Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Wuhu Sanqi Interactive Entertainment Network Technology
Group Co., Ltd.
2019 Semi-annual Report
August 2019
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Section I Contents and Interpretation
Table of Contents
Section I Contents and Interpretation ...... 2
Section II Company Profile and Key Financial Indicators ...... 6
Section III Business Overview ...... 10
Section IV Discussion and Analysis of Operation Status ...... 16
Section V Important Events ...... 35
Section VI Equity Changes and Shareholders ...... 40
Section VII Financial Report ...... 47
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Definitions
| Term | means | Definition |
| CSRC | means | China Securities Regulatory Commission |
| SZSE | means | Shenzhen Stock Exchange |
| The Company/Company/Listed Company/Sanqi Interactive Entertainment | means | Wuhu Shunrong Auto Parts Co., Ltd./Wuhu Shunrong Sanqi Interactive Entertainment Network Technology Co., Ltd./Wuhu Sanqi Interactive Entertainment Network Technology Group Co., Ltd. |
| Shanghai Sanqi Interactive Entertainment | means | Sanqi Interactive Entertainment (Shanghai) Technology Co., Ltd. |
| Company Law | means | Company Law of the People’s Republic of China |
| Securities Law | means | Securities Law of the People’s Republic of China |
| Articles of Association | means | Articles of Association of Wuhu Shunrong Auto Parts Co., Ltd./Articles of Association of Wuhu ShunrongSanqi Interactive Entertainment Network Technology Co., Ltd./Articles of Association of Wuhu Sanqi Interactive Entertainment Network Technology Group Co., Ltd. |
| RMB/RMB 10,000 | means | Chinese yuan/10,000 Chinese yuan |
| Reporting Period | means | From January 1st, 2019 to June 30th, 2019 |
| End of Reporting Period | means | June 30th, 2019 |
| Browser games | means | Clientless or browser kernel-based micro-client games that are based on web development technologies and utilize standard protocols as basic transmission modes. Game users can play browser games directly through an Internet browser |
| Mobile games | means | Games that are downloaded via mobile network and run on mobile phones or other mobile terminals. |
| RPG | means | Role playing game |
| ARPG | means | Action role playing game |
| SIM | means | Simulation game |
| SLG | means | Strategy game |
| STG | means | Shooting game |
| MMO | means | Massive Multiplayer Online |
| MOBA | means | Multiplayer Online Battle Arena |
| Shanghai Mokun | means | Shanghai Mokun Digital Technology Co., Ltd. |
| Jiangsu Zhiming | means | Jiangsu Zhiming Network Technology Co., Ltd. |
| Tibet Xintai | means | Tibet Xintai Culture Media Co., Ltd. |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Anhui Vogue Entertainment | means | Anhui Vogue Entertainment Network Technology Co., Ltd. |
| Vogue Entertainment International | means | Vogue Entertainment International Limited |
| G-MEI Network | means | G-MEI Network Technology Co., Ltd. |
| Guangzhou Sanqi | means | Guangzhou Sanqi Network Technology Co., Ltd. |
| Guangzhou Xingzhong | means | Guangzhou Xingzhong Information Technology Co., Ltd. |
| Anhui Xuhong | means | Anhui Xuhong Information Technology Co., Ltd. |
| Anhui Sanqi | means | Anhui Sanqi Network Technology Co., Ltd. |
| Jiangsu Aurora/Aurora Network/Jiangsu Aurora Network | means | Jiangsu Aurora Network Technology Co., Ltd. |
| Shanghai Yingtong | means | Shanghai Yingtong Network Technology Co., Ltd. |
| Wisdom Entertainment International | means | Wisdom Entertainment Online International Limited |
| Wisdom Game International | means | Wisdom Game Online International Limited |
| Shanghai Guanhang | means | Shanghai Guanhang Network Technology Co., Ltd. |
| Anhui Jiashang | means | Anhui Jiashang Network Technology Co., Ltd. |
| Chengdu Shengge Times Network Technology Co., Ltd. | means | Chengdu Shengge Times Network Technology Co., Ltd. |
| Beijing Shangheng | means | Beijing ShanghengJiatian Network Technology Co., Ltd. |
| Jiangsu Jiaqu | means | Jiangsu Jiaqu Network Technology Co., Ltd. |
| Shanghai Zhiren | means | Shanghai Zhiren Culture Media Co., Ltd. |
| Tibet Taifu | means | Tibet Taifu Culture Media Co., Ltd. |
| 37 Games Entertainment Co., Ltd. | means | 37 Games Entertainment Limited |
| Shanghai Mobile Game | means | Shanghai ShouyouTianxia Digital Technology Co., Ltd. |
| Anhui Guanyu | means | Anhui Guanyu Culture Media Co., Ltd. |
| Tibet Yaotong | means | Tibet Yaotong Network Technology Co., Ltd. |
| Tibet Shengge | means | Tibet Shengge Network Technology Co., Ltd. |
| Guangzhou Sanqi Interactive Entertainment | means | Sanqi Interactive Entertainment (Guangzhou) Technology Co., Ltd. |
| Guangzhou Huoshanhu | means | Guangzhou Huoshanhu Information Technology Co., Ltd. |
| KhorgasQianyu | means | Khorgos Entertainment Network Technology Co., Ltd. |
| KhorgasXinghui | means | KhorgosXinghui Network Technology Co., Ltd. |
| KhorgosXinrui | means | KhorgosXinrui Network Technology Co., Ltd. |
| Top Increase | means | Top Increase Global Limited |
| KhorgasSanqi | means | KhorgosSanqi Entertainment Venture Capital Co., Ltd. |
| Anhui Aurora | means | Anhui Sanqi Aurora Network Technology Co., Ltd. |
| Guangzhou Jisheng | means | Guangzhou Jisheng Network Technology Co., Ltd. |
| Anhui Wanhu | means | Anhui Wanhu Information Technology Co., Ltd. |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Zhuhai Miaohu | means | Zhuhai Miaohu Network Technology Co., Ltd. |
| Zhuhai Shangjie | means | Zhuhai Shangjie Network Technology Co., Ltd. |
| Huai’anSanqi | means | Huai’anSanqiYijian Pan-Entertainment Asset Management Center (Limited Partnership) |
| Anhui Zhusheng | means | Anhui Zhusheng Network Technology Co., Ltd. |
| Guangzhou Sanqi Culture & Entertainment | means | Sanqi Entertainment Network Technology (Guangzhou) Co., Ltd. |
| Chengdu Pengwan Technology Co., Ltd. | means | Chengdu Pengwan Technology Co., Ltd. and its subsidiaries |
| Wangzhong Investment | means | ZhangshuWangzhong Investment Management Center (Limited Partnership) |
| Chengdu Shouyin | means | Chengdu Shouyin Technology Co., Ltd. |
| Silk Road Culture Company | means | KhorgosSanqi Wisdom Entertainment Silk Road Cultural Technology Development Co., Ltd. |
| Anhui Jishuo | means | Anhui Jishuo Network Technology Co., Ltd. |
| Shanghai Jiqu | means | Shanghai Jiqu Network Technology Co., Ltd. |
| Feiying Network | means | Feiying Network Technology Co., Ltd. |
| Guangzhou Lehu | means | Guangzhou Lehu Network Technology Co., Ltd. |
| ChuangshiPoxiao | means | ChuangshiPoxiao Co., Ltd. |
| Japanese Lychee | means | Lychee Corporation |
| Guangzhou Jishang | means | Guangzhou Jishang Network Technology Co., Ltd. |
| Zen-game Technology | means | Zengame Technology Holding Limited and its operating entities |
| X.D. Network | means | XD Inc. and its operating entities |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Section II Company Profile and Key Financial IndicatorsI. Company profile
| Stock abbreviation | Sanqi Interactive Entertainment | Stock code | 002555 |
| Place of Listing | Shenzhen Stock Exchange | ||
| Company name in Chinese | 芜湖三七互娱网络科技集团股份有限公司 | ||
| Company short name in Chinese (if any) | 三七互娱 | ||
| Company name in English (if any) | WUHU SANQI INTERACTIVE ENTERTAINMENT NETWORK TECHNOLOGY GROUP CO.,LTD. | ||
| Legal representative | Li Weiwei | ||
II. Contact person and contact information
| Secretary of the Board of Directors | Securities Affairs Representative | |
| Name | Ye Wei | Wang Sijie |
| Contact address | 11/F, Creative Advertising Complex, Wuhu Advertising Industrial Park, Middle Beijing Road, Jiujiang District, Wuhu City, Anhui Province | 11/F, Creative Advertising Complex, Wuhu Advertising Industrial Park, Middle Beijing Road, Jiujiang District, Wuhu City, Anhui Province |
| Tel. | 0553-7653737 | 0553-7653737 |
| Fax | 0553-7653737 | 0553-7653737 |
| ir@37.com | ir@37.com |
III. Other Relevant Information
1. Contact information
Any change to the registered address, office address and postal code, company website, e-mail during the reporting period
√Applicable □Not Applicable
| Registered Address | 11/F, Creative Advertising Complex, Wuhu Advertising Industrial Park, Middle Beijing Road, Jiujiang District, Wuhu City, Anhui Province |
| Post code of registered address | 241000 |
| Business Address | 11/F, Creative Advertising Complex, Wuhu Advertising Industrial Park, Middle Beijing Road, Jiujiang District, Wuhu City, Anhui Province |
| Post code of business address | 241000 |
| Website | http://www.37wan.net/ |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Company email address | ir@37.com |
| Query date (if any) of the designated website for temporary announcement | March 19th, 2019 |
| Query index (if any) of the designated website for temporary announcement | For details of the Announcement of the Twenty-sixth Meeting of the Fourth Board of Directors (announcement No.: 2019-033), please refer to China Securities Journal, Securities Times, Shanghai Securities News, Securities Daily and www.cninfo.com.cn. |
2. Information disclosure and designated place
Any change to the information disclosure and designated place during the reporting period
□Applicable √Not Applicable
Any change to the name of newspaper as designated by the Company for information disclosure, the website designated by CSRC forpublication of the semi-annual report, and the designated place of the semi-annual report during the reporting period (refer to theannual report in 2018).
3. Other relevant information
Any change to other relevant information during the reporting period
√Applicable □Not Applicable
On April 8th, 2019, the Company held the 3rd Extraordinary General Meeting of 2019, at which the Proposal on Advancing theGeneral Election of Non-independent Directors for the Fifth Board of Directors and the Proposal on Advancing the General Electionof Independent Directors for the Fifth Board of Directors were reviewed and approved. Seven directors nominated by Li Weiweiwere elected in the general election of Board of Directors and secured more than half of the seats on the Board of Directors. Thevoting rights held by Li Weiwei have had a material influence on the resolution of the Company’s 3rd Extraordinary General Meetingof 2019, played a decisive role in electing more than half of the members of the Company’s Board of Directors through this meeting,and effectively controlled the majority of the new Board of Directors. Therefore, the controlling shareholders and actual controllersof the Company were changed from Wu Xushun, Wu Weidong and Wu Weihong to Li Weiwei. For details, please refer to the PromptAnnouncement on the Changes of Controlling Shareholders and Actual Controllers disclosed by the Company on April 9th, 2019(announcement No.: 2019-045).
IV. Main accounting data and financial index
Does the Company need to retroactively adjust or restate accounting data of previous years?
□ Yes √ No
| Current Reporting Period | Same Reporting Period of the Prior Year | Increase or decrease of current year against previous year | |
| Operating income (RMB) | 6,070,957,503.06 | 3,302,496,146.77 | 83.83% |
| Net profits attributable to the listed company shareholders (RMB) | 1,033,074,405.38 | 801,378,948.23 | 28.91% |
| Net profits attributable to listed company | 949,369,446.08 | 761,182,531.85 | 24.72% |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| shareholders after deducting non-recurring profits and losses (RMB) | |||
| Net cash flows from operating activities (RMB) | 616,354,936.37 | 977,236,017.96 | -36.93% |
| Basic earning per share (yuan/share) | 0.49 | 0.37 | 32.43% |
| Diluted earning per share (yuan/share) | 0.49 | 0.37 | 32.43% |
| Weighted average rate of return on equity | 16.31% | 12.71% | 3.60% |
| End of the Current Reporting Period | End of the Same Reporting Period of the Prior Year | Increase or decrease compared with the end of previous year | |
| Total assets (RMB) | 8,767,575,383.14 | 8,395,761,716.98 | 4.43% |
| Net assets attributable to listed company shareholders (RMB) | 6,166,617,209.02 | 5,972,675,405.86 | 3.25% |
V. Data differences due to different accounting standards in Mainland China and otherregions
1. Differences regarding to net profits and net assets between financial statements disclosed according tointernational standards and Chinese standards
□Applicable √Not Applicable
During the reporting period, there is no difference regarding to net profits and net assets between financial statements disclosedaccording to international standards and Chinese standards.
2. Differences regarding to net profits and net assets between financial statements disclosed according tostandards of other regions and Chinese standards
□Applicable √Not Applicable
During the reporting period, there is no difference regarding to net profits and net assets between financial statements disclosedaccording to standards of other regions and Chinese standards
VI. Non-recurring profits and losses and their amount
√Applicable □Not Applicable
Unit: RMB
| Item | Amount | Description |
| Profits or losses on disposal of non-marketable asset, including offset amount accrued for impairment provision | 8,967,295.34 | Mainly profit and loss from the disposal of long-term equity investment and fixed assets. |
| Government subsidy included in current profit or loss (except those closely related to enterprise operation and received based on | 23,416,359.86 | Mainly government subsidy other than the refund of value-added tax |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| consolidated national standard quota or quantitative) | （hereinafter called the ‘VAT’）and additional deduction of VAT. | |
| Profit or loss of asset whose investment or management is entrusted to others | 11,172,479.46 | Mainly the income from bank’s financial products. |
| Except effective hedging business relating to normal operating business of the Company, profit or loss caused by change in the fair value of trading financial assets, derivative financial assets, trading financial liabilities and derivative financial liabilities, and investment profit for disposal of trading financial assets, derivative financial assets, trading financial liabilities and derivative financial liabilities and other creditors' investments. | 44,790,828.46 | |
| Other non-operating revenues and expenditures except the foregoing items | 408,225.48 | |
| Less: Affected amount of income taxes | 4,387,332.89 | |
| Affected amount of minority interest income (after-tax) | 662,896.41 | |
| Total | 83,704,959.30 | -- |
As to non-recurring profits and losses determined based on the definition provided in the Explanatory Announcement No. 1 onInformation Disclosure for Companies Offering Their Securities to the Public - Non-Recurring Profit and Loss, and the recurringprofits and losses determined from non-recurring profits and losses listed in the Explanatory Announcement No. 1 on InformationDisclosure for Companies Offering Their Securities to the Public - Non-Recurring Profit and Loss, reasoning shall be provided
□Applicable √Not Applicable
During the reporting period, the Company recognized no non-recurring profit and loss defined and listed in the ExplanatoryAnnouncement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public - Non-Recurring Profit andLoss as recurring profit and loss.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Section III Business Overview
I. Main business in the reporting period
Does the Company need to comply with the disclosure requirements for special industries?YesSoftware and IT servicesThe Company is required to comply with the disclosure requirements of the SZSE Industrial Information Disclosure Guide No. 12 -Listed Companies Engaged in Software and IT Services.During the reporting period, the Company focused on cultural and creative businesses based on the development, distributionand operation of mobile games and browser games, and also development in segments such as film and television, music, animation,VR, cultural health, Internet children education, social entertainment, etc. The Company ranked 22nd in the 2018 global listed gamecompanies list by Newzoo, a well-known third-party data organization, and was also the third Chinese game company in the list, dueto its steady promotion of development strategy of “boutiqueization, diversification, platformization and globalization” around IPs.During the reporting period, the Company gained an operating income of RMB 6.071 billion, with a year-on-year increase of
83.83%; a total profit of RMB 1.291 billion, with a year-on-year increase of 40.43%; a net profit attributable to the listed companyshareholders of RMB 1.033 billion, with a year-on-year increase of 28.91%. The main reason for driving performance growth wasthe Company’s 152.90% increase in its income of mobile games.
1. Changes in industry-related economic situation and their impacts on the Company
1) In the first half of 2019, the overall income of the Chinese game market showed a rebound trend. The 2019 Semi-annualReport of Chinese Game Industry released by Gamma Data showed that the actual sales revenue of Chinese game market fromJanuary to June 2019 was RMB 116.31 billion, with a year-on-year increase of 10.8%; in the period from January to June 2019, thenumber of users in the Chinese game market was 554 million, with a year-on-year increase of 5.1%. Among them, from January toJune 2019, the actual sales revenue of Chinese mobile game market was RMB 75.31 billion, with a year-on-year increase of 18.8%,accounting for 64.8% of the total actual sales revenue of the Chinese game market. The growth rate of revenue increased comparedwith the first half of 2018. The share of mobile games continues to increase year on year, and mobile games are still the main drivingforce for the overall growth of Chinese game market.During the reporting period, the Company’s domestic mobile game revenuegrew rapidly. The Overall Analysis 2019H1 for Chinese Mobile Game Market released by Analysys showed that the market share ofthe Company’s domestic mobile game business was 10.02%.
2) In the first half of 2019, the game industry entered a new stage of development under the influence of various factors: Onthe one hand, the industry’s attention is increasingly concentrated on top works and head manufacturers, and the development trendof the industry as a whole will not change. On the other hand, the number of mobile game users has not changed much in the firsthalf of 2019, and the dividends of users in the game industry have also basically reached the bottleneck, so the Chinese gameindustry started to enter into the mature stage and its growth drivers have shifted from “demographic dividends” to “contentdividends”.During the reporting period, the Company increased R&D investments, expanded its R&D teams, and enhanced its outputcapability of high-quality games on the one hand, and on the other hand, the Company deepened the “diversification” strategy inrespect of research and development, domestic distribution, overseas distribution, etc., and reserved high-quality games of differentthemes and types through independent research and development, investment in competent R&D companies, and cooperation withR&D companies that produced quality games. The Company actively promoted the life cycle of quality games through systematic
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
traffic operations and improved operational services, and further leveraged the advantages of “integration of R&D and operation”model to improve the operational efficiency.
2. Changes in industrial policy environment and their impacts on the Company
In June 2019, the Ministry of Culture and Tourism publicly solicited opinions on the Cultural Industry Promotion Law (Draftfor Comment). The draft for comment pointed out that China would promote the integration of cultural industry development intonational economic and social development plans, formulate special plans to promote the development of cultural industry, publish aguidance catalogue for cultural industry development, and promote structural adjustment and layout optimization of cultural industry.China encourages innovation in content, technology, and business type of cultural industry, and creates a social environmentconducive to the emergence of quality cultural products and talents.During the reporting period, the Company actively responded to relevant requirements of industrial development, increasedinvestments in high-quality games and innovative gameplay settings, and vigorously protected intellectual property rights to ensurecompliant operations.In December 2018, the General Office of the State Council issued the Regulations on Further Supporting the Development ofCultural Enterprises, which explicitly increased the national supports for key enterprises and projects for national cultural exportsand strengthened the construction of national cultural export bases.Sanqi Interactive Entertainment actively responds to the national “Go Out policy” for cultural industries, and strives to promoteChinese cultural services to the rest of world. 37GAMES will further develop its first-mover advantage in overseas markets, and relyon its advanced game R&D and localized marketing capabilities to continuously expand the scale of overseas business and createmore foreign currency earnings, thus escorting the exports of cultural industries and helping Chinese cultural and entertainmententerprises to enhance their cultural confidence.
3. Main businesses, main products and business models of the Company
During the reporting period, the Company’s main businesses include the development, distribution and operation of mobilegames and browser games. The operating modes of the Company’s mobile games and browser games mainly include independentoperation and third-party joint operation.Under the independent operation mode, the Company obtains the operation rights of game products through independent R&Dor agencies, and publishes and operates these products through its own or third-party channels. The Company is fully responsible forthe operation, promotion and maintenance of the game; providing unified management services for online promotion, onlinecustomer service and top-up payment; and iteratively updating game products along with game developers based on the real-timefeedback of users and games.Under the third-party joint operation mode, the Company cooperates with one or more game operators to jointly operate games.The third-party game operators are responsible for operation and promotion of respective channels and management of recharge andcharge system, while the Company provides technical support services along with game developers.
II. Material changes in major assets
1. Material changes in major assets
| Major assets | Material changes |
| Equity assets | No major changes to equity assets occurred. |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Fixed assets | No major changes to fixed assets occurred. |
| Intangible assets | No major changes to intangible assets occurred. |
| Trading financial assets | The ending balance of trading financial assets increased by RMB 204 million compared with the opening balance, mainly due to the increase in the balance of unredeemed financial products at the end of the period. |
| Accounts receivable | The ending balance of accounts receivable increased by RMB 419 million compared with the opening balance, mainly due to the increase in operating income in the second quarter of this year compared with that in the fourth quarter of the previous year. |
| Prepayments | The ending balance of prepayments increased by RMB 309 million compared with the opening balance, mainly due to the increase in prepaid Internet traffic charges. |
| Other receivables | The ending balance of other receivables decreased by RMB 700 million compared with the opening balance, mainly due to: 1) the recovery of remaining amount during the reporting period for disposal of Wuhu Shunrong Auto Parts Co., Ltd. in the previous year; 2) the recovery of the cash compensation paid by the original shareholders of Shanghai Mokun to the Company arising from the failure of performance commitments by Shanghai Mokun in the previous year. |
| Other current assets | The ending balance of other current assets decreased by RMB 115 million compared with the opening balance, mainly because that Shanghai Mokun failed to fulfill its performance commitments in the previous year and its original shareholders’ compensation shares to the Company were cancelled during the reporting period. |
| Construction in progress | The ending balance of construction in progress increased by RMB 751 million compared with the opening balance, mainly because that the office building purchased in 2017 was delivered during the reporting period and the prepayment for office building was recognized under the construction in progress. |
| Deferred income tax assets | The ending balance of deferred income tax assets decreased by RMB 20 million compared with the opening balance, mainly due to the decrease in the balance of bad debt reserves at the end of the period. |
| Other non-current assets | The ending balance of other non-current assets increased by RMB 743 million compared with the opening balance, mainly because that the office building purchased in 2017 was delivered during the reporting period and the prepayment for office building was recognized under the construction in progress. |
| Note: The above-mentioned opening balance is the balance on January 1st, 2019 after adjustment according to accounting policies. |
2. Main assets beyond Mainland China
□Applicable √Not Applicable
III. Analysis of core competitiveness
Does the Company need to comply with the disclosure requirements for special industries?Yes
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Software and IT servicesThe Company has steadily promoted the development strategy of “boutiqueization, diversification, platformization andglobalization” around IPs to form the following core competitiveness:
1. Industry-leading R&D strength
During the reporting period, the Company has successively launched two self-developed products: Yi Dao Chuan Shi (一刀传世) and Dou Luo Da Lu H5 (斗罗大陆H5), both with a monthly gross billing of over RMB 100 million. Jing Ling Sheng Dian (精灵盛典) has achieved outstanding performance since its launch, the highest ranking of which was third in the best-selling list ofAppStore games. A number of self-developed quality games, such as Yong HengJi Yuan (永恒纪元) and Swords of Archangels (大天使之剑), have achieved steady gross billing in the markets at which these games have been launched for more than one year. TheCompany’s self-developed products are characterized by high output, high success rate and long period, and the Company’s R&Dstrength is at the leading level in the industry.The Company has always attached great importance to R&D investments. During the reporting period, the Company incurredan R&D expenditure of RMB 318 million, with a year-on-year increase of 22.74%. During the reporting period, the Company beganto implement the “Aurora 2.0” strategy aimed at further strengthening its R&D capabilities by expanding its focus on products totalent development and diversity of personnel, internally encouraging talent innovation, maximizing personnel potential, establishinga corporate youth training system, building a diverse team, and striving to contribute top games to players around the world. Underthe guidance of this strategy, the Company's self-developed products show the trend of "boutiqueization, diversification andglobalization".The “boutiqueization” R&D strategy runs through the entire life cycle of the Company’s self-developed products: Before thelaunch of games, the Company carefully worked out details of product planning, art quality, music effects, etc.; after the launch ofgames, the Company continued to invest in product iteration, process optimization, user experience and other aspects to ensure thehigh gross billing and long period of games.The Company’s product research and development have always been market-oriented. The Company adheres to the principleof sustainable development and constantly breaks through itself. Through continuous R&D investments, the Company hasaccumulated a large number of core technologies: A series of high-performance and stable game engines and frameworks areindependently developed by the Company to support the development of highly playable large-scale online games of highperformance and quality, which provide an important guarantee for the Company to continuously launch high-quality games. Theengine 2.0 that the Company is developing will further enhance the refinement of items and characters and the reflection of scenesand landscapes, create more realistic light and shadow performance, and support overall 3D map scene management technologies,thus significantly improving the authenticity of games. At the same time, as an important tool to enhance the product experience, theCompany analyzes its game data through self-developed big data analysis system, and uses the analysis results to provide accuratenumerical reference for design of new products and iterative optimization of previous products, thus improving the Company’sinsights and capacity for process optimization in terms of product development.During reporting period, the Company’s continued to promote the “diversification” strategy at the R&D level, and its R&Dteam also maintained its advantages in the ARPG category while at the same time making initial attempts in new areas. The causalgame Chao Neng Qiu Qiu (超能球球) and the simulation game Code DG (代号DG) are expected to be launched in the second halfof 2019. During the reporting period, the Company continued to carry out pre-market researches and analysis on SLG-type games,and was expected to start projects in the second half of the year. In 2019, the Company will continue to make diversified innovationin product types, themes, art performance, gameplay settings, etc.During the reporting period, the Company’s self-developed products have also made excellent achievements in the overseasmarket, such as Yong Heng Ji Yuan (永恒纪元) and Dou Luo Da Lu H5 (斗罗大陆H5). In addition, the Company is also expectedto launch two self-developed overseas products in the second half of 2019.As of the issuance date of this report, the Company was developing mobile games such as Chao Neng Qiu Qiu (超能球球),Code NB (代号NB), Code YZD (代号YZD), Code S (代号S), Code DG (代号DG), An Hei Hou Yi (暗黑后裔), Dou Luo Da Lu 3D
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
(斗罗大陆3D), Country and Beauty (working title) (江山与美人(暂定名)), etc. With its accumulated experiences and continuousinnovation, the Company is expected to continue to produce long-period quality games that surpass the Yong Heng Ji Yuan (永恒纪元) and Swords of Archangels (大天使之剑).
2. Excellent distribution strength
During the reporting period, the market share of the Company’s mobile game distribution business in Mainland Chinaincreased to 10.02%; the Company’s browser game business in Mainland China also continued to maintain its leading position; whilemaintaining its market advantages in Southeast Asia, the Company also focused on high-potential markets in Japan, South Korea,Europe and the United States. The Company actively adheres to the “boutiqueization and diversification” business strategy andpromotes its own business capacity to a new height through continuous innovation:
1) The promotion of “boutiqueization” strategy is reflected in product supply before the launch of games and operationoptimization after the launch.In terms of product supply, the Company has accumulated abundant product resources, established a rigorous evaluationprocess and evaluation criteria for product introduction, and also utilized its own advantages in user data and numerical experiencesto work out products along with game developers, thus ensuring a better quality of games before their launch.In terms of operation optimization, the Company has strong capabilities for operation and optimization in numericalmanagement, process optimization, event planning, etc. After the launch of games, the Company continues to improve the quality ofgames, attract users through better contents, extend the product life cycle, and accumulate higher income.
2) The “diversification” strategy has achieved good results in multiple business dimensions such as products, promotion andservices.In terms of game products, the Company on the one hand brought a diversified layout to the product supply side throughindependent research and development, investment in quality developers and cooperation with many large R&D manufacturers suchas Tencent, NetEase, Perfect World, Century Huatong Group, etc.; on the other hand, the Company has also made diversifiedattempts in product categories and product themes to achieve better results. During the reporting period, the Company hassuccessively launched a series of game products with different categories and themes and higher gross billing in the Chinese mobilegame market, such as Dou Luo Da Lu H5 (斗罗大陆H5) and Sword and Rebirth (剑与轮回). Therefore, the Company’s multi-themeand multi-category product matrix has begun to take shape and the Company also went further on the road of diversification.
In terms of promotion, the Company adopted a multi-dimensional approach of “multi-channel marketing + targetedadvertising ” to create a new idea for systemic traffic management. In terms of multi-channel marketing, the Company tried to meetthe different cultural consumption needs of users from different perspectives by choosing spokespersons who match the productconnotation, promoting games through high-quality micro-movie-style promotional materials, carrying out cross-border cooperationamong games, finance, catering and FMCG industries, and implanting public welfare activities into game products, thereby forminga unique “product-effect combination” propaganda means to further expand its brand value and influence. In terms of targetedadvertising the Company analyzes big data such as “user portrait” and “user model” with the user resources accumulated over theyears to accurately deliver advertisements to targeted user groups and improve the advertising effect.In terms of services, the Company is committed to providing game users with comprehensive and detailed long-term services.Through an improved user account and service system, and an experienced service team, the Company uses abundant productsupplies to provide users with comprehensive game products and one-stop services to continuously improve user satisfaction,activation and retention, and also to extend the product life cycle.The Company implements the above business strategies based on the principle of “refinement, datamation andintelligentization” to provide users with a better experience in a more efficient manner.
3. Advantage of “integration of R&D and operation” mode
The “integration of R&D and operation” mode of the Company is conducive to making full use of resources and creating
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
quality products from a long-term perspective. On the one hand, the Company can ensure the stable supply of quality products tosupport the operation development and reduce its reliance on external supplies through strong R&D strengths. At the same time, theR&D team can utilize the feedback of the operation department to optimize products and extend the product life cycle; on the otherhand, in the early stages of product R&D, the operation team can provide advices and suggestion to the R&D team with years ofexperiences and keen market insights. Additionally, in the early stage of commercialization of products, the operation team can alsosupport the R&D team to conduct a large number of product tests, and utilize the promotion and marketing strategies to guide theR&D team to adjust the iterative updates of product activities and improve the product success rate.
4. Team strengths
The Company has been deeply involved in the field of cultural and creative industries for many years. Its core managementteam consists of experienced employees who have strong and forward-looking capabilities for strategic layout, while the core teamconsists of highly skilled R&D personnel, creative operators, and highly efficient managers. The Company has always adhered to themarathon-style entrepreneurial spirit, and constantly caught up to surpass the industry leader.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Section IV Discussion and Analysis of Operation PerformanceI. Overview
| Key performance indicators | The first half of 2019 | The first half of 2018 | Year-On-Year Change |
| Operating income (RMB 100 million) | 60.71 | 33.02 | 83.83% |
| Total profit (RMB 100 million) | 12.91 | 9.19 | 40.43% |
| Net profits attributable to the listed company shareholders (RMB 100 million) | 10.33 | 8.01 | 28.91% |
| Net cash flows from operating activities (RMB 100 million) | 6.16 | 9.77 | -36.93% |
| Basic earning per share (yuan/share) | 0.49 | 0.37 | 32.43% |
| Weighted average rate of return on equity | 16.31% | 12.71% | 3.60% |
During the reporting period, the Company has steadily promoted the development strategy of “boutiqueization, diversification,platformization and globalization” around IPs, making its comprehensive strength in the forefront among Chinese competitors.During the reporting period, the Company gained an operating income of RMB 6.071 billion, with a year-on-year increase of
83.83%; a total profit of RMB 1.291 billion, with a year-on-year increase of 40.43%; a net profit attributable to the listed companyshareholders of RMB 1.033 billion, with a year-on-year increase of 28.91%. The growth of distribution and R&D for mobile gameswas the main driver for the increase in overall income and profit during the reporting period.Following new products launched in thethird quarter，the company's gross billing of the third quarter is expected to surpass that of the second quarter.
(I) Mobile game businessDuring the reporting period, the Company achieved an operating income of RMB 5,427 million and a gross profit of RMB4,751 million from mobile games, a year-on-year increase of 152.90% and 185.42% respectively. The Company’s business revenuefrom and R&D investment into mobile games continued to increase, and the mobile game business maintained the leading position indomestic and overseas markets.
