 10,433,152,020.09 | 8,539,842,630.68 |
| Construction in progress | 4,377,080,137.56 | 3,770,803,300.80 |
| Right-of-use assets | 532,980,822.86 | 574,478,326.31 |
| Intangible assets | 1,586,649,264.40 | 1,544,933,502.19 |
| Goodwill | 397,053,077.36 | 217,386,531.28 |
| Long-term deferred expenses | 181,447,230.64 | 177,277,742.41 |
| Deferred tax assets | 1,693,530,982.33 | 1,470,966,695.68 |
| Other non-current assets | 2,882,764,536.05 | 2,815,702,012.70 |
| Total Non-current Assets | 24,294,306,826.06 | 21,327,965,460.70 |
| Total Assets | 127,457,393,562.08 | 119,234,602,968.11 |
| Current Liabilities: | ||
| Short-term borrowings | 2,921,132,464.29 | 3,343,071,972.89 |
| Held-for-trading financial liabilities | 4,181,387.92 | 68,299,685.57 |
| Notes payable | 635,917,745.45 | 1,207,756,963.94 |
| Accounts payable | 15,276,807,817.90 | 16,025,563,802.99 |
| Item | September 30, 2023 | December 31, 2022 |
| Contract liabilities | 3,094,814,814.71 | 2,644,496,508.36 |
| Payroll payable | 4,382,570,861.70 | 4,837,302,455.95 |
| Taxes payable | 1,844,339,050.35 | 1,234,032,138.37 |
| Other payables | 3,601,311,665.99 | 3,203,308,686.31 |
| Non-current liabilities due within one year | 5,033,280,741.55 | 868,197,272.46 |
| Other current liabilities | 1,451,039,846.11 | 923,721,593.78 |
| Total Current Liabilities | 38,245,396,395.97 | 34,355,751,080.62 |
| Non-current Liabilities: | ||
| Long-term borrowings | 9,251,855,308.30 | 7,522,315,341.60 |
| Lease liabilities | 278,314,201.74 | 277,255,924.83 |
| Long-term payables | 5,967,794.23 | 7,569,934.67 |
| Provisions | 216,105,842.16 | 219,365,227.62 |
| Deferred income | 877,399,488.02 | 933,260,426.12 |
| Deferred tax liabilities | 121,685,829.78 | 117,340,377.75 |
| Other non-current liabilities | 1,669,822,285.01 | 2,831,108,087.59 |
| Total Non-current liabilities | 12,421,150,749.24 | 11,908,215,320.18 |
| Total Liabilities | 50,666,547,145.21 | 46,263,966,400.80 |
| Owners’ Equity | ||
| Share capital | 9,330,600,931.00 | 9,430,920,624.00 |
| Capital reserves | 8,312,925,536.12 | 10,141,153,435.32 |
| Less: Treasury shares | 2,737,987,226.55 | 5,316,033,650.24 |
| Other comprehensive income | 12,228,192.69 | (42,587,158.81) |
| Surplus reserves | 4,715,460,312.00 | 4,715,460,312.00 |
| Retained earnings | 51,879,499,617.03 | 49,459,757,577.51 |
| Total owners' equity attributable to owner of the Company | 71,512,727,362.29 | 68,388,671,139.78 |
| Minority equity | 5,278,119,054.58 | 4,581,965,427.53 |
| Total Owners' Equity | 76,790,846,416.87 | 72,970,636,567.31 |
| Total Liabilities and Owners' Equity | 127,457,393,562.08 | 119,234,602,968.11 |
Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin YanPerson in Charge of Accounting Institution: Zhan Junhua
1.2 Consolidated income statement from the beginning of the year to the end of the reporting period
Unit: RMB
| Item | 2023 Q1~Q3 | 2022 Q1~Q3 |
| I. Revenue | 61,275,164,193.63 | 59,721,536,891.77 |
| II．Total Operating Costs | 51,800,457,295.98 | 50,291,034,361.47 |
| Less: Cost of sales and services | 33,792,365,273.38 | 34,428,422,516.36 |
| Business taxes and surcharges | 526,331,975.20 | 404,250,604.06 |
| Selling expenses | 7,702,706,183.02 | 7,105,121,639.99 |
| Administrative expenses | 2,044,153,100.82 | 1,934,338,028.12 |