1. Release of mobile games
(1) Domestic market
The Company continued to play a vital role in domestic mobile game publishing market. During the reporting period, themarket share of the Company’s mobile game business in Mainland China increased to 10.02%. During the reporting period, thehighest monthly gross billing of the Company’s game products exceeded RMB 1.35 billion, with the total number of new registeredusers exceeding 133 million and the highest number of monthly active users exceeding 34 million.During the reporting period, the Company applied diversification strategy at various levels such as products, promotion andservices in a creative manner, based on its capability of operating different games.During the reporting period, under the “diversification” strategy, the Company adequately reserved game products consideringproduct type, theme and quantity. The Company’s product matrix includes ARPG, MMO, CARD, SLG, SIM and other types,covering a wide range of themes such as magic, western fantasy, oriental fantasy, adventure, fantasy, etc. During the reporting period,the Company launched a series of quality game products of different types and themes such as Yi Dao Chuan Shi (一刀传世), DouLuo Da Lu H5 (斗罗大陆H5) and Sword and Rebirth (剑与轮回), thus bringing diverse game experiences to players. As of the
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
issuance date of this report, the Company’s independently-developed games include Code NB (代号NB), Code YZD (代号YZD),Code S (代号S), Dou Luo Da Lu 3D (斗罗大陆3D), Country and Beauty (working title) (江山与美人(暂定名)), etc. In addition, theCompany also reserved a large number of domestic agency games, including:
MMO games: Ming Ri Huan Xiang (working title) (明日幻想(暂定名)), Yun Shang Cheng Zhi Ge (working title) (云上城之歌(暂定名)), Code MK4 (代号MK4)Card games: Light Adventure (working title) (光明冒险(暂定名)), Street Hero (working title) (街区英雄(暂定名)), Code DIG(代号DIG)SIM games: Code-SF (代号-SF)Magic ARPG: ARPG Code-TARO (代号-TARO)In addition, the Company accurately understood users’ needs, delivered advertisements to target groups accurately, andprovided a full range of high-quality services from initial contact, access to games to start of games, thereby prolonging the productlife cycle and accumulating higher gross billing, by adhering to the core idea of systemic traffic management and the diversifiedmethods of “multi-channel marketing + targeted advertising + long-term service” and radiating “products + promotion + users” underthe principles of “refinement, datamation and intelligentization”.
(2) Overseas market
During the reporting period, the Company continued to promote its strategic layout of globalization and intensified efforts toexpand its overseas markets. While it maintained its competitiveness in Southeast Asia and other advantageous regions, the Companycontinued to focus on high-potential markets in Japan, South Korea, Europe and the United States by utilizing localized productselection and marketing methods. As of the end of the reporting period, 37GAMES, the Company’s overseas brand, launched over100 mobile games in more than 200 countries and regions, including ARPG, MMOPRG, CARD RPG, SLG, STG, MOBA, etc., with14 language versions such as Traditional Chinese, English, Japanese, Korean, Thai, etc.
As of the date of this report, the self-developed product Dou Luo Da Lu H5 (斗罗大陆H5) was launched on Singapore andMalaysia and other regions, with the first monthly gross billing exceeding RMB 10 million; the card game SNK All Star (SNKオールスター) was launched in Japan and quickly went top on the GooglePlay game download list; during the reporting period, theCompany constantly updated and iterated its flagship product, Yong Heng Ji Yuan (永恒纪元), keeping a stable gross billing inregional markets of Southeast Asia, Europe, the United States, Japan, South Korea.The Company maintained a good cooperative relationship with many R&D firms, ensured the relevance of product sourceswith agency distribution, self-development and investment customization, and also adhered to the quality route in product selection.As of the date of this report, the Company has reserved a number of game products in several regions around the world, such as theWestern fantasy SLG Code MH (代号MH) and medieval SLG Ocean Wars, and has also strengthened the global SLG market layoutthrough strategic investments in a number of successful R&D firms. In addition, many self-developed quality products such as theARPG An Hei Hou Yi (暗黑后裔), international version of Dou Luo Da Lu H5 (斗罗大陆H5), and SIM Code DG (代号DG) areexpected be launched overseas in the second half of 2019 to help the Company further develop its overseas markets.
2. Research and development of mobile games
During the reporting period, the Company achieved a significant increase in the gross billing of mobile game R&D business,thereby enhancing the Company’s profitability. The continuous investment into mobile game R&D is an important part of theCompany’s “boutiqueization, diversification and globalization” business strategy. The increased R&D investment mainly focuses onimprovement of product quality and exploration of new product categories.To improve product quality, the Company is committed to make better the product engines, and the artistic and sound qualityof products to meet the user demand in experiencing high-quality games at technical level; it is dedicated to game innovation andprocess optimization to meet user demand in fun and smooth experience at the planning level. High-quality development andhigh-frequency iterations made new products attractive to users, and allowed most self-developed products to maintain high grossbilling for a long time. During the reporting period, several self-developed mobile games have been launched, among which Dou Luo
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Da Lu H5 (斗罗大陆H5) and Yi Dao Chuan Shi (一刀传世) and other games achieved a monthly gross billing of over RMB 100million, and Jing Ling Sheng Dian (精灵盛典) has achieved outstanding performance since its launch, the highest ranking of whichwas third in the best-selling list of AppStore games. The Company has innovated the game framework of Yi Dao Chuan Shi (一刀传世) and Jing Ling Sheng Dian (精灵盛典), focusing more on players’ experiences and growth in games; through Dou Luo Da Lu H5(斗罗大陆H5), the Company has opened a new operation model, enabling game activities to fully meet the needs of players atdifferent stages. The Company also determined to build the latter a H5 benchmark product with the longest product cycle.In the exploration of new product categories, the Company set foot on R&D of casual sports games and simulation gamesduring the reporting period, and conducted preliminary research on the development of other categories such as SLG. Chao Neng QiuQiu (超能球球), a casual game developed by the Company, and Code DG (代号DG), a SIM game aimed at overseas market, willalso be launched to markets in the second half of this year. In the future, the goal of the Company is to become a first-rate gamedeveloper capable of providing players with various game products, focusing on high-quality content and utilizing its ownadvantages in anticipating user needs. It will apply core technologies to further explore new themes, gameplay and catagories, and toactively expand its product lines. At the end of the reporting period, the Company was developing eight mobile games includingChao Neng Qiu Qiu (超能球球), Code NB (代号NB), Code YZD (代号YZD), Code S (代号S), Code DG (代号DG), An Hei HouYi (暗黑后裔), Dou Luo Da Lu 3D (斗罗大陆3D), Country and Beauty (working title) (江山与美人(暂定名)).
In terms of new technology accumulation, the Company is currently committed to building a better cloud game system, including:
building internal cloud, providing computing and network supports for cloud games; building cloud game agency services, activelyresearching efficient game video transcoding and decoding technologies; developing a universal framework with user interaction,video decoding, and cloud server communication, so as to support the universal light App for cloud gaming. In the upcoming 5G era,the Company’s smooth transition among cloud gaming technologies is expected to bring new experiences to game players.
(II) Browser gamesMore than 18,590 new servers were opened in 2019 in the domestic market, topping the ranking list of operation platforms interm of server opening (source of data from 9k9k). During the reporting period, the operating income from browser games reachedRMB 646 million, with a slight drop year on year, which was mainly due to users’ shift to mobile clients and reduction in browsergames. The Company also continued its efforts to develop browser games, and its self-developed product An Hei Da Tian Shi (暗黑大天使) was launched in July 2019. The Company strengthened cooperation with domestic top browser game developers throughstrategic investment and business cooperation on the one hand, on the other hand, the Company also refined the operation of itsmajor quality games, improved user stickiness, stabilized the product life cycle, and further stabilized its revenue.
(III) Cultural industry layoutThe Company invested into other fast-growing cultural and creative segments, while maintaining the high-speed growth of itscore business, and deeply explored the opportunity to extend film and television, music, animation, VR, cultural health, Internetchildren education and social entertainment with a key focus centering a strategy on quality content. As of the end of the reportingperiod, the Company invested in cultural and creative segments of film and television (Chenming Media, Youying Culture, ZhonghuiTelevision), animation (YHKT Entertainment, Junengwan), music (FenghuaQiushi), Internet sports (Wake Yoga), children’seducation (Miaocode, KaDa Story), cultural tourism (TuoluLingyin), talent agent (Original Plan) and IP incubation (JinhaiShiyi), toprovide high-quality content for all ages and segments.As of the date of this report, the Company’s many subject companies have shown great potential of development, and theCompany’s investment strategies in the field of cultural and creative development has also begun to show its outcomes. In April 2019,Zen-game Technology, a domestic chess and card game company with part of its shares held by the Company, was officially listedon the Hong Kong Stock Exchange; in May, SNK, a game company with part of its shares held by the Company, was listed on theKorean KOSDAQ market and became the largest Chinese game company listed on the Korean KOSDAQ market; in June, He Luoluo,a member of the Yi’an Music Society under Original Plan (with the Company as one of its shareholders), successfully made his debut
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
as the second place in “Creation Camp 2019”; the animation project of Three Body, a science fiction novel, was announced to beproduced by YHKT Entertainment (with the Company as one of its shareholders); in July 2019, X.D. Network, a well-knownChinese game operator (with the Company as one of its shareholders), publicized its IPO prospectus; Hong Kong-listed Inkeannounced that it has completed the acquisition of the Company’s shareholding of domestic youth social platform ,and the Companyachieved considerable returns in less than a year. When the Company selects investment targets, it focuses on their ability tocontinuously export high-quality contents or products, excellent teams or talent reserves, and explosive growth in the later stage, soas to accelerate the integration of high-quality resources in the industry and consolidate the position of the Company in the capitalmarket.Focusing on main game business and traffic operation advantages, combined with the previous layout of VR and AR, theCompany will focus on and actively get involved in fields of 5G, cloud gaming and e-sports, empower and coordinate strategicallywith the invested companies, offer more high-quality content with new experience, create a one-stop cultural and entertainmentecosystem, and become the most trusted cultural brand of China’s younger generation.
(IV) IP strategyIt’s a long-term development goal of the Company to create quality content and establish a quality content brand. Based on this,the Company continues to explore, by the methods of internal incubation and external access, high-quality IPs for development ofquality cultural products including games, relying on its own advantages. As of the end of the reporting period, the reserved IPs ofthe Company covered different segments, including games, animation, literature, media, etc. At the same time, the Company willgradually develop own IPs to create a higher value. Relying on its excellent IP strategy, the Company will continue to build itscultural and creative strategy system, satisfy the diversified demands of users for entertainment, and exploit the value extension spaceof IPs in film and television, music, animation, VR, cultural health industry, Internet children education and social entertainment indepth.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
II. Analysis of main business
OverviewSee “I. Overview” in “Discussion and Analysis of Operation Status” for related content.Year-on-year changes of the main financial data
Unit: RMB
| Current Reporting Period | Same Reporting Period of the Prior Year | Year-On-Year Change | Cause of changes | |
| Operating income | 6,070,957,503.06 | 3,302,496,146.77 | 83.83% | Mainly due to the development of mobile game release and R&D business during the reporting period. |
| Operating cost | 838,986,561.51 | 886,273,600.84 | -5.34% | Mainly due to the increase in the proportion of self-developed game revenue during the reporting period. |
| Selling expenses | 3,632,067,521.84 | 1,143,478,494.94 | 217.63% | During the reporting period, sales expenses increased rapidly, mainly due to the launch of quality games such as Dou Luo Da Lu H5 (斗罗大陆H5). During the reporting period, a number of new games were being promoted and required large Internet traffic. The total number of newly registered users of domestic mobile games in the first half of the year exceeded 133 million, higher than the annual level in 2018. Since a large number of games were launched in the first quarter, as these games gradually entered the payback period, the sales expenses in the second quarter decreased by RMB 650 million compared with the first quarter. |
| Administrative expense | 88,053,838.68 | 127,934,924.44 | -31.17% | Mainly due to the fact that Wuhu Shunrong Auto Parts Co., Ltd. and ENP Games Co., Ltd. were no longer included in the consolidation scope. |
| Financial expenses | 4,333,541.72 | 13,958,433.93 | -68.95% | Mainly due to the decrease in bank borrowings and interest expenses during the reporting period. |
| Income taxes | 131,634,742.44 | 36,437,882.35 | 261.26% | Mainly due to: 1) Increase in profit before tax during the reporting period; 2) increase in the income tax rate applicable to certain subsidiaries . |
| Investment in R&D | 318,493,874.16 | 259,493,136.84 | 22.74% |
| Net cash flows from operating activities | 616,354,936.37 | 977,236,017.96 | -36.93% | During the reporting period, the net cash flow from operating activities decreased by RMB 360 million year on year mainly due to two reasons: 1) Operating income increased by 84% during the reporting period, and the balance of accounts receivable correspondingly increased; 2) in order to obtain better traffic resources and business conditions more in line with the Company’s interests, the Company and major traffic service |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| providers renegotiated the transaction period during the reporting period, resulting in a decrease in the net cash flow from operating activities. As the income scale and transaction period tend to stabilize, the net cash flow from operating activities in the second half of the year is expected to improve. | ||||
| Net cash flows from investing activities | 476,138,307.69 | -72,005,570.73 | 761.25% | Mainly due to: 1) the recovery of remaining amount during the reporting period for disposal of Wuhu Shunrong Auto Parts Co., Ltd. in the previous year; 2) the recovery of the cash compensation paid by the original shareholders of Shanghai Mokun to the Company arising from the failure of performance commitments by Shanghai Mokun in the previous year. |
| Net cash flows from financing activities | -823,976,503.10 | -946,717,438.85 | 12.96% | 1) In the report period, repayment of bank loans and payment of repurchased shares resulted in a cash outflow from financing activities of RMB 824 million; 2) in the same period of last year, bank loans generated a cash inflow from financing activities of RMB 669 million; and repayment of bank loans and payment for acquisition of minority shares caused a cash outflow from financing activities of RMB 1.616 billion. |
| Net increase of cash and cash equivalents | 268,388,648.05 | -42,251,340.41 | 745.40% | Mainly due to the large YoY increase in net cash flow from investing activities and financial activities during the reporting period. |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Any major changes to the profit composition or profit source of the Company during the reporting period
□Applicable √Not Applicable
No major change occurs to the profit composition or profit source of the Company during the reporting periodComposition of operating income
Unit: RMB
| Current Reporting Period | Same Period of the Prior Year | Year-on-year increase/decrease | |||
| Amount | Proportion of operating income | Amount | Proportion of operating income | ||
| Total operating income | 6,070,957,503.06 | 100% | 3,302,496,146.77 | 100% | 83.83% |
| By industry | |||||
| Online game industry | 6,070,957,503.06 | 100.00% | 3,071,123,194.02 | 92.99% | 97.68% |
| Automobile parts industry | 0.00 | 0.00% | 231,372,952.75 | 7.01% | -100.00% |
| By products | |||||
| Mobile games | 5,426,572,514.55 | 89.39% | 2,145,744,221.56 | 64.97% | 152.90% |
| Browser games | 644,384,988.51 | 10.61% | 910,103,611.46 | 27.56% | -29.20% |
| Others | 0.00 | 0.00% | 15,275,361.00 | 0.46% | -100.00% |
| Automobile parts | 0.00 | 0.00% | 231,372,952.75 | 7.01% | -100.00% |
| By regions | |||||
| Mainland China | 5,573,514,047.04 | 91.81% | 2,828,407,922.34 | 85.64% | 97.05% |
| Overseas | 497,443,456.02 | 8.19% | 474,088,224.43 | 14.36% | 4.93% |
Industries, products or regions that account for over 10% of the Company’s operating income or operating profit
√Applicable □Not Applicable
Unit: RMB
| Operating income | Operating cost | Gross profit margin | Year-on-year increase/decrease of the operating income | Year-on-year increase/decrease of the operating cost | Year-on-year increase/decrease of gross profit | |
| By industry | ||||||
| Online game industry | 6,070,957,503.06 | 838,986,561.51 | 86.18% | 97.68% | 17.17% | 9.50% |
| By products | ||||||
| Mobile games | 5,426,572,514.55 | 675,612,778.55 | 87.55% | 152.90% | 40.41% | 9.97% |
| Browser games | 644,384,988.51 | 163,373,782.96 | 74.65% | -29.20% | -30.44% | 0.46% |
| By regions | ||||||
| Mainland China | 5,573,514,047.04 | 671,488,655.17 | 87.95% | 97.05% | -14.29% | 15.65% |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Overseas | 497,443,456.02 | 167,497,906.34 | 66.33% | 4.93% | 62.85% | -11.98% |
For change of statistical caliber for main business data during the reporting period, the Company adjusted the main business data forthe current period according to year-end statistical caliber
□Applicable √Not Applicable
The Company is required to comply with the disclosure requirements of the SZSE Industrial Information Disclosure Guide No. 12 -Listed Companies Engaged in Software and IT Services.Industries that account for over 10% of the Company’s operating income or operating profit
√Applicable □Not Applicable
Unit: RMB
| Operating income | Operating cost | Gross profit margin | Year-on-year increase/decrease of the operating income | Year-on-year increase/decrease of the operating cost | Year-on-year increase/decrease of gross profit | |
| Industry of customers | ||||||
| Online game industry | 6,070,957,503.06 | 838,986,561.51 | 86.18% | 97.68% | 17.17% | 9.50% |
| By products | ||||||
| Mobile games | 5,426,572,514.55 | 675,612,778.55 | 87.55% | 152.90% | 40.41% | 9.97% |
| Browser games | 644,384,988.51 | 163,373,782.96 | 74.65% | -29.20% | -30.44% | 0.46% |
| By regions | ||||||
| Mainland China | 5,573,514,047.04 | 671,488,655.17 | 87.95% | 97.05% | -14.29% | 15.65% |
| Overseas | 497,443,456.02 | 167,497,906.34 | 66.33% | 4.93% | 62.85% | -11.98% |
The single sales contract with its amount accounting for more than 30% of the audited operating income of the Company in the mostrecent fiscal year and the contract under execution with the amount more than RMB 50 million
□Applicable √Not Applicable
Composition of operating cost
Unit: RMB
| Cost composition | Current Reporting Period | Same Reporting Period of the Prior Year | Year-on-year increase/decrease | ||
| Amount | Proportion in operating cost | Amount | Proportion in operating cost | ||
| Royalties | 713,853,625.84 | 85.09% | 633,845,493.29 | 71.52% | 12.62% |
| Cost of servers | 52,216,599.22 | 6.22% | 43,827,578.58 | 4.95% | 19.14% |
| Amortization of copyright money | 72,014,090.09 | 8.58% | 22,131,700.53 | 2.50% | 225.39% |
| Other costs | 331,105.07 | 0.04% | 503,238.47 | 0.06% | -34.21% |
| Production cost | 571,141.29 | 0.07% | 15,732,575.61 | 1.78% | -96.37% |
| Direct materials cost | 0.00 | 0.00% | 134,734,499.98 | 15.20% | -100.00% |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Direct labor expenses | 0.00 | 0.00% | 8,281,182.96 | 0.93% | -100.00% |
| Manufacturing expenses | 0.00 | 0.00% | 27,217,331.03 | 3.07% | -100.00% |
| Total | 838,986,561.51 | 100.00% | 886,273,600.45 | 100.00% | -5.34% |
Explanation for +30% deviation YOY of relevant data
√Applicable □Not Applicable
1. The operating income of online games increased by 97.68% year-on-year, and the operating income of mobile games increased by
152.90% year-on-year, mainly due to the significant increase in the Company’s operating income after the launch of new games suchas Dou Luo Da Lu H5 (斗罗大陆H5) and Yi Dao Chuan Shi (一刀传世) in this report period.
2. The operating income of auto parts decreased by 100% year-on-year, mainly due to the disposal of Wuhu Shunrong Auto Parts Co.,Ltd. at the end of last year and its separation from the consolidation scope in the current period.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
III. Analysis of non-main business
√Applicable □Not Applicable
Unit: RMB
| Amount | Proportion of total profit | Cause | Is it consistently applied? | |
| Investment income | 18,932,969.82 | 1.47% | Mainly due to the disposal of equity investment, dividend distribution during the period of equity investment, and the investment income from financial products. | No |
| Profits and losses from change of fair value | 41,603,452.48 | 3.22% | Mainly due to changes in the fair value of equity investment | No |
| Asset impairment | 18,305,311.43 | 1.42% | Mainly due to bad debt losses and impairment losses of long-term equity investment. | Bad debt losses are sustainable, and impairment losses of long-term equity investment are not sustainable. |
| Non-operating income | 3,082,997.15 | 0.24% | Mainly due to compensation income. | No |
| Non-operating expense | 2,674,771.67 | 0.21% | Mainly due to donation expenses. | No |
| Other profits | 49,294,108.11 | 3.82% | Mainly refund of VAT upon collection and other government subsidies related to daily operations. | Refund of VAT upon collection can be consistently applied, but other government subsidies cannot be consistently applied. |
IV. Analysis of Assets and Liabilities
1. Significant changes in the composition of assets
Unit: RMB
| End of the Current Reporting Period | End of the Same Reporting Period of the Prior Year | Increase/decrease of proportion | Explanation | |||
| Amount | Proportion of | Amount | Proportion of | |||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| total assets | total assets | |||||
| Monetary fund | 1,788,431,889.15 | 20.40% | 1,538,659,591.57 | 17.52% | 2.88% | Mainly due to the recovery of remaining amount during the reporting period for disposal of Wuhu Shunrong Auto Parts Co., Ltd. in the previous year; and the recovery of the cash compensation paid by the original shareholders of Shanghai Mokun to the Company. |
| Accounts receivable | 1,717,575,938.59 | 19.59% | 942,845,341.12 | 10.73% | 8.86% | Mainly due to the increase in operating income in the second quarter of this year compared with that in the fourth quarter of the previous year. |
| Long-term equity investments | 514,224,823.77 | 5.87% | 397,333,972.65 | 4.52% | 1.35% | |
| Fixed assets | 36,385,942.05 | 0.42% | 288,015,211.62 | 3.28% | -2.86% | Mainly due to the fact that Wuhu Shunrong Auto Parts Co., Ltd. was no longer included in the consolidation scope. |
| Construction in progress | 751,293,007.77 | 8.57% | 72,389,566.29 | 0.82% | 7.75% | Mainly because that the office building purchased in 2017 was delivered during the reporting period and the prepayment for office building was recognized under the construction in progress. |
| Short-term loan | 0.00% | 649,000,000.00 | 7.39% | -7.39% | Mainly due to the repayment of bank loans from the second half of 2018 to the first half of 2019. | |
| Long-term loans | 265,883,241.55 | 3.03% | 296,165,631.48 | 3.37% | -0.34% |
2. Assets and liabilities measured by fair value
√Applicable □Not Applicable
Unit: RMB
| Item | Beginning balance | Profits and losses from change of fair value in this period | Change in fair value included in equity | Impairment accrued in current period | Purchase amount in current period | Sales amount in current period | Ending balance |
| Financial assets | |||||||
| 1. Trading financial assets (excluding derivative | 1,038,719,630.88 | 41,603,452.48 | 2,451,626,703.60 | 2,279,501,060.00 | 1,252,481,621.45 | ||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| financial assets) | |||||||
| 4. Other equity investment | 196,571,394.67 | 50,029,719.00 | 246,635,981.28 | ||||
| Subtotal of financial assets | 1,235,291,025.55 | 41,603,452.48 | 0.00 | 0.00 | 2,501,656,422.60 | 2,279,501,060.00 | 1,499,117,602.73 |
| Total of the above | 1,235,291,025.55 | 41,603,452.48 | 0.00 | 0.00 | 2,501,656,422.60 | 2,279,501,060.00 | 1,499,117,602.73 |
| Financial liabilities | 0.00 | 0.00 |
Whether there is significant change to measurement attributes of main assets during the reporting period
□ Yes √ No
3. Restriction of main assets and rights as if the end of the reporting period
1. The total amount of construction in process corresponding to subsidiaries’ mortgage loan for office building was RMB 751,293,007.77 in total.
2. In the bank account balance of the Company’s subsidiaries, RMB 34,302,896.31 was the balance of restricted margin account.
V. Analysis of Investment Situations
1. Overview
√Applicable □Not Applicable
| Investment amount during the reporting period (RMB) | Investment amount of previous year (RMB) | Change % |
| 88,507,340.85 | 1,511,174,479.33 | -94.14% |
2. Major equity investment during the reporting period
√Applicable □Not Applicable
Unit: RMB
| Name of invested | Main businesses | Way of contribution | Investment amount | Shareholding ratio | Capital sources | Partner | Investment period | Product types | Progress as of the balance | Anticipated revenue | Current investment | Involved in lawsuit or | Date of disclosure | Index of disclosure |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| company | sheet date | profit and loss | not? | (if any) | (if any) | |||||||||
| Karma Game Beijing Limited | Internet cultural activities; Internet information services; technology promotion, technology transfer, technology consulting, technical services, technology development; computer system services; data processing; basic software services; application software services (excluding medical software); design, production, agency and release of advertisement; software development; import and export of technology, import and export of goods, and import and export agency. | Capital increase | 17,000,000.00 | 10.00% | Self-owned | None | Long-term | R&D of games | Industrial and commercial changes have been registered | No | ||||
| Karma Game HK Limited | Internet cultural activities; Internet information services; technology promotion, technology transfer, technology consulting, technical services, technology development; computer system services; data processing; basic software services; application software services (excluding medical | Capital increase | 12,918,608.00 | 10.00% | Self-owned | None | Long-term | R&D of games | Industrial and commercial changes have been registered | No |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| software); design, production, agency and release of advertisement; and software development. | ||||||||||||||
| Suzhou Youge Huaxin Venture Investment Center (Limited Partnership) | Venture capital and related consulting business; venture capital business agency for other venture capital institutions or individuals; and provision of entrepreneurial management services for start-up enterprises. (Operating activities to be approved in accordance with laws should be taken after being approved by related departments) | Capital increase | 10,500,000.00 | 18.69% | Self-owned | None | Long-term | Funds | Industrial and commercial changes have been registered | No | Dec 4th, 2018 | (Announcement No.: 2018-087、2018-089、2018-093) | ||
| 合计 | -- | -- | 40,418,608.00 | -- | -- | -- | -- | -- | -- | 0.00 | 0.00 | -- | -- | -- |
3. Major non-equity investment during the reporting period
√Applicable □Not Applicable
Unit: RMB
| Project name | Way of contribution | Is it fixed assets investment | Industries relevant for investment projects | Investment amount during the reporting period | Accumulated input amount as of the end of reporting period | Capital sources | Project progress | Anticipated revenue | Accumulated gains as of the end of the reporting period | Reasons for failure to reach planned schedule or expected revenue | Date of disclosure (if any) | Index of disclosure (if any) |
| 12F, 14F, 17F~23F office premises, | Others | Yes | Commercial real estate | 7,950,918.25 | 844,755,711.27 | Own + mortgag | 0.00 | 0.00 | Not applicable | April 26th, 2017 | Announcement on the Subsidiary’s Purchase |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| underground 3F and 4F parking spaces of Zhongrong Plaza, No. 666, Huangpu Avenue, Tianhe District, Guangzhou | e loans | of Office Space and Supporting Parking Lot (Announcement No.: 2017-034) | ||||||||||
| Total | -- | -- | -- | 7,950,918.25 | 844,755,711.27 | -- | -- | 0.00 | 0.00 | -- | -- | -- |
4. Financial assets that are measured by fair value
√Applicable □Not Applicable
Unit: RMB
| Assets category | Initial investment cost | Profits and losses from change of fair value in this period | Change in fair value included in equity | Purchase amount during the reporting period | Amount sold during the reporting period | Accumulated investment income | Ending amount | Capital sources |
| Share | 247,477,664.36 | 41,603,452.48 | 4,999,610.00 | -12,624.02 | 255,776,496.54 | Self-owned | ||
| Others | 1,046,204,601.78 | 2,501,656,422.60 | 2,274,501,450.00 | 16,073,479.46 | 1,243,341,106.19 | Self-owned | ||
| Total | 1,293,682,266.14 | 41,603,452.48 | 0.00 | 2,501,656,422.60 | 2,279,501,060.00 | 16,060,855.44 | 1,499,117,602.73 | -- |
5. Security investment
√Applicable □Not Applicable
| Securities type | Securities code | Securities short name | Initial investment cost | Accounting measurement model | Book value at the beginning of the period | Profits and losses from change of fair value in this period | Change in fair value included in equity | Purchase amount in the current period | Sales amount in the current period | Profit and loss in reporting period | Carrying value at the end of the period | Accounting subjects | Capital sources |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Domestic and foreign stocks | 002445-SZSE | Zhongnan Culture | 68,896,440.90 | Fair value measurements | 3,986,218.11 | -1,510,798.74 | 2,475,419.37 | Other non-current financial assets | Others | ||||
| Domestic and foreign stocks | 300431-SZSE | Mango Excellent Media | 35,582,900.00 | Fair value measurements | 67,155,608.00 | 7,330,686.30 | 74,486,294.30 | Other non-current financial assets | Others | ||||
| Domestic and foreign stocks | 02660-HKEX | Shenzhen Zen-game | 18,000,000.00 | Fair value measurements | 18,000,000.00 | -793,210.12 | 17,217,313.29 | Other non-current financial assets | Self-owned | ||||
| Domestic and foreign stocks | 960180-KSE | SNK | 1,036.35 | Fair value measurements | 1,036.35 | 36,576,775.04 | 36,600,182.47 | Other non-current financial assets | Self-owned | ||||
| Domestic and foreign stocks | 833604-NEEQ | Southern Pictures | 64,997,287.11 | Fair value measurements | 69,996,897.11 | 4,999,610.00 | -12,624.02 | 64,997,287.11 | Other non-current financial assets | Self-owned | |||
| Domestic and foreign stocks | 835067-NEEQ | Mokylin | 60,000,000.00 | Fair value measurements | 60,000,000.00 | 60,000,000.00 | Other equity investment | Self-owned | |||||
| Total | 247,477,664.36 | -- | 219,139,759.57 | 41,603,452.48 | 0.00 | 0.00 | 4,999,610.00 | -12,624.02 | 255,776,496.54 | -- | -- | ||
| Disclosure date of board meeting announcement concerning the approval of securities investment | |||||||||||||
| Disclosure date of shareholder meeting announcement concerning the approval of securities investment (if any) | |||||||||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
6. Investment in derivatives
□Applicable √Not Applicable
There was no derivative investment during the reporting period.
7. Utilization of raised fund
□Applicable √Not Applicable
No raised funds were used by the Company during the reporting period.
8. Description of key projects not invested by the raised fund
□Applicable √Not Applicable
During the reporting period, the Company had no major projects invested by non-raised funds.VI. Major Asset and Equity Sales
1. Sales of major assets
□Applicable √Not Applicable
The Company did not sell major assets during the reporting period.
2. Sales of major equity
□Applicable √Not Applicable
VII. Analysis of Main Holding and Joint-Stock Company
√Applicable □Not Applicable
Main subsidiaries and joint-stock companies affecting more than 10% of the Company’s net profit
Unit: RMB
| Company name | Company type | Main businesses | Registered capital | Total assets | Net asset | Operating income | Operating profit | Net profit |
| Jiangsu Aurora | Subsidiary | Development of mobile and browser games | 6,250,0000.00 | 2,762,827,128.14 | 1,986,334,960.29 | 909,987,318.23 | 552,518,363.11 | 496,684,776.71 |
| Guangzhou Sanqi | Subsidiary | Release and operation of mobile games | 11,764,706.00 | 4,839,312,848.18 | 765,510,356.03 | 4,271,590,566.86 | 689,884,760.75 | 638,667,391.93 |
Acquisition and disposal of subsidiaries during this reporting period
√Applicable □Not Applicable
| Company name | Method for acquisition and disposal of | Influence on overall production, operation |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| subsidiaries during this reporting period | and performance | |
| Shanghai Mokun | Sale | No major impact on the Company’s overall operation and performance |
Major holding and joint-stock companies
VIII. The Structured Entity Controlled by the Company
□Applicable √Not Applicable
IX. Predication of business performance from January to September in 2019
□Applicable √Not Applicable
X. Risks and Countermeasures
1. Market competition risks and countermeasures
The online game industry is facing increasingly fierce competition as it gradually matures. The development of variousInternet-based cultural creative segments other than online games is further exacerbating external competition. At the same time,online game users are also maturing, and online game users have increasingly higher standards for game products. Intense marketcompetition will challenge the Company’s development in terms of products and market channels.In response, the Company will continue to increase R&D investment, R&D and innovation in product creativity, gameplay,theme, art and technology. It will maintain close cooperation with excellent developers to guarantee the supply of quality products,and continue to connect users with quality games. In terms of market channels, the Company will further bring into play the role ofnew ideas in traffic operation, deepen the business strategy of multi-channel marketing ,targeted advertising and long-term services,and continuously enhance its core market competitiveness.