| Research and development (R&D) expenses | 8,173,026,397.26 | 7,356,096,237.35 |
| Financial expenses | (438,125,633.70) | (937,194,664.41) |
| Including：Interest expenses | 327,860,614.56 | 221,677,391.74 |
| Interest income | 705,753,970.45 | 654,737,093.34 |
| Add: Other income | 1,695,250,235.38 | 1,648,453,505.94 |
| Investment income (loss"-") | 39,763,080.90 | 166,250,594.06 |
| Including: Investment gains (losses) in associated enterprise and joint-venture enterprise | (42,311,858.66) | 20,851,979.61 |
| Gains (loss"-") from changes in fair values | 83,987,239.15 | (69,558,120.87) |
| Credit impairment losses ("-") | (541,104,768.19) | (478,935,914.07) |
| Impairment losses ("-") of assets | (269,035,009.89) | (238,371,890.55) |
| Asset disposal income (loss"-") | (12,073,109.46) | (10,541,208.42) |
| III. Operating Profit (loss"-") | 10,471,494,565.54 | 10,447,799,496.39 |
| Add: Non-operating income | 76,153,790.31 | 75,058,667.75 |
| Less: Non-operating expenses | 13,606,755.97 | 11,756,007.04 |
| IV. Total Profit (loss"-") | 10,534,041,599.88 | 10,511,102,157.10 |
| Less: Income tax expenses | 1,035,810,349.56 | 1,137,253,259.27 |
| V. Net Profit (loss"-") | 9,498,231,250.32 | 9,373,848,897.83 |
| 5.1 Classification by operation continuity | ||
| (a) Net profit (loss) on continuous operation | 9,498,231,250.32 | 9,373,848,897.83 |
| (b) Net profit (loss) on terminated operation | - | - |
| 5.2 Classification by attribution of ownership | ||
| (a) Net profit attributable to owners of parent company | 8,851,167,117.21 | 8,840,604,273.67 |
| (b) Profit or loss attributable to minority shareholders | 647,064,133.11 | 533,244,624.16 |
| VI. Other Comprehensive Income, Net of Income Tax | 132,104,468.87 | 93,448,547.69 |
| Other comprehensive income attributable to owners of the Company, net of tax | 54,815,351.50 | 40,202,998.69 |
| Item | 2023 Q1~Q3 | 2022 Q1~Q3 |
| (I) Items that will not be reclassified subsequently to profit or loss | - | - |
| (II) Other comprehensive income to be reclassified to profit or loss in subsequent periods | 54,815,351.50 | 40,202,998.69 |
| 1. Exchange differences arising on conversion of financial statements denominated in foreign currencies | 54,815,351.50 | 40,202,998.69 |
| Other comprehensive income attributable to minority interests, net of tax | 77,289,117.37 | 53,245,549.00 |
| VII. Total Comprehensive Income | 9,630,335,719.19 | 9,467,297,445.52 |
| Total comprehensive income attributable to owners of the parent company | 8,905,982,468.71 | 8,880,807,272.36 |
| Total comprehensive income attributable to minority shareholders | 724,353,250.48 | 586,490,173.16 |
| VIII. Earnings Per Share | ||
| (I) Basic earnings per share | 0.949 | 0.938 |
| (II) Diluted earnings per share | 0.949 | 0.938 |
Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin YanPerson in Charge of Accounting Institution: Zhan Junhua
1.3 Consolidated cash flow statement from the beginning of the year to the end of the reporting period
Unit: RMB
| Item | 2023 Q1~Q3 | 2022 Q1~Q3 |
| I. Cash Flows from Operating Activities: | ||
| Cash received from sale of goods or rendering of services | 64,047,725,763.17 | 59,535,173,216.27 |
| Receipts of tax refunds | 2,795,802,271.62 | 3,065,301,011.49 |
| Other cash receipts relating to operating activities | 1,467,205,190.63 | 1,816,017,950.14 |