2. Business risks and countermeasures
The online game industry is characterized by fast product update, limited life cycle and fast change of user preference. Gameenterprises need to increase their investment in technology development and closely keep in pace with trend of the industrialtechnologies. If the technology, products and other aspects of the game undergo major changes, but game enterprises fail to keep upwith the development of industry technology, their products will fail to meet the market demands. At the same time, informationsecurity and user privacy protection arouse great public concerns. If the Company leaks users’ information due to negligence, therewill be a significant damage on the user experience and brand image. Consequently, its operation performance will be impaired.In response, increasing input in product R&D is needed to maintain continuous product innovation. The Company also needsto dig deeper into operational data, continuously update the understanding of changes in target users’ preferences, and timely adjustoperational strategies and R&D directions, to meet the core demands of users.A strict internal control system for information security management and user privacy protection has been set up to ensure thesecurity of users’ information to the maximum extent. In terms of information security, the Company has developed a series ofinternal control systems to define and classify security incidents and to respond to possible data security problems. Informationsecurity audits take place once every six months for systematic control of information security risks. In terms of privacy protection,the Privacy Policy has been established, which provides in details the rules and standards for collection and use of users’ personalinformation and sets forth the reasonable and feasible security measures adopted for protection of users’ personal information. In thisway the Company will make sure with greatest efforts that all users’ personal information are protected at the highest level. TheCompany ensures that it runs the business in compliance with applicable laws and regulations throughout the world, and protects theusers’ right to manage personal information. A response procedure has been stipulated to inform users of any possible cost and
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
necessary actions needed to be taken.
3. Risks of core personnel turnover and countermeasures
A stable and high-quality talent team for game development, operation and management is an important guarantee for theCompany to maintain its core competitive advantage. If the Company fails to effectively build a core talent team, give reasonableincentives and manages the core personnel, the employees’ enthusiasm and creativity will be affected, which will have an adverseimpact on the Company’s core competitiveness.In response, much attention has been attached to cultivation and acquisition of professional talents. The Company creativelybuilds a platform-based talent management mechanism, according to which excellent game producers are rewarded with high projectbonus, and given discretion of research and creation. In order to flexibly attract and retain quality management and business talents,taking into account the Company’s long-term and recent interests and the Company’s long-term, sustainable and sound development,the Company implemented the employee stock ownership plan during the reporting period to establish and improve the benefitsharing mechanism between workers and owners, further improve the corporate governance structure of the Company and effectivelymobilize the enthusiasm of workers and employees. The Company maintains the stability of core technology and managementpersonnel by signing agreements with core personnel, creating a favorable working environment and building a great corporateculture. Meanwhile, the Company helps employees to realize their potential through a well-trained employee training system, andrationally manages the team by using a clear rule of survival of the fittest to reinforce the team’s dynamics.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Section V Important EventsI. Annual general meeting and extraordinary general meeting during the reporting period
1. General meeting of shareholders in this reporting period
| Sessions of meetings | Types of meetings | Proportion of attended investors | Opening date | Date of disclosure | Index of disclosure |
| 2019 first extraordinary general meeting | Extraordinary general meeting of shareholders | 22.51% | January 21st, 2019 | January 22nd, 2019 | Announcement on Resolutions of the First Extraordinary General Meeting of Shareholders in 2019 (announcement No.: 2019-012) |
| 2019 second extraordinary general meeting | Extraordinary general meeting of shareholders | 22.59% | February 15th, 2019 | February 16th, 2019 | The Announcement on Resolutions of the Second Extraordinary General Meeting of Shareholders in 2019 (announcement No.: 2019-026) |
| 2019 third extraordinary general meeting | Extraordinary general meeting of shareholders | 22.56% | April 8th, 2019 | April 9th, 2019 | Announcement on Resolutions of the Third Extraordinary General Meeting of Shareholders in 2019 (announcement No.: 2019-044) |
| Annual General Meeting of Shareholders 2018 | Annual general meeting of shareholders | 40.40% | May 23rd, 2019 | May 24th, 2019 | Announcement on Resolutions of the 2018 Annual General Meeting of Shareholders (announcement No.: 2019-073) |
2. Request for extraordinary general meeting by preferred shareholders with recovered voting rights
□Applicable √Not Applicable
II. Profit distribution and conversion of capital reserve to share capital during the reportingperiod
√Applicable □Not Applicable
| Number of bonus shares per 10 shares (share) | 0 |
| Number of dividends per 10 shares (RMB) (taxes included) | 1 |
| Number of shares converted by capital reserve per 10 shares (share) | 0 |
| Share capital base for the distribution proposal (shares) | 2,112,251,697 |
| Amount of cash dividend (RMB) (tax included) | 211,225,169.70 |
| Amount of cash dividends distributed by other means (such as repurchase of shares) (unit: RMB) | 301,961,944.30 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Total cash dividend (including cash dividend distributed by other methods) (RMB) | 513,187,114 |
| Distributable profits (RMB) | 978,058,151.86 |
| The proportion of total cash dividend (including cash dividend distributed by other methods) to total profit distribution | 100% |
| Current cash dividends: | |
| Where the Company’s development stage is difficult to distinguish and major expenditure arrangements exist, cash dividend distribution shall account for not less than 20% of profit distribution of this time | |
| Explanation on the proposal of profit distribution or conversion of capital reserve to share capital | |
| In view of the Company’s sustained and stable profitability and good financial position, as well as the expectations and confidence for the Company’s future development, fully considering the interests and reasonable demands of investors, the Company’s Board of Directors proposed a 2019 semi-annual profit distribution plan, in accordance with the No. 3 Listed Companies Regulatory Guidelines, the Company Law, the Articles of Association and the Company’s shareholder return plan, under the principle of profit distribution and the premise of ensuring the normal operation of the Company and its long-term development. After review by the Board of Directors, the Company’s 2019 semi-annual profit distribution plan is as follows: Based on the total issued share capital (the total registered capital of the Company deducted from the shares of the listed company’s stock repurchase special securities account) on the dividend registration date, the cash dividend of RMB 1 (tax-included) will be distributed to every 10 shares held by all shareholders. The remaining undistributed profits will be carried forward to the next year; no bonus shares will be distributed, and no capital reserve will be transferred to share capital. The above profit distribution plan is consistent with the Company’s performance growth, and also in line with relevant provisions of the Company Law, the Articles of Association and the Company’s shareholder return plan. Independent directors of the Company issued independent consents to the above profit distribution plan. | |
III. Implementation of the Company’s equity incentive plan, employee stock ownership planor other employee incentives
√Applicable □Not Applicable
Through the first employee stock ownership plan, the Company raised a total of RMB 100 million. Employees held 5,903,187stocks of listed company by subscribing privately offered stocks of the Company (after the implementation of the Company’s 2015profit distribution plan, the number of held stocks increased to 11,806,374 stocks). These stocks were listed on January 12th, 2016,and were released from restriction on sales and circulated on January 14th, 2019. For details, please visit www.cninfo.com.cn to referto the 2015 Employee Stock Ownership Plan (Draft) (subscription by private offering) and the Notice on Listing and Circulating ofRestricted Stocks (announcement No.: 2019-007).The second employee stock ownership plan of the Company has been reviewed and approved at the 16th meeting of the 4thBoard of Directors, the 12th meeting of the 4th Board of Supervisors and the 2nd Extraordinary General Meeting of the Company in2018. In this phase, the employee stock ownership plan is expected to be carried out in a fully self-financing manner with a totalfundraising amount of no more than RMB 250 million. Within six months after the Company’s general meeting of shareholdersapproved the employee stock ownership plan, the purchase of underlying stocks will be completed through the secondary market(including but not limited to competitive price transaction, block trade, agreement transfer, etc.). On September 5th, 2018, theCompany’s second employee stock ownership plan enabled the purchase of a total of 26,310,527 stocks of the Company throughblock trades. The stocks purchased via this employee stock ownership plan are locked in accordance with regulations, and thelock-up period will be from September 6th, 2018 to September 5th, 2019. For details, please visit www.cninfo.com.cn to refer to theSecond Employee Stock Ownership Plan of Wuhu ShunrongSanqi Interactive Entertainment Network Technology Co., Ltd. (Draft)
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
and its summary, the Announcement on Resolutions of the 16th Meeting of the 4th Board of Directors (announcement No.: 2018-044),the Announcement on Resolutions of the 12th Meeting of the 4th Board of Supervisors (announcement No.: 2018-045), theAnnouncement on Resolutions of the Second Extraordinary General Meeting of Shareholders in 2018 (announcement No.: 2018-048),and the Announcement on the Completion of Stocks Purchase for the Second Employee Stock Ownership Plan (announcement No.:
2018-069).The Company’s third employee stock ownership plan has been reviewed and approved at the 4th meeting of the 5th Board ofDirectors, the 4th meeting of the 5th Board of Supervisors and the 4th extraordinary general meeting of shareholders in 2019. Thisemployee stock ownership plan will transfer the Company’s shares to its employees at a zero price through the Company’srepurchased shares from April 11th, 2019 to May 7th, 2019. The total of 22,347,537 shares accounts for 1.06% of the Company’stotal share capital. After 12 months from the date on which the last batch of underlying stocks announced are transferred to accountof the employee stock ownership plan, the underlying stocks acquired by means of non-trading transfer and other legally permittedmethods will be unlocked in stages, and the lock-up period is up to 36 months. For details, please visit www.cninfo.com.cn to refer tothe Third Employee Stock Ownership Plan of Wuhu Sanqi Interactive Entertainment Network Technology Group Co., Ltd. (Draft)and its summary, the Announcement on Resolutions of the 4th Meeting of the 5th Board of Directors (announcement No.: 2019-078),the Announcement on Resolutions of the 4th Meeting of the 5th Board of Supervisors (announcement No.: 2019-079), theAnnouncement on Resolutions of the Fourth Extraordinary General Meeting of Shareholders in 2019 (announcement No.:
2019-089).
IV. Social responsibility
1. Major environmental issues
Do the listed company and its subsidiaries become the key pollutant discharging units announced by the environmental protectiondepartment?NoThe listed company and its subsidiaries are not the key pollutant discharging units announced by the environmental protectiondepartment.
2. Performance of social responsibility for targeted poverty alleviation
(1) Targeted poverty alleviation planning
In 2014, the Company initiated and established the Guangdong Youxin Foundation. As of June 30th, 2019, the Company hasdonated more than RMB 16 million to Guangdong Youxin Foundation for social welfare undertakings such as poverty alleviationthrough high school education in poverty-stricken areas in central and western regions in China.Specific projects include:
1) Youxin Education Program for Students in Hardship: As of June 30th, 2019, a total of 1,153 high school students inhardship were financially supported, of which 487 funded high school students completed their high school education. Theenrollment rate of first-tier universities among these funded high school students was over 40%. Some of these funded students wereenrolled by Peking University, Beijing University of Aeronautics and Astronautics, University of Science and Technology of China,Zhejiang University, Sun Yat-sen University, Jinan University, Xiamen University, Wuhan University and other well-knownuniversities.
2) Free Reading Program for Remote Areas: As of June 30th, 2019, the program has brought free reading activities after class
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
to over 500 classes of a total of 45 county-level high schools in 34 underdeveloped counties/districts, including 20 national-level poorcounties/districts, thereby directly benefiting more than 40,000 students and teachers.
3) Occupational volunteer program: As of June 30th, 2019, more than 100 company employee volunteers have provided morethan 300 high school students in remote areas with experiences for specialty choices and career planning to help students make goodchoices in the future.
(2) Overview of targeted poverty alleviation in the half year
In the first half of 2019, Sanqi Interactive Entertainment spent a total of RMB 1.212 million on public welfare through theGuangdong Youxin Foundation to financially support 906 high school students, of which 240 high school students participated in thecollege entrance examination in 2019; to add 125 free reading corners; to carry out 3 occupational volunteer activities.In the aspect of poverty alleviation in agriculture and forestry industry, Sanqi Interactive Entertainment supported thedevelopment of local tea industry in Fengqing County (a national-level poor county) in Yunnan Province in the first half of 2019,with an investment of RMB 30,000.
(3) Achievements of targeted poverty alleviation
| Index | Measurement unit | Quantity/implementation |
| I. Overview | - | - |
| Wherein: 1. Capital | RMB 10,000 | 124.2 |
| II. Itemized investment | - | - |
| 1. Poverty alleviation by industry development | - | - |
| Wherein: 1.1 Types of industrial poverty alleviation projects | - | Poverty alleviation by agriculture and forestry industry |
| 1.2 Number of industrial poverty alleviation projects | Pcs | 1 |
| 1.3 Investment amount of industrial poverty alleviation projects | RMB 10,000 | 3 |
| 2. Poverty alleviation by labor transfer and employment | - | - |
| 3. Poverty alleviation by relocation and resettlement | - | - |
| 4. Educational poverty alleviation | - | - |
| Wherein: 4.1 Investment amount of subsidies for poor students | RMB 10,000 | 52.9 |
| 4.2 Number of poor students subsidized | Person | 906 |
| 4.3 Investment amount of improving educational resources in poor areas | RMB 10,000 | 48.5 |
| 5. Poverty alleviation by improving health | —— | —— |
| 6. Poverty alleviation by ecological protection | —— | —— |
| 7. Minimum guarantee | —— | —— |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 8. Social poverty alleviation | —— | —— |
| 9. Other projects | —— | —— |
| Wherein: 9.1 Number of projects | Pcs | 1 |
| 9.2 Investment amount | RMB 10,000 | 19.8 |
| III. Awards (contents and classes) | - | - |
| The 2019 Social Responsibility Research Report for Chinese Internet Companies (I) released by the Internet Research Institute of Beijing Normal University in June 2019 showed that Sanqi Interactive Entertainment ranked first in the social responsibility list of network game industry. | ||
| In June 2019, the Committee of Corporate Citizenship under the China Association of Social Workers awarded the honorary title of “One of Top 60 Responsible Brands” to Sanqi Interactive Entertainment. |
(4) Future targeted poverty alleviation plan
Sanqi Interactive Entertainment will continue to support the development of high school education in remote and impoverishedareas of the central and western regions in China through various poverty alleviation projects of the Guangdong Youxin Foundation.It is estimated that the annual public welfare expenditure of Sanqi Interactive Entertainment will reach RMB 3.4 million in 2019,with an increase by 13% compared with 2018.In respect of poverty alleviation in agriculture and forestry industry, Sanqi Interactive Entertainment is expected to invest RMB130,000 in the whole year.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Section VI Equity Changes and ShareholdersI. Changes in equity
1. Statements of changes in equity
Unit: Share
| Prior to this change | Changes (+/-) in this time | After this change | |||||||
| Quantity | Proportion | Stock issue | Dividend stock | Shares converted from accumulated reserves | Others | Subtotal | Quantity | Proportion | |
| I. Shares with trading limited conditions | 904,822,736 | 42.58% | -384,792,453 | -384,792,453 | 520,030,283 | 24.62% | |||
| 2. Shares held by state-owned corporate | 23,612,750 | 1.11% | -23,612,750 | -23,612,750 | 0 | 0.00% | |||
| 3. Other domestic-held shares | 881,209,986 | 41.47% | -361,179,703 | -361,179,703 | 520,030,283 | 24.62% | |||
| Wherein: Shares held by a corporate of Mainland China | 306,965,752 | 14.45% | -306,965,752 | -306,965,752 | 0 | 0.00% | |||
| Shares held by a natural person of Mainland China | 574,244,234 | 27.02% | -54,213,951 | -54,213,951 | 520,030,283 | 24.62% | |||
| II. Shares without trading limited conditions | 1,220,047,517 | 57.42% | 372,173,897 | 372,173,897 | 1,592,221,414 | 75.38% | |||
| 1. Ordinary shares in RMB | 1,220,047,517 | 57.42% | 372,173,897 | 372,173,897 | 1,592,221,414 | 75.38% | |||
| III. Total shares | 2,124,870,253 | 100.00% | -12,618,556 | -12,618,556 | 2,112,251,697 | 100.00% | |||
Causes for changes in shares
√Applicable □Not Applicable
During the reporting period, 8 shareholders applied for the release of restricted shares on January 14th, 2019, and the numberof released shares was 306,965,752 shares, accounting for 14.4463% of the Company’s total share capital (2,124,870,253 shares) atthat time. For details, please refer to the Notice on Listing and Circulating of Restricted Stocks disclosed at www.cninfo.com.cn onJanuary 11th, 2019 (announcement No.: 2019-007).During the reporting period, 1 shareholder applied for the release of restricted shares on January 23rd, 2019, and the number ofreleased shares was 23,612,750 shares, accounting for 1.1113% of the Company’s total share capital (2,124,870,253 shares) at thattime. For details, please refer to the Notice on Listing and Circulating of Restricted Stocks disclosed at www.cninfo.com.cn onJanuary 22nd, 2019 (announcement No.: 2019-011).The Proposal on Compensatory Shares and Cash Rebate of Compensation Obligors for Repurchase and Cancellation and theProposal on Requesting the General Meeting of Shareholders to Authorize the Board of Directors to Handle Repurchase RelatedMatters were reviewed and approved by the 2nd meeting of the 5th Board of Directors held on April 25th, 2019. Due to the failure of
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Shanghai Mokun Digital Technology Co., Ltd. to fulfill its 2018 annual performance commitments, Yang Dongmai, Chen Wei andWangzhong Investment must provide compensation for performance and impairment, with a total amount of RMB 478,790,500, ofwhich the shares compensation is preferred and the remainder is supplemented in cash. Yang Dongmai and other compensationobligors are required to provide a total of 12,618,556 compensation shares (the consideration of shares is RMB 217,922,500) and thecash compensation of RMB 260,868,000. The Company will repurchase and cancel the corresponding compensation sharesaccording to relevant agreement. For details, please refer to the Announcement on Compensatory Shares and Cash Rebate ofCompensation Obligors for Repurchase and Cancellation disclosed on April 26th, 2019 (announcement No.: 2019-057). The sharesrepurchased were cancelled at Shenzhen Branch of China Securities Depository and Clearing Corporation Limited (CSDC) on June26th, 2019. For details, please refer to the Announcement on Cancellation Completion of Compensatory Shares disclosed by theCompany on June 28th, 2019 at www.cninfo.com.cn (announcement No.: 2019-086).Approval for changes in shares
□Applicable √Not Applicable
Status of transfer for share change
□Applicable √Not Applicable
Implementation progress of shares repurchase
√Applicable □Not Applicable
The Company held the 23rd meeting of the 4th Board of Directors on January 3rd, 2019 and the first Extraordinary GeneralMeeting of 2019 on January 21st, 2019, at which the Plan for Repurchasing Shares of the Company by Centralized CompetitiveBidding was reviewed and approved. The Company held the 24th meeting of the 4th Board of Directors on January 21st, 2019, atwhich the Proposal on Amending and Supplementing the “Plan for Repurchasing Shares of the Company by Centralized CompetitiveBidding” was reviewed and approved. The Company intends to use its own funds or self-raised funds to concentrate buy back sharesof the Company by centralized competitive bidding. The repurchase amount is not less than RMB 300 million (included) and notmore than RMB 600 million (included), with the repurchase price not exceeding RMB 15.00/share (included). The specificrepurchase quantity is based on the number of shares actually repurchased at the end of the repurchase period. The implementationperiod of shares repurchase shall be within 12 months from the date of consideration and approval of the shares repurchase plan bythe Company’s general meeting of shareholders.As of June 30th, 2019, the Company repurchased shares through a stock repurchase special securities account by centralizedcompetitive bidding. A total of 22,347,537 shares were repurchased, accounting for 1.06% of the Company’s current total sharecapital, with the highest price of RMB 14.02/share and the lowest price of RMB 12.61/share. The total amount paid was RMB301,961,944.30 (excluding transaction costs). For details, please visit www.cninfo.com.cn to refer to the Announcement on theProgress of Shares Repurchase (announcement No.: 2019-087).Implementation progress of reducing held repurchased shares by means of centralized bidding
□Applicable √Not Applicable
Impact of share change on such financial indexes as basic EPS and diluted EPS, net assets value per share of common stockholders,etc. in recent year or recent period
√Applicable □Not Applicable
During the reporting period, the Company repurchased 22,347,537 shares through a stock repurchase special securities accountby centralized competitive bidding, and also repurchased and cancelled the compensation shares of Yang Dongmai and otherstakeholders to impose certain influences on financial indicators: Basic earnings per share increased by RMB 0.001/share, dilutedearnings per share increased by RMB 0.001/share, and net asset value per share decreased by RMB 0.15/share.Other information disclosed as necessary in the opinion of the Company or as required by securities regulatory institutions
□Applicable √Not Applicable
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
2. Changes in restricted shares
√Applicable □Not Applicable
Unit: Share
| Name of shareholder | Restricted shares at the beginning of the period | Restricted shares available for trade during the reporting period | Increase in restricted shares during the reporting period | The number of restricted shares at the end of the period | Reason for restriction | Lifting date |
| Li Weiwei | 302,743,539 | 0 | 0 | 302,743,539 | Restricted shares after IPO and locked shares of officers | On December 29th, 2015, not more than 10% of all shares; on December 29th, 2016, not more than 30% of all shares; on December 29, 2017, not more than 50% of all shares; on December 29th, 2018, not more than 70% of all shares; on December 29th, 2019, all shares can be released. |
| Wu Weihong | 126,153,496 | -14,775,000 | 0 | 111,378,496 | Executives locked shares | - |
| Wu Weidong | 125,016,063 | -26,820,395 | 0 | 98,195,668 | Executives locked shares | - |
| China Universal Asset Management (CUAM) - Bank of Ningbo - Zhuhai Rongxi Equity Investment Partnership (Limited Partnership) | 59,031,876 | -59,031,876 | 0 | 0 | Restricted shares after IPO | January 14th, 2019 |
| China Universal Asset Management (CUAM) - Bank of Ningbo - China Universal Asset Management (CUAM) - ShunrongSanqi No. 2 Asset Management Plan under Private Placement Plan | 44,604,486 | -44,604,486 | 0 | 0 | Restricted shares after IPO | January 14th, 2019 |
| Shanghai Panxin Investment Management Co., Ltd. - Pan Feng Private Placement Phase I Private Equity Investment Fund | 33,057,850 | -33,057,850 | 0 | 0 | Restricted shares after IPO | January 14th, 2019 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Ningbo XindaFengsheng Investment Partnership (limited partnership) | 32,467,532 | -32,467,532 | 0 | 0 | Restricted shares after IPO | January 14th, 2019 |
| China Universal Asset Management (CUAM) - Bank of Ningbo - China Universal Asset Management (CUAM) - ShunrongSanqi No. 1 Asset Management Plan under Private Placement Plan | 28,595,042 | -28,595,042 | 0 | 0 | Restricted shares after IPO | January 14th, 2019 |
| Mango Media Co. Ltd. | 23,612,750 | -23,612,750 | 0 | 0 | Restricted shares after IPO | January 14th, 2019 |
| Guangzhou AoyuSante Culture Co., Ltd. | 23,612,750 | -23,612,750 | 0 | 0 | Restricted shares after IPO | January 23rd, 2019 |
| Others | 105,927,352 | -98,214,772 | 0 | 7,712,580 | Restricted shares after IPO and locked shares of officers | - |
| Total | 904,822,736 | -384,792,453 | 0 | 520,030,283 | -- | -- |
3. Issuance and listing of securities
None.II. Number of shareholders and shareholding status
Unit: Share
| Total number of common shareholders at the end of the reporting period | 53,291 | Total number of preferred shareholders with recovered voting rights at the end of the reporting period (if any) (see Note 8) | 0 | ||||||
| Shareholding of ordinary shareholders holding 5% of total shares or top 10 shareholders | |||||||||
| Name of shareholder | Nature of the shareholder | Shareholding ratio | Quantity of common shares held at the end of the reporting period | Increase/decrease during this reporting period | Quantity of restricted common shares | Quantity of unrestricted common shares | Pledged or frozen status | ||
| Shareholding status | Quantity | ||||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Li Weiwei | Natural person of Mainland China | 19.11% | 403,658,052 | 0 | 302,743,539 | 100,914,513 | Pledge | 65,104,000 |
| ZengKaitian | Natural person of Mainland China | 17.48% | 369,304,174 | 0 | 0 | 369,304,174 | Pledge | 48,880,000 |
| Wu Weihong | Natural person of Mainland China | 6.48% | 136,927,562 | -11,577,100 | 111,378,496 | 25,549,066 | ||
| Wu Weidong | Natural person of Mainland China | 6.20% | 130,927,557 | 98,195,668 | 32,731,889 | |||
| Wu Xushun | Natural person of Mainland China | 5.15% | 108,837,782 | -58,900,000 | 0 | 108,837,782 | Pledge | 39,000,000 |
| Hu Yuhang | Natural person of Mainland China | 2.97% | 62,830,436 | -1,000,000 | 7,192,530 | 55,637,906 | Pledge | 12,010,000 |
| China Universal Asset Management (CUAM) - Bank of Ningbo - Zhuhai Rongxi Equity Investment Partnership (Limited Partnership) | Others | 2.62% | 55,337,463 | -3,694,413 | 0 | 55,337,463 | ||
| China Universal Asset Management (CUAM) - Bank of Ningbo - China Universal Asset Management (CUAM) - ShunrongSanqi No. 2 Asset Management Plan under Private Placement Plan | Others | 1.79% | 37,705,686 | -6,898,800 | 0 | 37,705,686 | ||
| Hong Kong Securities Clearing Company Limited | Overseas corporation | 1.71% | 36,020,602 | 26,252,231 | 0 | 36,020,602 | ||
| Hua life Insurance Company Limited - Own Funds | Others | 1.42% | 30,000,000 | 30,000,000 | 0 | 30,000,000 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Information of strategic investor or general legal person who becomes one of top 10 common shareholders due to rights issue (if any) (refer to note 3) | Not applicable | ||
| Statement on relationship and concerted action among the above-mentioned shareholders | 1. Among the top 10 shareholders of the Company, Wu Xushun is the father of Wu Weihong and Wu Weidong, and Wu Xushun, Wu Weihong and Wu Weidong are shareholders acting in concert. 2. The Company is not aware of any other relationship among other top 10 shareholders, and is also unknown whether there is any shareholder acting in concert as stipulated in the Measures on the Administration of Acquisition of Listed Companies. | ||
| Shareholding status of top 10 un-restricted common shareholders | |||
| Name of shareholder | Quantity of held un-restricted common shares at the end of the reporting period | Class of shares | |
| Class of shares | Quantity | ||
| ZengKaitian | 369,304,174 | Common shares in RMB | 369,304,174 |
| Wu Xushun | 108,837,782 | Common shares in RMB | 108,837,782 |
| Li Weiwei | 100,914,513 | Common shares in RMB | 100,914,513 |
| Hu Yuhang | 55,637,906 | Common shares in RMB | 55,637,906 |
| China Universal Asset Management (CUAM) - Bank of Ningbo - Zhuhai Rongxi Equity Investment Partnership (Limited Partnership) | 55,337,463 | Common shares in RMB | 55,337,463 |
| China Universal Asset Management (CUAM) - Bank of Ningbo - China Universal Asset Management (CUAM) - ShunrongSanqi No. 2 Asset Management Plan under Private Placement Plan | 37,705,686 | Common shares in RMB | 37,705,686 |
| Hong Kong Securities Clearing Company Limited | 36,020,602 | Common shares in RMB | 36,020,602 |
| Wu Weidong | 32,731,889 | Common shares in RMB | 32,731,889 |
| Hua life Insurance Company Limited - Own Funds | 30,000,000 | Common shares in RMB | 30,000,000 |
| Wuhu ShunrongSanqi Interactive Entertainment Network Technology Co., Ltd. - Second Employee Stock Ownership Plan | 26,310,527 | Common shares in RMB | 26,310,527 |
| Information of relationship or concerted action among top 10 | 1. Among the top 10 shareholders of the Company, Wu Xushun is the father of Wu Weihong and Wu Weidong, and Wu Xushun, | ||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| un-restricted common shareholders, and between top 10 un-restricted common shareholders and top 10 common shareholders | Wu Weihong and Wu Weidong are shareholders acting in concert. 2. The Company is not aware of any other relationship among other top 10 shareholders, and is also unknown whether there is any shareholder acting in concert as stipulated in the Measures on the Administration of Acquisition of Listed Companies. |
| Description for top 10 common shareholders participating in securities margin trading (if any) (see Note 4) | None |
Have top 10 common shareholders and top 10 un-restricted common shareholders conducted repurchasing trades within the report period
□ Yes √ No
Top 10 common shareholders and top 10 un-restricted common shareholders do not conduct repurchasing trades within the report period.
III. Changes in the Controlling Shareholder or Actual Controllers
Change of controlling shareholder during the reporting period
√Applicable □Not Applicable
| Name of new controlling shareholders | Li Weiwei |
| Change date | April 8th, 2019 |
| Query index of designated website | http://www.cninfo.com.cn |
| Disclosure date of designated website | April 9th, 2019 |
Change of actual controller during the reporting period
√Applicable □Not Applicable
| Name of new actual controller | Li Weiwei |
| Change date | April 8th, 2019 |
| Query index of designated website | http://www.cninfo.com.cn |
| Disclosure date of designated website | April 9th, 2019 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Section VII Financial ReportI. Financial StatementsUnit in statements in financial notes: RMB
1. Consolidated balance sheet
Prepared by: Wuhu Sanqi Interactive Entertainment Network Technology Group Co., Ltd.