| Sub-total of cash inflows from operating activities | 68,310,733,225.42 | 64,416,492,177.90 |
| Cash payments for goods purchased and services received | 39,429,099,767.75 | 42,941,542,076.67 |
| Cash paid to and on behalf of employees | 13,869,935,240.93 | 12,515,261,002.67 |
| Payments of various types of taxes | 4,618,424,247.88 | 4,385,864,114.47 |
| Other cash payments relating to operating activities | 4,479,420,487.91 | 4,413,707,843.05 |
| Sub-total of cash outflows from operating activities | 62,396,879,744.47 | 64,256,375,036.86 |
| Net Cash Flows from Operating Activities | 5,913,853,480.95 | 160,117,141.04 |
| II. Cash Flows from Investing Activities: | ||
| Cash receipts from recovery of investments | 3,676,551,269.16 | 5,325,102,722.13 |
| Cash receipts from investment income | 2,170,800.00 | 52,646,156.83 |
| Net cash receipts from disposals of fixed assets, intangible assets and other long-term assets | 4,992,600.07 | 15,393,463.90 |
| Other cash receipts relating to investing activities | 45,490,116.17 | 37,408,842.43 |
| Sub-total of cash inflows from investing activities | 3,729,204,785.40 | 5,430,551,185.29 |
| Item | 2023 Q1~Q3 | 2022 Q1~Q3 |
| Cash payments to acquire or construct fixed assets, intangible assets and other long-term assets | 3,321,446,998.66 | 2,792,918,794.05 |
| Cash paid to acquire investments | 3,803,400,267.38 | 5,260,713,466.18 |
| Net cash paid to acquire subsidiaries and other business units | 43,992,651.82 | - |
| Sub-total of cash outflows from investing activities | 7,168,839,917.86 | 8,053,632,260.23 |
| Net Cash Flows from Investing Activities | (3,439,635,132.46) | (2,623,081,074.94) |
| III. Cash Flows from Financing Activities: | ||
| Cash receipts from capital contributions | 10,820,000.00 | 2,893,831,394.55 |
| Including: cash receipts from capital contributions from minority owners of subsidiaries | 10,820,000.00 | - |
| Cash receipts from borrowings | 8,411,594,640.04 | 7,552,410,026.04 |
| Other cash receipts relating to financing activities | 5,000,000.00 | - |
| Sub-total of cash inflows from financing activities | 8,427,414,640.04 | 10,446,241,420.59 |
| Cash repayments of borrowings | 3,193,590,889.95 | 3,915,869,370.59 |
| Cash payments for distribution of dividends or profits or settlement of interest expenses | 6,919,370,094.76 | 8,593,072,039.85 |
| Other cash payments relating to financing activities | 881,998,903.51 | 130,241,064.72 |
| Sub-total of cash outflows from financing activities | 10,994,959,888.22 | 12,639,182,475.16 |
| Net Cash Flows from Financing Activities | (2,567,545,248.18) | (2,192,941,054.57) |
| IV. Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents | 91,529,173.89 | 149,153,315.95 |
| V. Net Decrease in Cash and Cash Equivalents | (1,797,725.80) | (4,506,751,672.52) |
| Add: Opening balance of Cash and Cash Equivalents | 39,815,390,514.57 | 34,603,944,429.20 |
| VI. Closing Balance of Cash and Cash Equivalents | 39,813,592,788.77 | 30,097,192,756.68 |
Legal Representative: Chen Zongnian Person in Charge of the Accounting work: Jin YanPerson in Charge of Accounting Institution: Zhan Junhua
2. Adjustments to financial report at the beginning of the year relating to the initial adoption of the newaccounting standards or interpretation of standards since 2023.