June 30th, 2019
Unit: RMB
| Item | June 30th, 2019 | December 31st, 2018 |
| Current assets: | ||
| Monetary fund | 1,788,431,889.15 | 1,532,965,200.05 |
| Transaction settlement funds | ||
| Loans to other banks | ||
| Trading financial assets | 320,000,000.00 | |
| Financial assets measured at fair value with changes included in current profits and losses | ||
| Derivative financial assets | ||
| Notes receivable | ||
| Accounts receivable | 1,717,575,938.59 | 1,298,554,481.23 |
| Receivables financing | ||
| Prepayments | 502,448,873.30 | 193,770,132.83 |
| Premiums receivable | ||
| Reinsurance premiums receivable | ||
| Reinsurance contract reserves receivable | ||
| Other receivables | 92,363,339.09 | 792,425,628.90 |
| Wherein: Interest receivable | 64,445.20 | |
| Dividends receivable | ||
| Redemptory monetary capital for sale | ||
| Inventories | ||
| Contract assets | ||
| Assets held-for-sale | 7,536,816.46 | 7,536,816.46 |
| Non-current assets due within one year |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Other current assets | 125,703,458.23 | 356,865,377.91 |
| Total current assets | 4,554,060,314.82 | 4,182,117,637.38 |
| Non-current assets: | ||
| Disbursement of advances and loans | ||
| Creditors’ investment | ||
| Available-for-sale financial assets | 1,119,291,025.55 | |
| Other long-term investments on bonds | ||
| Held-to-maturity investment | ||
| Long-term receivables | ||
| Long-term equity investments | 514,224,823.77 | 555,602,013.99 |
| Other equity investment | 246,635,981.28 | |
| Other non-current financial assets | 932,481,621.45 | |
| Investment property | ||
| Fixed assets | 36,385,942.05 | 36,458,454.56 |
| Construction in progress | 751,293,007.77 | |
| Productive biological assets | ||
| Oil and gas assets | ||
| Right-of-use asset | ||
| Intangible assets | 14,279,324.27 | 14,296,437.04 |
| Development expenditure | 6,205,796.16 | |
| Goodwill | 1,578,065,048.53 | 1,578,567,397.76 |
| Long-term deferred expenses | 74,090,122.83 | 74,286,546.49 |
| Deferred income tax assets | 7,790,147.85 | 27,325,270.01 |
| Other non-current assets | 58,269,048.52 | 801,611,138.04 |
| Total non-current assets | 4,213,515,068.32 | 4,213,644,079.60 |
| Total assets | 8,767,575,383.14 | 8,395,761,716.98 |
| Current liabilities: | ||
| Short-term loan | 369,000,000.00 | |
| Loan from central bank | ||
| Loans from other banks | ||
| Trading financial liabilities | ||
| Financial liabilities measured at fair value with changes included in current profits and losses | ||
| Derivative financial liabilities |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Notes payable | 30,000,000.00 | |
| Accounts payable | 1,100,674,856.19 | 1,082,362,368.29 |
| Account received in advance | 180,159,647.52 | 94,628,742.59 |
| Financial assets sold for repurchase | ||
| Receipt of deposits and deposits from other banks | ||
| Receivings from vicariously traded securities | ||
| Receivings from vicariously sold securities | ||
| Payroll payable | 121,495,008.66 | 121,978,401.18 |
| Tax payable | 88,463,827.01 | 89,275,803.43 |
| Other payables | 552,307,169.79 | 108,142,599.83 |
| Wherein: Interests payable | 52,841.84 | |
| Dividends payable | 417,980,832.00 | |
| Service charges and commissions payable | ||
| Reinsured accounts payable | ||
| Contract liabilities | ||
| Liabilities held for sale | ||
| Non-current liabilities due within one year | 30,282,389.93 | 29,599,165.73 |
| Other current liabilities | 76,707,849.63 | 97,256,568.16 |
| Total current liabilities | 2,180,090,748.73 | 1,992,243,649.21 |
| Non-current liabilities: | ||
| Reserves for insurance contract | ||
| Long-term loans | 265,883,241.55 | 281,176,106.33 |
| Bonds payable | ||
| Wherein: Preferred shares | ||
| Perpetual bond | ||
| LEASE LIABILITIES | ||
| Long-term payables | ||
| Long-term remuneration payable | ||
| Estimated liabilities | ||
| Deferred income | 2,264,694.54 | 3,903,715.32 |
| Deferred income tax liabilities | 4,735,906.20 | |
| Other non-current liabilities | ||
| Total non-current liabilities | 268,147,936.09 | 289,815,727.85 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Total liabilities | 2,448,238,684.82 | 2,282,059,377.06 |
| Owners’ equity: | ||
| Share capital | 2,112,251,697.00 | 2,124,870,253.00 |
| Other equity instruments | ||
| Where: Preferred shares | ||
| Perpetual capital securities | ||
| Capital reserve | 192,239,353.57 | 298,739,967.21 |
| Less: Treasury stock | 302,007,311.87 | |
| Other comprehensive incomes | 19,514,256.07 | 46,376,346.58 |
| Special reserves | ||
| Surplus reserve | 170,477,835.88 | 170,477,835.88 |
| General risk provisions | ||
| Undistributed profit | 3,974,141,378.37 | 3,332,211,003.19 |
| Total equity attributable to parent company owners | 6,166,617,209.02 | 5,972,675,405.86 |
| Minority shareholders' equity | 152,719,489.30 | 141,026,934.06 |
| Total owners' equities | 6,319,336,698.32 | 6,113,702,339.92 |
| Total liabilities and owners’ equity | 8,767,575,383.14 | 8,395,761,716.98 |
| Legal representative: Li Weiwei | Accounting supervisor: Ye Wei | Legal representative of the accounting firm: Ye Wei |
2. Consolidated balance sheet of parent company
Unit: RMB
| Item | June 30th, 2019 | December 31st, 2018 |
| Current assets: | ||
| Monetary fund | 113,306,255.18 | 4,325,959.18 |
| Trading financial assets | ||
| Financial assets measured at fair value with changes included in current profits and losses | ||
| Derivative financial assets | ||
| Notes receivable | ||
| Accounts receivable | ||
| Receivables financing |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Prepayments | 63,300.00 | |
| Other receivables | 528,604,929.21 | 1,391,766,571.39 |
| Wherein: Interest receivable | ||
| Dividends receivable | 500,000,000.00 | |
| Inventories | ||
| Contract assets | ||
| Assets held-for-sale | ||
| Non-current assets due within one year | ||
| Other current assets | 3,386,365.63 | 1,165,393.00 |
| Total current assets | 645,297,550.02 | 1,397,321,223.57 |
| Non-current assets: | ||
| Creditors’ investment | ||
| Available-for-sale financial assets | 179,996,897.11 | |
| Other long-term investments on bonds | ||
| Held-to-maturity investment | ||
| Long-term receivables | ||
| Long-term equity investments | 6,409,414,609.22 | 6,402,393,690.49 |
| Other equity investment | 60,000,000.00 | |
| Other non-current financial assets | 114,997,287.11 | |
| Investment property | ||
| Fixed assets | ||
| Construction in progress | ||
| Productive biological assets | ||
| Oil and gas assets | ||
| Right-of-use asset | ||
| Intangible assets | ||
| Development expenditure | ||
| Goodwill | ||
| Long-term deferred expenses | ||
| Deferred income tax assets | 8,657.92 | 8,090.43 |
| Other non-current assets | ||
| Total non-current assets | 6,584,420,554.25 | 6,582,398,678.03 |
| Total assets | 7,229,718,104.27 | 7,979,719,901.60 |
| Current liabilities: |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Short-term loan | 369,000,000.00 | |
| Trading financial liabilities | ||
| Financial liabilities measured at fair value with changes included in current profits and losses | ||
| Derivative financial liabilities | ||
| Notes payable | ||
| Accounts payable | 116,619.20 | 36,357,038.26 |
| Account received in advance | ||
| Contract liabilities | ||
| Payroll payable | 93,813.27 | 484,767.87 |
| Tax payable | 18,326.30 | 1,745,935.68 |
| Other payables | 424,748,346.45 | 711,616,794.64 |
| Wherein: Interests payable | 52,841.84 | |
| Dividends payable | 417,980,832.00 | |
| Liabilities held for sale | ||
| Non-current liabilities due within one year | ||
| Other current liabilities | ||
| Total current liabilities | 424,977,105.22 | 1,119,204,536.45 |
| Non-current liabilities: | ||
| Long-term loans | ||
| Bonds payable | ||
| Wherein: Preferred shares | ||
| Perpetual bond | ||
| LEASE LIABILITIES | ||
| Long-term payables | ||
| Long-term remuneration payable | ||
| Estimated liabilities | ||
| Deferred income | ||
| Deferred income tax liabilities | ||
| Other non-current liabilities | ||
| Total non-current liabilities | ||
| Total liabilities | 424,977,105.22 | 1,119,204,536.45 |
| Owners’ equity: | ||
| Share capital | 2,112,251,697.00 | 2,124,870,253.00 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Other equity instruments | ||||||
| Where: Preferred shares | ||||||
| Perpetual capital securities | ||||||
| Capital reserve | 3,845,960,626.18 | 3,952,461,239.82 | ||||
| Less: Treasury stock | 302,007,311.87 | |||||
| Other comprehensive incomes | ||||||
| Special reserves | ||||||
| Surplus reserves | 170,477,835.88 | 170,477,835.88 | ||||
| Undistributed profit | 978,058,151.86 | 612,706,036.45 | ||||
| Total owner’s equity | 6,804,740,999.05 | 6,860,515,365.15 | ||||
| Total liabilities and owners’ equity | 7,229,718,104.27 | 7,979,719,901.60 | ||||
| Legal representative: Li Weiwei | Accounting supervisor: Ye Wei | Legal representative of the accounting firm: Ye Wei | ||||
3. Consolidated profit statement
Unit: RMB
| Item | The first half of 2019 | The first half of 2018 |
| I. Total operating income | 6,070,957,503.06 | 3,302,496,146.77 |
| Wherein: Operating incomes | 6,070,957,503.06 | 3,302,496,146.77 |
| Interest incomes | ||
| Earned insurance premium | ||
| Incomes from service charges and commissions | ||
| II. Total operating cost | 4,908,533,506.03 | 2,445,334,024.33 |
| Wherein: Operating cost | 838,986,561.51 | 886,273,600.84 |
| Interest payment | ||
| Service charges and commission expenses | ||
| Refunded premium | ||
| Net amount of compensation payout | ||
| Net amount of reserves for reinsurance contract | ||
| Policy dividend payment | ||
| Reinsured expenses | ||
| Taxes and additional charges | 20,392,371.96 | 15,844,704.11 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Selling expenses | 3,632,067,521.84 | 1,143,478,494.94 |
| Administrative expense | 88,053,838.68 | 127,934,924.44 |
| R&D expense | 324,699,670.32 | 257,843,866.07 |
| Financial expenses | 4,333,541.72 | 13,958,433.93 |
| Wherein: Interest fee | 18,926,518.37 | 21,337,173.26 |
| Interest incomes | 8,475,803.74 | 9,241,560.12 |
| Add: Other profits | 49,294,108.11 | 42,885,206.03 |
| Investment profit (“-” indicates the loss) | 18,932,969.82 | 23,747,705.64 |
| Wherein: Investment income of joint-venture and partnership | -6,172,892.49 | -4,090,378.50 |
| Financial assets measured by amortized cost no longer recognized as income (loss is marked with “-”) | ||
| Exchange income (“-” indicates the loss) | ||
| Net open hedge income (loss is marked with "-") | ||
| Income from changes in fair value (“-” indicates the loss) | 41,603,452.48 | |
| Credit impairment loss (loss is marked with “-”) | 33,094,388.44 | |
| Asset impairment loss (loss is marked with “-”) | -14,789,077.01 | -2,141,680.01 |
| Assets disposal income (“-” indicates the loss) | -77,711.53 | 4,411.96 |
| III. Operation profit (“-” indicates the loss) | 1,290,482,127.34 | 921,657,766.06 |
| Add: Non-operating income | 3,082,997.15 | 1,076,547.10 |
| Less: Non-operating expense | 2,674,771.67 | 3,487,862.12 |
| IV. Total profit (“-” indicates the total loss) | 1,290,890,352.82 | 919,246,451.04 |
| Less: Income taxes | 131,634,742.44 | 36,437,882.35 |
| V. Net profit (“-” indicates the loss) | 1,159,255,610.38 | 882,808,568.69 |
| (I) Classified by going concern | ||
| 1. Net profit of going concern (“-” indicates net loss) | 1,159,255,610.38 | 880,922,320.29 |
| 2. Net profit of discontinuing operation (“-” indicates net loss) | 1,886,248.40 | |
| (II) Classified by attribution of ownership |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 1. Net profits attributable to parent company owners | 1,033,074,405.38 | 801,378,948.23 |
| 2. Gain and loss of minority shareholders | 126,181,205.00 | 81,429,620.46 |
| VI. After-tax net of other comprehensive incomes | -25,288.71 | -12,085,783.31 |
| After-tax net of other comprehensive incomes owned by the owner of the parent company | -25,288.71 | -11,959,438.02 |
| (I) Other comprehensive incomes that cannot be classified into profits and losses | ||
| 1. Re-measurement of changes in defined benefit plan | ||
| 2. Other comprehensive incomes that cannot be reclassified into profits and losses under the equity method | ||
| 3. Changes in fair value of investment in other equity instruments | ||
| 4. Changes in the fair value of the company's own credit risk | ||
| 5. Others | ||
| (II) Other comprehensive incomes that would be classified into profits and losses | -25,288.71 | -11,959,438.02 |
| 1. Other comprehensive incomes that can be reclassified into profits and losses under the equity method | ||
| 2. Changes in fair value of other debt investment | ||
| 3. Loss and profit of change in fair value of available-for-sale financial assets | -16,780,009.82 | |
| 4. The amount of financial assets reclassified into other comprehensive income | ||
| 5. Loss and profit of available-for-sale financial assets of held-to-maturity investments | ||
| 6. Credit depreciation provision for other credit investment | ||
| 7. Cash flow hedge reserve | ||
| 8. Translation difference in the foreign currency financial statement | -25,288.71 | 4,820,571.80 |
| 9. Others | ||
| Other comprehensive incomes net of tax | -126,345.29 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| attributed to minority stockholders | ||
| VII. Total consolidated income | 1,159,230,321.67 | 870,722,785.38 |
| Total consolidated income attributable to parent company owners | 1,033,049,116.67 | 789,419,510.21 |
| Total consolidated income attributable to minority shareholders | 126,181,205.00 | 81,303,275.17 |
| VIII. Earnings per share: | ||
| (I) Basic earning per share | 0.49 | 0.37 |
| (II) Diluted earning per share | 0.49 | 0.37 |
For combination of enterprises under the same control in this period, the net profit realized by the merged party before combinationwas: RMB 0.00, net profit realized by the merged party in last times: RMB 0.00.
| Legal representative: Li Weiwei | Accounting supervisor: Ye Wei | Legal representative of the accounting firm: Ye Wei |
4. Profit statement of parent company
Unit: RMB
| Item | The first half of 2019 | The first half of 2018 |
| I. Operating income | 0.00 | 0.00 |
| Less: Operating cost | 0.00 | 0.00 |
| Taxes and additional charges | 8,651.83 | 1,024,725.00 |
| Selling expenses | ||
| Administrative expense | 664,215.31 | 6,601,859.21 |
| R&D expense | ||
| Financial expenses | 5,026,558.14 | 5,213,002.36 |
| Wherein: Interest fee | 8,467,829.41 | 10,775,718.70 |
| Interest incomes | 3,444,301.05 | 5,565,824.46 |
| Add: Other profits | 25,780.49 | 50,943.38 |
| Investment profit (“-” indicates the loss) | 789,008,294.71 | 198,698,898.16 |
| Wherein: Investment income of joint-venture and partnership | -979,081.27 | -1,301,101.84 |
| Financial assets measured by amortized cost no longer recognized as income (loss is marked with “-”) | ||
| Net open hedge income (loss is marked with "-") | ||
| Income from changes in fair value (“-” |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| indicates the loss) | ||
| Credit impairment loss (loss is marked with “-”) | -2,270.00 | 2,508,054.79 |
| Asset impairment loss (loss is marked with “-”) | ||
| Assets disposal income (“-” indicates the loss) | ||
| II. Operating profit ("-" indicates the loss) | 783,332,379.92 | 188,418,309.76 |
| Add: Non-operating income | ||
| Less: Non-operating expense | 5,483.09 | |
| III. Total profit (“-” indicates the total loss) | 783,332,379.92 | 188,412,826.67 |
| Less: Income taxes | -567.49 | 515,819.10 |
| IV. Net profit (“-” indicates the loss) | 783,332,947.41 | 187,897,007.57 |
| (I) Net profit of going concern (“-” indicates net loss) | 783,332,947.41 | 187,897,007.57 |
| (II) Net profit of discontinuing operation (“-” indicates net loss) | ||
| V. Net of tax of other comprehensive incomes | ||
| (I) Other comprehensive incomes that cannot be classified into profit and loss | ||
| 1. Re-measurement of changes in defined benefit plan | ||
| 2. Other comprehensive incomes that cannot be reclassified into profits and losses under the equity method | ||
| 3. Changes in fair value of investment in other equity instruments | ||
| 4. Changes in the fair value of the company's own credit risk | ||
| 5. Others | ||
| (II) Other comprehensive incomes that would be classified into profits and losses | ||
| 1. Other comprehensive incomes that can be reclassified into profits and losses under the equity method | ||
| 2. Changes in fair value of other debt investment | ||
| 3. Loss and profit of change in fair |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| value of available-for-sale financial assets | ||||||
| 4. The amount of financial assets reclassified into other comprehensive income | ||||||
| 5. Loss and profit of available-for-sale financial assets of held-to-maturity investments | ||||||
| 6. Credit depreciation provision for other credit investment | ||||||
| 7. Cash flow hedge reserve | ||||||
| 8. Translation difference in the foreign currency financial statement | ||||||
| 9. Others | ||||||
| VI. Total Comprehensive Income | 783,332,947.41 | 187,897,007.57 | ||||
| VII. Earnings per share: | ||||||
| (I) Basic earning per share | ||||||
| (II) Diluted earning per share | ||||||
| Legal representative: Li Weiwei | Accounting supervisor: Ye Wei | Legal representative of the accounting firm: Ye Wei | ||||
5. Consolidated cash flow statement
Unit: RMB
| Item | The first half of 2019 | The first half of 2018 |
| I. Cash flows from operating activities: | ||
| Cash received from sales of goods or rendering of services | 5,978,803,476.57 | 3,438,837,552.44 |
| Net increase of deposits from customers and other banks | ||
| Net increase of loans from central bank | ||
| Net increase of loans from other financial institutions | ||
| Cash received from receiving insurance premium of original insurance contract | ||
| Net cash received from reinsurance business | ||
| Net increase of policy holder deposits and investment funds | ||
| Cash received from interests, fees and commissions | ||
| Net increase of loans from other banks |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Net capital increase of repurchase business | ||
| Net cash received from traded securities by agency | ||
| Refunds of taxes and levies | 18,148,222.30 | 26,890,901.13 |
| Cash received from other operating activities | 53,303,204.02 | 23,960,147.51 |
| Sub-total of cash inflows from operating activities | 6,050,254,902.89 | 3,489,688,601.08 |
| Cash paid for purchasing goods and services | 663,495,847.03 | 764,126,180.75 |
| Net increase of customer’s loans and advances | ||
| Net increase of deposits in central bank and other banks | ||
| Cash paid for indemnity of original insurance contract | ||
| Net increase in trading financial assets | ||
| Net increase in lending funds | ||
| Cash paid for interests, service charges and commissions | ||
| Cash paid for policy dividends | ||
| Cash paid to and on behalf of employees | 384,362,339.55 | 389,536,519.50 |
| Payments of taxes and levies | 234,010,246.88 | 148,413,335.07 |
| Other cash paid relating to operating activities | 4,152,031,533.06 | 1,210,376,547.80 |
| Sub-total of cash outflows from operating activities | 5,433,899,966.52 | 2,512,452,583.12 |
| Net cash flows from operating activities | 616,354,936.37 | 977,236,017.96 |
| II. Cash flows from investing activities: | ||
| Cash received from withdrawal of investments | 105,816,280.71 | 118,636,674.46 |
| Cash received from returns on investments | 16,060,855.44 | 31,431,186.39 |
| Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 204,690.00 | 2,174,729.81 |
| Net cash received from disposal of subsidiaries and other business units | 433,449,673.50 | |
| Other cash received relating to investing activities | 2,488,320,540.52 | 1,126,557,800.00 |
| Sub-total of cash inflows from investing activities | 3,043,852,040.17 | 1,278,800,390.66 |
| Cash paid to procure fixed assets, intangible assets and other long-term assets | 59,645,209.49 | 131,912,260.35 |
| Cash paid to acquire investments | 78,068,522.99 | 92,335,901.04 |
| Net increase of pledge loans | ||
| Net cash received from payment of subsidiaries |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| and other business entities | ||||||
| Cash payments relating to other investment activities | 2,430,000,000.00 | 1,126,557,800.00 | ||||
| Sub-total of cash outflows from investing activities | 2,567,713,732.48 | 1,350,805,961.39 | ||||
| Net cash flows from investing activities | 476,138,307.69 | -72,005,570.73 | ||||
| III. Cash flows from financing activities: | ||||||
| Cash received from capital contribution | 19,789,457.72 | |||||
| Wherein: Cash from the investment of minority shareholders of the subsidiaries | 19,789,457.72 | |||||
| Cash received from borrowings | 649,000,000.00 | |||||
| Cash received from issuance of debentures | ||||||
| Other cash received relating to financing activities | ||||||
| Sub-total of cash inflows from financing activities | 668,789,457.72 | |||||
| Cash repayments of amounts borrowed | 383,609,640.58 | 385,933,010.04 | ||||
| Cash payments for interest expenses and distribution of dividends or profits | 138,359,549.65 | 109,256,651.46 | ||||
| Wherein: Dividends and profits paid by subsidiaries to minority shareholders | 122,000,000.00 | 90,000,000.00 | ||||
| Other cash payments relating to financing activities | 302,007,312.87 | 1,120,317,235.07 | ||||
| Sub-total of cash outflows from financing activities | 823,976,503.10 | 1,615,506,896.57 | ||||
| Net cash flows from financing activities | -823,976,503.10 | -946,717,438.85 | ||||
| IV. Influence of exchange rate change on cash and cash equivalents | -128,092.91 | -764,348.79 | ||||
| V. Net increase of cash and cash equivalents | 268,388,648.05 | -42,251,340.41 | ||||
| Add: Beginning balance of cash and cash equivalents | 1,515,740,344.79 | 1,580,910,931.98 | ||||
| VI. Balance of cash and cash equivalents at the end of period | 1,784,128,992.84 | 1,538,659,591.57 | ||||
| Legal representative: Li Weiwei | Accounting supervisor: Ye Wei | Legal representative of the accounting firm: Ye Wei | ||||
6. Cash flow statement of parent company
Unit: RMB
| Item | The first half of 2019 | The first half of 2018 |
| I. Cash flows from operating activities: |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Cash received from sales of goods or rendering of services | ||
| Refunds of taxes and levies | 50,943.38 | |
| Cash received from other operating activities | 1,355,608,209.24 | 1,717,002,285.35 |
| Sub-total of cash inflows from operating activities | 1,355,608,209.24 | 1,717,053,228.73 |
| Cash paid for purchasing goods and services | ||
| Cash paid to and on behalf of employees | 360,009.16 | 1,238,172.66 |
| Payments of taxes and levies | 1,736,261.21 | 18,667,911.67 |
| Other cash paid relating to operating activities | 2,256,700,554.73 | 835,785,281.58 |
| Sub-total of cash outflows from operating activities | 2,258,796,825.10 | 855,691,365.91 |
| Net cash flows from operating activities | -903,188,615.86 | 861,361,862.82 |
| II. Cash flows from investing activities: | ||
| Cash received from withdrawal of investments | 4,999,610.00 | 50,000,000.00 |
| Cash received from returns on investments | 1,289,987,375.98 | 6,000,000.00 |
| Net cash received from disposal of fixed assets, intangible assets and other long-term assets | ||
| Net cash received from disposal of subsidiaries and other business units | 404,709,910.00 | |
| Other cash received relating to investing activities | ||
| Sub-total of cash inflows from investing activities | 1,699,696,895.98 | 56,000,000.00 |
| Cash paid to procure fixed assets, intangible assets and other long-term assets | ||
| Cash paid to acquire investments | 8,000,000.00 | 1,120,000,000.00 |
| Net cash received from payment of subsidiaries and other business entities | ||
| Cash payments relating to other investment activities | ||
| Sub-total of cash outflows from investing | 8,000,000.00 | 1,120,000,000.00 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| activities | ||||||
| Net cash flows from investing activities | 1,691,696,895.98 | -1,064,000,000.00 | ||||
| III. Cash flows from financing activities: | ||||||
| Cash received from capital contribution | ||||||
| Cash received from borrowings | 649,000,000.00 | |||||
| Cash received from issuance of debentures | ||||||
| Other cash received relating to financing activities | 91,195.70 | |||||
| Sub-total of cash inflows from financing activities | 649,091,195.70 | |||||
| Cash repayments of amounts borrowed | 369,000,000.00 | 369,000,000.00 | ||||
| Cash payments for interest expenses and distribution of dividends or profits | 8,520,671.25 | 10,627,267.52 | ||||
| Other cash payments relating to financing activities | 302,007,312.87 | 491,089.23 | ||||
| Sub-total of cash outflows from financing activities | 679,527,984.12 | 380,118,356.75 | ||||
| Net cash flows from financing activities | -679,527,984.12 | 268,972,838.95 | ||||
| IV. Influence of exchange rate change on cash and cash equivalents | ||||||
| V. Net increase of cash and cash equivalents | 108,980,296.00 | 66,334,701.77 | ||||
| Add: Beginning balance of cash and cash equivalents | 4,325,959.18 | 5,437,518.91 | ||||
| VI. Balance of cash and cash equivalents at the end of period | 113,306,255.18 | 71,772,220.68 | ||||
| Legal representative: Li Weiwei | Accounting supervisor: Ye Wei | Legal representative of the accounting firm: Ye Wei | ||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
7. Consolidated statement of changes in owners' equity
Amount of current period
Unit: RMB
| Item | Half year of 2019 | ||||||||||||||
| Total owners' equity attributable to the parent company | Minority shareholders' equity | Total owner’s equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive incomes | Special reserves | Surplus reserve | General risk provisions | Undistributed profit | Others | Subtotal | |||||
| Preferred shares | Perpetual capital securities | Others | |||||||||||||
| I. Balance at the end of previous year | 2,124,870,253.00 | 298,739,967.21 | 46,376,346.58 | 170,477,835.88 | 3,332,211,003.19 | 5,972,675,405.86 | 141,026,934.06 | 6,113,702,339.92 | |||||||
| Add: Changes to accounting policies | -26,836,801.80 | 26,836,801.80 | |||||||||||||
| Fund for corrections of errors of previous period | |||||||||||||||
| Business combination under the same control | |||||||||||||||
| Others | |||||||||||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| II. Beginning balance at this year | 2,124,870,253.00 | 298,739,967.21 | 19,539,544.78 | 170,477,835.88 | 3,359,047,804.99 | 5,972,675,405.86 | 141,026,934.06 | 6,113,702,339.92 | |||||||
| III. Increased/decreased amount this year (“-” indicates decrease) | -12,618,556.00 | -106,500,613.64 | 302,007,311.87 | -25,288.71 | 615,093,573.38 | 193,941,803.16 | 11,692,555.24 | 205,634,358.40 | |||||||
| (I) Total comprehensive income | -25,288.71 | 1,033,074,405.38 | 1,033,049,116.67 | 126,181,205.00 | 1,159,230,321.67 | ||||||||||
| (II) Owner investment and decreased capital | -12,618,556.00 | -106,500,613.64 | 302,007,311.87 | -421,126,481.51 | 7,511,350.24 | -413,615,131.27 | |||||||||
| 1. Ordinary share invested by Owners | -12,618,556.00 | -106,500,613.64 | 302,007,311.87 | -421,126,481.51 | -421,126,481.51 | ||||||||||
| 2. Capital invested by other equity instrument holders | |||||||||||||||
| 3. Amounts of share-based payments recognized in owners' equity | |||||||||||||||
| 4. Others | 7,511,350.24 | 7,511,350.24 | |||||||||||||
| (III) Profit distribution | -417,980,832.00 | -417,980,832.00 | -122,000,000.00 | -539,980,832.00 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 1. Appropriation to surplus reserves | |||||||||||||||
| 2. Appropriation of general risk reserves | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -417,980,832.00 | -417,980,832.00 | -122,000,000.00 | -539,980,832.00 | |||||||||||
| 4. Others | |||||||||||||||
| (IV) Internal transfer of owners' equity | |||||||||||||||
| 1. Capital (or share capital) from capital reserves | |||||||||||||||
| 2. Capital (or share capital) from surplus reserves | |||||||||||||||
| 3. Surplus reserves for making up losses | |||||||||||||||
| 4. Set the income from the carrying forward and retaining of benefit plan change amount |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 5. Income from the carrying forward and retaining of other comprehensive income | |||||||||||||||
| 6. Others | |||||||||||||||
| (V) Special reserves | |||||||||||||||
| 1. Withdrawn amount of this period | |||||||||||||||
| 2. Using amount this period | |||||||||||||||
| (VI) Others | |||||||||||||||
| IV. Closing balance of this accounting period | 2,112,251,697.00 | 192,239,353.57 | 302,007,311.87 | 19,514,256.07 | 170,477,835.88 | 3,974,141,378.37 | 6,166,617,209.02 | 152,719,489.30 | 6,319,336,698.32 |
Amount of previous period
Unit: RMB
| Item | Half year of 2018 | ||||||||||||||
| Total owners' equity attributable to the parent company | Minority shareholders' equity | Total owner’s equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive incomes | Special reserves | Surplus reserve | General risk provisions | Undistributed profit | Others | Subtotal | |||||
| Preferred share | Perpetual capital securitie | Others | |||||||||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| s | s | ||||||||||||||
| I. Balance at the end of previous year | 2,148,110,844.00 | 1,947,846.62 | 1,972,639,580.66 | -25,087,592.30 | 99,561,946.09 | 2,819,597,585.78 | 7,016,770,210.85 | 269,888,245.23 | 7,286,658,456.08 | ||||||
| Add: Changes to accounting policies | |||||||||||||||
| Fund for corrections of errors of previous period | |||||||||||||||
| Business combination under the same control | |||||||||||||||
| Others | |||||||||||||||
| II. Beginning balance at this year | 2,148,110,844.00 | 1,947,846.62 | 1,972,639,580.66 | -25,087,592.30 | 99,561,946.09 | 2,819,597,585.78 | 7,016,770,210.85 | 269,888,245.23 | 7,286,658,456.08 | ||||||
| III. Increased/decreased amount this year (“-” indicates | -23,240,591.00 | -1,608,657,849.98 | -11,959,438.02 | 588,891,922.93 | -1,054,965,956.07 | -165,803,442.46 | -1,220,769,398.53 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| decrease) | |||||||||||||||
| (I) Total comprehensive income | -11,959,438.02 | 801,378,948.23 | 789,419,510.21 | 81,303,275.17 | 870,722,785.38 | ||||||||||
| (II) Owner investment and decreased capital | -23,240,591.00 | -1,608,657,849.98 | -1,631,898,440.98 | -157,106,717.63 | -1,789,005,158.61 | ||||||||||
| 1. Ordinary share invested by Owners | -23,240,591.00 | -375,621,894.06 | -398,862,485.06 | 7,286,957.72 | -391,575,527.34 | ||||||||||
| 2. Capital invested by other equity instrument holders | |||||||||||||||
| 3. Amounts of share-based payments recognized in owners' equity | |||||||||||||||
| 4. Others | -1,233,035,955.92 | -1,233,035,955.92 | -164,393,675.35 | -1,397,429,631.27 | |||||||||||
| (III) Profit distribution | -212,487,025.30 | -212,487,025.30 | -90,000,000.00 | -302,487,025.30 | |||||||||||
| 1. Appropriation to surplus |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| reserves | |||||||||||||||
| 2. Appropriation of general risk reserves | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -212,487,025.30 | -212,487,025.30 | -90,000,000.00 | -302,487,025.30 | |||||||||||
| 4. Others | |||||||||||||||
| (IV) Internal transfer of owners' equity | |||||||||||||||
| 1. Capital (or share capital) from capital reserves | |||||||||||||||
| 2. Capital (or share capital) from surplus reserves | |||||||||||||||
| 3. Surplus reserves for making up losses | |||||||||||||||
| 4. Set the income from the carrying |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| forward and retaining of benefit plan change amount | |||||||||||||||||||
| 5. Income from the carrying forward and retaining of other comprehensive income | |||||||||||||||||||
| 6. Others | |||||||||||||||||||
| (V) Special reserves | |||||||||||||||||||
| 1. Withdrawn amount of this period | |||||||||||||||||||
| 2. Using amount this period | |||||||||||||||||||
| (VI) Others | |||||||||||||||||||
| IV. Closing balance of this accounting period | 2,124,870,253.00 | 1,947,846.62 | 363,981,730.68 | -37,047,030.32 | 99,561,946.09 | 3,408,489,508.71 | 5,961,804,254.78 | 104,084,802.77 | 6,065,889,057.55 | ||||||||||
| Legal representative: Li Weiwei | Accounting supervisor: Ye Wei | Legal representative of the accounting firm: Ye Wei | |||||||||||||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
8. Statement of equity changes of parent company owner
Amount of current period
Unit: RMB
| Item | Half year of 2019 | |||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive incomes | Special reserves | Surplus reserves | Undistributed profit | Others | Total owner’s equity | |||
| Preferred shares | Perpetual capital securities | Others | ||||||||||
| I. Balance at the end of previous year | 2,124,870,253.00 | 3,952,461,239.82 | 170,477,835.88 | 612,706,036.45 | 6,860,515,365.15 | |||||||
| Add: Changes to accounting policies | ||||||||||||
| Fund for corrections of errors of previous period | ||||||||||||
| Others | ||||||||||||
| II. Beginning balance at this year | 2,124,870,253.00 | 3,952,461,239.82 | 170,477,835.88 | 612,706,036.45 | 6,860,515,365.15 | |||||||
| III. Increased/decreased amount this year (“-” indicates decrease) | -12,618,556.00 | -106,500,613.64 | 302,007,311.87 | 365,352,115.41 | -55,774,366.10 | |||||||
| (I) Total comprehensive income | 783,332,947.41 | 783,332,947.41 | ||||||||||
| (II) Owner investment and decreased capital | -12,618,556.00 | -106,500,613.64 | 302,007,311.87 | -421,126,481.51 | ||||||||
| 1. Ordinary share invested | -12,618,556.00 | -106,500,613.64 | 302,007,311.87 | -421,126,481.51 | ||||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| by Owners | ||||||||||||
| 2. Capital invested by other equity instrument holders | ||||||||||||
| 3. Amounts of share-based payments recognized in owners' equity | ||||||||||||
| 4. Others | ||||||||||||
| (III) Profit distribution | -417,980,832.00 | -417,980,832.00 | ||||||||||
| 1. Appropriation to surplus reserves | ||||||||||||
| 2. Distribution to owners (or shareholder) | -417,980,832.00 | -417,980,832.00 | ||||||||||
| 3. Others | ||||||||||||
| (IV) Internal transfer of owners' equity | ||||||||||||
| 1. Capital (or share capital) from capital reserves | ||||||||||||
| 2. Capital (or share capital) from surplus reserves | ||||||||||||
| 3. Surplus reserves for making up losses | ||||||||||||
| 4. Set the income from the carrying forward and retaining of benefit plan change amount | ||||||||||||
| 5. Income from the carrying |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| forward and retaining of other comprehensive income | ||||||||||||
| 6. Others | ||||||||||||
| (V) Special reserves | ||||||||||||
| 1. Withdrawn amount of this period | ||||||||||||
| 2. Using amount this period | ||||||||||||
| (VI) Others | ||||||||||||
| IV. Closing balance of this accounting period | 2,112,251,697.00 | 3,845,960,626.18 | 302,007,311.87 | 170,477,835.88 | 978,058,151.86 | 6,804,740,999.05 |
Amount of previous period
Unit: RMB
| Item | Half year of 2018 | |||||||||||
| Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive incomes | Special reserves | Surplus reserves | Undistributed profit | Others | Total owner’s equity | |||
| Preferred shares | Perpetual capital securities | Others | ||||||||||
| I. Balance at the end of previous year | 2,148,110,844.00 | 4,401,934,248.25 | 99,561,946.09 | 399,437,078.96 | 7,049,044,117.30 | |||||||
| Add: Changes to accounting policies | ||||||||||||
| Fund for corrections of errors of previous period | ||||||||||||
| Others | ||||||||||||
| II. Beginning balance at this | 2,148,110,844.00 | 4,401,934,248.25 | 99,561,946.09 | 399,437,078.96 | 7,049,044,117.30 | |||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| year | ||||||||||||
| III. Increased/decreased amount this year (“-” indicates decrease) | -23,240,591.00 | -378,124,394.06 | -24,590,017.73 | -425,955,002.79 | ||||||||
| (I) Total comprehensive income | 187,897,007.57 | 187,897,007.57 | ||||||||||
| (II) Owner investment and decreased capital | -23,240,591.00 | -378,124,394.06 | -401,364,985.06 | |||||||||
| 1. Ordinary share invested by Owners | -23,240,591.00 | -378,124,394.06 | -401,364,985.06 | |||||||||
| 2. Capital invested by other equity instrument holders | ||||||||||||
| 3. Amounts of share-based payments recognized in owners' equity | ||||||||||||
| 4. Others | ||||||||||||
| (III) Profit distribution | -212,487,025.30 | -212,487,025.30 | ||||||||||
| 1. Appropriation to surplus reserves | ||||||||||||
| 2. Distribution to owners (or shareholder) | -212,487,025.30 | -212,487,025.30 | ||||||||||
| 3. Others | ||||||||||||
| (IV) Internal transfer of owners' equity | ||||||||||||
| 1. Capital (or share capital) from capital reserves |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 2. Capital (or share capital) from surplus reserves | |||||||||||||||
| 3. Surplus reserves for making up losses | |||||||||||||||
| 4. Set the income from the carrying forward and retaining of benefit plan change amount | |||||||||||||||
| 5. Income from the carrying forward and retaining of other comprehensive income | |||||||||||||||
| 6. Others | |||||||||||||||
| (V) Special reserves | |||||||||||||||
| 1. Withdrawn amount of this period | |||||||||||||||
| 2. Using amount this period | |||||||||||||||
| (VI) Others | |||||||||||||||
| IV. Closing balance of this accounting period | 2,124,870,253.00 | 4,023,809,854.19 | 99,561,946.09 | 374,847,061.23 | 6,623,089,114.51 | ||||||||||
| Legal representative: Li Weiwei | Accounting supervisor: Ye Wei | Legal representative of the accounting firm: Ye Wei | |||||||||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
9. First implementation of new financial instrument standards, new revenue standards, new lease standards,adjustment of relevant items in financial statements at the beginning of the year
√Applicable □Not Applicable
Consolidated balance sheet
Unit: RMB
| Item | December 31st, 2018 | Jan 1st, 2019 | Adjustment |
| Current assets: | |||
| Monetary fund | 1,532,965,200.05 | 1,532,965,200.05 | |
| Transaction settlement funds | |||
| Loans to other banks | |||
| Trading financial assets | 116,000,000.00 | 116,000,000.00 | |
| Financial assets measured at fair value with changes included in current profits and losses | |||
| Derivative financial assets | |||
| Notes receivable | |||
| Accounts receivable | 1,298,554,481.23 | 1,298,554,481.23 | |
| Receivables financing | |||
| Prepayments | 193,770,132.83 | 193,770,132.83 | |
| Premiums receivable | |||
| Reinsurance premiums receivable | |||
| Reinsurance contract reserves receivable | |||
| Other receivables | 792,425,628.90 | 792,425,628.90 | |
| Wherein: Interest receivable | 64,445.20 | 64,445.20 | |
| Dividends receivable | 0.00 | ||
| Redemptory monetary capital for sale | |||
| Inventories | |||
| Contract assets | |||
| Assets held-for-sale | 7,536,816.46 | 7,536,816.46 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Non-current assets due within one year | |||
| Other current assets | 356,865,377.91 | 240,865,377.91 | -116,000,000.00 |
| Total current assets | 4,182,117,637.38 | 4,182,117,637.38 | |
| Non-current assets: | |||
| Disbursement of advances and loans | |||
| Creditors’ investment | |||
| Available-for-sale financial assets | 1,119,291,025.55 | -1,119,291,025.55 | |
| Other long-term investments on bonds | |||
| Held-to-maturity investment | |||
| Long-term receivables | |||
| Long-term equity investments | 555,602,013.99 | 555,602,013.99 | |
| Other equity investment | 196,571,394.67 | 196,571,394.67 | |
| Other non-current financial assets | 922,719,630.88 | 922,719,630.88 | |
| Investment property | |||
| Fixed assets | 36,458,454.56 | 36,458,454.56 | |
| Construction in progress | 0.00 | ||
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use asset | |||
| Intangible assets | 14,296,437.04 | 14,296,437.04 | |
| Development expenditure | 6,205,796.16 | 6,205,796.16 | |
| Goodwill | 1,578,567,397.76 | 1,578,567,397.76 | |
| Long-term deferred expenses | 74,286,546.49 | 74,286,546.49 | |
| Deferred income tax assets | 27,325,270.01 | 27,325,270.01 | |
| Other non-current assets | 801,611,138.04 | 801,611,138.04 | |
| Total non-current assets | 4,213,644,079.60 | 4,213,644,079.60 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Total assets | 8,395,761,716.98 | 8,395,761,716.98 | |
| Current liabilities: | |||
| Short-term loan | 369,000,000.00 | 369,000,000.00 | |
| Loan from central bank | |||
| Loans from other banks | |||
| Trading financial liabilities | |||
| Financial liabilities measured at fair value with changes included in current profits and losses | |||
| Derivative financial liabilities | |||
| Notes payable | 0.00 | ||
| Accounts payable | 1,082,362,368.29 | 1,082,362,368.29 | |
| Account received in advance | 94,628,742.59 | 94,628,742.59 | |
| Financial assets sold for repurchase | |||
| Receipt of deposits and deposits from other banks | |||
| Receivings from vicariously traded securities | |||
| Receivings from vicariously sold securities | |||
| Payroll payable | 121,978,401.18 | 121,978,401.18 | |
| Tax payable | 89,275,803.43 | 89,275,803.43 | |
| Other payables | 108,142,599.83 | 108,142,599.83 | |
| Wherein: Interests payable | 52,841.84 | 52,841.84 | |
| Dividends payable | 0.00 | ||
| Service charges and commissions payable | |||
| Reinsured accounts payable | |||
| Contract liabilities |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Liabilities held for sale | |||
| Non-current liabilities due within one year | 29,599,165.73 | 29,599,165.73 | |
| Other current liabilities | 97,256,568.16 | 97,256,568.16 | |
| Total current liabilities | 1,992,243,649.21 | 1,992,243,649.21 | |
| Non-current liabilities: | |||
| Reserves for insurance contract | |||
| Long-term loans | 281,176,106.33 | 281,176,106.33 | |
| Bonds payable | |||
| Wherein: Preferred shares | |||
| Perpetual bond | |||
| LEASE LIABILITIES | |||
| Long-term payables | |||
| Long-term remuneration payable | |||
| Estimated liabilities | |||
| Deferred income | 3,903,715.32 | 3,903,715.32 | |
| Deferred income tax liabilities | 4,735,906.20 | 4,735,906.20 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 289,815,727.85 | 289,815,727.85 | |
| Total liabilities | 2,282,059,377.06 | 2,282,059,377.06 | |
| Owners’ equity: | |||
| Share capital | 2,124,870,253.00 | 2,124,870,253.00 | |
| Other equity instruments | |||
| Where: Preferred shares | |||
| Perpetual capital securities | |||
| Capital reserve | 298,739,967.21 | 298,739,967.21 | |
| Less: Treasury stock | |||
| Other comprehensive | 46,376,346.58 | 19,539,544.78 | -26,836,801.80 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| incomes | |||
| Special reserves | |||
| Surplus reserve | 170,477,835.88 | 170,477,835.88 | |
| General risk provisions | |||
| Undistributed profit | 3,332,211,003.19 | 3,359,047,804.99 | 26,836,801.80 |
| Total equity attributable to parent company owners | 5,972,675,405.86 | 5,972,675,405.86 | |
| Minority shareholders' equity | 141,026,934.06 | 141,026,934.06 | |
| Total owners' equities | 6,113,702,339.92 | 6,113,702,339.92 | |
| Total liabilities and owners’ equity | 8,395,761,716.98 | 8,395,761,716.98 |
Adjustment descriptionIn accordance with the Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments,the opening book value of items under the consolidated balance sheet is adjusted as follows:
1. The bank financial products of RMB 116,000,000.00 under other current assets are reclassified as trading financial assets;
2. The available-for-sale financial assets of RMB 1,119,291,025.55 are reclassified as other equity instrument and other non-currentfinancial assets;
3. The profits and losses from change of fair value and income tax expenses recognized as other comprehensive income in the previousyears of RMB 26,836,801.80 were transferred to undistributed profits.Consolidated balance sheet of parent company
Unit: RMB
| Item | December 31st, 2018 | Jan 1st, 2019 | Adjustment |
| Current assets: | |||
| Monetary fund | 4,325,959.18 | 4,325,959.18 | |
| Trading financial assets | |||
| Financial assets measured at fair value with changes included in current profits and losses | |||
| Derivative financial assets | |||
| Notes receivable | |||
| Accounts receivable | |||
| Receivables financing | |||
| Prepayments | 63,300.00 | 63,300.00 | |
| Other receivables | 1,391,766,571.39 | 1,391,766,571.39 | |
| Wherein: Interest receivable | |||
| Dividends receivable | 500,000,000.00 | 500,000,000.00 | |
| Inventories |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Contract assets | |||
| Assets held-for-sale | |||
| Non-current assets due within one year | |||
| Other current assets | 1,165,393.00 | 1,165,393.00 | |
| Total current assets | 1,397,321,223.57 | 1,397,321,223.57 | |
| Non-current assets: | |||
| Creditors’ investment | |||
| Available-for-sale financial assets | 179,996,897.11 | -179,996,897.11 | |
| Other long-term investments on bonds | |||
| Held-to-maturity investment | |||
| Long-term receivables | |||
| Long-term equity investments | 6,402,393,690.49 | 6,402,393,690.49 | |
| Other equity investment | 60,000,000.00 | 60,000,000.00 | |
| Other non-current financial assets | 119,996,897.11 | 119,996,897.11 | |
| Investment property | |||
| Fixed assets | |||
| Construction in progress | |||
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use asset | |||
| Intangible assets | |||
| Development expenditure | |||
| Goodwill | |||
| Long-term deferred expenses | |||
| Deferred income tax assets | 8,090.43 | 8,090.43 | |
| Other non-current assets | |||
| Total non-current assets | 6,582,398,678.03 | 6,582,398,678.03 | |
| Total assets | 7,979,719,901.60 | 7,979,719,901.60 | |
| Current liabilities: | |||
| Short-term loan | 369,000,000.00 | 369,000,000.00 | |
| Trading financial liabilities | |||
| Financial liabilities measured at fair value with changes included in current profits and losses | |||
| Derivative financial liabilities |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Notes payable | |||
| Accounts payable | 36,357,038.26 | ||
| Account received in advance | |||
| Contract liabilities | |||
| Payroll payable | 484,767.87 | 484,767.87 | |
| Tax payable | 1,745,935.68 | 1,745,935.68 | |
| Other payables | 711,616,794.64 | 711,616,794.64 | |
| Wherein: Interests payable | 52,841.84 | 52,841.84 | |
| Dividends payable | |||
| Liabilities held for sale | |||
| Non-current liabilities due within one year | |||
| Other current liabilities | |||
| Total current liabilities | 1,119,204,536.45 | 1,119,204,536.45 | |
| Non-current liabilities: | |||
| Long-term loans | |||
| Bonds payable | |||
| Wherein: Preferred shares | |||
| Perpetual bond | |||
| LEASE LIABILITIES | |||
| Long-term payables | |||
| Long-term remuneration payable | |||
| Estimated liabilities | |||
| Deferred income | |||
| Deferred income tax liabilities | |||
| Other non-current liabilities | |||
| Total non-current liabilities | |||
| Total liabilities | 1,119,204,536.45 | 1,119,204,536.45 | |
| Owners’ equity: | |||
| Share capital | 2,124,870,253.00 | 2,124,870,253.00 | |
| Other equity instruments | |||
| Where: Preferred shares | |||
| Perpetual capital securities | |||
| Capital reserve | 3,952,461,239.82 | 3,952,461,239.82 | |
| Less: Treasury stock |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Other comprehensive incomes | |||
| Special reserves | |||
| Surplus reserves | 170,477,835.88 | 170,477,835.88 | |
| Undistributed profit | 612,706,036.45 | 612,706,036.45 | |
| Total owner’s equity | 6,860,515,365.15 | 6,860,515,365.15 | |
| Total liabilities and owners’ equity | 7,979,719,901.60 | 7,979,719,901.60 |
Adjustment descriptionIn accordance with the Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments,the parent company’s opening available-for-sale financial assets of RMB 1,119,291,025.55 was reclassified as other equityinvestment and other non-current financial assets.
II. Item Notes to Consolidated Financial Statement
1. Monetary funds
Unit: RMB
| Item | Ending balance | Beginning balance |
| Cash on hand | 29,585.32 | |
| Bank deposit | 1,755,552,866.06 | 1,526,769,012.67 |
| Other monetary funds | 32,879,023.09 | 6,166,602.06 |
| Total | 1,788,431,889.15 | 1,532,965,200.05 |
| Wherein: Total amount deposited in the other regions beyond Mainland China | 472,745,413.06 | 382,759,855.68 |
Other notes
2. Trading financial assets
Unit: RMB
| Item | Ending balance | Beginning balance |
| Financial assets measured at fair value with changes included in current profits and losses | 320,000,000.00 | 116,000,000.00 |
| Wherein: | ||
| Financial products | 320,000,000.00 | 116,000,000.00 |
| Wherein: | ||
| Total | 320,000,000.00 | 116,000,000.00 |
Other notes:
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
3. Accounts receivables
(1) Disclosure of accounts receivable types
Unit: RMB
| Type | Ending balance | Balance at the beginning of the period | ||||||||
| Book balance | Provision for bad debts | Book value | Book balance | Provision for bad debts | Book value | |||||
| Amount | Proportion | Amount | Accrual proportion | Amount | Proportion | Amount | Accrual proportion | |||
| Account receivable individually accrued for provision of bad account | 10,681,600.08 | 0.25% | 10,681,600.08 | 100.00% | 0.00% | 0.00% | ||||
| Wherein: | ||||||||||
| Accounts receivable with bad debt provision accrued by portfolio | 1,736,488,867.38 | 99.75% | 18,912,928.79 | 1.09% | 1,717,575,938.59 | 1,367,120,440.35 | 100.00% | 68,565,959.12 | 5.02% | 1,298,554,481.23 |
| Wherein: | ||||||||||
| Credit term portfolio | 1,363,538,028.79 | 78.04% | 0.00 | 0.00% | 1,363,538,028.79 | |||||
| Aging portfolio | 372,950,838.59 | 21.35% | 18,912,928.79 | 1.09% | 354,037,909.80 | 1,367,120,440.35 | 100.00% | 68,565,959.12 | 5.02% | 1,298,554,481.23 |
| Total | 1,747,170,467.46 | 100.00% | 29,594,528.87 | 1.69% | 1,717,575,938.59 | 1,367,120,440.35 | 100.00% | 68,565,959.12 | 5.02% | 1,298,554,481.23 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Provision for bad debts by single account RMB 10,681,600.08
Unit: RMB
| Name | Ending balance | |||
| Book balance | Provision for bad debts | Accrual proportion | Reason for accruing | |
| Combined transport customers | 10,681,600.08 | 10,681,600.08 | 100.00% | Estimated to be unrecoverable |
| Total | 10,681,600.08 | 10,681,600.08 | -- | -- |
Provision for bad debts by single account
Unit: RMB
| Name | Ending balance | |||
| Book balance | Provision for bad debts | Accrual proportion | Reason for accruing | |
Provision for bad debts by portfolio: RMB 0.00
Unit: RMB
| Name | Ending balance | ||
| Book balance | Provision for bad debts | Accrual proportion | |
| Credit term portfolio | 1,363,538,028.79 | 0.00 | 0.00% |
| Total | 1,363,538,028.79 | 0.00 | -- |
Description of basis for this portfolio determination:
The debtor has no payment obligation for the receivables within the credit term, and historical experiences indicate that no debtdefault of customer occurs during the credit term.Provision for bad debts by portfolio: RMB 18,912,928.79
Unit: RMB
| Name | Ending balance | ||
| Book balance | Provision for bad debts | Accrual proportion | |
| Within 1 year (inclusive) | 368,256,294.35 | 18,412,814.71 | 5.00% |
| 1-2 year(s) | 4,596,348.05 | 459,634.81 | 10.00% |
| 2 - 3 years | 43,094.14 | 12,928.24 | 30.00% |
| 3 - 4 years | 55,102.05 | 27,551.03 | 50.00% |
| 4 - 5 years | 0.00 | 0.00 | 80.00% |
| Over 5 years | 0.00 | 0.00 | 100.00% |
| Total | 372,950,838.59 | 18,912,928.79 | -- |
Description of basis for this portfolio determination:
Receivables of same aging share similar characteristics of credit riskProvision for bad debts by portfolio:
Unit: RMB
| Name | Ending balance |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Book balance | Provision for bad debts | Accrual proportion |
Description of basis for this portfolio determination:
If the bad debt provision for accounts receivable is made according to the general model of expected credit losses, please discloserelevant information of bad debt provision according to the disclosure method of other receivables:
□Applicable √Not Applicable
Disclosure by aging
Unit: RMB
| Aging | Balance at the end of the period |
| Within 1 year (inclusive) | 1,736,940,256.66 |
| 1-2 year(s) | 9,410,985.41 |
| 2 - 3 years | 764,123.34 |
| Over 3 years | 55,102.05 |
| 3 - 4 years | 55,102.05 |
| 4 - 5 years | 0.00 |
| Over 5 years | 0.00 |
| Total | 1,747,170,467.46 |
The Company is required to comply with the disclosure requirements of the SZSE Industrial Information Disclosure Guide No. 12 -Listed Companies Engaged in Software and IT Services.The Company does not have any account receivable with age of more than 3 years and high single amount.
(2) Reserve of the bad debts that are accrued, withdrew and taken back in current periodAccrued provision for bad debts in this period:
Unit: RMB
| Type | Beginning balance | Change in this period | Ending balance | ||
| Accrual | Recovery or reversal | Cancellation after verification | |||
| Account receivable individually accrued for provision of bad account | 10,681,600.08 | 10,681,600.08 | |||
| Accounts receivable with bad debt provision accrued by portfolio | 68,565,959.12 | 49,653,030.33 | 18,912,928.79 | ||
| Total | 68,565,959.12 | 10,681,600.08 | 49,653,030.33 | 0.00 | 29,594,528.87 |
Including important provision for bad debt returned back or taken back in this current period:
Unit: RMB
| Organization name | Amount returned back or taken back | Change the way of return |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
(3) Top five arrears balance of accounts receivable by the end of the period
Unit: RMB
| Organization name | Book balance | Proportion in account receivable of accounts receivable | Provision for bad debts |
| No. 1 | 648,795,581.09 | 37.13% | 11,945,847.09 |
| No. 2 | 270,608,142.11 | 15.49% | - |
| No. 3 | 128,011,890.04 | 7.33% | 781.79 |
| No. 4 | 96,887,602.15 | 5.55% | 36,238.51 |
| No. 5 | 92,441,041.73 | 5.29% | 85,324.25 |
| Total | 1,236,744,257.12 | 70.79% | 12,068,191.64 |
4. Prepayments
(1) Prepayments listed by aging
Unit: RMB
| Aging | Closing balance | Beginning balance | ||
| Amount | Proportion | Amount | Proportion | |
| Within 1 year | 455,618,358.29 | 90.68% | 146,868,718.41 | 75.80% |
| 1 - 2 year(s) | 38,847,294.03 | 7.73% | 39,028,966.61 | 20.14% |
| 2 - 3 years | 4,253,718.15 | 0.85% | 4,642,733.10 | 2.40% |
| Over 3 years | 3,729,502.83 | 0.74% | 3,229,714.71 | 1.66% |
| Total | 502,448,873.30 | -- | 193,770,132.83 | -- |
The explanation for the reasons of failure in in-time settlement for significant amount of advance payment with aging of more than 1year:
Unit: RMB
| Organization name | Ending balance | Unsettlement reasons |
| Prepaid supplier I | 6,163,981.68 | The game has not been launched |
| Prepaid supplier II | 5,846,083.03 | Prepayments are being deducted |
| Subtotal | 12,010,064.71 |
(2) Top five ending balances of prepayments classified by prepayment objects:
Unit: RMB
| Organization name | Ending balance | Proportion in remaining pre-paid amount |
| No. 1 | 126,089,301.17 | 25.09% |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| No. 2 | 60,129,492.40 | 11.97% |
| No. 3 | 34,398,708.08 | 6.85% |
| No. 4 | 29,337,279.59 | 5.84% |
| No. 5 | 28,267,619.07 | 5.63% |
| Subtotal | 278,222,400.31 | 55.38% |
Other notes:
5. Other receivables
Unit: RMB
| Item | Ending balance | Beginning balance |
| Interests receivable | 64,445.20 | |
| Dividends receivable | 0.00 | |
| Other receivables | 92,363,339.09 | 792,361,183.70 |
| Total | 92,363,339.09 | 792,425,628.90 |
(1) Interest receivable
1) Classification of interests payable
Unit: RMB
| Item | Ending balance | Beginning balance |
| Fixed-term deposits | 0.00 | 64,445.20 |
| Total | 64,445.20 |
(2) Other receivables
1) Classification of other receivables based on the fund nature
Unit: RMB
| Fund nature | Ending book value | Opening book balance |
| Security, deposit and reserve | 55,705,678.80 | 69,863,183.59 |
| Receivable sharing and royalty | 16,154,711.03 | 33,563,609.65 |
| Equity-related receivables | 47,176,888.88 | 448,486,888.88 |
| Performance compensation receivables | 0.00 | 260,868,040.88 |
| Others | 6,429,081.90 | 7,073,939.79 |
| Total | 125,466,360.61 | 819,855,662.79 |
2) Accrual of bad debt provision
Unit: RMB
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Provision for bad debts | Stage I | Stage II | Stage III | Total |
| Expected credit losses in the next 12 months | Expected credit losses for the entire duration (without credit impairment) | Expected credit losses for the entire duration (with credit impairment) | ||
| Balance on January 1st, 2019 | 27,294,479.09 | 200,000.00 | 27,494,479.09 | |
| Balance on January 1st, 2019 is in the period | - | - | - | - |
| - Transferred to Stage II | -1,859,300.93 | 1,859,300.93 | 0.00 | |
| Accrual of the period | 18,738,152.85 | 18,738,152.85 | ||
| Reversal of the period | 13,129,610.42 | 13,129,610.42 | ||
| Balance on June 30th, 2019 | 12,305,567.74 | 20,797,453.78 | 33,103,021.52 |
For the provision for loss, is there any major change in book balances of the period?
□Applicable √Not Applicable
Disclosure by aging
Unit: RMB
| Aging | Balance at the end of the period |
| Within 1 year (inclusive) | 59,355,299.57 |
| Within 1 year (inclusive) | 59,355,299.57 |
| 1-2 year(s) | 56,060,036.04 |
| 2 - 3 years | 2,533,902.43 |
| Over 3 years | 7,517,122.57 |
| 3 - 4 years | 5,217,110.07 |
| 4 - 5 years | 12.50 |
| Over 5 years | 2,300,000.00 |
| Total | 125,466,360.61 |
3) Reserve of the bad debts that are accrued, withdrew and taken back in current period
Accrued provision for bad debts in this period:
Unit: RMB
| Type | Beginning balance | Change in this period | Ending balance | |
| Accrual | Recovery or reversal | |||
| Account receivable individually accrued for provision of bad account | 200,000.00 | 20,597,453.78 | 20,797,453.78 | |
| Accounts receivable with bad debt provision accrued by portfolio | 27,294,479.09 | 14,988,911.35 | 12,305,567.74 | |
| Total | 27,494,479.09 | 20,597,453.78 | 14,988,911.35 | 33,103,021.52 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Including important provision for bad debt transferred back or recovered in this period:
Unit: RMB
| Organization name | Amount carried forward or recovered | Change the way of return |
4) Other accounts receivable in top five based on year-end balance collected from arrears party
Unit: RMB
| Organization name | Fund nature | Ending balance | Aging | Proportion in total ending balance of other receivables | Ending balance of provision for bad debts |
| No. 1 | Equity disposal receivables | 42,768,000.00 | 1 - 2 year(s) | 34.47% | 10,926,508.41 |
| No. 2 | Security, deposit and reserve | 24,450,000.00 | 1 year | 25.15% | 1,222,500.00 |
| No. 3 | Security, deposit and reserve | 20,000,000.00 | 1 year | 20.57% | 1,000,000.00 |
| No. 4 | Amount to be recovered | 11,142,625.96 | 1 - 2 year(s) | 2.09% | 9,214,262.60 |
| No. 5 | Amount to be recovered | 5,000,000.00 | 2 - 3 years | 2.71% | 2,500,000.00 |
| Total | -- | 103,360,625.96 | -- | 84.99% | 24,863,271.01 |
6. Assets held-for-sale
Unit: RMB
| Item | Ending book value | Impairment provision | Carrying value at the end of the period | Fair value | Estimated disposal expense | Estimated disposal date |
| Available-for-sale financial assets | 7,536,816.46 | 7,536,816.46 | 7,536,816.46 | 0.00 | December 31st, 2019 | |
| Total | 7,536,816.46 | 7,536,816.46 | 7,536,816.46 | 0.00 | -- |
Other notes:
The above assets are expected to be disposed of within the next 12 months.
7. Other current assets
Have the new revenue standards been implemented?
□ Yes √ No
Unit:RMB
| Item | Ending balance | Beginning balance |
| Retained VAT and VAT to be certified | 119,783,320.81 | 115,335,389.59 |
| Prepaid income tax | 5,920,137.42 | 6,410,819.68 |
| Performance compensation receivables | 0.00 | 119,119,168.64 |
| Total | 125,703,458.23 | 240,865,377.91 |
Other notes:
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
The opening balance of the receivable performance compensation was generated because that Shanghai Mokun failed to fulfill its2018 annual performance commitment and its original shareholders’ compensation shares of 23,240,591 shares in total wererepurchased and cancelled according to relevant agreements during the reporting period.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
8. Long-term equity investment
Unit: RMB
| Invested company | Opening balance (book value) | Increase or decrease in this period | Ending balance (book value) | Ending balance of depreciation reserves | |||||||
| Additional investments | Negative investment | Profit and loss on investments confirmed with equity method | Other comprehensive income adjustment | Other equity change | Profit or cash dividend declared to be distributed | Withdrawn impairment provision | Others | ||||
| I. Joint ventures | |||||||||||
| II. Associates | |||||||||||
| Yangzhou Fuhai Sanqi Internet Cultural Investment Center (Limited Partnership) | 48,136,104.35 | -1,986,511.87 | 46,149,592.48 | ||||||||
| Shanghai Fenghua Qiushi Culture Media Co., Ltd. | 132,678,347.40 | 1,925,411.11 | 134,603,758.51 | ||||||||
| New Cues (Beijing) Television Investment Co., Ltd. | 101,285,461.34 | -1,039,585.34 | 100,245,876.00 | ||||||||
| Chengdu Pengwan Technology Co., Ltd. | 55,790,372.01 | -263,915.66 | 55,526,456.35 | ||||||||
| Sanqi Guangzheng (Guangzhou) Cultural Technology Investment Partnership (Limited Partnership) | 45,000,000.00 | 45,000,000.00 | |||||||||
| Mango (Xiamen) Creative Incubation Equity Investment Fund Partnership (Limited Partnership) | 39,163,509.62 | 29,315,220.72 | 27,828.40 | 9,876,117.30 | |||||||
| Shanghai Yuhouyi Network Technology Co., Ltd. | 20,233,958.82 | -272,274.96 | 19,961,683.86 | ||||||||
| Shanghai Jueli Culture Media Co., Ltd. | 27,593,699.69 | -979,081.27 | 26,614,618.42 | ||||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Chengdu Mofei Technology Co., Ltd. | 15,777,419.05 | -1,137,760.98 | 14,639,658.07 | ||||||||
| Jiangsu Yezi Network Technology Co., Ltd. | 13,901,748.49 | -328,184.42 | 13,573,564.07 | ||||||||
| Chengdu Popcorn Interactive Entertainment Technology Co., Ltd. | 11,611,786.40 | -510,002.93 | 11,101,783.47 | ||||||||
| Others | 44,429,606.82 | 8,900,000.00 | -1,608,814.57 | 14,789,077.01 | 36,931,715.24 | 26,949,181.42 | |||||
| Subtotal | 555,602,013.99 | 8,900,000.00 | 29,315,220.72 | -6,172,892.49 | 14,789,077.01 | 514,224,823.77 | 26,949,181.42 | ||||
| Total | 555,602,013.99 | 8,900,000.00 | 29,315,220.72 | -6,172,892.49 | 14,789,077.01 | 514,224,823.77 | 26,949,181.42 |
Other notes:
“Others” refer to a summary of equity investment with an ending balance of less than RMB 10 million.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
9. Other equity investment
Unit: RMB
| Item | Ending balance | Beginning balance | ||||||||
| Shenzhen Mokylin Technology Co., Ltd. | 60,000,000.00 | 60,000,000.00 | ||||||||
| Shenzhen QiFun Network Corp. Ltd. | 50,000,000.00 | 50,000,000.00 | ||||||||
| Archiact Interactive Ltd. | 21,650,889.40 | 21,624,422.86 | ||||||||
| Karma Game Beijing Limited | 17,000,000.00 | |||||||||
| Karma Game HK Limited | 12,918,608.00 | |||||||||
| Guangzhou Xuyang Network Technology Co., Ltd. | 11,000,000.00 | 1,000,000.00 | ||||||||
| Tianshe (Shanghai) Culture & Media Co., Ltd. | 10,000,000.00 | 10,000,000.00 | ||||||||
| Shanghai Original Plan Culture & Media Co. Ltd. | 10,000,000.00 | 10,000,000.00 | ||||||||
| Others | 54,066,483.88 | 43,946,971.81 | ||||||||
| Total | 246,635,981.28 | 196,571,394.67 | ||||||||
| Unit: RMBProject name | Recognized dividend income | Accumulated gains | Accumulated losses | Amount of other comprehensive income transferred to retained income | Reason for measurement by fair value and change being recognized in other comprehensive income | Reason for other comprehensive income transferred to retained income | ||||
| Shenzhen Mokylin Technology Co., Ltd. | Non-trading equity investment | |||||||||
| Shenzhen QiFun Network Corp. Ltd. | Non-trading equity investment | |||||||||
| Archiact Interactive Ltd. | Non-trading equity investment | |||||||||
| Karma Game Beijing Limited | Non-trading equity investment | |||||||||
| Karma Game HK Limited | Non-trading equity investment | |||||||||
| Guangzhou Xuyang Network Technology Co., Ltd. | Non-trading equity investment | |||||||||
| Tianshe (Shanghai) Culture & Media Co., Ltd. | Non-trading equity investment | |||||||||
| Shanghai Original Plan Culture & Media Co. Ltd. | Non-trading equity investment | |||||||||
| Others | Non-trading equity investment | |||||||||
Other notes：
“Others” refer to a summary of equity investment with an ending balance of less than RMB 10 million.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
10. Other non-current financial assets
Unit: RMB
| Item | Ending balance | Beginning balance |
| Shanghai Mango Creative Equity Investment Fund (L.P.) | 173,581,491.41 | 173,581,491.41 |
| X.D. Network | 100,055,903.60 | 100,050,000.00 |
| Tianjin Digital Color Interactive Technology Co., Ltd. | 80,000,000.00 | 80,000,000.00 |
| Mango Excellent Media Co., Ltd. | 74,486,294.30 | 67,155,608.00 |
| Hangzhou Southern Pictures Co., Ltd. | 64,997,287.11 | 69,996,897.11 |
| Chengdu 91ACT Technology Company | 52,731,000.00 | 52,731,000.00 |
| Shenzhen Zhonghui Television Culture Communication Co., Ltd. | 50,000,000.00 | 50,000,000.00 |
| Jiangsu Mingtong Information Technology Co., Ltd. | 50,000,000.00 | 50,000,000.00 |
| Beijing Chinese Anci Equity Investment Fund Management Center (Limited Partnership) | 42,748,550.00 | 50,000,000.00 |
| SNK Corporation | 36,600,182.47 | 1,036.35 |
| Hebei Youying Culture Spreading Co., Ltd. | 26,800,000.00 | 26,800,000.00 |
| Beijing Chenming Media Co., Ltd. | 25,000,000.00 | 25,000,000.00 |
| Tianjin Purple Dragon Singular Point Interactive Entertainment Co., Ltd. | 23,115,789.90 | 23,115,789.90 |
| Zen-game Technology | 17,217,313.29 | 18,000,000.00 |
| Hangzhou Honghua Duoduo Network Technology Co., Ltd. | 16,978,390.00 | 16,978,390.00 |
| Shanghai Touch Culture Communication Co., Ltd. | 15,000,000.00 | 15,000,000.00 |
| YHKT Entertainment Co., Ltd. | 14,400,000.00 | 14,400,000.00 |
| Suzhou Youge Huaxin Venture Investment Center (Limited Partnership) | 10,500,000.00 | |
| Shanghai Zhangmeng Network Technology Co., Ltd. | 10,000,000.00 | 10,000,000.00 |
| Najia Technology (Shenzhen) Co., Ltd. | 40,000,000.00 | |
| Others | 48,269,419.37 | 39,909,418.11 |
| Total | 932,481,621.45 | 922,719,630.88 |
Other notes:
“Others” refer to a summary of equity investment with an ending balance of less than RMB 10 million.