√Applicable □Inapplicable
The Ministry of Finance issued the Interpretation No. 16 of Accounting Standards for Business Enterprises (the"Interpretation No. 16") on November 30, 2022. The scope of the initial recognition exemption for deferred incometax in the Accounting Standards for Business Enterprises No. 18-Income Tax was revised. Making it clear that theprovisions on exemption of initial recognition of deferred income tax liabilities and deferred income tax assets inAccounting Standards for Business Enterprises No. 18-Income Taxes shall not be applied if a single transaction isnot a business combination, that affects neither accounting profit nor taxable income (or deductible loss) when the
Hikvision 2023 Q3 Reporttransaction occurs, and that initially recognized assets and liabilities result in equal taxable temporary differencesand deductible temporary differences. This provision is effective as of January 1, 2023 and may be implemented inadvance. The Group implemented this requirement from January 1, 2023, and accounted for individual transactionsbetween the beginning of the earliest period in which the financial statements are presented and December 31, 2022using the retrospective adjustment method, and restated the financial statements for the comparative period. Thespecific impact on the financial statement items is described below:
(1) The impact on the relevant items of the Group's consolidated balance sheet on January 1, 2022
Unit: RMB
| Item | Before the restatement | Adjustment | After the restatement |
| Deferred tax assets | 1,210,877,575.24 | 758,784.91 | 1,211,636,360.15 |
| Deferred tax liabilities | 93,315,151.17 | 971,090.51 | 94,286,241.68 |
| Retained earnings | 45,148,877,451.52 | (942,347.44) | 45,147,935,104.08 |
| Minority equity | 1,933,755,610.62 | 730,041.84 | 1,934,485,652.46 |
(2) The impact on the relevant items of the Group's consolidated balance sheet on December 31, 2022
Unit: RMB
| Item | Before the restatement | Adjustment | After the restatement |
| Deferred tax assets | 1,469,646,489.04 | 1,320,206.64 | 1,470,966,695.68 |
| Deferred tax liabilities | 116,502,770.84 | 837,606.91 | 117,340,377.75 |
| Retained earnings | 49,460,240,986.49 | (483,408.98) | 49,459,757,577.51 |
| Minority equity | 4,580,999,418.82 | 966,008.71 | 4,581,965,427.53 |
(3) The impact on the relevant items of the Group's 2022 consolidated income statement
Unit: RMB
| Item | Before the restatement | Adjustment | After the restatement |
| Income tax expenses | 1,297,981,905.54 | (694,905.33) | 1,297,287,000.21 |
| Net profit attributable to owners of parent company | 12,837,342,061.07 | 458,938.46 | 12,837,800,999.53 |
| Profit or loss attributable to minority shareholders | 719,627,660.86 | 235,966.87 | 719,863,627.73 |
(4) The impact on items related to the Group's consolidated income statement for the period from January 1, 2022to September 30, 2022
Unit: RMB
| Item | Before the restatement | Adjustment | After the restatement |
| Income tax expenses | 1,137,676,186.81 | (422,927.54) | 1,137,253,259.27 |
| Net profit attributable to owners of parent company | 8,840,255,887.45 | 348,386.22 | 8,840,604,273.67 |
| Profit or loss attributable to minority shareholders | 533,170,082.84 | 74,541.32 | 533,244,624.16 |
3. Audit Report
Whether audit has been performed on this 2023 3
rdQuarter Report
□ Yes √ No
The Company’s 2023 3
rd
Quarter report has not been audited.
HANGZHOU HIKVISION DIGITAL TECHNOLOGY CO., LTD.
Board of DirectorsOctober 21, 2023
Note:
This document is a translated version of the Chinese version 2023 3
rdQuarter Report (“2023年第三季度报告”),and the published announcements in the Chinese version shall prevail. The complete published Chinese 2023 3
rd
Quarter Report may be obtained at www.cninfo.com.cn.