11. Fixed assets
Unit: RMB
| Item | Ending balance | Beginning balance |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Fixed assets | 36,385,942.05 | 36,458,454.56 |
| Liquidation of fixed assets | 0.00 | 0.00 |
| Total | 36,385,942.05 | 36,458,454.56 |
(1) Status of fixed assets
Unit: RMB
| Item | Motor vehicles | Electric and office equipment | Total |
| I. Original carrying value: | |||
| 1. Balance at the beginning of this period | 6,424,328.85 | 116,980,511.36 | 123,404,840.21 |
| 2. Increase of this period | 683,185.84 | 10,673,356.07 | 11,356,541.91 |
| (1) Purchasing | 683,185.84 | 10,647,900.74 | 11,331,086.58 |
| (2) Construction in progress transferred-in | |||
| (3) Increase by business combination | |||
| (4) Exchange conversion | 25,455.33 | 25,455.33 | |
| 3. Decrease of this period | 3,918,238.46 | 8,509,193.94 | 12,427,432.40 |
| (1) Disposal or discard as useless | 1,296,997.73 | 1,296,997.73 | |
| (2) Disposal of subsidiaries | 3,918,238.46 | 7,212,196.21 | 11,130,434.67 |
| 4. Closing balance | 3,189,276.23 | 119,144,673.49 | 122,333,949.72 |
| II. Accumulated depreciation | |||
| 1. Balance at the beginning of this period | 3,134,095.70 | 83,812,289.95 | 86,946,385.65 |
| 2. Increase of this period | 331,780.58 | 6,900,230.23 | 7,232,010.81 |
| (1) Accruing | 331,780.58 | 6,884,900.75 | 7,216,681.33 |
| (2) Exchange conversion | 15,329.48 | 15,329.48 | |
| 3. Decrease of this period | 1,605,267.63 | 6,625,121.16 | 8,230,388.79 |
| (1) Disposal or discard as useless | 1,059,850.53 | 1,059,850.53 | |
| (2) Disposal of subsidiaries | 1,605,267.63 | 5,565,270.63 | 7,170,538.26 |
| 4. Closing balance | 1,860,608.65 | 84,087,399.02 | 85,948,007.67 |
| III. Provision for impairment of assets | |||
| 1. Balance at the beginning of this period | |||
| 2. Increase of this period |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| (1) Accruing | |||
| 3. Decrease of this period | |||
| (1) Disposal or discard as useless | |||
| 4. Closing balance | |||
| IV. Book value | |||
| 1. Ending book value | 1,328,667.58 | 35,057,274.47 | 36,385,942.05 |
| 2. Book value at the beginning of period | 3,290,233.15 | 33,168,221.41 | 36,458,454.56 |
12. Construction in progress
Unit: RMB
| Item | Ending balance | Beginning balance |
| Construction in progress | 751,293,007.77 | 0.00 |
| Total | 751,293,007.77 | 0.00 |
(1) Status of construction under progress
Unit: RMB
| Item | Ending balance | Balance at the beginning of the period | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
| Office building | 751,293,007.77 | 751,293,007.77 | ||||
| Total | 751,293,007.77 | 751,293,007.77 | 0.00 | |||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
(2) Change of significant construction during the period
Unit: RMB
| Project name | Budget | Beginning balance | Increased amount of current period | Amount of transfer-in fixed assets at current period | Amount of other decreases of this period | Ending balance | Proportion of accumulative engineering investment in budget | Project progress | Accumulated amount of capitalized interest | Wherein: Amount of capitalized interest in current period | Capitalization rate of interest for this period | Capital sources |
| Office building | 0.00 | 751,293,007.77 | 0.00 | 0.00 | 751,293,007.77 | 0.00 | 0.00 | 0.00% | Others | |||
| Total | 0.00 | 751,293,007.77 | 0.00 | 0.00 | 751,293,007.77 | -- | -- | -- |
13. Intangible assets
(1) Status of intangible assets
Unit: RMB
| Item | Cost of publication number | Domain name | Game copyright | Trademark | Office software | Total |
| I. Original carrying value | ||||||
| 1. Balance at the beginning of this period | 354,930.00 | 12,778,182.04 | 93,439,716.94 | 865,764.31 | 12,360,394.64 | 119,798,987.93 |
| 2. Increase of this period | 262.99 | 1,769,927.00 | 1,770,189.99 | |||
| (1) Purchasing | 1,769,911.60 | 1,769,911.60 | ||||
| (2) Internal R&D | ||||||
| (3) Increase by business combination |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| (4) Exchange conversion | 262.99 | 15.40 | 278.39 | |||
| 3. Decrease of this period | ||||||
| (1) Disposal | ||||||
| 4. Closing balance | 354,930.00 | 12,778,182.04 | 93,439,716.94 | 866,027.30 | 14,130,321.64 | 121,569,177.92 |
| II. Accumulated amortization | ||||||
| 1. Balance at the beginning of this period | 354,930.00 | 3,034,818.47 | 62,856,266.86 | 373,698.10 | 8,035,094.35 | 74,654,807.78 |
| 2. Increase of this period | 319,454.58 | 55,249.98 | 42,260.64 | 1,370,337.56 | 1,787,302.76 | |
| (1) Accruing | 319,454.58 | 55,249.98 | 42,009.12 | 1,370,322.15 | 1,787,035.83 | |
| (2) Exchange conversion | 251.52 | 15.41 | 266.93 | |||
| 3. Decrease of this period | ||||||
| (1) Disposal | ||||||
| 4. Closing balance | 354,930.00 | 3,354,273.05 | 62,911,516.84 | 415,958.74 | 9,405,431.91 | 76,442,110.54 |
| III. Provision for impairment of assets | ||||||
| 1. Balance at the beginning of this period | 30,440,779.99 | 406,963.12 | 30,847,743.11 | |||
| 2. Increase of this period | ||||||
| (1) Accruing | ||||||
| 3. Decrease of this period | ||||||
| (1) Disposal |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 4. Closing balance | 30,440,779.99 | 406,963.12 | 30,847,743.11 | |||
| IV. Book value | ||||||
| 1. Ending book value | 0.00 | 9,423,908.99 | 87,420.11 | 450,068.56 | 4,317,926.61 | 14,279,324.27 |
| 2. Book value at the beginning of period | 0.00 | 9,743,363.57 | 142,670.09 | 492,066.21 | 3,918,337.17 | 14,296,437.04 |
The ratio of intangible assets formed through the internal research and development of the Company at the end of the period to the balance of intangible assets is 16.24%.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
14. Development expenditure
Unit: RMB
| Item | Beginning balance | Increased amount of current period | Decreased amount of current period | Ending balance | ||||
| Internal development expenses | Others | Defined as intangible assets | Transferred to current profits and losses | |||||
| Item I | 6,205,796.16 | 6,205,796.16 | 0.00 | |||||
| Total | 6,205,796.16 | 6,205,796.16 | 0.00 | |||||
Other notesOther notes
15. Goodwill
(1) Carrying value of goodwill
Unit: RMB
| Name of the invested company and the matter which forms goodwill | Beginning balance | Increase in current period | Decrease in current period | Ending balance | ||
| Formed through business combination | Others | Disposal | ||||
| Shanghai Sanqi Interactive Entertainment | 1,578,065,048.53 | 1,578,065,048.53 | ||||
| Chengdu Shengge Times Network Technology Co., Ltd. | 263,737.88 | 263,737.88 | ||||
| Shanghai Mokun | 1,259,793,586.00 | 1,259,793,585.93 | 0.00 | |||
| Total | 2,838,122,372.34 | 1,259,291,236.70 | 1,578,328,786.41 | |||
(2) Goodwill impairment
Unit: RMB
| Name of the invested company and the matter which forms goodwill | Beginning balance | Increase in current period | Decrease in current period | Ending balance | ||
| Withdrawing | Others | Disposal | Others | |||
| Chengdu Shengge Times Network Technology Co., Ltd. | 263,737.88 | 263,737.88 | ||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Shanghai Mokun | 1,259,291,236.70 | 1,259,291,236.70 | 0.00 | |||
| Total | 1,259,554,974.58 | 1,259,291,236.70 | 263,737.88 |
Information about the asset group or portfolio in which the goodwill is recognizedExplain the process of goodwill impairment test, key parameters (such as the growth rate in forecast period, growth rate in steadyperiod, profit rate, discount rate, forecast period, etc. for estimation of the present value of future cash flows), and the recognitionmethod of goodwill impairment loss:
Impact of goodwill impairment testOther notes
16. Long-term prepaid expenses
Unit: RMB
| Item | Beginning balance | Increased amount of current period | Amortization amount of the current period | Other decreases | Ending balance |
| Cost of copyright agency | 70,174,940.95 | 39,004,517.78 | 38,190,510.02 | -69,639.51 | 71,058,588.22 |
| Trade mark registration fee | 2,943.26 | 2,943.26 | 0.00 | ||
| Cost of building decoration | 4,108,662.28 | 1,048,583.96 | 28,543.71 | 3,031,534.61 | |
| Total | 74,286,546.49 | 39,004,517.78 | 39,242,037.24 | -41,095.80 | 74,090,122.83 |
Other notes
17. Deferred tax assets and deferred tax liabilities
(1) Non-offset deferred income tax assets
Unit: RMB
| Item | Ending balance | Beginning balance | ||
| Deductible temporary differences | Deferred income tax assets | Deductible temporary differences | Deferred income tax assets | |
| Provision for assets impairment | 49,161,428.01 | 7,790,147.85 | 130,272,445.92 | 22,476,347.10 |
| Deductible losses | 23,377,176.05 | 3,718,400.30 | ||
| Accrued performance compensation receivables | 7,536,817.40 | 1,130,522.61 | ||
| Total | 49,161,428.01 | 7,790,147.85 | 161,186,439.37 | 27,325,270.01 |
(2) Non-offset deferred income tax liabilities
Unit: RMB
| Item | Ending balance | Beginning balance | ||
| Taxable temporary | Deferred income tax | Taxable temporary | Deferred income tax | |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| difference | liabilities | difference | liabilities | |
| Changes in fair value of available-for-sale financial assets | 0.00 | 0.00 | 31,572,708.00 | 4,735,906.20 |
| Total | 0.00 | 0.00 | 31,572,708.00 | 4,735,906.20 |
(3) The deferred tax assets or debt reported in the net amount after offset
Unit: RMB
| Item | Amount of offsetting between the deferred tax assets and liabilities at the end of the period | Closing balance of the deferred tax assets or liabilities after offsetting between them | Amount of offsetting between the deferred income tax assets and liabilities at the beginning of the period | Opening balance of the deferred tax assets or liabilities after offsetting between them |
| Deferred income tax assets | 0.00 | 7,790,147.85 | 0.00 | 27,325,270.01 |
| Deferred income tax liabilities | 0.00 | 0.00 | 4,735,906.20 |
(4) Details of unrecognized deferred income tax assets
Unit: RMB
| Item | Ending balance | Beginning balance |
| Deductible temporary differences | 98,551,675.35 | 80,408,693.08 |
| Deductible losses | 659,818,310.43 | 122,954,217.39 |
| Total | 758,369,985.78 | 203,362,910.47 |
(5) Deductible losses of unrecognized deferred income tax assets will be expired at the end of followingyears
Unit: RMB
| Year | Amount at the end of the period | Initial amount | Remarks |
| 2020 | 882,980.60 | 2,058,386.09 | |
| 2021 | 14,790.08 | 18,045,171.61 | |
| 2022 | 22,278,522.68 | 85,382,375.75 | |
| 2023 | 42,404,201.76 | 17,468,283.94 | |
| After 2023 | 594,237,815.31 | ||
| Total | 659,818,310.43 | 122,954,217.39 | -- |
Other notes:
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
18. Other non-current assets
Have the new revenue standards been implemented?
□ Yes √ No
Unit: RMB
| Item | Ending balance | Beginning balance |
| Prepayment for house purchase | 58,269,048.52 | 801,611,138.04 |
| Total | 58,269,048.52 | 801,611,138.04 |
Other notes:
19. Short-term loans
(1) Classification of short-term loans
Unit: RMB
| Item | Ending balance | Beginning balance |
| Guaranteed loans | 369,000,000.00 | |
| Total | 369,000,000.00 |
Description of classification of other short-term borrowings:
20. Notes payable
Unit: RMB
| Type | Ending balance | Beginning balance |
| Bank acceptance bills | 30,000,000.00 | |
| Total | 30,000,000.00 | 0.00 |
The due and unpaid payable note at the end of the period is RMB 0.00.
21. Accounts payable
(1) List of accounts payable
Unit: RMB
| Item | Ending balance | Beginning balance |
| Payable shared profits of games | 647,422,034.40 | 508,051,919.40 |
| Payable internet promotion and traffic costs | 436,126,375.84 | 560,422,006.00 |
| Other payable costs | 17,126,445.95 | 13,888,442.89 |
| Total | 1,100,674,856.19 | 1,082,362,368.29 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
(2) Significant accounts payable with age of more than one year
Unit: RMB
| Item | Ending balance | Reasons for outstanding or non-carryover |
| Payable supplier I | 5,572,750.32 | In the process of reconciliation |
| Payable supplier II | 14,998,419.30 | Means of settlement is under negotiation |
| Total | 20,571,169.62 | -- |
Other notes:
22. Account received in advance
Have the new revenue standards been implemented?
□ Yes √ No
(1) List of account received in advance
Unit: RMB
| Item | Ending balance | Beginning balance |
| Recharge received in advance | 180,060,823.75 | 94,547,117.27 |
| Others | 98,823.77 | 81,625.32 |
| Total | 180,159,647.52 | 94,628,742.59 |
23. Staff salaries payable
(1) List of staff salaries payable
Unit: RMB
| Item | Balance at the beginning of the period | Increase in current period | Decrease in current period | Ending balance |
| I. Short-term remuneration | 121,133,549.27 | 370,773,545.96 | 372,261,897.81 | 119,645,197.42 |
| II. Post-employment benefit-defined contribution plans | 674,799.08 | 17,721,260.80 | 18,082,248.64 | 313,811.24 |
| III. Dismiss welfares | 170,052.83 | 4,445,093.56 | 3,079,146.39 | 1,536,000.00 |
| IV. Other welfare due within one year | 0.00 | 0.00 | 0.00 | 0.00 |
| Total | 121,978,401.18 | 392,939,900.32 | 393,423,292.84 | 121,495,008.66 |
(2) List of short-term remuneration
Unit: RMB
| Item | Balance at the beginning of the period | Increase in current period | Decrease in current period | Closing balance |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 1. Salaries, bonus, allowances and subsidies | 120,493,925.04 | 326,788,365.29 | 328,008,823.28 | 119,273,467.05 |
| 2. Staff welfare expenses | 0.00 | 22,857,652.29 | 22,857,652.29 | 0.00 |
| 3. Social insurance premiums | 379,477.06 | 10,106,054.60 | 10,306,547.79 | 178,983.87 |
| Wherein: Medical insurance premiums | 332,631.49 | 8,471,033.80 | 8,653,618.93 | 150,046.36 |
| Industrial injuries insurance premium | 5,586.28 | 241,926.16 | 243,225.40 | 4,287.04 |
| Maternity insurance premiums | 33,864.00 | 1,028,646.36 | 1,044,290.45 | 18,219.91 |
| Critical illness insurance | 7,395.29 | 364,448.27 | 365,413.00 | 6,430.56 |
| 4. Housing provident fund | 249,061.00 | 9,660,969.30 | 9,729,454.90 | 180,575.40 |
| 5. Union expenses and employee educational expenditure | 11,086.17 | 1,360,504.48 | 1,359,419.55 | 12,171.10 |
| Total | 121,133,549.27 | 370,773,545.96 | 372,261,897.81 | 119,645,197.42 |
(3) List of defined contribution plans
Unit: RMB
| Item | Balance at the beginning of the period | Increase in current period | Decrease in current period | Closing balance |
| 1. Basic endowment insurance | 654,126.16 | 16,946,755.18 | 17,300,788.62 | 300,092.72 |
| 2. Unemployment insurance premiums | 20,672.92 | 774,505.62 | 781,460.02 | 13,718.52 |
| Total | 674,799.08 | 17,721,260.80 | 18,082,248.64 | 313,811.24 |
Other notes:
24. Tax payable
Unit: RMB
| Item | Ending balance | Beginning balance |
| VAT | 17,212,333.91 | 33,574,036.91 |
| Enterprise income tax | 67,656,481.38 | 51,032,839.33 |
| Individual income tax | 48,720.38 | 971,561.88 |
| Urban maintenance and construction tax | 905,870.42 | 1,366,222.30 |
| Education surtax | 388,417.51 | 590,668.51 |
| Local education surcharge | 258,945.00 | 392,703.75 |
| Water conservancy funds | 650,442.49 | 397,874.74 |
| Stamp tax | 874,846.00 | 591,306.68 |
| Outbound income tax | 467,769.92 | 358,410.10 |
| Embankment protection fee | 179.23 | |
| Total | 88,463,827.01 | 89,275,803.43 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Other notes:
25. Other payables
Unit: RMB
| Item | Ending balance | Beginning balance |
| Interests payable | 52,841.84 | |
| Dividends payable | 417,980,832.00 | 0.00 |
| Other payables | 134,326,337.79 | 108,089,757.99 |
| Total | 552,307,169.79 | 108,142,599.83 |
(1) Interest payable
Unit: RMB
| Item | Ending balance | Beginning balance |
| Interest payable for short-term loan | 52,841.84 | |
| Total | 52,841.84 |
Significant interest overdue but unpaid:
Unit: RMB
| Borrower | Default penalty | Overdue reason |
Other notes:
(2) Dividend payable
Unit: RMB
| Item | Ending balance | Beginning balance |
| Dividends on common stock | 417,980,832.00 | 0.00 |
| Total | 417,980,832.00 | 0.00 |
Other instructions, including important dividends payable unpaid for more than 1 year, should disclose the reasons for thenon-payment:
(3) Other payables
1) Other accounts payable listed by the nature of accounts
Unit: RMB
| Item | Ending balance | Beginning balance |
| Deposit and guarantee deposit | 9,240,000.00 | 8,360,000.00 |
| Investment funds payable | 11,000,000.00 | 8,500,000.00 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Temporary payment for equity payment | 109,936,207.21 | 86,936,207.21 |
| Others | 4,150,130.58 | 4,293,550.78 |
| Total | 134,326,337.79 | 108,089,757.99 |
2) Other significant accounts payable with age of more than one year
Unit: RMB
| Item | Ending balance | Reasons for outstanding or non-carryover |
| Ningbo Xishan Investment Partnership (limited partnership) | 41,246,292.00 | Transaction not completed yet |
| Total | 41,246,292.00 | -- |
Other notes
26. Non-current liability due within one year
Unit: RMB
| Item | Ending balance | Beginning balance |
| Long-term loans due within 1 year | 30,282,389.93 | 29,599,165.73 |
| Total | 30,282,389.93 | 29,599,165.73 |
Other notes:
Non-current liabilities due within one year are the mortgage loans due within one year for house purchase by legal persons that areused by the subsidiaries of the Company for the purchase of office space.
27. Other current liabilities
Have the new revenue standards been implemented?
□ Yes √ No
Unit: RMB
| Item | Ending balance | Beginning balance |
| Temporarily estimated output tax | 69,171,032.23 | 89,719,750.76 |
| Payable performance compensation | 7,536,817.40 | 7,536,817.40 |
| Total | 76,707,849.63 | 97,256,568.16 |
Movements in short-term bonds payable:
Unit: RMB
| Name of bonds | Nominal value | Issuing date | Bond period | Issuing amount | Beginning balance | Issuance in the current period | Withdrawing interest at par | Amortization of premium or discount | Repayments in the current period | Ending balance |
Other notes:
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
28. Long-term loans
(1) Classification of long-term loans
Unit: RMB
| Item | Ending balance | Beginning balance |
| Mortgage, guaranteed loan | 265,883,241.55 | 281,176,106.33 |
| Total | 265,883,241.55 | 281,176,106.33 |
Description of classification of other long-term borrowings:
Long-term borrowings are the mortgage loans for house purchase by legal persons that are used by the subsidiaries of the Companyfor the purchase of office space. The Company assumes joint and several liabilities for these borrowings.Other instructions, including interest rate range:
The applicable interest rate is 105% of the benchmark interest rate for 5-year RMB loans from financial institutions.
29. Deferred income
Unit: RMB
| Item | Balance at the beginning of the period | Increase in current period | Decrease in current period | Ending balance | Cause |
| Deferred income from royalty income | 3,903,715.32 | 1,639,020.78 | 2,264,694.54 | Game copyright payment to be amortized | |
| Total | 3,903,715.32 | 1,639,020.78 | 2,264,694.54 | -- |
Items revolving governmental subsidies:
Unit: RMB
| Items of liabilities | Beginning balance | Amounts of new subsidies in current period | Amount of non-operating income in current period | Amount of other income in current period. | Amount of cost offset in the current period | Other movements | Ending balance | Related to assets/income |
Other notes:
30. Share capital
Unit: RMB
| Beginning balance | Changes (+/-) in this time | Ending balance | |||||
| Stock issue | Dividend stock | Shares converted from accumulated reserves | Others | Subtotal | |||
| Total number of shares | 2,124,870,253.00 | -12,618,556.00 | -12,618,556.00 | 2,112,251,697.00 | |||
Other notes:
The total number of compensation shares for performance commitment repurchased and cancelled by the Company during the
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
reporting period was 12,618,556 shares. The shares repurchased were cancelled at Shenzhen Branch of China Securities Depositoryand Clearing Corporation Limited (CSDC) on June 26th, 2019.
31. Capital reserves
Unit: RMB
| Item | Balance at the beginning of the period | Increase in current period | Decrease in current period | Ending balance |
| Capital Premium (share premium) | 295,818,167.99 | 106,500,613.64 | 189,317,554.35 | |
| Other capital reserves | 2,921,799.22 | 2,921,799.22 | ||
| Total | 298,739,967.21 | 106,500,613.64 | 192,239,353.57 |
Other notes, involving changes in the current period and change reasons:
The capital reserve premium decreased in the current period, because the compensation shares provided by the original shareholdersof Shanghai Mohan due to the failure of performance commitments in 2018 were cancelled in the current period to offset the capitalreserve of RMB 106,500,613.64.
32. Treasury stock
Unit: RMB
| Item | Balance at the beginning of the period | Increase in current period | Decrease in current period | Ending balance |
| Treasury stock | 302,007,311.87 | 302,007,311.87 | ||
| Total | 302,007,311.87 | 302,007,311.87 |
Other notes, involving changes in the current period and change reasons:
During the reporting period, the Company repurchased 22,347,537 shares through a stock repurchase special securities account bycentralized competitive bidding. The total amount paid for repurchase and transaction was RMB 302,007,311.87 in total.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
33. Other comprehensive income
Unit: RMB
| Item | Beginning balance | Amount incurred in the current period | Ending balance | |||||
| Accrual before income tax in this period | Less: The amount calculated in other comprehensive income in earlier period and carried over to profit and loss in current period. | Less: Other comprehensive income in earlier period carried over to retained income in current period | Less: Income taxes | Attributable to parent company after tax | Attributable to minority shareholders after tax | |||
| II. Other comprehensive incomes that would be classified into profit and loss | 19,539,544.78 | -25,288.71 | -25,288.71 | 19,514,256.07 | ||||
| Translation difference in the foreign currency financial statement | 19,539,544.78 | -25,288.71 | -25,288.71 | 19,514,256.07 | ||||
| Other total comprehensive income | 19,539,544.78 | -25,288.71 | -25,288.71 | 19,514,256.07 | ||||
Other notes, involving conversion of the effective component of the cash flow hedging profit and loss to the initially recognized amount of the hedged items:
34. Surplus reserves
Unit: RMB
| Item | Balance at the beginning of the period | Increase in current period | Decrease in current period | Ending balance |
| Statutory surplus reserves | 170,477,835.88 | 170,477,835.88 | ||
| Total | 170,477,835.88 | 170,477,835.88 |
Surplus reserve notes, involving changes in the current period and change reasons:
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
35. Undistributed profits
Unit: RMB
| Item | Current period | Previous period |
| Adjustment of undistributed profits of previous year | 3,332,211,003.19 | 2,819,597,585.78 |
| Adjustment of undistributed profits by beginning of the period (Add + /subtract -) | 26,836,801.80 | |
| Undistributed profits at the beginning of the period after adjustment | 3,359,047,804.99 | 2,819,597,585.78 |
| Add: Net profit owned by parent company owners in this year | 1,033,074,405.38 | 801,378,948.23 |
| Dividends payable on common stock | 417,980,832.00 | 212,487,025.30 |
| Undistributed profits at the end of the period | 3,974,141,378.37 | 3,408,489,508.71 |
Details of undistributed profits at the beginning of adjustment period:
1) Due to retroactive adjustment of Enterprise Accounting Standard and its relevant new provisions, the affected undistributed profitat the beginning of the period is RMB 26,836,801.80.
2) Due to changes in accounting policies, the affected undistributed profit at the beginning of the period is RMB 0.00.
3) Due to correction of significant accounting errors, the affected undistributed profit at the beginning of the period is RMB 0.00.
4) Due to changes of consolidation scope caused by the same control, the affected undistributed profit at the beginning of the periodis RMB 0.00.
5) Due to all the other adjustments, the affected undistributed profit at the beginning of the period is RMB 0.00.
36. Operating income and operating costs
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period | ||
| Income | Cost | Income | Cost | |
| Main business | 6,070,957,503.06 | 838,986,561.51 | 3,302,496,146.77 | 886,273,600.84 |
| Total | 6,070,957,503.06 | 838,986,561.51 | 3,302,496,146.77 | 886,273,600.84 |
Have the new revenue standards been implemented?
□ Yes √ No
Other notes
37. Taxes and additional charges
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Urban maintenance and construction tax | 6,172,602.07 | 4,948,385.78 |
| Education surtax | 2,647,382.39 | 2,249,705.79 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Housing property tax | 709,881.81 | |
| Land use tax | 1,491,346.02 | |
| Vehicle and vessel use tax | 5,786.00 | |
| Stamp tax | 5,887,808.42 | 4,040,180.13 |
| Local education surcharge | 1,763,620.77 | 1,499,803.86 |
| Water conservancy construction fund | 3,906,174.99 | 899,614.72 |
| Others | 14,783.32 | |
| Total | 20,392,371.96 | 15,844,704.11 |
Other notes:
38. Sales expense
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Salary and welfare | 67,946,816.49 | 58,178,715.37 |
| Depreciation cost | 366,206.32 | 1,183,914.65 |
| Office expense | 1,177,474.71 | 841,929.24 |
| Internet traffic fee | 3,558,291,208.95 | 1,065,490,253.23 |
| Traveling expense | 616,366.75 | 1,250,701.25 |
| Transportation and storage fees | 11,259,054.71 | |
| Entertainment expenses | 1,446,225.44 | 2,796,751.98 |
| Others | 2,223,223.18 | 2,477,174.51 |
| Total | 3,632,067,521.84 | 1,143,478,494.94 |
Other notes:
39. Management expense
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Salary and welfare | 62,419,050.34 | 73,347,048.30 |
| Office expense | 3,809,689.53 | 9,433,016.34 |
| Traveling and conference fees | 3,034,384.13 | 6,939,636.95 |
| Fees of depreciation and amortization | 1,683,992.38 | 7,703,961.58 |
| Business entertainment expense | 4,209,103.29 | 6,595,354.94 |
| Rentals | 7,866,253.84 | 10,477,606.15 |
| Agency and consulting fees | 4,778,608.36 | 9,806,211.13 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Share payment | ||
| Others | 252,756.81 | 3,632,089.05 |
| Total | 88,053,838.68 | 127,934,924.44 |
Other notes:
40. R&D expense
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Salary and welfare | 271,801,617.49 | 193,673,609.70 |
| Operation and maintenance fees | 17,842,148.02 | 20,486,409.91 |
| Fees of depreciation and amortization | 12,268,281.05 | 6,228,919.76 |
| Design cost | 9,427,709.39 | 21,767,674.58 |
| Traveling and transportation expenses | 2,678,081.45 | 3,295,910.41 |
| Office expense | 4,164,613.26 | 3,558,828.12 |
| Rent and office utilities | 3,575,323.68 | 2,058,966.19 |
| Others | 2,941,895.98 | 6,773,547.40 |
| Total | 324,699,670.32 | 257,843,866.07 |
Other notes:
41. Financial expenses
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Interest payment | 16,306,707.81 | 21,337,173.26 |
| Service charges and others paid to financial authorities | 590,754.01 | 234,059.11 |
| Less: Interest incomes | 12,445,472.86 | 9,241,560.12 |
| Exchange gains and losses | -118,447.24 | 1,628,761.68 |
| Total | 4,333,541.72 | 13,958,433.93 |
Other notes:
42. Other profits
Unit: RMB
| Sources of other incomes | Amount incurred in the current period | Amount incurred in the previous period |
| VAT immediate levy and refund | 18,148,222.30 | 26,890,901.13 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| VAT (for addition or deduction) | 7,729,525.95 | |
| Other government subsidies | 23,416,359.86 | 15,994,304.90 |
| Total | 49,294,108.11 | 42,885,206.03 |
43. Investment income
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Long-term equity investment income measured by equity method | -6,172,892.49 | -4,090,378.50 |
| Investment profits by the disposal of long-term equity investment | 9,045,006.87 | 3,511,999.12 |
| Investment income of trading financial assets during the holding period | 1,701,000.00 | |
| Investment profit by the disposal of trading financial assets | 3,187,375.98 | |
| Investment income of available-for-sale financial assets during the holding period | 1,194,183.75 | |
| Investment profit by the disposal of marketable financial assets | 16,461,078.84 | |
| Bank yields from financial products | 11,172,479.46 | 6,670,822.43 |
| Total | 18,932,969.82 | 23,747,705.64 |
Other notes:
44. Profits from change in fair value
Unit: RMB
| Sources of profits from change of fair value | Amount incurred in the current period | Amount incurred in the previous period |
| Trading financial assets | 41,603,452.48 | |
| Total | 41,603,452.48 |
Other notes:
45. Credit impairment loss
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Bad debt loss of other receivables | -3,143,317.39 | |
| Losses on bad debts of account receivables | 36,237,705.83 | |
| Total | 33,094,388.44 |
Other notes:
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
46. Asset impairment losses
Have the new revenue standards been implemented?
□ Yes √ No
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| I. Losses on bad debts | -2,355,927.32 | |
| II. Inventory devaluation losses | 214,247.31 | |
| V. Long-term equity investment impairment losses | -14,789,077.01 | |
| Total | -14,789,077.01 | -2,141,680.01 |
Other notes:
47. Income from disposal of assets
Unit: RMB
| Source of income from asset disposal | Amount incurred in the current period | Amount incurred in the previous period |
| Gains (losses) from disposal of fixed assets | -77,711.53 | 4,411.96 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
48. Non-operating income
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period | Amount recognized into current non-recurring profits and losses |
| Tort compensation | 3,074,941.61 | 725,408.11 | 3,074,941.61 |
| Others | 8,055.54 | 351,138.99 | 8,055.54 |
| Total | 3,082,997.15 | 1,076,547.10 |
Government subsidy recognized in current losses and gains:
Unit: RMB
| Subsidy items | Entity | Reason | Nature and type | Do subsidies affect the profit and loss of the year? | Whether it is a special subsidy or not? | Amount incurred in this period | Amount incurred in the previous period | Related to assets/income |
| VAT immediate levy and refund | Tax bureaus in Shanghai, Guangzhou, Huai’an, etc. | Subsidies | Subsidies received from the government to encourage and support specific industries and segments (according to national policies and regulations) | No | No | 18,148,222.30 | 26,890,901.13 | Related to income |
| Return of handling charges of individual income tax | Tax bureaus in Guangzhou, Huai’an, Shanghai, Nanling County (Anhui), etc. | Subsidies | Subsidies received from the government for the protection of certain utility services or socially necessary product supply or price control functions | No | No | 53,440.62 | 583,643.95 | Related to income |
| Subsidy for post stability | Social insurance fund management centers in Guangzhou, Huai’an, Wuhu, Shenzhen, etc. | Subsidies | Subsidies received from the government for the protection of certain utility services or socially necessary product supply or price control functions | No | No | 11,517.43 | 81,019.95 | Related to income |
| Entrepreneurship-driven employment subsidies | Guangzhou Municipal Human Resources and Social Security Bureau | Subsidies | Subsidies received from the government for the protection of certain utility services or socially necessary product supply or price control functions | No | No | 4,000.00 | Related to income | |
| Rewards for quality development | Economic Development Bureau of Huai’an Economic and | Reward | Subsidies received for compliance with local support policies for investment promotion by local | No | No | 15,000.00 | Related to income |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Technological Development Zone | governments | |||||||
| Subsidies for Huai’an Software Park | Huai’an Software Park Management Development Co., Ltd. | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 991,394.84 | 3,282,551.15 | Related to income |
| Government support tax rebates | Huai’anHongze District Internet Industry Base Management Co., Ltd., and Huai’anSanhe Internet Game Industry Park Construction Management Co., Ltd. | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 4,530,331.59 | 596,562.00 | Related to income |
| Subsidies from Huai’an Overseas Students Pioneer Park Management Committee | Huai’an Economic and Technological Development Zone Overseas Students Pioneer Park Management Office | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 40,633.00 | 2,551,934.70 | Related to income |
| Industrial subsidies | Management Committee of Anhui Xinwu Economic & Technological Development Zone | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 414,000.00 | Related to income | |
| Industrial subsidies | Wuhu Jiujiang District Finance Bureau | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 15,100,444.24 | Related to income | |
| Provincial Financial Research Funds for Research and Development of Enterprises in Guangdong Province | Department of Science and Technology of Guangdong Province | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 1,080,500.00 | Related to income | |
| Subsidies to Guangzhou enterprises’ R&D investment | Guangzhou Science, Technology and Innovation Commission | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 575,700.00 | Related to income | |
| Special fund for construction of Guangzhou enterprise R&D | Guangzhou Municipal Science and Technology Bureau | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 400,000.00 | Related to income |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| institute | ||||||||
| Special subsidy for construction of enterprise R&D institute | Guangzhou Science, Technology and Innovation Commission | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 600,000.00 | Related to income | |
| Guangzhou enterprise R&D subsidy | Guangzhou Science, Technology and Innovation Commission | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 278,200.00 | Related to income | |
| Incentive fund for cultivation of provincial new high-tech enterprises | Jiangsu Department of Finance | Reward | Subsidies for research and development, technology renewal and renovation | No | No | 55,555.00 | Related to income | |
| Special fund of commercial development | Guangzhou Municipal Commerce Bureau | Reward | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 397,500.00 | Related to income | |
| Rebates of VAT levied by South Korea | Sam Sung Tax Office | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 4,198.14 | 1,251.47 | Related to income |
| VAT (for addition or deduction) | Tax bureaus in Shanghai, Guangzhou, Huai’an, etc. | Subsidies | Subsidies received from the government to encourage and support specific industries and segments (according to national policies and regulations) | No | No | 7,729,525.95 | Related to income | |
| Return of land use tax | Jishan Town Government of Nanling County, Anhui Province | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 1,857,265.43 | Related to income | |
| Supporting subsidy from the Finance Bureau of Jiading District, Shanghai | Finance Bureau of Jiading District, Shanghai | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 3,632.80 | Related to income | |
| Fees for withholding taxes | Huai’an Municipal Office of SAT | Reward | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 71,081.94 | Related to income | |
| Business stabilization and | People’s Government of Tang | Subsidies | Subsidies received for compliance with local support | No | No | 161,000.00 | Related to |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| development policies during the 13th Five-Year Plan Period in Pudong New Area | Town, Pudong New Area, Shanghai | policies for investment promotion by local governments | income | |||||
| Provincial Financial Research Funds for Research and Development of Enterprises in Guangdong Province in 2017 | Finance Bureau of Tianhe District, Guangzhou City | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 697,300.00 | Related to income | |
| Provincial financial reward for enterprise R&D expenses in 2017 | Treasury Payment Center of Huai’an Economic and Technological Development Zone | Reward | Subsidies for research and development, technology renewal and renovation | No | No | 2,000,000.00 | Related to income | |
| Special fund for innovation in 2017 | Finance Bureau of Tianhe District, Guangzhou City | Reward | Subsidies for research and development, technology renewal and renovation | No | No | 200,000.00 | Related to income | |
| Withheld VAT, income tax refund | Treasury Payment Center of Wuhu Jiujiang District Finance Bureau | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 551,046.04 | Related to income | |
| Reward for technological innovation and invention patent | Nanling County Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 286,000.00 | Related to income | |
| Subsidy of Finance and Taxation Service Center in Wuhu Machinery Industry Development Zone | Finance and Taxation Service Center in Wuhu Machinery Industry Development Zone | Subsidies | Subsidies received for compliance with local support policies for investment promotion by local governments | No | No | 1,412,900.00 | Related to income | |
| Project subsidies of Automotive Fuel System R&D Center | Anhui Department of Finance | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 65,000.00 | Related to assets | |
| Subsidy for the purchase of single equipment by SMEs | Wuhu Municipal Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 13,725.46 | Related to assets |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Provincial “6+1” subsidies for building independent innovation capacity | Nanling County Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 49,400.00 | Related to assets | |
| Special funds for development of provincial enterprises of Nanling Country Commission of Economy and Information Technology | Nanling County Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 25,000.00 | Related to assets | |
| Provincial innovation enterprise R&D equipment subsidy | Wuhu Municipal Science and Technology Bureau | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 13,875.00 | Related to assets | |
| 2015 provincial special fund to build an innovative province | Nanling County Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 13,875.00 | Related to assets | |
| Subsidies for R&D and purchase of instruments and equipment | Nanling County Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 39,200.00 | Related to assets | |
| 2016 provincial special fund to build an innovative province | Wuhu Municipal Science and Technology Bureau | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 39,200.00 | Related to assets | |
| 2017 Construction fund supports for building manufacturing strong provinces, and equipment subsidies for technological transformation projects to improve industrial foundation | Nanling County Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 171,000.00 | Related to assets | |
| Reward and subsidy for industrial technology reform of Country Commission of Economy and Information Technology | Nanling County Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 84,135.00 | Related to assets |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 2017 provincial special fund to build an innovative province of Nanling County Commission of Economy and Information Technology (technology division) | Nanling County Commission of Economy and Information Technology | Subsidies | Subsidies for research and development, technology renewal and renovation | No | No | 6,650.01 | Related to assets |
Other notes:
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
49. Non-operating expenses
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period | Amount recognized into current non-recurring profits and losses |
| External donation | 2,520,249.00 | 2,154,575.54 | 2,520,249.00 |
| Others | 154,522.67 | 1,333,286.58 | 154,522.67 |
| Total | 2,674,771.67 | 3,487,862.12 |
Other notes:
50. Income taxes
(1) Income tax sheet
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Income taxes of current period | 118,354,346.40 | 36,457,725.45 |
| Deferred income tax | 13,280,396.04 | -19,843.10 |
| Total | 131,634,742.44 | 36,437,882.35 |
(2) Accounting profit and income tax expenses adjustment process
Unit: RMB
| Item | Amount incurred in the current period |
| Total profit | 1,290,890,352.82 |
| Income tax expenses calculated at legal/applicable tax rate | 322,722,588.21 |
| Impact of various tax rates applicable to subsidiaries | -222,136,356.75 |
| Adjustment of impact on the income tax in the previous period | -7,761.11 |
| Impact of non-taxable income | -255,150.00 |
| Impact of deductible losses of unrecognized deferred income tax assets in the previous period | -4,953,408.15 |
| Impact of deductible temporary differences or deductible loss of unrecognized deferred income tax assets of this period | 36,264,830.24 |
| Income taxes | 131,634,742.44 |
Other notes
51. Other comprehensive income
For details, please refer to Note 33 - Other comprehensive income.
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
52. Items of cash flow statements
(1) Cash received from other operating activities
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Interest income received | 9,069,877.61 | 4,310,656.28 |
| Government subsidies received | 23,820,201.73 | 15,583,868.49 |
| Non-operating income received | 3,076,941.61 | 806,655.75 |
| Current account received | 17,336,183.07 | 3,258,966.99 |
| Total | 53,303,204.02 | 23,960,147.51 |
Description of other received cash relevant to operating activities:
(2) Cash paid relating to other operating activities
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Out-of-pocket expenses | 4,143,483,785.04 | 1,194,332,855.95 |
| Service charge | 571,965.99 | 263,721.64 |
| Non-operating expense | 2,674,749.00 | 2,899,331.81 |
| Current account paid | 5,301,033.03 | 12,880,638.40 |
| Total | 4,152,031,533.06 | 1,210,376,547.80 |
Description of other cash paid relating to operating activities:
(3) Other cash received relating to investment activities
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Financial products | 2,226,000,000.00 | 1,126,557,800.00 |
| Mokun performance compensation received | 261,800,000.00 | 0.00 |
| Others | 520,540.52 | |
| Total | 2,488,320,540.52 | 1,126,557,800.00 |
Description of other cash received relating to investing activities:
(4) Other cash payments relating to investing activities
Unit: RMB
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Financial products | 2,430,000,000.00 | 1,126,557,800.00 |
| Total | 2,430,000,000.00 | 1,126,557,800.00 |
Description of other cash payments relating to investing activities:
(5) Other cash payments relating to financing activities
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Repurchase of treasury stocks | 302,007,312.87 | 317,235.07 |
| Acquisition of minority shareholders’ equity of subsidiaries | 0.00 | 1,120,000,000.00 |
| Total | 302,007,312.87 | 1,120,317,235.07 |
Description of cash payments relating to financing activities:
53. Supplementary data of cash flow statement
(1) Supplementary data of cash flow statement
Unit: RMB
| Supplementary data | Amount of current period | Amount of previous period |
| 1. Net profits transferred to cash flow of operation activities: | -- | -- |
| Net profit | 1,159,255,610.38 | 882,808,568.69 |
| Add: Provision for assets impairment | -18,305,311.43 | 2,141,680.01 |
| Depreciations of fixed assets, oil and gas assets, and productive biological assets | 7,216,681.33 | 25,040,716.87 |
| Amortization of intangible assets | 1,787,302.76 | 4,418,266.42 |
| Amortization of long-term deferred expenses | 39,242,037.24 | 29,337,234.51 |
| Losses on disposal of fixed assets, intangible assets and other long-term assets (“-” indicates the profit) | 77,711.53 | 559,118.35 |
| Financial expense (“-” indicates the profit) | 12,906,797.81 | 15,837,173.26 |
| Losses on investments (“-” indicates the profit) | -60,536,422.30 | -23,747,705.64 |
| Decrease of deferred tax assets (“-” indicates increase) | 18,060,904.24 | -19,843.10 |
| Increase of deferred tax liabilities (“-” indicates decrease) | -4,735,906.20 | 0.00 |
| Decrease of inventories (“-” indicates increase) | 30,356,816.91 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Decrease of operational receivable items (“-” indicates increase) | -656,621,611.14 | -61,504,845.64 |
| Increase of operational payable items (“-” indicates decrease) | 118,069,996.97 | 80,267,426.81 |
| Others | -62,854.82 | -8,258,589.49 |
| Net cash flows from operating activities | 616,354,936.37 | 977,236,017.96 |
| 2. Major investments and financing activities not related to cash expenditure and income: | -- | -- |
| 3. Changes of cash and cash equivalent: | -- | -- |
| Ending cash balance | 1,784,128,992.84 | 1,538,659,591.57 |
| Less: Cash balance at the beginning of the period | 1,515,740,344.79 | 1,580,910,931.98 |
| Net increase of cash and cash equivalents | 268,388,648.05 | -42,251,340.41 |
(2) Net cash received for the disposal of subsidiaries in the current period
Unit: RMB
| Amount | |
| Cash or cash equivalent received in current period for the disposal of subsidiaries in the current period | 110,000,000.00 |
| Wherein: | -- |
| Shanghai Mokun | 110,000,000.00 |
| Less: Cash and cash equivalent held by subsidiary at the date of losing control | 81,260,236.50 |
| Wherein: | -- |
| Shanghai Mokun | 81,260,236.50 |
| Add: Cash or cash equivalent received in the current year for the disposal of subsidiaries in the previous periods | 404,709,910.00 |
| Wherein: | -- |
| Wuhu Shunrong Auto Parts Co., Ltd. | 404,709,910.00 |
| Net cash received for the disposal of subsidiaries | 433,449,673.50 |
Other notes:
(3) Constitution of cash and cash equivalent
Unit: RMB
| Item | Ending balance | Beginning balance |
| I. Cash | 1,784,128,992.84 | 1,515,740,344.79 |
| Wherein: Cash on hand | 29,585.32 | |
| Bank deposit available for payment at any time | 1,721,249,969.75 | 1,509,544,157.41 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Other monetary fund available for payment at any time | 32,879,023.09 | 6,166,602.06 |
| Note margin due within three months | 30,000,000.00 | |
| III. Balance of cash and cash equivalents at the end of period | 1,784,128,992.84 | 1,515,740,344.79 |
| Wherein: Restricted cash and cash equivalents used by parent company and subordinated company of Group | 30,000,000.00 |
Other notes:
The ending balance of cash and cash equivalents was RMB 1,784,128,992.84. The ending balance of monetary fund was RMB1,788,431,889.15. The difference of RMB 4,302,896.31 was the guarantee and frozen fund not meeting the cash and cash equivalentstandard.
54. Assets with limited ownership or right of use
Unit: RMB
| Item | Carrying value at the end of the period | Reason for restriction |
| Monetary fund | 34,302,896.31 | Margin account |
| Construction in progress | 751,293,007.77 | Borrowing of the Company’s subsidiaries with the office building as the mortgage |
| Total | 785,595,904.08 | -- |
Other notes:
55. Foreign currency monetary items
(1) Monetary items in foreign currency
Unit: RMB
| Item | Balance of foreign currency at the end of period | Exchange rate | Balance in RMB at the end of period |
| Monetary fund | -- | -- | 473,347,088.90 |
| Including: USD | 67,476,767.42 | 6.8716 | 463,673,354.99 |
| EUR | 92,005.30 | 7.8007 | 717,712.01 |
| HKD | 5,306,590.33 | 0.8803 | 4,671,349.95 |
| KRW | 390,933,993.00 | 0.0062 | 2,423,790.76 |
| JPY | 2,164,694.00 | 0.0632 | 136,702.64 |
| THB | 1,846,869.07 | 0.2240 | 413,691.47 |
| NT | 5,903,095.00 | 0.2220 | 1,310,487.09 |
| Accounts receivable | -- | -- | 159,495,588.48 |
| Wherein: USD | 8,622,815.50 | 6.8716 | 59,252,538.96 |
| EUR | 4,719.43 | 7.8007 | 36,817.63 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| HKD | 29,806,669.61 | 0.8803 | 26,237,378.58 |
| AUD | 761.53 | 4.8149 | 3,666.69 |
| Lille, Brazil | 219.93 | 1.7846 | 392.49 |
| PLN | 30.40 | 1.8382 | 55.88 |
| RUB | 2,930.55 | 0.1093 | 320.31 |
| PHP | 28,657,877.73 | 0.1338 | 3,834,424.04 |
| KRW | 366,059,899.00 | 0.0062 | 2,264,331.65 |
| MYR | 2,322,635.37 | 1.6636 | 3,863,936.20 |
| NOK | 0.77 | 0.8052 | 0.62 |
| JPY | 807,005,106.59 | 0.0632 | 50,995,326.83 |
| SEK | 18.20 | 0.7385 | 13.44 |
| THB | 17,291,267.20 | 0.2240 | 3,869,785.59 |
| Turkey | 201,000.58 | 1.1957 | 240,336.39 |
| SGD | 95,702.76 | 5.0760 | 485,787.21 |
| NT | 1,184,087.50 | 0.2220 | 262,852.28 |
| INR | 7,942.50 | 0.0996 | 791.07 |
| IDR | 10,529,516,567.00 | 0.0005 | 5,159,601.84 |
| GBP | 414.65 | 8.7200 | 3,615.75 |
| VND | 10,079,780,506.25 | 0.0003 | 2,983,615.03 |
| Long-term loans | -- | -- | |
| Wherein: USD | |||
| EUR | |||
| HKD | |||
| Other receivables | -- | 4,222,670.21 | |
| Wherein: USD | 612,229.71 | 6.8716 | 4,206,997.70 |
| KRW | 810,004.84 | 0.0062 | 5,022.03 |
| NT | 47,975.14 | 0.2220 | 10,650.48 |
| Accounts payable | -- | 213,643,110.09 | |
| Wherein: USD | 27,726,222.00 | 6.8716 | 190,523,507.00 |
| EUR | 7,984.30 | 7.8007 | 62,287.92 |
| THB | 28,007.57 | 0.2240 | 6,273.70 |
| NT | 97,617,070.82 | 0.2220 | 21,670,743.61 |
| VND | 4,676,607,625.40 | 0.0003 | 1,380,297.86 |
| Other payables | -- | 618,777.98 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Wherein: USD | 90,000.00 | 6.8716 | 618,444.00 |
| NT | 1,500.00 | 0.2220 | 333.98 |
Other notes:
(2) Notes to operational entities beyond Mainland China, including disclosures of principal places ofbusiness, functional currencies and the basis of choosing functional currencies, as well as the reasons for thechange in functional currencies (if any).
□Applicable √Not Applicable
56. Government subsidies
(1) Basic information on government subsidies
Unit: RMB
| Type | Amount | Presented item | Amount included in current profits and losses |
| Government Subsidy Related to Income | 49,294,108.11 | Other profits | 49,294,108.11 |
III. Consolidation scope change
1. Business combinations not under the same control
(1) Business combination not under common control in current period
Unit: RMB
| Name of Acquiree | Time point of stock control | Equity control cost | Share ratio | Stock controlling mode | Purchasing date | Confirmation basis on purchase day | Revenue of Acquiree from purchase date to the end of term | Net profit of Acquiree from purchase date to the end of term |
| Chengdu Shouyin | January 7th, 2019 | 550,000.00 | 55.00% | Purchase | January 7th, 2019 | Actual handover date | 0.00 | -850,182.00 |
Other notes:
(2) Merger cost and goodwill
Unit: RMB
| Combination cost | |
| - Cash | 550,000.00 |
| Total merger cost | 550,000.00 |
| Less: Proportion of fair value of identifiable net assets acquired | 550,000.00 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Amount of goodwill/ merger cost which is less than the definable net assets fair proportion | 0.00 |
Recognition method for fair value on the combined costs and description of contingent consideration and its change:
The main reasons for the large goodwill:
Other notes:
(3) Identifiable assets and liabilities of acquiree on the acquisition date
Unit: RMB
| Fair value on purchase day | Book value on purchase day | |
| Monetary fund | 520,540.52 | 520,540.52 |
| Receivables | 88,947.62 | 88,947.62 |
| Accounts payable | 59,488.14 | 59,488.14 |
| Net asset | 550,000.00 | 550,000.00 |
| Net asset acquired | 550,000.00 | 550,000.00 |
Recognition method for identifiable assets and fair value:
Determined by book value.Contingent liabilities of the acquiree assumed in business combination:
NoneOther notes:
None
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
(4) Shares previously held before the acquisition day will be recalculated in terms of the fair value for profits or losses producedWhether there are transactions that realize business combination step by step through multiple transactions and gain control during the reporting period
□ Yes √ No
2. Disposal of subsidiaries
Whether there are cases where the control over investment in subsidiary is lost in single disposal
□ Yes √ No
Unit: RMB
| Name of subsidiary | Disposal price of equity | Ratio of disposal equity (%) | Disposal method of equity | Time point of losing control | Determination basis of time point of losing control | Difference of enjoyed net asset share of the subsidiary between consolidated financial statements corresponding to disposal price and investment | Proportion of remaining equity on the date of losing control | Carrying value of remaining equity on the date of losing control | Fair value of remaining equity on the date of losing control | Profits or losses attributing to remaining equity re-measured by fair values | Recognition methods and main assumption for fair value of remaining equity on the date of losing control | Amount of other comprehensive income, related to equity investment of original subsidiary, carried forward to the profit and loss on investments |
| Shanghai Mokun | 110,000,000.00 | 100.00% | Sale | February 28th, 2019 | The equity transfer procedure was completed | 9,045,006.87 | 0.00% | 0.00 | 0.00 | 0.00 | Not applicable | 0.00 |
Other notes:
Whether there are cases where investment in subsidiary is disposed step by step through multiple transactions and the control is lost in the current period
□ Yes √ No
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
3. Merger scope change for other reasons
Notes to changes in scope of combination due to other reasons (e.g., establishment of new subsidiaries, liquidation of subsidiaries, etc.) and their related circumstances:
| Company name | Cause of changes | Establishment/Change date |
| Silk Road Culture Company | Newly-established | January 2019 |
| Anhui Jishuo | Newly-established | January 2019 |
| Shanghai Jiqu | Newly-established | January 2019 |
| Guangzhou Lehu | Newly-established | January 2019 |
| Feiying Network | Newly-established | February 2019 |
| ChuangshiPoxiao | Newly-established | March 2019 |
| Japanese Lychee | Newly-established | March 2019 |
| 37 FUN WORLD PTE.LTD | Newly-established | April 2019 |
| Guangzhou Jishang | Newly-established | June 2019 |
IV. Rights and interests in other parties
1. Rights and interests in subsidiary
(1) Organization of enterprise group
| Name of subsidiary | Principal place of business | Registered address | Business nature | Shareholding ratio | Acquisition method | |
| Directly | Indirectly | |||||
| Level 1 subsidiary | ||||||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Guangzhou Sanqi Culture & Entertainment | Guangzhou | Guangzhou | Software and Information Technology Service | 100.00% | Establishment | |
| Tibet Xintai | Tibet | Tibet | Investment | 100.00% | Establishment | |
| Level 2 subsidiary | ||||||
| Shanghai Sanqi Interactive Entertainment | Shanghai | Shanghai | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Khorgas Sanqi | Xinjiang | Xinjiang | Investment | 100.00% | Establishment | |
| Level 3 subsidiary | ||||||
| Shanghai Yingtong | Shanghai | Shanghai | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Anhui Vogue Entertainment | Wuhu | Wuhu | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Vogue Entertainment International | British Virgin Islands | British Virgin Islands | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Guangzhou Sanqi | Guangzhou | Guangzhou | Software and Information Technology Service | 80.00% | Business combination not under common control | |
| Jiangsu Aurora | Huai’an | Huai’an | Software and Information Technology Service | 20.00% | 80.00% | Business combination not under common control |
| Guangzhou Xingzhong | Guangzhou | Guangzhou | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Shanghai Guanhang | Shanghai | Shanghai | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Anhui Jiashang | Wuhu | Wuhu | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Easy Gaming, Inc. | United States | United States | Software and Information Technology Service | 100.00% | Business combination not under |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| common control | ||||||
| Level 4 subsidiary | ||||||
| Shanghai Zhiren | Shanghai | Shanghai | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Zhuhai Shangjie | Zhuhai | Zhuhai | Software and Information Technology Service | 100.00% | Establishment | |
| Chuangshi Poxiao | Hong Kong | Hong Kong | Software and Information Technology Service | 100.00% | Establishment | |
| G-MEI Network | British Virgin Islands | British Virgin Islands | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Top Increase | British Virgin Islands | British Virgin Islands | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Feiying Network | British Virgin Islands | British Virgin Islands | Software and Information Technology Service | 100.00% | Establishment | |
| Shanghai Mobile Game | Shanghai | Shanghai | Software and Information Technology Service | 80.00% | Business combination not under common control | |
| Chengdu Shengge Times Network Technology Co., Ltd. | Chengdu | Chengdu | Software and Information Technology Service | 80.00% | Business combination not under common control | |
| Beijing Shangheng | Beijing | Beijing | Software and Information Technology Service | 80.00% | Business combination not under common control | |
| Jiangsu Jiaqu | Huai’an | Huai’an | Software and Information Technology Service | 80.00% | Business combination not under common control | |
| Guangzhou Huoshanhu | Guangzhou | Guangzhou | Software and Information Technology Service | 80.00% | Establishment | |
| Anhui Sanqi | Wuhu | Wuhu | Software and Information Technology Service | 80.00% | Establishment | |
| Anhui Wanhu | Wuhu | Wuhu | Software and Information Technology Service | 80.00% | Establishment | |
| Zhuhai Miaohu | Zhuhai | Zhuhai | Software and Information Technology Service | 80.00% | Establishment | |
| Guangzhou Sanqi Interactive | Guangzhou | Guangzhou | Software and Information Technology Service | 100.00% | Establishment |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Entertainment | ||||||
| Anhui Aurora | Wuhu | Wuhu | Software and Information Technology Service | 100.00% | Establishment | |
| Guangzhou Jisheng | Guangzhou | Guangzhou | Software and Information Technology Service | 100.00% | Establishment | |
| Anhui Jishuo | Wuhu | Wuhu | Software and Information Technology Service | 100.00% | Establishment | |
| Shanghai Jiqu | Shanghai | Shanghai | Software and Information Technology Service | 100.00% | Establishment | |
| Guangzhou Jishang | Guangzhou | Guangzhou | Software and Information Technology Service | 100.00% | Establishment | |
| Anhui Xuhong | Wuhu | Wuhu | Software and Information Technology Service | 100.00% | Establishment | |
| Anhui Guanyu | Wuhu | Wuhu | Advertising | 100.00% | Business combination not under common control | |
| Guangzhou Lehu | Guangzhou | Guangzhou | Software and Information Technology Service | 100.00% | Establishment | |
| Anhui Zhusheng | Wuhu | Wuhu | Software and Information Technology Service | 100.00% | Establishment | |
| Level 5 subsidiary | ||||||
| Tibet Taifu | Tibet | Tibet | Investment | 100.00% | Business combination not under common control | |
| Khorgas Xinghui | Xinjiang | Xinjiang | Software and Information Technology Service | 100.00% | Establishment | |
| Jiangsu Zhiming | Huai’an | Huai’an | Software and Information Technology Service | 49.00% | 51.00% | Business combination not under common control |
| 37 FUN WORLD PTE.LTD | Singapore | Singapore | Software and Information Technology Service | 100.00% | Establishment | |
| 37 Games Entertainment Co., Ltd. | Hong Kong | Hong Kong | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Wisdom Game International | British Virgin Islands | British Virgin Islands | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Wisdom Entertainment International | Hong Kong | Hong Kong | Software and Information Technology Service | 100.00% | Business combination not under common control |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| 37 Games Company | South Korea | South Korea | Software and Information Technology Service | 100.00% | Business combination not under common control | |
| Khorgos Xinrui | Xinjiang | Xinjiang | Software and Information Technology Service | 80.00% | Establishment | |
| Level 6 subsidiary | ||||||
| Tibet Yaotong | Tibet | Tibet | Software and Information Technology Service | 100.00% | Establishment | |
| Tibet Shengge | Tibet | Tibet | Software and Information Technology Service | 100.00% | Establishment | |
| Huai’an Sanqi | Huai’an | Huai’an | Investment | 100.00% | Business combination not under common control | |
| Chengdu Shouyin | Chengdu | Chengdu | Software and Information Technology Service | 55.00% | Business combination not under common control | |
| Khorgas Qianyu | Xinjiang | Xinjiang | Software and Information Technology Service | 100.00% | Establishment | |
| 37Games.Japan Co,.Ltd. | Japan | Japan | Software and Information Technology Service | 100.00% | Establishment | |
| Japanese Lychee | Japan | Japan | Software and Information Technology Service | 100.00% | Establishment | |
| Silk Road Culture Company | Xinjiang | Xinjiang | Software and Information Technology Service | 80.00% | Establishment |
The shareholding ratio in the subsidiary is different from the percentage of the voting rights:
Basis for a company to control the invested organization with half or less than half of voting rights and a company not to control the invested organization with more than half of voting rights:
For important structured entities that are included in the scope of consolidation, the basis for control:
Basis for determining whether the company is an agent or a client:
Other notes:
(2) Key no-wholly owned subsidiaries
Unit: RMB
| Name of subsidiary | Shareholding ratio of minority shareholders | Profit and loss belonging to minority shareholder of the current period | Dividend declared to be distributed to minority shareholder of the current period | Balance of minority equity at the end of period |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Guangzhou Sanqi | 20.00% | 127,733,478.39 | 122,000,000.00 | 153,102,071.21 |
Notes to shareholding ratio of minority shareholders of subsidiaries which is different from the percentage of the voting rights:
Other notes:
(3) Main financial information of key non-wholly owned subsidiaries
Unit: RMB
| Name of subsidiary | Ending balance | Beginning balance | ||||||||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Guangzhou Sanqi | 4,694,117,564.15 | 145,195,284.03 | 4,839,312,848.18 | 4,044,363,998.60 | 29,438,493.55 | 4,073,802,492.15 | 2,156,907,783.27 | 127,801,334.17 | 2,284,709,117.44 | 1,516,725,501.90 | 31,140,651.44 | 1,547,866,153.34 |
Unit: RMB
| Name of subsidiary | Amount incurred in the current period | Amount incurred in the previous period | ||||||
| Operating incomes | Net profit | Total consolidated income | Cash flows from operating activities | Operating income | Net profit | Total consolidated income | Cash flows from operating activities | |
| Guangzhou Sanqi | 4,271,590,566.86 | 638,667,391.93 | 638,667,391.93 | 147,492,216.92 | 1,450,102,463.44 | 321,256,372.49 | 321,256,372.49 | 499,741,276.33 |
Other notes:
2. Equity in jointly operated arrangements or joint ventures
(1) Key joint ventures or associates
| Names of joint ventures or associated enterprises | Principal place of business | Registered address | Business nature | Shareholding ratio | Accounting treatment methods of joint ventures or associated enterprises | |
| Directly | Indirectly | |||||
| Yangzhou FuhaiSanqi Internet Cultural Investment Center (Limited | Yangzhou | Yangzhou | Investment | 25.46% | Equity method | |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Partnership) | ||||||
| Mango (Xiamen) Creative Incubation Equity Investment Fund Partnership (Limited Partnership) | Xiamen | Xiamen | Investment | 31.75% | Equity method | |
| Shanghai FenghuaQiushi Culture Media Co., Ltd. | Shanghai | Shanghai | Investment | 20.00% | Equity method | |
| New Cues (Beijing) Television Investment Co., Ltd. | Beijing | Beijing | Investment | 20.00% | Equity method |
The shareholding ratio in the joint ventures or associates is different from the percentage of the voting rights:
Not applicableEvidence of voting right below 20% but significant, or voting right over 20% but not significant:
Not applicable
(2) Main financial information on key associated enterprises
Unit: RMB
| Ending balance/Amount incurred in the current period | Opening balance/Amount incurred in previous period | |||||||
| Yangzhou FuhaiSanqi Internet Cultural Investment Center (Limited Partnership) | Mango (Xiamen) Creative Incubation Equity Investment Fund Partnership (Limited Partnership) | Shanghai FenghuaQiushi Culture Media Co., Ltd. | New Cues (Beijing) Television Investment Co., Ltd. | Yangzhou FuhaiSanqi Internet Cultural Investment Center (Limited Partnership) | Mango (Xiamen) Creative Incubation Equity Investment Fund Partnership (Limited Partnership) | Shanghai FenghuaQiushi Culture Media Co., Ltd. | New Cues (Beijing) Television Investment Co., Ltd. | |
| Current assets | 62,224,642.07 | 41,258,730.31 | 93,168,199.04 | 117,833,251.34 | 59,887,123.89 | 96,865,384.60 | 88,732,285.69 | 174,005,448.14 |
| Non-current assets | 169,000,000.00 | 26,500,000.00 | 22,310,091.84 | 6,626,167.36 | 139,000,000.00 | 26,500,000.00 | 41,926,172.74 | 17,240,844.95 |
| Total assets | 231,224,642.07 | 67,758,730.31 | 115,478,290.88 | 124,459,418.70 | 198,887,123.89 | 123,365,384.60 | 130,658,458.43 | 191,246,293.09 |
| Current liabilities | 4,305,315.07 | 10,675,675.78 | 87,376,207.86 | 35,247,574.35 | 142,418,605.58 | |||
| Non-current liabilities | 37,312.00 | |||||||
| Total liabilities | 4,305,315.07 | 10,675,675.78 | 87,413,519.86 | 35,247,574.35 | 142,418,605.58 | |||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Total shareholders’ equity attributed to parent company | 226,919,327.00 | 67,758,730.31 | 104,802,615.10 | 37,045,898.84 | 198,887,123.89 | 123,365,384.60 | 95,410,884.08 | 48,827,687.51 |
| Share of net assets calculated at shareholding ratio | 46,149,592.48 | 9,876,117.30 | 21,007,587.93 | 8,725,952.16 | 48,136,104.35 | 39,163,509.62 | 19,082,176.82 | 9,765,537.50 |
| - Goodwill | 113,596,170.58 | 91,519,923.84 | 113,596,170.58 | 91,519,923.84 | ||||
| Book value of equity investment on associates | 46,149,592.48 | 9,876,117.30 | 134,603,758.51 | 100,245,876.00 | 48,136,104.35 | 39,163,509.62 | 132,678,347.40 | 101,285,461.34 |
| Operating income | 23,072,637.19 | 1,392,282.21 | ||||||
| Net profit | -7,802,481.82 | 87,648.49 | 9,627,055.60 | -5,197,926.67 | -5,227.13 | 1,481,132.99 | ||
| Total consolidated income | -7,802,481.82 | 87,648.49 | 9,627,055.60 | -5,197,926.67 | -5,227.13 | 1,481,132.99 |
Other notes
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
(3) Financial information summary on less important joint ventures and associated enterprises
Unit: RMB
| Ending balance/Amount incurred in the current period | Opening balance/Amount incurred in previous period | |
| Joint ventures: | -- | -- |
| Totals of the following items calculated as per respective shareholding proportion | -- | -- |
| Affiliated enterprises: | -- | -- |
| Total investment book value | 223,349,479.48 | 229,338,591.28 |
| Totals of the following items calculated as per respective shareholding proportion | -- | -- |
| - Net profit | -5,100,034.79 | -771,667.10 |
| - Total consolidated income | -5,100,034.79 | -771,667.10 |
Other notes
(4) Excess deficit in joint ventures or associated enterprises
Unit: RMB
| Names of joint ventures or associated enterprises | Accumulated unconfirmed losses recognized in the previous period | Unconfirmed loss of the current period (or shared net profits of the current period) | Accumulated unconfirmed loss at the end of the period |
| Longzhang Animation (Shanghai) Co., Ltd. | -7,906,627.53 | 5,834,060.02 | -2,072,567.51 |
Other notesV. Risk associated with financial instrumentsThe target of risk management by the Group is to balance risk and profit, and minimize the negative influence of risk on theCompany's operation performance, and maximize the profit of shareholder and other equity investors. Base on this risk managementtarget, the fundamental strategy of the Company's risk management is to identify and analyze various risks in the Company, establishappropriate risk tolerance baseline, manage risks, and to supervise all risks promptly and reliably so as to control risk in limitedscope.The various risks related to financial instruments Company faces in its daily activities mainly include credit risk, liquidity riskand market risk. The policy that has been examined and authorized by the management to manage the risks is summarized as follows.(I) Risks of creditCredit risk refers to the possibility of financial loss borne by one party caused by the failure to performance obligation by anotherparty of the financial instrument.The Company's credit risk is mainly derived from bank deposits and receivables. To control the above-mentioned relevant risks, theCompany adopts the following measures.
1. Bank deposit
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
The Company deposits bank deposits in financial institutions with higher credit ratings, so its credit risk is lower.
2. Receivables
The Company regularly conducts credit evaluations for customers who use credit-based transactions. Based on the results of thecredit evaluation, the Company chooses to conduct transactions with recognized customers of good credit, and monitors the balanceof its receivables to avoid significant risks of bad debts.As the Company's risk points of accounts receivable are distributed among multiple partners and customers, as of June 30st,2019, 70.79% of the Company’s accounts receivable (December 31st, 2018: 61.82%) was from the top five balance customers. Thetop five customers of the Company’s accounts receivable balance are the main cooperation channels for distribution of mobile gamessuch as Tencent and Apple. The highly concentrated accounts receivable balance at the end of the period is a normal phenomenon ofbusiness development, and the Company does not have significant credit concentration risks.(II) Liquidity riskLiquidity risk refers to the risk of a shortage of funds when the Company is required to settle its obligations in the form of cash orother financial assets. The liquidity risk may result from the inability to sell financial assets at fair value as soon as possible; or fromthe inability of the other party to repay their contractual debts; or from debts that are due in advance; or from the inability to generateexpected cash flows.The Company’s current financial assets can meet working capital needs and capital expenditures, so it does not assume significantliquidity risks.(III) Market riskMarket risk refers to the possibility of fluctuation in the fair value of financial instruments or future cash flow caused by market pricechange. Market risk includes interest rate risk and foreign exchange risk.
1. Interest rate risk
Interest rate risk refers to the possibility of fluctuation in the fair value of financial instruments/future cash flow caused by marketinterest rate change. The Company does not have the risk of changes in market interest rates.
2. Foreign currency risk
Exchange rate risk refers to the possibility of fluctuation of the fair value of financial instruments or future cash flows due to changesin foreign exchange rates. The exchange rate risk of the company mainly related to monetary assets and debts of foreign currency.The main business place of the Company is in Mainland China and the main activities are calculated in RMB. Therefore, the marketrisk of foreign exchange changes tolerated by the Company is not significant.The ending foreign currency monetary assets and liabilities of the Company can be found in the description of foreign currencymonetary items under Item Notes to Consolidated Financial Statement in thenotes to the financial statements.VI. Disclosure of fair value
1. Ending fair value of assets and liabilities measured at fair value
Unit: RMB
| Item | Ending fair value | |||
| Level I measurement of fair value | Level II measurement of fair value | Level III measurement of fair value | Total | |
| I. Continuous fair value measurements | -- | -- | -- | -- |
| (I) Trading financial assets | 450,779,209.43 | 801,702,412.02 | 1,252,481,621.45 | |
| 1. Financial assets measured at | 450,779,209.43 | 0.00 | 801,702,412.02 | 1,252,481,621.45 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| fair value with changes included in profits and losses | ||||
| (1) Debt instrument investment | 320,000,000.00 | 320,000,000.00 | ||
| (2) Equity instrument investment | 130,779,209.43 | 801,702,412.02 | 932,481,621.45 | |
| (III) Other equity investment | 246,635,981.28 | 246,635,981.28 | ||
| Total assets continuously measured by fair value | 450,779,209.43 | 1,048,338,393.30 | 1,499,117,602.73 | |
| II. Non-continuous measurement of fair value | -- | -- | -- | -- |
2. Determining basis for the market price of continuous and non-continuous first-level fair value-measuredprojectThe fair value of financial products and stock investment is determined based on the open market transaction price.
3. Qualitative and quantitative information of sustainable and non-sustainable third-level fair valuemeasurement items, evaluation technology and important parameters.Other equity investments without active market quotation are measured at cost unless the cost measurement is not reliable.
VII. Related parties and related transaction
1. Information of the Company's parent company
| Name of parent company | Registered address | Business nature | Registered capital | Shareholding ratio of the parent company against the Company | Percentage of the Company's vote rights held by the parent company |
Description of the information of the Company’s parent companyThe ultimate controller of the Company is Li Weiwei.Other notes:
2. Information of the Company’s subsidiaries
Details of the subsidiaries of the company are shown in Note IX: Rights and Interests in Other Bodies.
3. Affiliates and joint ventures of the Company
For the important joint ventures or affiliated enterprises of the Company, please refer to Notes IX: Rights and Interests in OtherEntities.Details on other joint ventures or associated enterprises with balance from related party transactions with the Company this period orearlier are as follows:
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Names of joint ventures or associated enterprises | Relation with the Company |
| Shenzhen Yiwan Network Technology Co., Ltd. | An associated enterprise of the Company |
| Chengdu Pengwan Technology Co., Ltd. | An associated enterprise of the Company |
| Shanghai Tingting Network Technology Co., Ltd. | An associated enterprise of the Company |
| Chengdu Mofei Technology Co., Ltd. | An associated enterprise of the Company |
| Longzhang Animation (Shanghai) Co., Ltd. | An associated enterprise of the Company |
| Chengdu Modu Technology Co., Ltd. | An associated enterprise of the Company |
| Shenzhen Zhanlong Interactive Entertainment Technology Co., Ltd. | An associated enterprise of the Company |
| Longzhang Network Technology (Shanghai) Co., Ltd. | An associated enterprise of the Company |
| ShaoxingShangyuZhangyu Network Technology Co., Ltd. | An associated enterprise of the Company |
| Shanghai Yuhouyi Network Technology Co., Ltd. | An associated enterprise of the Company |
| Chengdu Popcorn Interactive Entertainment Technology Co., Ltd. | An associated enterprise of the Company |
| Jiangsu Yezi Network Technology Co., Ltd. | An associated enterprise of the Company |
| Shanghai Aoting Network Technology Co., Ltd. | An associated enterprise of the Company |
| Beijing Xize Interactive Entertainment Technology Co., Ltd. | An associated enterprise of the Company |
| Longzhang Media (Shanghai) Co., Ltd. | An associated enterprise of the Company |
Other notes
4. Other related parties
| Names of other related parties | Relationship between other related parties and the Company |
| Shenzhen Mokylin Technology Co., Ltd. | A related person for the past 12 months ended January 31st, 2018, (Chairman and General Manager of the Company and a director of this company) |
| Beijing Colorful Game Technology Co., Ltd. | A related person (Director and Deputy General Manager of the Company served as Directors of the affiliated party within the past 12 months) |
| Shenzhen QiFun Network Corp. Ltd. | A related person (Director and Deputy General Manager of the Company served as Directors of the affiliated party within the past 12 months) |
| Chengdu 91ACT Technology Company | A related person (Director and Deputy General Manager of the Company served as Directors of the affiliated party within the past 12 months) |
| Xiamen Huoyou Information Technology Co., Ltd. | A related person (Director and Deputy General Manager of the Company served as Directors of the affiliated party) |
| Shanghai Zhangmeng Network Technology Co., Ltd. | A related person (Director and Deputy General Manager of the Company served as Directors of the affiliated party within the past 12 months) |
| Shanghai Mango Interactive Entertainment Technology Co., Ltd. | A related person (Director and Deputy General Manager of the Company served as Directors of the affiliated party) |
| Wuhu Ningzhong Auto Parts Technology Co., Ltd. | A company under of the controlling shareholders before November 13th, 2018 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Li Weiwei | Natural person who holds more than 5% of the shares of a listed company, Chairman and General Manager |
| ZengKaitian | Natural person who holds more than 5% of the shares of a listed company |
Other notes
5. Status of associated transaction
(1) Associated transaction regarding trade of goods and labor services
Profile on purchasing products and obtaining labor services
Unit: RMB
| Related party | Details of transaction between related parties | Amount incurred in the current period | Approved transaction amount | Whether it exceeds the transaction amount | Amount incurred in the previous period |
| Beijing Xize Interactive Entertainment Technology Co., Ltd. | Shared revenue from games | 11,705.08 | Yes | ||
| Beijing Colorful Game Technology Co., Ltd. | Shared revenue from games | 86,064.24 | 970,000.00 | No | 364,767.11 |
| Chengdu Popcorn Interactive Entertainment Technology Co., Ltd. | Shared revenue from games | 2,241,632.06 | 34,220,900.00 | No | |
| Chengdu 91ACT Technology Company | Shared revenue from games, copyright money purchasing | 1,625,141.17 | 13,363,200.00 | No | |
| Chengdu Pengwan Technology Co., Ltd. | Commissioned R&D expense | 1,044,855.78 | 10,447,800.00 | No | 4,816,344.35 |
| Chengdu Modu Technology Co., Ltd. | Commissioned R&D expense | 12,103.21 | Yes | 1,063,809.25 | |
| Chengdu Mofei Technology Co., Ltd. | Shared revenue from games and commissioned R&D fees | 4,014,299.52 | 58,455,900.00 | No | 20,476,612.59 |
| Jiangsu Yezi Network Technology Co., Ltd. | Shared revenue from games | 22,736,516.29 | 17,515,100.00 | Yes | |
| Longzhang Media (Shanghai) Co., Ltd. | Commissioned R&D expense | 542,438.06 | Yes | ||
| Xiamen Huoyou Information Technology Co., Ltd. | Shared revenue from games | 42,199.18 | 695,500.00 | No | 136,749.05 |
| Shanghai Mango Interactive Entertainment Technology | Shared revenue from games | 169,933.35 | 1,980,000.00 | No | 604,927.92 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Co., Ltd. | |||||
| Shanghai Zhangmeng Network Technology Co., Ltd. | Shared revenue from games, copyright money purchasing | 290,573.30 | 3,691,800.00 | No | |
| ShaoxingShangyuZhangyu Network Technology Co., Ltd. | Shared revenue from games | 8,534.97 | 848,300.00 | No | 76,623.87 |
| Shenzhen Yiwan Network Technology Co., Ltd. | Shared revenue from games and commissioned R&D fees | 293,759.25 | 3,397,300.00 | No | |
| Shenzhen Zhanlong Interactive Entertainment Technology Co., Ltd. | Shared revenue from games | 990,485.31 | 13,121,400.00 | No | 76,768.89 |
| Shanghai Tingting Network Technology Co., Ltd. | Shared revenue from games and commissioned R&D fees | No | 299,979.17 | ||
| Shenzhen Mokylin Technology Co., Ltd. | Shared revenue from games and commissioned R&D fees | No | 155,553.92 | ||
| Shenzhen QiFun Network Corp. Ltd. | Shared revenue from games, copyright money purchasing | No | 45,803.04 | ||
| Longzhang Animation (Shanghai) Co., Ltd. | Shared revenue from games, copyright money purchasing | No | 4,840,151.19 | ||
| Longzhang Network Technology (Shanghai) Co., Ltd. | Commissioned R&D expense | No | 17,669.82 |
Profile on selling products/providing labor services
Unit: RMB
| Related party | Details of transaction between related parties | Amount incurred in the current period | Amount incurred in the previous period |
| Shanghai Yuhouyi Network Technology Co., Ltd. | Software operating income | 2,519,158.87 | 14,895,524.15 |
| Shanghai Mango Interactive Entertainment Technology Co., Ltd. | Software operating income | 20,037.16 | |
| Beijing Colorful Game Technology Co., Ltd. | Software operating income | 3,461.47 |
Note to related party transactions for the purchase and sale of goods, provision and acceptance of labor services
(2) Affiliated-party guarantee
The company acts as the guarantor
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
Unit: RMB
| The guaranteed | Amount of guarantee | Starting date of guarantee | Ending date of guarantee | Has the guarantee been fulfilled? |
The company acts as the guaranteed
Unit: RMB
| Guarantor | Amount of guarantee | Starting date of guarantee | Ending date of guarantee | Has the guarantee been fulfilled? |
| Li Weiwei, ZengKaitian | 210,000,000.00 | June 22nd, 2018 | June 21st, 2019 | Yes |
| Li Weiwei, ZengKaitian | 159,000,000.00 | June 25th, 2018 | June 21st, 2019 | Yes |
| Li Weiwei, ZengKaitian | 126,040,193.75 | June 10th, 2019 | August 10th, 2019 | No |
Status of associated guarantee
(3) Remuneration for key management personnel
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Remuneration for key management personnel | 9,507,086.96 | 8,095,170.17 |
6. Accounts receivable and payable by related parties
(1) Receivables
Unit: RMB
| Project name | Related party | Closing balance | Balance at the beginning of the period | ||
| Book balance | Provision for bad debts | Book balance | Provision for bad debts | ||
| Accounts receivable | Shanghai Yuhouyi Network Technology Co., Ltd. | 1,705,997.45 | 25,744.90 | 2,091,604.00 | 104,580.20 |
| Accounts receivable | Beijing Colorful Game Technology Co., Ltd. | 370.22 | 18.51 | ||
| Prepayment | Chengdu 91ACT Technology Company | 1,810,658.83 | |||
| Prepayment | Shenzhen Yiwan Network Technology Co., Ltd. | 1,757,187.08 | 2,193,140.33 | ||
| Prepayment | Shenzhen Zhanlong Interactive Entertainment Technology Co., Ltd. | 261,244.04 | 650,147.37 | ||
| Prepayment | Chengdu Pengwan Technology Co., Ltd. | 1,167,805.05 | |||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| Prepayment | Chengdu Mofei Technology Co., Ltd. | 2,000,000.00 | |||
| Prepayment | Longzhang Network Technology (Shanghai) Co., Ltd. | 2,061,081.07 | |||
| Prepayment | Shenzhen QiFun Network Corp. Ltd. | 2,264,856.00 | |||
| Prepayment | Chengdu Popcorn Interactive Entertainment Technology Co., Ltd. | 1,000,000.00 | |||
| Prepayment | Jiangsu Yezi Network Technology Co., Ltd. | 3,000,000.00 | |||
| Other receivables | Wuhu Ningzhong Auto Parts Technology Co., Ltd. | 401,310,000.00 |
(2) Payables
Unit: RMB
| Project name | Related party | Ending book value | Opening book balance |
| Accounts payable | Beijing Xize Interactive Entertainment Technology Co., Ltd. | 11,705.08 | |
| Accounts payable | Beijing Colorful Game Technology Co., Ltd. | 143,661.50 | 1,512,769.27 |
| Accounts payable | Chengdu Popcorn Interactive Entertainment Technology Co., Ltd. | 2,191,701.48 | 175,699.90 |
| Accounts payable | Chengdu Modu Technology Co., Ltd. | 1,807,142.05 | 1,794,731.88 |
| Accounts payable | Chengdu Mofei Technology Co., Ltd. | 1,149,554.23 | 11,483,657.92 |
| Accounts payable | Jiangsu Yezi Network Technology Co., Ltd. | 20,773,601.33 | |
| Accounts payable | Longzhang Media (Shanghai) Co., Ltd. | 81,204.88 | |
| Accounts payable | Xiamen Huoyou Information Technology Co., Ltd. | 134,667.83 | |
| Accounts payable | Shanghai Aoting Network Technology Co., Ltd. | 7,360.48 | 7,360.48 |
| Accounts payable | Shanghai Mango Interactive Entertainment Technology Co., Ltd. | 399,109.45 | 490,418.65 |
| Accounts payable | Shanghai Tingting Network Technology Co., Ltd. | 299,979.17 | 299,979.17 |
| Accounts payable | Shanghai Zhangmeng Network Technology Co., Ltd. | 2,247,205.95 | 1,941,996.00 |
| Accounts payable | ShaoxingShangyuZhangyu Network Technology Co., Ltd. | 42,417.40 | 33,370.33 |
| Accounts payable | Shenzhen QiFun Network Corp. Ltd. | 250,072.03 | |
| Accounts payable | Chengdu Pengwan Technology Co., Ltd. | 2,985,888.98 | 311,961.83 |
| Accounts payable | Shenzhen Yiwan Network Technology Co., Ltd. | 339,622.58 | |
| Other payables | Xiamen Huoyou Information Technology Co., Ltd. | 5,000,000.00 | 5,000,000.00 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
VIII. Share-based payment
1. Overview of share payment
□Applicable √Not Applicable
IX. Commitment and contingencies
1. Material commitments
The existence of material commitments at the balance sheet dateThe Company has no significant commitments needing to be disclosed.
2. Contingencies
(1) The fact that the Company has no significant contingencies required to be disclosed should also beexplainedThe Company does not have material commitments or contingencies that need to be disclosed.X. Events after the Balance Sheet Date
1. Profit distribution
Unit: RMB
| Proposed distributed profits or dividends | 211,225,169.70 |
XI. Other Important Events
1. Segment information
(1) Basis for determining reportable divisions and accounting policies
The Company determines the reporting segment based on internal organizational structure, management requirement and internalreporting system, and determines the reporting segment based on the product type segment. The performance of mobile and browsergames were assessed separately.
(2) Financial information of reportable divisions
Unit: RMB
| Item | Mobile games | Browser games | Offset among segments | Total |
| Operating income | 5,426,572,514.55 | 644,384,988.51 | 6,070,957,503.06 | |
| Operating cost | 675,612,778.55 | 163,373,782.96 | 838,986,561.51 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
(3) If the Company has no reporting segments, or cannot disclose the total assets and total liabilities of eachreporting segment, the reasons shall be explained.Some of the Company’s assets are used jointly by reporting segments, and corresponding assets and liabilities cannot be easilyclassified into the reporting segments.
XII. Notes to Main Items of Financial Statements of Parent Company
1. Other receivables
Unit: RMB
| Item | Ending balance | Beginning balance |
| Dividends receivable | 500,000,000.00 | |
| Other receivables | 528,604,929.21 | 891,766,571.39 |
| Total | 528,604,929.21 | 1,391,766,571.39 |
(1) Dividend receivable
1) Dividends receivable
Unit: RMB
| Item (or invested organization) | Ending balance | Beginning balance |
| Shanghai Sanqi Interactive Entertainment | 500,000,000.00 | |
| Total | 500,000,000.00 |
(2) Other receivables
1) Classification of other receivables based on the fund nature
Unit: RMB
| Fund nature | Ending book value | Opening book balance |
| Deposit and guarantee deposit | 65,000.00 | 65,000.00 |
| Current account of related parties within the Group | 528,211,926.83 | 490,106,699.02 |
| Equity disposal receivables | 0.00 | 401,310,000.00 |
| Others | 362,634.08 | 317,234.07 |
| Total | 528,639,560.91 | 891,798,933.09 |
2) Accrual of bad debt provision
Unit: RMB
| Provision for bad debts | Stage I | Stage II | Stage III | Total |
| Expected credit | Expected credit losses for | Expected credit losses for |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| losses in the next 12 months | the entire duration (without credit impairment) | the entire duration (with credit impairment) | ||
| Balance on January 1st, 2019 | 32,361.70 | 32,361.70 | ||
| Balance on January 1st, 2019 is in the period | - | - | - | - |
| Accrual of the period | 2,270.00 | 2,270.00 | ||
| Balance on June 30th, 2019 | 34,631.70 | 34,631.70 |
For the provision for loss, is there any major change in book balances of the period?
□Applicable √Not Applicable
Disclosure by aging
Unit: RMB
| Aging | Balance at the end of the period |
| Within 1 year (inclusive) | 362,634.08 |
| Within 1 year (inclusive) | 362,634.08 |
| 1 - 2 year(s) | 40,000.00 |
| Over 3 years | 25,000.00 |
| 3 - 4 years | 25,000.00 |
| Total | 427,634.08 |
3) Reserve of the bad debts that are accrued, withdrew and taken back in current period
Accrued provision for bad debts in this period:
Unit: RMB
| Type | Beginning balance | Change in this period | Ending balance | |
| Accrual | Recovery or reversal | |||
| Other accounts receivable withdrawn provision for bad debts based on credit risk feature combination | 32,361.70 | 2,270.00 | 34,631.70 | |
| Total | 32,361.70 | 2,270.00 | 34,631.70 | |
Including important provision for bad debt transferred back or recovered in this period:
Unit: RMB
| Organization name | Amount carried forward or recovered | Change the way of return |
4) Other accounts receivable in top five based on year-end balance collected from arrears party
Unit: RMB
| Organization name | Fund nature | Ending balance | Aging | Proportion in total ending balance of other receivables | Ending balance of provision for bad debts |
| No. 1 | Internal current account | 528,211,926.83 | Within 1 year | 99.92% | 0.00 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
| No. 2 | Others | 232,215.68 | Within 1 year | 0.04% | 11,610.78 |
| No. 3 | Others | 106,668.40 | Within 1 year | 0.02% | 5,333.42 |
| No. 4 | Guarantee deposit / cash deposit | 30,000.00 | 1 - 2 year(s) | 0.01% | 3,000.00 |
| No. 5 | Guarantee deposit / cash deposit | 25,000.00 | 3 - 4 years | 0.00% | 12,500.00 |
| Total | -- | 528,605,810.91 | -- | 99.99% | 32,444.20 |
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
2. Long-term equity investment
Unit: RMB
| Item | Ending balance | Balance at the beginning of the period | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
| Investment to subsidiaries | 6,382,799,990.80 | 6,382,799,990.80 | 6,374,799,990.80 | 6,374,799,990.80 | ||
| Investment into associated enterprises and joint ventures | 26,614,618.42 | 26,614,618.42 | 27,593,699.69 | 27,593,699.69 | ||
| Total | 6,409,414,609.22 | 6,409,414,609.22 | 6,402,393,690.49 | 0.00 | 6,402,393,690.49 | |
(1) Investment to subsidiaries
Unit: RMB
| Invested company | Opening balance (book value) | Increase or decrease in this period | Ending balance (book value) | Ending balance of depreciation reserves | |||
| Additional investments | Negative investment | Withdrawn impairment provision | Others | ||||
| Jiangsu Aurora Network Technology Co., Ltd. | 1,400,000,000.00 | 1,400,000,000.00 | |||||
| Jiangsu Zhiming Network Technology Co., Ltd. | 254,799,990.80 | 254,799,990.80 | |||||
| Sanqi Entertainment Network Technology (Guangzhou) Co., Ltd. | 0.00 | 4,728,000,000.00 | 4,728,000,000.00 | ||||
| Sanqi Interactive Entertainment (Shanghai) Technology Co., Ltd. | 4,720,000,000.00 | 4,720,000,000.00 | 0.00 | ||||
| Total | 6,374,799,990.80 | 4,728,000,000.00 | 4,720,000,000.00 | 0.00 | 6,382,799,990.80 | ||
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
(2) Investment into associates and joint ventures
Unit: RMB
| Investment company | Opening balance (book value) | Increase or decrease in this period | Ending balance (book value) | Ending balance of depreciation reserves | |||||||
| Additional investments | Negative investment | Profit and loss on investments confirmed with equity method | Other comprehensive income adjustment | Other equity change | Profit or cash dividend declared to be distributed | Withdrawn impairment provision | Others | ||||
| I. Joint ventures | |||||||||||
| II. Associates | |||||||||||
| Shanghai Jueli Culture Media Co., Ltd. | 27,593,699.69 | -979,081.27 | 26,614,618.42 | ||||||||
| Subtotal | 27,593,699.69 | -979,081.27 | 26,614,618.42 | ||||||||
| Total | 27,593,699.69 | -979,081.27 | 26,614,618.42 | ||||||||
(3) Others notes
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
3. Investment income
Unit: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Long-term equity investment income measured by cost method | 790,000,000.00 | 200,000,000.00 |
| Long-term equity investment income measured by equity method | -979,081.27 | -1,301,101.84 |
| Investment profit by the disposal of trading financial assets | -12,624.02 | |
| Total | 789,008,294.71 | 198,698,898.16 |
XIII. Supplementary data
1. Incidental profit or loss statement in current period
√Applicable □Not Applicable
Unit: RMB
| Item | Amount | Description |
| Losses and profits on disposal of non-current assets | 8,967,295.34 | Mainly profit and loss from the disposal of long-term equity investment and fixed assets. |
| Government subsidy included in current profit or loss (except those closely related to enterprise operation and received based on consolidated national standard quota or quantitative) | 23,416,359.86 | Mainly government subsidy other than the refund of value-added tax and addition or deduction of VAT. |
| Profit or loss of asset whose investment or management is entrusted to others | 11,172,479.46 | Mainly the income from bank’s financial products. |
| Except effective hedging business relating to normal operating business of the Company, profit or loss caused by change in the fair value of trading financial assets, derivative financial assets, trading financial liabilities and derivative financial liabilities, and investment profit for disposal of trading financial assets, derivative financial assets, trading financial liabilities and derivative financial liabilities and other creditors' investments. | 44,790,828.46 | |
| Other non-operating revenues and expenditures except the foregoing items | 408,225.48 | |
| Less: Affected amount of income taxes | 4,387,332.89 | |
| Affected amount of minority interest income | 662,896.41 | |
| Total | 83,704,959.30 | -- |
As to non-recurring profits and losses determined based on the definition provided in the Explanatory Announcement No. 1 onInformation Disclosure for Companies Offering Their Securities to the Public - Non-Recurring Profit and Loss, and the recurringprofits and losses determined from non-recurring profits and losses listed in the Explanatory Announcement No. 1 on InformationDisclosure for Companies Offering Their Securities to the Public - Non-Recurring Profit and Loss, reasoning shall be provided
□Applicable √Not Applicable
Should there be any discrepancy between the English version and the Chinese version of this Report, the Chinese version shall prevail.
2. Return on equity and earnings per share
| Profits during reporting period | Weighted average rate of return on equity | Earnings per share | |
| Basic earning per share (yuan/share) | Diluted earning per share (yuan/share) | ||
| Net profits attributable to the company common shareholders | 16.31% | 0.49 | 0.49 |
| Net profits attributable to the company common shareholders after deducting non-recurring profits and losses | 14.98% | 0.47 | 0.47 |